by Brian DeChesare Comments (260)

Master’s in Finance Programs: The Best Last-Minute Path into Investment Banking?

Master’s in Finance Programs: The Best Last-Minute Path into Investment Banking?

If you don’t succeed the first time around, should you try and try again?

It depends on your reasons for not succeeding the first time around, but most people ignore that point and jump straight to the “try and try again” part.

And one of the most popular methods for getting a “do-over” is the Master’s in Finance (MSF) program offered at universities around the world.

These programs can be useful if you use them correctly.

But most students don’t understand when they’re helpful, which leads to wasted time and money and big disappointments:

Why a Master’s Degree?

Many students and professionals believe that a Master’s in Finance degree is a magical solution for getting into investment banking.

That explains how we get emails like the following:

“I’ve worked in marketing for two years, and I have a B.A. from a Top 50 university in the U.S. I decided to change my career a year ago, and now I am pursuing a Master’s Degree in Economics at a Top 20 university.

I have no experience in finance, but I am currently taking accounting and finance classes. Which area of investment banking should I apply to?”

I hate to be the bearer of bad news, but a Master’s degree is not a great idea in this case.

But first, let’s define a “Master’s in Finance” degree and explain how it differs from other options like an MBA.

What is a Master’s in Finance Degree?

A Master’s in Finance program is shorter, cheaper, and narrower than a traditional MBA:

  • Length: Usually one year rather than two.
  • Cost: Far less because of the shorter length, though tuition still adds up to tens of thousands of USD, GBP, or EUR.
  • Scope: Covers just accounting and finance; classes are more focused than those in MBA programs. You won’t learn about operations, management, or marketing unless it’s a Master’s degree in Management or another, broader area.

You might apply for this degree right after finishing undergraduate, or you might do it after working for 1-2 years.

Applying after 5-10 years of full-time work would not be useful – go for an MBA or skip the degree altogether.

There are also Master’s degrees in other areas, like Economics or Management, but you’re best off with Finance or the Finance track if you want the types of roles featured on this site (investment banking, private equity, corporate development, etc.).

There are exceptions to the rules above: For example, many top European MBAs last for one year (INSEAD, Bocconi, etc.), and some MSF programs last for two years.

Finally, there are some differences between the U.S. and other countries because 4- or 5-year combined Bachelor’s/Master’s programs are more common in the rest of the world.

What MSF Programs Can and Can’t Do for You

MSF degrees are most useful when you’ve decided on investment banking late in the process, but not too late.

So, you have some finance-related coursework, internships, or full-time work experience, but not enough to get into banking out of university.

Here’s a specific example:

  • Useful: You majored in accounting and became interested in banking in your last year of university. You have no IB-related internships, but you did win a Big 4 full-time offer. You’re planning to work there for 1-2 years and use that experience, plus a Master’s degree, to get into investment banking.
  • Not as Useful: You majored in biology, worked in a lab for 1-2 years, and you’re going to apply to MSF programs to make a career change into banking. You were not interested in banking until you started working full-time and got bored with your job.

In the second case, you’ll have no relevant work experience, which is a big problem since you need a sequence of finance-related internships or full-time roles to get in.

An MSF degree would make sense in the second case only if you could complete finance internships before or during the program.

Here’s another example:

  • Useful: You became interested in banking when you were attending university in China, but it was too late to win real IB internships. However, you did complete a corporate finance internship at a local firm. You’ll apply to Master’s programs in the U.S. or U.K., complete several internships, and move into IB from there (a similar story from a reader).
  • Not as Useful: You completed a technical degree in India and worked as an engineer for 1-2 years. You have no finance experience. Now, you want to make a complete career change and apply to Master’s programs in the U.S. or U.K. and get into investment banking from there.

It’s the same problem as in the first example: It’s a big leap to go from no finance experience to investment banking solely through a degree.

Even if you completed an MBA instead, you would still need a pre-MBA internship in finance or something more relevant to have a good shot.

