Those banking on a career in the financial sector have a plethora of choices of qualifications that will help them get one. Conventionally, the MBA has been the degree of choice for anyone wanting to work on Wall Street. The degree covers a broad curriculum of finance, strategy, entrepreneurship and more.
However, in recent years a more focused option has emerged. The Master in Finance (MiF)—sometimes also known as an MSc in Finance—has become increasingly popular. In general, the MiF teaches a more rigorous set of technical abilities in addition to transferrable skills — such as data analysis, statistics and computing — that are vital to a wide range of jobs, according to Alex Stremme, director of the MSc in Finance course at Warwick Business School in the UK.
He says that application numbers to the program are up by 12 percent this year compared with three years ago.
MBA or MiF: what’s the difference?
There are fundamental differences between the MBA and Masters Programs in Finance. For one, MiF candidates are usually fresh out of their undergraduate school with little or no professional work experience, and are looking to break into the financial sector. In contrast, MBA candidates typically have several years of experience and are often about to enter middle or senior management positions.
At IE Business School in Spain, MiF candidates are aged between 19-25 and 45 percent have no financial work experience. On the school’s MBA, the average student is 30 with six years’ work experience.
The two degrees also teach a different set of skills, although there is some overlap. An MBA is broader than the MiF and equips graduates with knowledge of the different aspects of business. Meanwhile, an MiF is more specialized and offers students in-depth knowledge of finance, such as investment banking, asset management and corporate finance.
The MiF is meant for those who are absolutely certain they want to start or continue working in the financial sector. At IE last year, 64 percent of MiF graduates worked at investment banks, says Viet Ha Tran, admissions director for the MiF course.
“It is the applicant’s career goals that should determine which program is best suited for them,” she says.
What do employers think?
Employers value the deep and specialist financial knowledge of an MiF degree, which can give graduates an edge, says Felix Papier, dean of academic programs at France’s ESSEC Business School. “This is one of the key advantages of the Master’s in Finance and explains the competitive salary of our graduates in the international job market.”
However, an MBA provides students with more flexibility in their careers than an MiF, whose students may miss out on the broad management knowledge that could propel them into more senior positions. “They say that the knowledge gained in an MBA is more horizontal and the knowledge in a MiF is more vertical,” says Ha Tran at IE, who adds that “an MBA is normally a requirement for many managerial jobs”.
This means that MBA students typically earn more after graduation than MiF candidates do. “Median starting salaries for early career Master’s in Finance students is $75,000,” says Heidi Pickett, director of the MiF at MIT Sloan School of Management in the US.
“Comparatively, the median starting base salary for MBAs [is] $125,000,” although “this varies by industry and the number of years work and type of experience prior to returning to business school.”
She says that a typical MiF graduate will start their career in financial services as an analyst and from there get promoted to associate, associate vice-president, vice-president, senior vice-president, and so on, with increasing levels of responsibility.
“Meanwhile, MBA students take a variety of career paths. In consulting, for example, an MBA will be hired at a senior consultant level; in financial services as an associate; and in tech companies product manager has become a popular post-MBA role,” adds Pickett.
What about tuition fees?
While MBAs begin in higher positions than MiFs and are paid more, the degree itself can cost MBAs dearly. “The MBA program has a higher cost than the Master’s in Finance” because the MBA curriculum is broader and offers electives and other extracurricular learning activities, says ESSEC’s Papier.
Tuition fees for an MBA at ESSEC’s France campus is €45,000 for 2018-2019. The MiF costs €22,500.
But Papier adds that price is not a major element of consideration for prospective students. “It is more about the professional [experience] and a student’s profile that influences their decision to choose between the two programs,” he says.
What’s more, the MBA and MiF are not mutually exclusive. “We sometimes have candidates who have already done a Master’s in Finance and who, after some years of additional work experience, are looking to further progress their careers into top management,” Papier says.
“For those candidates it makes sense to complement their specialist knowledge with a more general management education.”
In the same vein, MBA candidates can specialize in finance through electives.
Ultimately, both programs offer the potential for high-paying career opportunities in the financial sector, with good progression. But if you’re looking to branch out, an MBA is your best bet.