There are 1.4 million accountants and auditors in the US, making accountancy one of the biggest and most important professions in the business service sector.
Accounting is generally considered a stable and well paid job. How well paid is that? Let’s take a look at the average accounting salary in the US.
Average Accountant Salary – An Overview
According to the U.S. Bureau of Labor Statistics in 2017, the median accountant salary was $69,350:
US Accountant Salary
Per hour rate
*Low end salary is the average level for junior, inexperienced accountants. High end is the one for senior and experienced accountants.
In this article, I share insider info on jobs for former public accountants and professionals looking for an accounting career change. After all, many people choose to start with an accounting job because it is stable and pays relatively well. But some are forced into this profession because it’s the only job they can find with an accounting major.
But a few years down the road, with solid accounting experience under your belt, it might be time to revisit your decision. Should you go for a career change from accounting? If so, what would be a great second career?
Regardless, before leaving an accounting career, consider why accountants leave the profession. And then, think about alternative careers for accountants, like how to become an investment banker, entrepreneur jobs, and even Enrolled Agent jobs.
At some point in their careers, many public accountants start to consider a career change. So if you’re thinking of leaving public accounting, don’t worry—you’re not alone. In fact, leaving public accounting after 1 year is not uncommon. However, some professionals think that the best time to leave public accounting is after 3 to 6 years. That is, you might be ready after you’ve advanced in your firm but you haven’t yet made manager or become too specialized in a specific niche. Or, you should think about shifting roles if you realize that you don’t eventually want to become a partner in your firm.
If you’re thinking of when to leave public accounting, I recommend starting your career change with a plan for where to go next. You have many choices since accounting skills are often transferable into other positions in the finance and business world. For example, you could consider corporate banking, financial planning, corporate accounting or finance, internal auditing, and other roles. Some former accountants even go to work for the FBI because they must analyze and audit a lot of business and financial records. But in this article, I’m only going to focus on a few specific choices:
I used to work in Morgan Stanley’s Investment Banking division. After all, big commercial banks down to small regional and boutique banks often have investment banking departments. Plus, asset management companies, private equity institutions, and venture capital firms also hire investment bankers.
In our analyst class, we had a few lateral hires, and almost all of them were accountants by training. However, some investment bankers start with a bachelor’s degree in business or finance or even an MBA.
It’s no surprise that bankers find accountants complementary in their working team. Investment banking analysts are often hired based on how they can carry themselves professionally (in front of an interviewer or client), how smart they seem to be, and how likable they are. In other words, their majors and previous training do not always count. For instance, in my department at Morgan Stanley, we had History and English majors, just to give you an example.
All new investment bankers went through a month of training. But still, many of us lacked a solid foundation in accounting. At the same time, financial modeling requires a certain level of accounting knowledge, which often creates an issue for the working team.
As you can imagine, my seniors were thrilled when they saw a candidate coming from a Big 4. Or at least, they were happy with accounting majors with a few years of solid training. Better yet, if new hires had taken the time to pass the CPA Exam, they were gold.
So just exactly what is an investment banker? Well basically, investment bankers are highly skilled professionals who help people and organizations make investments. When companies, governments, and other organizations need to raise capital, they turn to investment bankers for help. Then, these trained experts examine an entity’s overall fiscal health, fundraising needs, and financial goals. And finally, after analyzing this data and the entity’s projected future, they connect the entity to potential investors.
In addition, investment bankers can find new support for growing ventures by selling investment products like stocks, bonds, and securities. Or, they can facilitate mergers and help take companies public. Therefore, a typical investment banker job description includes financial and statistical analysis and the ability to accurately forecast financial futures.
Moreover, because of their workload, investment banker hours can be long. But still, are investment bankers happy? Well, to be honest, the field can be stressful. However, if you enjoy the work, it can be worth it. After all, the banking environment is diverse, giving you plenty of opportunities to branch out and grow your career.
According to payscale.com, the typical investment banker starting salary in the United States is about 55K. However, when factoring in all professionals regardless of the length of employment, an investment banker average salary jumps up to over $101K. And furthermore, at the height of one’s career, an investment banker salary can reach as high as $208K.
If you’re starting a second career in investment banking as a former accountant, please expect that your firm may discount your experience and put you in a first-year class. Therefore, your fellow cohorts may have just graduated from college. I suggest that you look at the longer-term view, though—your solid accounting experience will help you stand out from the crowd. With dedication and hard work, your boss will notice. Plus, you could reap other benefits like a bigger bonus and a faster promotion down the road.
If you’re interested in this career move, check out this insider guide to investment banking.
Many accountants grow tired of working as bean counters. Fortunately, accountant jobs have evolved into interesting opportunities that require constant interaction with business operations, business development, and strategic planning units.