A Master’s in Finance degree helps you with:

  • Re-Branding – If nothing in your background seems related to finance, the degree will move you closer if you also get work experience.
  • Boosting Your Prestige – If you went to a lesser-known university, you could make up for it by completing a Master’s degree at a top school.
  • Access to Recruiters – If you attend a program that offers on-campus recruiting, you’ll have a much easier time winning interviews.
  • Access to Internships – You’ll also have an easier time winning internships before and during the school year if you contact firms and say you’re an incoming or current MSF student at University X.

But there are also some limitations.

For example, you won’t win IB roles as an Associate from an MSF; banks recruit Analyst-level candidates from these programs.

The usefulness of MSF programs also varies greatly by region.

They’re the most helpful in the U.S. and U.K. because of the sheer number of IB roles and because many banks recruit students from these programs.

But they’re useless in a place like Australia because most banks recruit only top undergrad students with Law and Commerce degrees, and post-graduate recruiting is underdeveloped.

The physical location of the university is also important.

It’s easier to win investment banking roles if you’re close to London, New York, or another financial center than if you’re in a small town with only a few local firms nearby.

Finally, if you’re an international student, you have to look up whether or not the degree qualifies for STEM treatment.

If it does, then you can work in the U.S. for 36 months after graduation (the OPT program) without applying for an H-1B visa, which makes it far easier to win job offers.

You cannot necessarily go by the lists of the “top” programs – you have to make sure anything you pick qualifies as STEM.

For example, the Princeton and Vanderbilt programs both qualify, so they are much better options than programs that do not.

The Best MSF Programs

On that note: I am allergic to rankings, but I’ll link to a few lists here.

In Europe, places like LSE, Imperial, HEC, LBS, Esade, IE, and several others offer the best MSF options (the eFinancialCareers list here is a good starting point).

You can find a partial list of the “top” U.S. programs here.

Note, however, that many schools are not on the list because of terminology differences.

For example, the UVA program is well-regarded, but the school calls it an “M.S. in Commerce” and offers a Finance track within that degree, so, technically, it is not an “M.S. in Finance.”

You’ll see that many of the best schools for MSF programs are not Ivy League universities, but are good state schools (UT Austin, UVA, etc.) and Top 20-30 schools (Vanderbilt, WUSTL, Notre Dame, USC, etc.) instead.

Many of these schools have stronger placements into certain industries than others, so you should always look up or request placement stats from the school before applying.

There’s an example for Villanova here.

How to Apply and Get In

It is extremely competitive at the top schools, which is another reason why these programs do not offer a sure-fire path into IB.

For example, the admissions rate at MIT appears to be ~10%; at Princeton, it’s closer to 5%.

These programs aren’t as competitive as Ph.D. programs with ~1% admission rates, but they’re also far tougher than community colleges with ~80% acceptance rates.

So, your GMAT or GRE scores must be high, your personal essays must be great, and you must have glowing recommendations and interview performances.

It goes back to the point I made in the beginning: Master’s programs are appropriate if you became interested in IB too late to get the required internships, but they aren’t a panacea.

We don’t do admissions consulting here, but a few application tips include:

  • Show That You Can Win Job Offers – These programs, especially the ones with smaller class sizes, care a lot about placement stats, so they’re more likely to admit someone who has front-office (or even middle-office) finance experience than someone who is coming in as a total career changer.

If you haven’t had full-time work experience, play up your internships and finance-related coursework. You need to give the impression that you could have won a front-office finance job if you had applied for one.

  • Show That You’re a Real Human Being – Have at least one solid interest outside of work and academics. It’s the same as responding to the “Walk me through your resume” question, and your interests, or lack thereof, will come across in admissions interviews.
  • Show That You Can Bring Something Unique to the School – For example, some programs are more research-oriented, so if you have published research, emphasize it (even if you have no intention of pursuing a D.).

What to Do When You’re There

Much of the advice in our MBA-level IB recruiting articles applies here as well:

  • Get Internship Experience ASAP – Many of these MSF programs are full-time, so you’ll have to go for part-time, school-year internships. You should try to take time off before the program to complete a “pre-MSF internship” as well, especially if you’re making a big change.
  • And Maintain Reasonably Good Grades – Now you have two sets of grades, and they both have to be reasonably good.

