Econ vs. Finance as a major

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Hello! I’m currently a sophomore at a large, public, and competitive Texas public high school. I want to do something business related. I’ve been told finance and economics sort of tie in together, and I want to know which one would be the best. I’m a bit hesitant on finance as a major because I’ve heard it’s really competitive (both in the job market and the chances of getting accepted into university), and I’ve also heard that the school you attend is really important in the finance industry. I’ve tried to do my own research, but different websites are saying different things about which is better. What should I do?

Edit: I can post my stats (so far) if anyone needs them for reference.
Edit 2: I’m not too sure about what exact career I want, but I’m sort of leaning towards investment banking or being an economist. I’ve heard that equities are pretty good, but I really have no idea what that is, same with hedge fund managing.

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D25 went through similar conundrum this past year.
Please be assured that you can’t go wrong with either of Finance/Economics major; both offer flexibility to chart your career per your evolving interests.
Yes, in general Finance major tends to be more competitive than Econ in most schools, but it’s not necessary. I’d advice you to first research your target/reach schools based on your expected stats by the end of Junior year. You can then figure out if you’d like to apply as Finance major for direct admit to its business school or economics major. Read about the offerings across different schools and expected career paths for both majors—it’s actually very interesting, and you’d enjoy the process.
Good luck!

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Hi! I’m a senior and I was between this issue too when applying. Finance is definitely tougher with competition and more math-based content – in the business school. Economics is more theory and obviously a social science – varies from school but usually in the liberal arts school.

In terms of figuring out, I suggest taking an economics class as well as a investing/finance class if your school offers that. I personally took investing & personal finance in freshman year, then economics, and then AP microeconomics.

Even though I did economic research too (which I LOVE) I decided to become a finance major because of the career outcomes & wide variety of options (pun unintended). However, even moderately selective state schools are usually harder to get into as a finance major.

It’s usually easier to go in as a finance major and switch to economics rather than the other way around. Something else to consider is that some schools have a special program where you can get a minor in finance or even dual degree as an economics major. ALSO, private schools tend to have economics-data science dual degree paths if that interests you.

I wouldn’t let the competitiveness hold you back for finance, though. Overall, try to explore the content of both majors to the best of your ability and check out the general expectations to get directly admitted into the business school + difficulty to transfer internally into the business school for the colleges you’re considering.

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Finance and Economics can tie together but they are really different. Finance is normally found in the Business School. Finance is a more specific major which focuses on how to manage capital assets for individuals and corporations and focuses especially on risk management, data analytics, investment strategy, and capital allocation. While an Economics major may be found in a Business School, it is really a social science discipline, typically found in the School of Arts & Sciences. Econ focuses on how markets work on both the macro and micro level and how the movement resources through markets have various outcomes. Finance is in many ways a sub section of Economics.

It is not necessary to have a major in Finance to get an entry level job in this field. Often companies will have their own in-house training programs to get you started. While the school you attend can be important in the Finance industry, this is typically more important with regard to where you get your MBA rather than where you get your undergraduate degree. The typical career path is to work in the field for a few years and the go back to school for your MBA.

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Economics and finance are different majors. Economics is a liberal arts course of study and gets very theoretical at the upper levels. In contrast, if a student attends an undergraduate business school he/she will take a business core with introductory classes in subjects such as accounting, finance, IT, marketing, etc. and then will major in one of those disciplines. One path is not better than the other, but they are different. I would suggest the student look at the required coursework (can be found online) for both an undergrad b-school and an economics major and see if one path is preferable.

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Some great universities don’t even have undergraduate business programs. Often the students hoping to go into finance pursue economics, or majors like math, statistics,physics… you’ve got a few years to figure this out. Just take the most rigorous classes you can as a HS student, figure out what you enjoy, and talk to many people in the field.

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As an opinion, economics with mathematics, in some combination of majors or minors, represents excellent preparation for a career in finance, and may offer you more post-graduation options than a finance major alone.

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If available, you can at college’s career outcomes for both paths.

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“I’ve also heard that the school you attend is really important in the finance industry”

Depends on what you plan to do with it. Outside of specific banking roles, I would disagree.

