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So, you're at a crossroads, trying to figure out your career path. Maybe you've heard a lot about accounting and are curious if it's a good fit for you.
Accounting has been gaining popularity as a career choice - in recent years, more and more students have been drawn to this field, and for good reason.
In this blog, we’ll shed light on the pros and cons of an accounting degree. We’ll also calculate whether an accounting degree is worth it based on the effort, money and time required for the return on investment.
When it comes to job stability and security, accounting stands out as a reliable career choice. Here's why:
Demand Across Industries: Accountants are in high demand across various industries. Every organization, whether it's a small startup, a multinational corporation, a government agency, or a non-profit, needs skilled accountants to manage their finances.
Job Security: The need for financial expertise is constant. Even during economic downturns, accountants play a crucial role in helping businesses navigate financial challenges. This translates to job security, making accounting a resilient profession.
As an entry-level accountant, you can expect a reasonable starting salary. According to BLS, the median yearly salary of an accountant in 2021 was $77,250.
However, what's even more enticing is the potential for significant salary growth as you progress in your career. Mid-career accountants often earn much more than their peers in other fields.
Climbing the career ladder, you can reach higher-paying positions such as financial manager, controller, or even a chief financial officer (CFO). The median yearly salary of a Financial Manager was $139,790 in 2022, according to BLS.
Accounting equips you with valuable skills that go beyond crunching numbers. Here are two key skills you'll develop:
Accountants are problem solvers. They analyze financial data, identify trends, and make informed decisions. These skills are not only valuable in the world of finance but are transferable to various other professions.
Precision is a hallmark of accounting. You'll develop a keen eye for detail, which is a skill that employers in all industries highly value. Your ability to maintain accuracy can set you apart in any job.
Accounting isn't a one-size-fits-all profession. It offers a multitude of career paths to explore:
Public Accounting: You can work in a public accounting firm, providing services like auditing, tax planning, and consulting to clients.
Corporate Finance: Many businesses have in-house finance departments where accountants manage financial planning, analysis, and reporting.
Government Agencies: Government entities also require accountants to manage public funds, ensuring transparency and accountability.
Specializations: Within accounting, you can choose to specialize in areas like taxation, audit, forensic accounting, or management accounting, allowing you to focus on what interests you most.
Certification can significantly enhance your accounting career, and the Certified Public Accountant (CPA) designation is the gold standard.
Becoming a CPA demonstrates your commitment to the profession and your expertise. It opens doors to higher-paying roles and greater responsibility.
Employers and clients often seek CPAs for their financial expertise and trust their judgment. Having a CPA designation can propel your career by enhancing your credibility and paving the way for career growth.
Academic prerequisites and CPA exam preparation
One of the first hurdles you'll encounter when pursuing an accounting degree is the rigorous academic requirements. This often includes completing 150 credit hours of coursework, which typically extends beyond the traditional four-year bachelor's degree.
Preparing for the CPA exam is no small task either. This grueling exam consists of multiple sections covering various accounting topics, and passing it requires a significant commitment of time and effort.
As with many professions, entry-level positions in accounting can involve repetitive and routine tasks. You may find yourself crunching numbers, inputting data, or reconciling accounts day in and day out.
While these tasks are essential for maintaining financial records, they can become monotonous over time.
However, it's important to note that as you progress in your career, you'll have opportunities to engage in more complex and intellectually stimulating work.
Accounting isn't just about numbers; it also involves strategic financial planning, auditing, and advising clients. So, while the early stages may be repetitive, there is room for growth and diversification of responsibilities.
The accounting field is not immune to technological disruption. Automation and artificial intelligence (AI) are becoming increasingly integrated into accounting processes.
Tasks like data entry, basic bookkeeping, and some forms of analysis can now be automated. While this can improve efficiency, it also means that certain job functions may become obsolete in the future.
To stay competitive in the accounting profession, you'll need to adapt and acquire new skills. This may involve learning how to use advanced accounting software, understanding data analytics, or even delving into cybersecurity to protect financial data.
Embracing these technological changes requires continuous learning throughout your career.
So, based on these pros and cons, is an accounting degree worth it?
Well, the short answer is yes, but let's dive deeper and calculate the Return on Investment (ROI) for an accounting degree to help you make an informed decision.
Before we start thinking about the returns, let's first figure out what you'll be spending to get that accounting degree.
The cost of education can vary widely depending on where you choose to study and whether you attend a public or private institution.
On average, a four-year accounting program at a public university can cost around $10,000 to $30,000 per year, including tuition, fees, and textbooks. If you opt for a private institution, the costs can be significantly higher, sometimes exceeding $50,000 per year.
Many students rely on student loans to fund their education. The amount of debt you accrue can depend on various factors like scholarships, grants, and your choice of school.
Be sure to consider the interest rates and repayment terms on your student loans, as they can have a substantial impact on your post-graduation finances.
Now, let's explore the potential earnings an accounting degree can bring.
Accountants are in demand, and the field offers a relatively stable and rewarding career path. As mentioned above, entry-level positions can start at around $70,000 annually, and with experience, you can expect to earn considerably more, potentially more than double that amount.
This means that even with an entry level job, your earnings would potentially exceed the cost of education in about 4-5 years.
As you gain experience and climb the career ladder, your earning potential increases. Accountants can move into supervisory and managerial roles, which often come with more substantial salaries. Some may even venture into entrepreneurship or become certified public accountants (CPAs), boosting their earning power further.
An accounting degree is absolutely worth it when calculating ROI as a measure of long-term value.
ROI isn't just about what you earn immediately after graduation. It's a long-term measure, consider the cumulative earnings over your entire career against the initial investment in your education. This perspective can provide a more accurate picture of the amazing value of your accounting degree.
Whether an accounting degree is the right choice for you depends on your individual goals, interests, and circumstances.
While it’s not suitable for everyone, it's a field that offers financial stability and various career opportunities. If you value job security and are comfortable with the prospect of ongoing learning to stay updated with industry regulations and technology, it may align with your aspirations.
An accounting degree’s benefits far outweigh the initial investment, and as long as it fits your aspirations, it could be the perfect choice for you.
If you need help deciding on a major or getting into your dream university, we’re here to help! Students working with Crimson strategists are 7 times more likely to gain admission to their dream university!
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