The average salary for a Chartered Financial Analyst (CFA) charterholder depends on several financial components: a base salary, company cash, performance bonuses, commissions, and stock options. It also depends on whether or not they receive some company equity or profit-sharing. According to the Corporate Finance Institute, “Charterholders can have salaries that are quite high, relative to other professionals in the finance industry.” And it gets better: not only do CFA charterholders earn higher compensation than their peers in similar professions, but CFA charterholders report also being highly satisfied with their overall careers.
So, what is the average CFA salary? According to Payscale.com (as of January 2020), CFAs earn from $50,000 to over $300,000 per year, depending on several factors. These include educational background, years of work experience, the city in which they live, size and type of company they work for, and career path they choose.
CFAs with a bachelor’s degree make slightly lower salaries than those with graduate degrees, according to the joint 2018 Financial Compensation Report by the CFA Society of Madison and Milwaukee. CFAs with a bachelor’s degree earn a median total compensation of $162,500, whereas CFAs with a graduate degree earn a median total of $237,357. While obtaining a graduate degree can be beneficial to your salary and career, years of experience working in the profession can sometimes balance out any educational discrepancies in overall financial compensation.
Years of Experience
For many CFA charterholders, increased salary comes with more work experience. Mid-to-late career professionals make much larger salaries than CFAs just entering into the profession.
The location of a company that a CFA charterholder works for can also have an impact on their salary. CFAs living in larger metropolitan areas will earn much more than those living in smaller cities. Also, cities like New York City, San Francisco, Dallas, Hong Kong, Tokyo, and Dubai, which are financial hubs, will pay higher salaries for CFA charterholders.
Popular Companies for CFAs
Where are the majority of CFAs working? Popular companies for CFAs are J.P. Morgan Chase & Company, Wells Fargo & Co, Ernst & Young, The Goldman Sachs Group, Inc., The Northern Trust Company, UBS Group AG, and Bank of America Corp. Fittingly, these companies tend to pay higher CFA salaries.
The type of industry a CFA chooses also determines salary. The Balance Careers website states: CFAs working for foundations or trusts make an average of just around $100,000 annually, while those in private practice with a firm earn approximately $85,000. Those who work for federal, state, or local governmental entities earn between $81,400 and $87,000 a year. Hospital-based CFAs earn around $92,600, and college or university CFA employees make around $75,000.
Self-employed and contract CFAs tend to earn higher salaries than CFAs who work within large organizations, with 20-year veterans earning $170,900 per year on average.
The Chartered Financial Institute indicates the median total compensation for CFA charterholders by job type in the chart below:
|Financial Analyst (corporate)||$80,930|
|Portfolio Manager (fixed income)||$253,250|
|Chief Investment Officer||$316,600|
|Portfolio Manager (equities)||$344,500|
While several factors cause the overall compensation for a CFA charterholder to vary greatly, its salary boost is evident. The CFA credential generally increases total salary and compensation and provides an advantage in the job market. Plus, earning the credential showcases your drive and commitment. Achieving such a difficult specialization helps you stand out to future employers.
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