For households and individuals, money management conjures thoughts of budgeting and other strategies to control spending. In the investment context, money management serves as a form of enhancing wealth for individuals and institutions. The following money management job description explains the functions, abilities, and background necessary for these professionals, also known as financial analysts. They help investors and their stakeholders accomplish their plans for sustaining their businesses, retirement, and education.
Job Overview: What Does a Money Management Professional Do?
Financial planners and money managers help individuals or entities increase wealth and grow their spending power. While financial planners focus on more financial goals, money managers concentrate their efforts on specific products designed to achieve an individual’s or organization’s financial goals. The money management job description highlights the job functions and skills that help accumulate wealth for investors.
Money Management Job Duties
- Research companies, mutual funds, industries and economic sectors from which the manager may find investments.
- Select or recommend specific stocks, bonds, other securities, currencies and other investment products for funds and portfolios.
- Create investment strategies for institutional and individual clients.
- Analyze companies’ historic and present financial data, structure, management, strategies, and policies.
- Examine trends in industries, overall economic barometers such as unemployment rates, inflation, and consumer confidence. As well as the movement of securities or currency markets.
- Consult with financial planners on investment and savings goals and needs of clients.
- Advise clients, especially individuals, of investment risks.
Money Management Job Essential Skills
Analytical Skills. The money management job description calls for these professionals to draw conclusions and select investments based on numerous pieces of information. Determinations of profitable or risky investments depend on the financial health of a company, the effectiveness of its management, regulations affecting the company or sector, events in particular regions and political actions. Analytical skills also include interpretation of increases, decreases and other trends in the market.
Computer Skills. Money managers and other financial analysts rely on software and applications to model predicted changes in prices and values of specific investments or market indices. Computer skills also include the ability to use spreadsheets. As well as find news and other useful information online, email and execute or request particular transactions.
Mathematical Skills. Those in the money management field need the ability to calculate formulas and ratios such as net income, debt-to-equity, earnings per share and simple or compound interest to determine the value of companies or securities. Within the math aspects of the money management job description lie skills in figuring future cash flows as a barometer of value.
Becoming a Money Management Professional
Aspiring money managers develop their knowledge and skills through formal college education and experience in investment and financial planning. The education and training often serve as a prerequisite to certifications desired or required by money management firms. For money managers who sell securities and other financial products, a license from the Financial Industry Regulatory Agency (FINRA) forms part of the money management job description.
Qualifications & Training
Typically, money managers hold undergraduate degrees in business administration, accounting or finance. Post-graduate education can also enhance employment opportunities. According to O*NET, approximately 35 percent of financial analysts hold master’s degree and six in ten achieve a bachelor’s degree.
College and masters-level classes include finance, statistics, economics, mathematics, and accounting. Future money managers should grasp concepts such as risk and reward. And diversification of investment assets in order to manage risk, hedge funds, calculating return on investments and currency exchange rates. Those who may concentrate in a particular industry should take courses related to that industry. For instance, money managers handling science and technology investments may include in their curriculum chemistry, biochemistry and engineering.
Generally, internships and work during college afford the pre-employment training for money managers. Investment firms, banks, accounting firms and government agencies that manage pension and similar funds also can train money managers prior to graduation.
Money managers who sell securities must be licensed by FINRA. And in the course of becoming so, must have sponsorship from an employer. This means that employers of money managers do not require significant prior work experience in the field as a condition of employment.
Certification as a Chartered Financial Analyst through the CFA Institute requires four years of work in applying or assessing financial or economic data or statistics to for investment decisions. Qualified experience can also result from supervision of those who apply or evaluate relevant data for investment purposes or those that teach these activities. The CFA mandates at least half of that time in direct investment decision making or work that leads to decisions. Work performed for family or for self is not eligible.
The money management job description features full-time work. Money managers often must work beyond traditional office hours into evenings and weekends. Daytime hours are devoted to phone calls and meetings with clients. Or even with the management of companies with whom money managers may meet as part of their research. Money managers also monitor markets and contact traders or brokers to execute the investment decisions.
Due to globalization, money managers handle foreign securities or currency markets. Thus, work hours for these professionals in the United States may run into evenings or late nights to correspond with the open hours of foreign exchanges. Evenings or weekends for money managers also include research and digesting the day’s news events. Or of government actions to determine their effect on the investments.
Job Outlook & Advancement Opportunities
The U.S. Bureau of Labor Statistics projects a jump of 11 percent in the employment of financial analysts, which directly impacts the money management jobs, that translates to 32,200 additional positions through 2026. While in 2016, financial analysts numbered approximately 296,100.
Prospects for employment depend generally upon economic conditions. More investment activity accompanies a healthy economy and the resulting increase in disposable income for individual and institutional investors. Further, an expanding economy means more new enterprises and growth of existing firms.
Money managers will see a greater number of businesses and commercial activity to evaluate in deciding on specific securities. Options for investing and the demand for money managers to assess and pursue them arise also from emerging markets in developing nations. Even with greater demand, money managers and other financial analysts must navigate a fairly competitive field for jobs.
Money management is poised to remain as a high-demand field, as banks, pension funds, insurance companies and other businesses rely on investing to fund their activities. Those aspiring to have the money management job description need to appreciate their role in handling the specifics of the financial strategies of investors and that it complements financial planners. With experience and acquired skills in applying financial, economic and business information, money managers can become certified and eligible in selling securities and advising investors on specific products.