Can Accounting Make You Rich?

Can Accounting Make You Rich? | Accounting Smarts
Charles Hall

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Charles Hall

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June 10, 2022

How much can you make from accounting? Well, that depends. An average 9-to-5 accounting job will pay you more than enough to live a good life - but may not be enough to make you rich.

How much can you make from accounting? Well, that depends. An average 9-to-5 accounting job will pay you more than enough to live a good life - but may not be enough to make you rich. Fortunately for all accountants, there are ways to get rich other than just relying on an income.

You can get rich from accounting, but your main source of income most likely won't come from the ordinary job. It will come from your experience and the gained opportunities this line of work will bring. An accountant knows a lot about money - and that knowledge is how accounting may make you rich.

This article will explore paths you may not have considered in your quest to be rich.

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First, you need to define what rich means to you

Before you figure out whether accounting will make you rich or not, you need to define what being rich is.

  • Is it having a million dollars in physical assets?
  • Is it having a million dollars in the bank?
  • Is it having a million dollars in a retirement account?

These three options are very different from one another in terms of possession and use. Having a million in the bank isn't the same as having it in your retirement account and definitely different than having it in physical assets like land or buildings. The biggest difference between each of these is liquidity. How easy is it to use the money that is yours?

Also, the process for acquiring each of these is much different.

A million dollars in physical assets may mean securing a loan to purchase assets and then over time paying down the debt as the asset increases in value.

A million dollars in the bank may mean consistently saving money over time and continually improving your annual income so you can eventually accumulate one million dollars. It also takes discipline not to spend it along the way.

A million dollars in a retirement account such as a 401K plan may never be achieved due to the limitations on annual contributions. However, there are other supplemental retirement plan or deferred revenue plans for highly compensated individuals that could provide a million dollars in retirement.

You get the picture on how different it can be to get to a million dollars. That said, anyone disciplined enough to save and invest over time can accumulate a million dollars. The only question is will it take 10 years, 20 years or 60 years. Your personality may dictate how quickly you accumulate one million dollars.

Manage your expectations

Now that you know what being rich means to you, you can begin to ponder if you can be rich as an accountant. You definitely can – maybe just not in the way you think.

If you believe you'll get rich working a 9-to-5 accounting job, you should know it is possible, just realize it will take you four or five decades. Are you willing to wait and exercise frugality?

There are other ways to become rich as an accountant, though!

An accounting job may make you rich under certain circumstances

The average yearly salary for an accountant is somewhere between $100,000 and $120,000. That's more than enough for you to live a good life! But as mentioned previously may take several decades to accumulate a million dollars or have the capital to invest in other physical assets.

On the other hand, a best-case scenario for you would be to land one of the best accounting jobs out there. These jobs are highly competitive, sought after, and might be considered cut-throat.

The natural path of an accounting professional in industry is to progress from staff accountant to controller to CFO. A CFO of a large corporation will command a salary $150,000 to $300,000+.

The natural path of an accounting professional in public accounting is to progress from a staff accountant to Partner of an accounting firm. A partner in a large public accounting firm will command $300,000 to over a million dollars a year depending on the market.

Both types of positions will get you rich, but remember they are limited and competitive and often require 7-15 years of lower-level experience to qualify. If you are able to hold up under the demands and rigor of these types of positions there is no doubt your income will be 10 times over what the average accountant makes.

You can also lose this job at any moment! Remember, it's a highly competitive field.

Never fear, you can still manage to become rich with an average accounting job. Why? Because of the experience you'll get from it.

The experience you'll get from the accounting profession may be the key

How can an accountant that doesn't work a cut-throat job get rich? Well, he can do it if he capitalizes on the experience he'll get from the job. Experience is the most important part and is the key that will help you unlock the door that guards being rich!

What does that mean? It's simple. As an accountant, you will deal with multiple businesses throughout your career, you'll get to understand how they work and why they fail. You will also get to know countless important people that will help you down the line.

That's the thing that'll help you get rich. Getting to understand how businesses work from within plus your accountant background.

It'll be the killer combo that'll let you know when to invest in a business, when to put your money out, how to start your own business, and surprisingly open opportunities to investments because of your network of friends. Experience matters more than money!

Accounting experience is the one thing that can help you get rich

Simply put, your accounting experience will allow you to make money work for you. As an accountant, getting rich will not solely rely on a high-paying job.

Instead, you'll have to rely on high-paying opportunities. And the only way to spot them is with the right experience. That's how an accountant gets rich!

Before you can get to that point, you need to work for at least five to ten years. College alone won't cut it. You need to get down and dirty with how multiple businesses work. Learn how they interact, how they make their money, how they survive during crisis mode, and more.

You can get rich - but not how you thought you could

At the end of the day, accounting can make you rich. It'll give you a head start to get there too! But you have to be willing to work for a while before you can start building up your wealth. Otherwise, you're the same as everyone else.

If you want to get rich as an accountant, you have two options: you can look for those cut-throat, high-paying jobs and get paid plenty every year or you can work an average accounting job, get to know multiple businesses, and get enough money and experience to call your own shots!

Charles Hall

Charles Hall

Charles has spent 25 plus years in the world of accounting and business. His experience includes working as a CPA/Auditor international accounting firms. He has worked as a controller and as a COO for small to medium sized companies.

Learn more about Charles Hall