Are things like a stable career, higher-than-average salary and healthy financial portfolio important to you? Do you want your friends to see you as someone who’s got it all figured out?
If so, the responsibility and professionalism that comes with a career in accounting should resonate with you. Accounting jobs are projected to grow 16 percent through 2020 and the median annual salary of people in the field is $61, 690 – a full $10,000 more than the national average!
The first step is to get involved in an accounting degree program. But not long after that, you’ll have to choose the direction your career will take once you get into the field.
To help you we highlighted the three most popular credentials for accounting professionals and broken down everything you need to know in a three-way comparison of CMA versus CPA versus CFA.
Here’s what you need to know.
CMA: Certified Management Accountant
What is it? The CMA – no, not the Country Music Awards – is designed to help you further develop your ability to make strategic business decisions based on an organization’s financial situation. Becoming a certified management accountant helps you develop a level of expertise in both financial accounting and strategic management.
The Requirements: A bachelor’s degree is the only component needed to be eligible to pursue a CMA. Don’t even think about trying for this credential without one, as 91 percent of accounting positions require it.
Why? The CMA is “perfect” for both accounting and finance majors, says Kari Grittner, accounting program coordinator at Rasmussen College. After all, she says, 75 percent of accountants work in private industry. Expertise in numbers and strategic planning makes CMA holders a valuable commodity for private businesses.
And if your own bottom line is a concern, CMA holders earn, on average, $34,000 more than their noncertified colleagues. And while all certifications require commitments of both time and finances – the CMA costs roughly $600 – the earning potential once you’ve passed the examination makes your earning potential well worth the effort.
CPA: Certified Public Accountant
What is it? The CPA credential is perhaps the most widely known credential for accounting professionals. And while it is certainly useful in a corporate setting, a CPA is more valuable in the public sector. The biggest reason for this is because CPAs can be paid by individuals or businesses for their accounting and tax services.
The Requirements: A bachelor’s degree combined with a few years of experience is the most common path to earning your CPA credential, but requirements vary by state. In Minnesota, for example, you can sit for the exams only after completing a bachelor’s degree. In Florida, one needs just 120 semester hours under his or her belt. CPAs are also required to complete varying levels of continuing professional education in order to keep their state license. Check out your state requirements here.
Why? “The CPA has always been the gold standard,” says Grittner. Earning your CPA puts you into an elite group of accounting professionals. With a CPA, employers know that you are a trusted professional in the field of public accounting. In fact, more than 90,000 accounting positions posted over the past 12 months* required candidates to be a CPA. That’s almost 25 percent of all accounting positions posted!
CFA: Chartered Financial Analyst
What is it? The CFA is a credential first introduced in 1963. Put simply, a CFA is a designation that certifies the competence and integrity of financial analysts. The CFA Institute grants individuals the credential only after they pass three levels of exams covering subjects including accounting, economics, ethics, money management and security analysis.
The Requirements: Individuals looking to earn a CFA credential need four years of experience working with investments; they need to be members of the CFA Institute; and they must pledge an oath of ethical conduct – all in addition to passing those exams! Completing the entire program takes most candidates between two and five years, according to the CFA Institute.
Why? Earning a CFA is a great way to distinguish your resume from that of other job applicants. In fact, more than 25,000* job postings over the past year listed a CFA as either required or preferred for employment.
How to decide and get started
Keep in mind that the first step toward earning any of these credentials – and someday an incredible career! – is to complete a bachelor’s degree in accounting or finance. Deciding between a CMA versus CPA versus CFA before getting a degree is putting the cart before the horse.
But one thing is for sure. If you want to be the cream of the crop, the path to becoming a CMA, CPA or CFA is the way to do so.
All you need to do is commit to making it happen.
*Source: BurningGlass.com (Analysis of accounting positions requiring the CPA and CFA certifications, Nov. 6, 2012 to Nov. 5, 2013)