CFA® Salary
The Chartered Financial Analyst® (CFA) designation is considered the gold standard in the banking and investment sectors, and naturally, a career as a CFA is very lucrative. According to the CFA Institute, charterholders earn higher pay than other finance professionals and get faster professional advancement, immediate recognition, and due credibility.
What is the Average CFA Charterholder's Salary?
People in the finance industry naturally, especially in portfolio management and investment banking, earn the highest average weekly wages versus their non-finance counterparts. And the CFA charter serves as the impetus for a significant rise in compensation.
As of May 2022, the average total compensation for charterholders (in the U.S.) is approximately $300,000, according to the CFA® Society. The median base salary for charterholders is approximately $180,000, which leaves the balance to be split between cash bonuses and equity or profit-sharing. CFA® charterholders often get a base salary, performance-based bonuses, and some equity or profit-sharing as part of their compensation. Compared to other financial industry experts, charterholders may earn comparatively high wages.
The following is a general formula to determine total compensation:
Total Compensation = Base CFA Salary + Cash Bonus + Equity
Please note that bonuses account for a large portion of the remuneration in the investing sector.
Source: The Corporate Finance Institute
Factors Determining a CFA Charterholder's Salary
When analyzing total compensation, there are several factors that contribute to the variance in one's pay. Averages do not provide the full picture, as there’s a wide range for CFA® salary, depending on several factors, including:
- Academic Background
- Experience
- Location
- Industry
- Job Title
Let's discuss them in detail.
Academic Background
Charterholders with a bachelor's degree earn a median total salary of $162,500, while those with a graduate degree receive a median total salary of $237,357. While a graduate degree might boost your compensation and help your career progression, years of job experience in the field can sometimes compensate for educational gaps in total earning potential.
Experience
While becoming a CFA charterholder sure is challenging, being one comes with an array of responsibilities that cater to the bigger picture in the financial industry. In such a scenario, adding years of experience enhances your work credibility, which in turn leads to better compensation. Naturally, charterholders in their mid-to-late careers earn much more than their entry-level counterparts.
| Experience | Average Pay |
|---|---|
| Less than one year | $85,000 |
| 1-4 years | $77,250 |
| 5-9 years | $80,000 |
| 10-19 years | $147,395 |
| 20 years and higher | $142,500 |
Source: Payscale
Location
Location can be a determining factor for better pay in any job title. Charterholders in bigger urban metropolitan regions typically earn more than those in smaller towns or rural locations. Charterholders are more likely to be paid higher in international financial centers such as New York City, San Francisco, Dallas, Hong Kong, Tokyo, and Dubai than in a rural setting.
Industry
Salaries are also affected by the industry in which a charterholder works.
For instance:
- CFA charterholders working for foundations or trusts earn roughly $100,000 per year; those in private practice with a company earn around $85,000.
- Charterholders working in colleges or universities earn around $75,000.
- Federal, state, or municipal government employees make between $81,400 and $87,000 per year,
- Charterholders working in hospitals earn roughly $92,600.
- Self-employed and contract CFA charterholders often earn more than charterholders who work for major firms, with veterans (20+ years of experience) earning an average of $170,900 annually.
Job Title
Much like how the Portfolio Management topic more or less dominates the curriculum in the CFA exam, when talking about the job title too, a 'Portfolio Manager' continues to dominate other career areas by a significant margin. The ‘2019 CFA Institute Pay Research' discovered an average self-reported total remuneration of $177,000 ($126,000 base salary) for portfolio managers, thus making it one of the most prevalent positions for the charterholders.
Following are some median total remunerations for charterholders by job type:
| Title | Compensation |
|---|---|
| Financial Analyst (corporate) | $80,930 |
| Portfolio Manager (fixed income) | $253,250 |
| Portfolio Manager (equities) | $316,600 |
| Chief Investment Officer | $344,500 |
Source: CFAI
CFA Salaries Around The World
Given the different labor laws and the general economic climates, the compensation that a charterholder receives is greatly influenced by their country of residence. For example, the average gross income for a chartered financial analyst (CFA) in India is ₹11,50,068 ($15,334), $101,812 in the United States, and £57,950 ($58,580) in the United Kingdom.
When looking at the average income for an entry-level chartered financial analyst (CFA) (1-3 years of experience), a charterholder earns about ₹8,23,310 ($10,977) in India, £40,855 ($41,299) in the UK, and $71,778 in the USA. A senior-level chartered financial analyst (CFA) (8+ years of experience), on the other hand, gets an average income of ₹14,48,218 ($19,309) in India, £71,864 ($72,645) in the UK and $126,259 in the USA.
Source: Salary Expert
Read more about the CFA
Understanding the differences between a CFA charterholder and a CFP is important when choosing a career. This article will guide you in choosing the best option for your needs.
What are the most prevalent CFA career paths? A CFA charterholder may pursue a wide range of professional prospects. Find out what your alternatives are.
Planning to take the CFA exam? Visit this quick guide for more information on everything you need to know before taking the exam.
