MFE or Industry After Graduation
All,
First post here at WSO; joined hoping to find some helpful insight related to my current situation: whether to pursue grad school or go right into industry after graduation.
I'm graduating from a non-target public school (top 15 finance program) next spring with a 3.5-3.6 GPA majoring in Finance with minors in Math and Econ.
I'm currently working as a summer intern in the treasury department of a fortune 500 company, and it seems likely that I'll get a full time offer form this company if things continue to go well. However, the offer is for a rotational program in corporate finance and is frankly more accounting oriented than finance (not exactly what I dream about doing).
My other option right now is to pursue grad school. I'm currently considering an MFE. I picked up the math minor specifically to leave this door open. However, I'm not sure if the long workweeks associated with those types of careers are what I want either; as I get a little older I think I want more work-life balance than that lifestyle offers. Moreover, I'm not sure how competitive I would really be coming from a non-target school.
The other issue I need to consdier is that it might not be an option to work for a few years and then pursue an MFE. My thought process is basically that those programs are so heavily math oriented (dif. eq, linear algebra, stochastic calculus), that if I wait another 3-4 years and then get the degree, the necessary math knowledge/skills may well have left me.
The main questions I am hoping to get answered are:
1. Am I competitive enough to get into a decent school given the brief background description I've given here? If not, is it worth it to settle for a mediocre MFE program, or will I be severely limited in choices after graduation if I'm not in a top program?
- If I do go the MFE route, are there any career paths that I can pursue that are somewhat less hazardous to the lifestyle than the IB/Trading route?
I'll need to give my current company a yes/no before grad schools get back to me, so I'm trying to get an idea of how competitive I am before deciding.
I'd appreciate any insight you guys can provide.
Which ones are you looking at?
You mean which school? For grad schools the only two factors I'm really considering are school ranking and location -- ideally I'd like a school in the northeastern US (for location/network). Schools that meet those criteria include Columbia, NYU, Baruch College NY, MIT, BU, etc. I know more about some of those than others, and I'm not sure how reasonable it is to get into an NYU with my background. Schools with decent programs that I've heard of include Georgia State and Florida State, and Boston College. The issue with the latter group, as mentioned, is that I'm not sure if it's worth it to get a degree such as an MFE from a mediocre program.
Your GPA is pretty moderate for a finance major, which weakens your chances for the programs with the best placement rates.
How much debt are you in and how badly do you want to work for a bank?
Even if you do get into these programs, there is the matter of cost. MIT, Princeton, Stanford, CMU all cost in excess of $100K to complete. Even then, they only place about 80% at best into the front office in this shrinking industry. Meanwhile, the interest on that $100K will be on the order of $750/month, and it won't be tax deductable. Assuming you also want to repay that in ten years, your payments will be on the order of $1200/month, on top of whatever debt you may have from undergrad. This debt is not dischargeable in bankruptcy and will follow you for decades- if you manage not to have heart attacks from creditors calling you at 3AM, it can even offset your social security payments.
Net net, you will need to bring home about an extra $2000/month pre-tax or $24K/year to pay for this degree.
So are you sure you want to take on that debt burden to enter a shrinking industry?
If you can get the cost down to that of an extra year of undergrad or two at a state school, it's worth it. Otherwise, I would pass, and enjoy a nice career at an F500 firm. But that's me. I'm conservative.
If you want into a top MFE program, outside of the top ~3-4 programs, it largely comes down to GRE scores and math prereqs. If you can get an 800 on the GRE.Q, somebody will take you. Even really strong programs like Chicago, Columbia, or NYU. But they all cost a lot of money and only have 50% placement rates into trading and banking.
Trust me, you don't want a $60K/year job and a $1200/month student loan to pay back.
Yeah I'd agree that my GPA could be better -- it's sitting at almost exactly 3.6 right now but I'll have to wait until the end of next year to know what I'm graduating with. The math minor brought it down a bit.
I don't think it's unreasonable for me to get close to an 800 on the GRE.Q; I've looked into it considerably and the math sections are nothing I haven't been dealing with for years. Having said that, I wonder if my math prereqs will cut it if I get into a good school: Calc 1-4, linear algebra, higher math/proofs, ODE, and a straight probability course. My plan was to take a few additional courses in summer if I were accepted (a few math classes, and a few programming classes).
I'm not sure if I'm being a bit naive about the cost of the programs; I currently don't have any debt. I'm surprised that you say the industry is shrinking so significantly though, last I read from the BLS is that the need for financial analyst/banking roles is growing at an average or above-average rate, depending on the specific field.
Also: a friend and I were having this discussion recently so I might as well ask it here. Is it beneficial, detrimental, or of no consequence being a native english speaker applying to these types of programs/positions in the US? Is this the type of thing these programs look at/consider?
Check out QuantNet.com as well as the NYU finance blog graphs on finance's share of the market over the past 90 years (ideally while listening to O Fortuna from the Carmina Burana).
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