(‘The Right Choice’ is a series from The Indian Express that addresses frequently asked questions, misconceptions and doubts about undergraduate admissions. You can read the story here.)
— Mudassar Nazar
A career in finance is attractive to many people, as it offers a steady progression through the ranks and a wide range of learning opportunities. It is known for its competitive pay and allows candidates to explore a variety of career paths. After pursuing a career in finance, most graduates take on key roles in their companies, becoming leaders in strategic initiatives, driving major projects, and influencing the organization’s progress.
The U.S. Bureau of Labor Statistics highlights that overall employment in business and finance-related occupations is likely to grow faster than the average for all occupations from 2023 to 2033.
On average, nearly 9,63,500 openings are expected in these occupations every year due to employment growth. In line with this trend, the Financial Planning Standards Board of India observed that there were around 18 million jobs in the financial services sector till last year. These statistics show that the demand for professionals in the financial industry is increasing, and this demand is likely to grow similarly around the world, highlighting a bright future for aspirants.
Nevertheless, choosing the right path in the financial field can be a daunting task for most people. Generally, many of them are in a dilemma when choosing financial literacy and behavioral finance. Let’s take a closer look at this.
curriculum
Financial literacy allows candidates to learn the nuances of financial decision-making. This includes understanding financial products, effectively managing finances through budgeting and expense tracking, and planning for retirement. You will also develop an understanding of risk assessment, taxation principles, debt management, savings and investments, and credit scoring. Applicants pursuing financial literacy courses work in positions such as financial planners, credit counselors, accountants, and personal finance consultants, just to name a few.
Behavioral Finance integrates psychology and finance, allowing candidates to learn how psychological biases influence financial decisions. It derives from the principles of behavioral economics, which examines cognitive biases such as overconfidence and loss aversion in leading people to make irrational choices. Additionally, behavioral finance studies market anomalies and investor behavior, along with strategies to reduce irrational investment behavior. People interested in this field will become behavioral finance analysts, investment analysts, risk management specialists, and portfolio managers in the future.
investment of time and money
Nowadays, financial literacy courses can be easily taken online or offline. Candidates can choose the duration of the course depending on their level of understanding and experience. Various prestigious universities offer certifications after successfully completing workshops and classes on financial literacy. Therefore, costs vary from person to person.
Conversely, behavioral finance is a specialized field that requires a deep dive into theory and psychology. Being a niche field, it may seem more costly than financial literacy. To fully achieve that, candidates may need to spend more time gaining practical knowledge beyond their immediate scope of study.
employment opportunities in the market
Financial literacy offers many job opportunities in the market, depending on the applicant’s experience level and location. According to Glassdoor, the estimated total salary for a new financial advisor in India is 500,000 rupees per year and the average salary is 400,000 rupees per year. Today, talented and skilled professionals are needed in a variety of fields, from personal finance to corporate finance.
When it comes to behavioral finance, salaries vary depending on the role and requirements. According to Ambition Box, salaries for investment analysts with less than 1 to 7 years of experience in India range from Rs 250,000 to Rs 31,400,000.
With more organizations recognizing the importance of psychology in driving financial results, competition in this field is likely to become much more intense in the future.
In summary, when choosing between financial literacy and behavioral finance, individuals must weigh their interests, skills, and long-term goals. Ultimately, both of these fields offer a wide range of career prospects and provide candidates with valuable skills to lead in the financial world.
(The author is CEO of Birla Brainiacs)
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