The Road to Finance: The MBA versus the MSFA

According to Ranstad U.S., the financial services sector is growing at such a rate that there aren’t enough skilled workers to fill job vacancies. Right now, midsize and major financial service firms report that their number one challenge is recruiting the right candidates and making sure they stick around. Because the demand is high, so is the opportunity for those looking to make a career in the financial sector. For candidates looking to fill those vacancies or bypass entry level positions with a certifiable career boost (think of a Super Mario Bros-style, power-up mushroom), there are two master’s degrees that are worth considering.

• reigning Master of Business Administration (MBA), and
• upsurging underdog: Master of Science in a Finance or Financial Analysis (MSF/MSFA)

Although both degrees have a good track record for getting you into the upper ranks of the financial services industry, there are crucial differences in cost, completion time and desired career trajectory.

Broad versus deep

To start with a popular simile, an MBA is like a buffet, and an MSF/MSFA is like a steakhouse. An MBA is expansive. It’s a program that gives students an understanding of how each part of an organization interacts. The goal is to produce graduates who are savvy in a range of subjects, including organizational behavior, leadership, management strategy, marketing, finance and accounting. Although MBAs offer various concentrations, the heart of the curriculum is all about management. It’s a good fit for students who are interested in working as a:

• management consultant,
• project manager,
• marketing director or
• entrepreneur

Alternatively, an MSFA is focused. It’s designed to give students a more detailed, specific understanding of finance. As a STEM-designated program, there’s more of an emphasis on developing a quantitative skillset, as opposed to a managerial one, so graduates are specially equipped for relevant certification tests, such as CFA, CPA and CMA exams. It’s a good option for those who already know they want to go into:

• financial advising,
• investment banking,
• accounting,
• actuarial science

and other finance jobs that require a high level of technical proficiency.

Cost and career trajectory

An MBA is a good fit for those who are interested in managing people, projects, programs, teams or organizations. It’s also a degree that benefits entrepreneurs. While both degrees have high earning potential, the MBA offers greater flexibility to those who might not want to be in the financial sector in the long term. But, if a management position and a career outside of the finance sector is not the ultimate goal, the MSFA is a shrewd option. It has a low opportunity cost and a shorter completion time. Although it’s more inexpensive than its rival, MSFA students don’t have to worry about compromising the quality or prestige that’s traditionally associated with the MBA. On average, an MBA is three to seven times more expensive and often takes an additional year to complete. It runs a student between $100,000–$200,000, while the cost of an MSFA program hovers around $30,000.

Specialists versus generalists

When it comes to filling job vacancies, most midsize and major financial service firms are looking for people who possess hard skills. They’re after the candidates that already have a quantitative skillset. Research studies, like the one conducted by Director of the Wharton School’s Center for Human Resources Peter Capelli, show that most employers want workers they don’t have to train. Since the late-70s, workers continue to report fewer on-the-job training hours than previous generations. Even in 2011, only 20 percent of workers could recall a time in the last five years when their employer provided on-the-job training. At the same time, the workplace is evolving. Generalists are becoming more important as work becomes more automated. Certainly, there’s an immediate need for specialists—that’s why jobs remain vacant in 2019. Yet, a report published by the Institute for the Future estimates that 85 percent of the jobs that we will hold in 2030 don’t exist right now. They haven’t been invented yet. With this in mind, it’s important for prospective graduate students to consider a master’s degree that will prepare them to be both specialists and generalists. That’s certainly the aim of Gordon’s new Master of Science in Financial Analysis program where graduate students learn how to crunch the numbers and interpret them in a larger context that is ultimately driven by social good and ethical practices. For more information on this topic, visit Gordon College’s Master of Science in Financial Analysis webpage.