As with MBA programs, the notion that you can “reinvent yourself” in MSF programs is completely false: You have to prepare for recruiting long before you set foot on campus.

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Master’s Programs: The Ultimate Second Chance?

If you use a Master’s in Finance program correctly, you won’t have to try and try again because you’ll win the offer you want the first time around.

But that only works if you’re the right candidate for MSF programs and you approach the entire process correctly.

Get any of that wrong, and you’ll be back in the “try and try again” camp for a long time to come.

M&I - Brian

About the Author

Brian DeChesare is the Founder of Mergers & Inquisitions and Breaking Into Wall Street. In his spare time, he enjoys memorizing obscure Excel functions, editing resumes, obsessing over TV shows, traveling like a drug dealer, and defeating Sauron.

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  1. Hi Brian,

    I am a third-year Bachelor of Business Administration student in studying in Belgium’s top university(not a target university for Finance). I have high grades (Cum Laude, equivalent to 2:1). I have done an Equity Research internship in Egypt’s biggest investment bank and I am currently working as a Private Equity intern in a search fund here in Belgium. over the next summer, I want to improve my chances of being accepted into a top MsF in London. My options for summer are :
    1-a summer course in LSE (Statistical Methods in Risk Management) and an Investment banking internship in the aforementioned bank in Egypt.
    2- a Business Development Internship in a growing tech company in the Netherlands.

    What do you think would serve my purpose more? Do you think me having only a 2:1 grade equivalent could obstruct my chances of being accepted?

  2. Hello Brian,

    Thank you for all of your insights. These articles are incredibly helpful! I was hoping to get some advice as we try to navigate through the current pandemic. I recently was admitted to a Top 5 Master’s of Accounting school, which gives me access to the same On-Campus Recruiting opportunities available to the school’s business school (It is a target school for West Coast, think UCLA/USC). They’ve placed several people in Investment Banking in years past. My own personal work experience has been healthcare, I have a 3.6 GPA and my undergrad is a top ten public school. Im really targeting Middle Market/Industry Specific Boutiques that have a high healthcare focus (Houlihan Lokey, SVB Leerink). I know you said that its imperative to have some type of finance experience going into your Master’s program, but given the current lockdown situation that is not looking very likely. Also, in one of your other articles, you mentioned how Middle Markets can serve as a solid entry point for people who decided on IB last minute. I was wondering if that still holds serve, and if a Master’s program can help someone meet that objective. There is also a very large alumni base to which I could reach out in the IB space, would that be of any benefit before I start the program as well?

  3. Hi Brian,
    Thanks for your articles. They are really insightful. I have a few questions. But first let me describe my situation.

    Am an aerospace engineering graduate. Fair gpa just above 3.0 and graduated May 2019. I have no work/internship experience in finance but it is something I have gained quite an interest for and am very interested in switching career paths. There’s no chance of me doing an MBA at a top school as my work experience is still low. Is an MSc in finance a good step right now? Do I have any shot at investment banking with the finance masters? Would you recommend it?

    I would love to work in M&As or Fixed income trading and my career goal is to work Private Equity or a major hedge fund. Am just in a loop right now as I don’t have many finance professionals to advice me. My peers are all engineers.

    Any advice is welcomed and deeply appreciated.

    Thanks.

    1. Yes, an MSF could potentially be helpful for you, but you will need to gain finance work experience ASAP before/during the degree program. However, given the current environment with a virus outbreak, recession/depression, and frozen hiring everywhere, it may not even be a good idea to try for these roles until things become more normal… if that happens.

  4. Avatar
    Stathis Tourloukis

    Hi Brian,
    I am a third year student studying International and European Studies with many economics lessons like Macro, Micro and Econometrics in Greece. I always had a passion for finance but i only recently decided to pursue it. have no intership experience (Banks here don’t do interships unless its mandatory to finish uni). On track to earn a 3+ GPA.My plan is to apply for a MSF in London business school (cass , ICL etc) and simultaneously apply for Internships there. Do you think it is plausible ?
    Thank you for your time and all the awesome articles that you write!

