A career in accounting can be as financially rewarding as it personally. Accountants and auditors earn a median annual salary of $63,550, according to the United States Bureau of Labor Statistics (BLS). Many accountants earn well above this median salary. A number of factors influence salary potential for accountants, ranging from industry and location to job level and education.
The industry in which an accounting professional works is one factor in salary. Salaries are highest in industries such as securities and commodity exchanges, the federal executive branch of the government, securities and commodity contracts intermediation and, financial investment activities, and investment pools and funds, according to the BLS. These industries don’t necessarily employ the most accountants. Industries that offer better employment prospects and still offer salaries above the median annual wage for accountants include accounting and tax preparation, office administrative services and land subdivision.
As in many other occupations, location plays an important role in an accounting professional’s salary potential. Accountants tend to earn the most in big cities on the east and west coast. The five top-paying cities for accountants are New York City, New Jersey’s Ocean City and Newark and California’s San Jose and San Francisco, according to U.S. News & World Report.
Job level is an important factor in salary potential. This is especially easy to see when you look at the highest-paying accounting jobs, three of which are manager-level, senior-level, or “C-level” executive. Of course, earning a promotion to a managerial or senior level position requires a good deal of experience and often an advanced education. Entry-level jobs, of course, will pay substantially less than high-level positions, but they offer the experience necessary to pursue higher level opportunities eventually. Mid-level jobs pay more. Positions like senior staff accountant, managerial accountant, and chief financial officer (CFO) have the highest salaries.
A bachelor’s degree is essential for attaining most entry-level positions in accounting. Earning an advanced degree may be a requirement for moving into higher level positions. However, you might be surprised to learn that the highest possible degree may not translate to the highest possible salary. If you’re wondering whether you should earn a Ph.D. in accounting or stop at the master’s degree level, be aware that doctoral degrees are generally considered more research-based and academic and less practical than masters degrees. For some potential employers, this may translate to fewer employment opportunities and a lower salary.
If your goal is to earn wages higher than the median annual salary for accountants, consider how you can do to change these factors to increase your salary. If you are working your way up from an entry-level position, going back to school or taking the Certified Public Accountant (CPA) exam may increase your chances of earning a promotion. If you are job-hunting, you may want to target a new location or industry. By changing these factors, you could increase your earning potential.