What Does a Financial Manager Do?

A financial manager is the key leader of an organization’s financial health. Everyday activities on the job include creating financial reports, directing investments, and fashioning the strategies that help their employer meet long-term financial goals. While financial managers can work in any industry, most of these professionals gravitate toward banking and finance companies.

According to the Bureau of Labor Statistics (BLS), financial managers command a median salary of $125,080 per year. That’s nearly 500 percent higher than the median salary for all occupations in the U.S. Plus, the BLS projects a growth rate of 19 percent for this profession between 2016 and 2026, almost three times the average of all careers. So, what does a financial manager do that can command this salary, and how can you become one?

Financial Manager Role Responsibilities

A financial manager controls the financial activities of a corporation. In the past, financial managers concentrated on preparing budget sheets and expenditure reports. Today, however, technology has automated or accelerated financial report production. Consequently, financial managers now act more like business advisors to top executives. They plan, organize, manage, and govern financial activities such as procuring and using funds to advance an organization’s mission. Their overall goal is to achieve and maintain corporate financial health in the immediate and long terms.

A financial manager contributes to an employer’s success by developing expert knowledge about the regulations, tax laws, and industry-specific standards relevant to their company. Financial managers can take on a variety of roles, including:

  • Controllers: Controllers serve as their company’s chief accounting officer. In this position, they typically oversee and direct report preparation, especially summarizing and forecasting cash flow, revenue, and expenditures. Most controllers manage a team of accountants and report to the Chief Financial Officer, or in a small company, they may answer directly to the CEO. A controller’s goal is to mitigate financial risk for their company and assure accurate reporting, which is critical to corporate success in highly regulatory industries.

Most controllers earn the Certified Public Accountant (CPA) designation prior to assuming their position. In most states, that means they must hold at least 150 undergraduate credits plus at least one year of accounting experience.

  • Treasurers: The treasurer’s job is to manage the assets and liabilities of the company. Treasurers take charge of corporate investments, raising capital, and preparing financial plans for mergers and acquisitions. Creating and communicating accurate financial models, managing risks, and overseeing fundraising efforts can all be part of a treasurer’s responsibilities.

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Most treasurers hold a bachelor’s degree or a master’s degree in finance or a related field, and many also earn a Certified Treasury Professional designation.

  • Risk Managers: Every sector of business assumes risk. A risk manager, therefore, works to help companies control and manage their risks by identifying, assessing, and mitigating financial risk; evaluating risks versus rewards; and recommending actions in the face of threats to corporate assets. While needed in every industry, risk managers must be deeply knowledgeable about the field in which their company serves due to potentially complex regulatory requirements.

Most risk managers hold at least a four-year degree in finance or business, and many hold an MBA or another graduate degree in finance.

  • Credit Managers: Credit managers oversee a company’s credit department. They review credit applications, set credit limits, and collect payments from past-due accounts. Their goal is to make sure their company does not overextend credit or otherwise assume too much risk while at the same time choosing the right customers to extend credit to maximize sales potential. Credit managers typically report to a director of finance.
  • Insurance Managers: These are the professionals who help secure their companies against risk by researching, evaluating, and advising corporate leadership on insurance purchases. They may also help determine insurance-related policies that minimize the chances of their companies’ receiving a lawsuit. An insurance manager’s ultimate professional goal is to help their company select and maintain optimal insurance coverage

A Financial Manager’s Salary

A financial manager salary can range from as low as $66,480 per year to as high as $208,000 with the median falling near $125,080. In Ohio, the mean wage stands at $136,360, and the state boasts a high percentage of financial managers among its population, most likely thanks to its proximity to major financial centers.

Many finance managers earn additional compensation such as bonuses, commissions, and profit shares, which can add an additional $8,000 per year. As in many professions, finance managers with more years of job-specific experience typically earn higher salaries than those just starting out. To maximize earnings, financial managers gain experience and skills in forecasting, financial analysis, and senior financial management. And financial managers who work in technology companies or corporate management often outearn those who serve in government jobs.

Advancing Your Finance Career

Financial management careers start with a bachelor’s degree in business or finance. Advancing past low-to-mid level posts into the more interesting and lucrative positions, however, requires a master’s degree. Malone University’s ACBSP-accredited online MBA emphasizes ethical and moral business practices and is taught in a flexible and convenient format. You can earn your MBA in just 20 months on a schedule that works for you.