    1. Yes, assuming the current virus crisis is over by the time you apply. You should focus on gaining internship experience ASAP because it will be difficult to use even a top MSF program to get into finance without at least 1-2 internships first.

  5. Hi Brian,

    I find your posts very useful. Just wanna share with you my situation and look for some recommendations:

    I graduated first honors with an arts degree in HKU. I did a full year volunteer work after graduation and got into big 4 audit the following year. Have been there for 1.5 years and almost done with my CPA exams and taking CFA level 1.

    People around me recommend a few years more in the field and switch career with an MBA. However, I really dislike the nature of auditing and would like to find new opportunities with a MSC finance degree (preferably UK G5/Singapore). My goal is primarily investment management/equity research analyst roles (also consider IB front office roles). I am open to career opportunities in HK/ other countries.

    Do you think it’s a good idea to get a masters in my situation? Would really appreciate if you can give some advice!

    1. If you can get into a top school in the US or UK and enroll quickly, yes. Once you get to the 3-year mark in your current role, though, you might need an MBA to switch into finance.

  6. Hi Brian,

    I have done an undergrad in film and tv, I’m looking to expand my career and in between three pathways. Film financing/investment
    Investment Banking
    Distribution/Sales within the entertainment industry.

    What kind of postgraduate degree could open those doors?
    MSc Finance, Master in Management, or an MBA?

    1. I know nothing about film financing/sales within the entertainment industry, so cannot recommend anything there. For investment banking, it just depends on how much full-time work experience you already have. If < 3 years, MSF is best. If >= 3 years, MBA is more appropriate.

  7. Hi Brian,

    I’m a second year student at Oxford/Cambridge. I was wondering if I should continue on for the integrated undergrad-masters program at Oxford/Cambridge and apply for penultimate IBD internships in London later this year, or if I should finish my undergrad here and go to the US for masters programs (e.g. Stanford MS&E, Princeton/MIT MFin)? The rationale for the latter is that I’d be able to apply for IBD internships in NY, which seems to be a better place to start your career than London. However, the worry is that in the US, BBs/EBs will mostly recruit from undergrads at target schools rather than master’s students. I’ve also checked the careers pages of programs like MIT/Princeton MFin/Stanford MS&E and it doesn’t seem like they place many students into BB/EB IBD in NY. Would really appreciate your advice!

    1. In general, you’re best off starting out in the same location as your university/Master’s program. There is some recruiting at Master’s programs in the U.S., but the problem is that the recruiting process there now starts so far in advance that it’s anyone’s guess whether or not you’ll be able to use it to win internship offers.

      So… you should probably stay in London, do an internship there, and then ask for an internal transfer once you’ve been working full-time for a year or so.

      1. Thanks for the reply! Part of my reasoning for wanting to do a master’s degree in the US is that you can start out as a 1st year analyst in NY and hence qualify for the on-cycle private equity recruitment process. As a 2nd year analyst in NY who transferred from London, would I have a path into MF (KKR, BX, etc) associate programs in NY?

        If there isn’t a path, would the best alternative be to (1) stay in London IBD, recruit for PE in London then try to transfer to the NY office of the PE firm; (2) do an 18-month master’s program in the US and apply for IBD NY internships – if courses start after apps open, perhaps try to recruit before starting courses? Otherwise, is there something I haven’t considered?

        1. The first thing to realize is that even if you are at a top bank, you will probably not make it into one of the mega-funds in NY. Very few Analysts do, and even if they do, most quit fairly quickly because the turnover rate is high at the junior levels (worse hours than IB, pay is not *that* great for the time and stress, rarely a path up the ladder, etc.).

          So, if that is your main motivation, you should probably re-think your goals (similar to how 50% of marriages end in divorce… yes, everyone goes in with the best intentions, but the numbers always trump “best intentions”).

          You can still win offers at these firms by going through the process as a 2nd year analyst and then staying in IB for 3 years.

          You are still probably better off staying in London, recruiting for PE there, and then trying to transfer.

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