Finance can be solid most anywhere.

But I would focus on curriculum and find the major aligned to your interests. I wouldn’t major in something not suited to your desires.

Both will place fine assuming a solid job market.

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If you do decide that economics represents the right path for you, then you may want to give preference to colleges with economics programs with available courses in finance, such as in accounting, corporate finance, international finance, financial economics and financial econometrics.

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Often, these are colleges without business majors, but offer economics as a substitute for a business major by including more business-adjacent course offerings.

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So taking a quick step back, as a HS sophomore you don’t really have to be trying to decide this now, indeed you should be open to the possibility that years from now when actually choosing a major, your interests and abilities may have evolved in very unanticipated directions.

In terms of your question, Economics is a very broad social science that can be taken in many different directions. Finance itself then can be separated broadly into Financial Economics, which is definitely a subfield within Economics (and in turn has its own subbranches), and what you might call Financial Analysis (also sometimes known as “traditional Finance”), which is more about some specific applications. Financial Analysis then can be focused on different types of entities–corporations, individuals (including investors), institutions (including banks), and so on. It is Financial Analysis applied to corporations, aka Corporate Finance, which is most obviously “business related”, but Financial Analysts of some sort are working all over the place. Then layered on top of all of this is the degree to which your job involves certain mathenatical/quantitative/computational techniques.

My point again is which, if any, of this you actually like the most and have the most aptitude for is basically impossible to determine as a HS sophomore. And that’s OK. For now, you can focus on building your mathematical, communication, and critical thinking skills.

Then eventually, you can make sure to apply to colleges that have all of the sorts of programs you might want to consider (although of course many people continue their education in one way or another after undergrad, so you don’t necessarily need everything to be available as an undergrad option). As another poster mentioned, sometimes it will make sense to apply for one sort of program for first-year entry just because it is easier to transfer out than in.

Again, bottom line is I would urge you not to think of this as a decision at a point in time, but as a process that will be unfolding over many years, indeed likely well after you have completed your education and are making career decisions. And you can’t know what that will all look like now, but you can keep focused on basic, foundational things, while keeping open your options.

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Whether finance or economics is a better course of study depends upon the individual’s interests and goals.

Finance and accounting tie in together better than do finance and economics.

As recommended by another poster in this thread, you should examine the courses required and offered by any particular college/university in each major to see which course of study better aligns with your interests.

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OP- start your college career now by engaging in research.

No, not just reading course catalogues. Read actual articles about stuff going on in the world. If you read an article about a study showing that increasing the minimum wage in a particular state meant that poverty INCREASED (more people eligible for food stamps, more people applying for unemployment) and you think “Wow, that’s so interesting”- hey, that’s something that economists study. Or if you read about a team of people trying to trace the assets of a country’s president who has been stealing from his own treasury and think “Wow, that’s so interesting”-- that’s something accountants do (specifically forensic accountants- a highly specialized sub-field of accounting). Or you read an Op-Ed in the Wall Street Journal that discusses the trade deficit with China- econ. Or a review of the issues that airlines have paying taxes in every place that an aircraft takes off or lands-- plus taxes on the liquor served on board, payroll taxes for pilots who live all over the place even if their “home” airport is Atlanta-- that’s Accounting.

The New Yorker, FT, WSJ, Bloomberg, Forbes-- start reading, reading and reading. You’ll begin to figure out what really excites you. And it will help your vocabulary (always nice), and give you a head start on college- when you have a question, don’t rely on strangers on the internet for help- do your own research!

Good luck. I attended a panel not long ago on Health economics-- the professors were economists and experts in public health-- and it was FASCINATING. Kinda wish I could go back to school to study economics with an emphasis on healthcare. I took more accounting than econ in my MBA program, and now, 40 years later, I wish it had been the reverse!!!

It will sort itself out once you begin to read!

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I spent my entire career working in finance - i-banking, private equity, corporate - and every econ class I took, both as an undergraduate and at b-school - was simply painful. Just not how my brain works! The big ideas interest me, but just too theoretical…

I wouldn’t pick based on selectivity.These are pretty different fields, albeit related. One is very much applied, the other theoretical. Both can probably get you where you want to go.

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