For example, accountants can transition careers as business analysts. Basically, a business analyst analyzes a company’s current processes and identifies potential areas of improvement. And then, the analyst helps the company create initiatives that will grow business and meet certain goals.
Therefore, business analysts must be good at solving problems, setting new objectives, and streamlining business processes. Plus, they need skills in everything from stakeholder management to data analysis, modeling, and even IT.
Business analysts often have bachelor’s degrees in business or accounting. So if you’re already an accountant, you could have the education you need to get started as a business analyst. If you are interested in this direction, the easiest way is to look for jobs via internal transfer. This is the most efficient way for you to transfer your accounting skills into one that’s more analytical and business-oriented.
For those who feel like analyzing a company’s business is not exciting enough, you might want to jump straight into creating a business yourself. But what is an entrepreneur? And do you have the skills needed as a former accountant?
First, an entrepreneur is simply someone who starts a business venture but takes on a greater financial risk to do so. So essentially, an entrepreneur takes on a lot of the financial risk of a new company but also reaps most of the rewards if and when it becomes successful. Entrepreneurs are known as innovators, as they find new goods and services to fill a community’s needs.
Second, if you’re wondering if you’d make it as an entrepreneur, consider that accounting requires a very practical set of skills. After all, it helps you understand how money flows in and out of any business. Plus, it also helps you plan and avoid pitfalls if you are leaving public accounting to run a business yourself. So if you are creative and entrepreneurial, launching your own company after your accounting training may be the way to go.
Of course, I’m not necessarily suggesting setting up your own CPA firm. However, it is possible if you have 10+ years of experience under your belt. But generally, starting a new firm is a tough road.
Instead, I am talking about creating your own company according to your passions. Essentially, it can be a bakeshop, an online business, or any other new business that fills a need in the market. But the point is that your accounting skills will help you along the way for years to come.
Nevertheless, to pursue a new business as an entrepreneur, you’ll need more than accounting skills. Instead, you should build a diverse skillset and stay current with the market so you can identify problems to solve with your new business. Specifically, skills like time management, networking, sales, and communication will help you bring an entrepreneurial idea to fruition.
Do you want to know the best-kept secret in the accounting circle? There is a profession called theEnrolled Agent that is perfect for accountants interested in tax who have an entrepreneurial mind.
The Enrolled Agent credential is offered by the IRS. And in fact, it’s the highest designation offered by the IRS. Therefore, Enrolled Agents are tax specialists. Basically, they can assist with any tax issue, including appeals, audits, and collections. Moreover, they prepare and sign tax returns, represent the client at tax audits, assist clients with collections issues, set up installment tax liability, and sign consents to extend the statutory period for assessments. Experienced EAs can even advise clients in IRS tax disputes and appear before the IRS in place of a taxpayer.
Unless you hate tax, you are probably already well-prepared to be an Enrolled Agent as an accountant. And after you receive the credential, you’ll be able to demonstrate your tax abilities, earn more money, and increase your job security.
Even more, with an accounting career as an Enrolled Agent, you can enjoy flexible hours. But unlike Financial Advisors, your job is not linked to the external markets (e.g. the stock market) in which the ups and downs of your performance could be out of your control.
Enrolled Agent positions are great opportunities for stay-at-home parents, retirees, and those who need flexible working hours. At the same time, it is a job that can provide financial freedom. After all, the Enrolled Agent salary is usually higher than that of tax preparers without the credential. In fact, EAs make about 10% more per tax return than their uncredentialled peers.
Some accountants question whether they should choose the path of an Enrolled Agent vs. a CPA. Or, if you’re looking to leave public accounting, you might wonder how an Enrolled Agent position could vary from what you’re already doing. So, here are the basic differences between an Enrolled Agent and a CPA.
The IRS doesn’t require any specific education or experience to become an Enrolled Agent. Nonetheless, you do have to meet a few other requirements. For example, you must pass the Enrolled Agent exam, which is the SEE (Special Enrollment Examination).
What’s more, once you become an Enrolled Agent, you need to gain continuing education credits every year. Specifically, Enrolled Agents need:
The Special Enrollment Examination has 3 parts: Each section has 100 multiple-choice questions and two essays and lasts for 3 ½ hours.
Note: Candidates who have been working in certain IRS positions for 5+ years don’t even need to take the exam. Instead, they can apply for the Enrolled Agent credential directly from their online IRS account.
Depending on the part and the year taken, the pass rate for the EA exam is about 61-88%. Therefore, it’s important to study with a review course that will greatly increase your chances of passing on the first try. If you need some reviews, check out this article about the best Enrolled Agent study materials from our partner site.
And to learn more about how to become an Enrolled Agent, check out this link.
If you’re thinking of leaving public accounting, I hope this article gives you good ideas about where to go. Just remember that accounting has already given you the skills you need for your next position. Once you’ve made your transition, feel free to leave a comment for other readers!