Most accountants remain well-paid and in demand, especially professionals holding a CPA license.
There are many career paths within the accounting field, and non-CPA accountants can still obtain gainful employment and attractive salaries.
However, the difference between holding the license and not can determine future opportunities.
For example, non-CPAs can still practice accounting as staff members, including:
- Accounts payable
- Accounts receivable
- Senior accountants
- Staff accountants
Professionals with their licenses can legally move beyond those positions and branch out into their own practices as freelancers or business owners.
Check out this guide to learn more about becoming a freelance CPA.
Understanding the benefits of obtaining a CPA license starts with understanding what a CPA license is.
What Is a CPA License?
A CPA license is a certification bestowed on accounting professionals by their respective states after fulfilling the education requirements and passing the exams.
Licensed accounting professionals have more in-depth knowledge of accounting standards and tax codes. Therefore, professionals command higher salaries, more job opportunities, and the ability to establish their practices.
Clients seek CPAs, while employers seek accountants since CPAs carry a high level of fiduciary duty. The duty mandates that professionals act in the best interests of their clients.
Now, we explore the benefits of obtaining a CPA license.
Several licenses and certifications exist for tax purposes. For example, local governments use general business licenses to keep tabs on how much taxes business owners owe the municipality.
The same goes for other licenses, such as:
- Food preparation
- Home improvement services
- Medical professionals
Simultaneously, the credentials give professionals credibility.
All licenses require education mandates before taking a test. Then, the credentials need continuing education mandates to renew them.
Some individuals can’t wait to finish high school and college, only to learn that they must continue studying for their profession afterward.
However, continuing education has several benefits, such as:
- Staying on top of trends
- Learning about new government regulations for the industry
- Networking with industry professionals
Then, credentialed accountants can market their services to high-net-worth individuals and corporations since the license creates mutually beneficial business relationships.
Clients rest assured that the CPA can handle complicated tax returns and estate planning scenarios.
Plus, the CPA must maximize the client’s financial position thanks to fiduciary duty.
In addition, 50% of test-takers pass the CPA exam at any time. Therefore, those who stick to the script prove that they have what it takes to succeed in the licensed accountant field.
The Bureau of Labor Statistics groups all accountants and auditors in their data. To differentiate between the levels of accountants, the government agency acknowledges that obtaining the proper credentials improves job prospects.
By extension, the license also improves compensation.
The BLS found that the median pay for accountants and auditors hovered at $77.2k annually in 2021. Moreover, the demand for accounting and auditing professionals remains positive, with a 6% growth forecasted through 2031.
Entry-level accountants earn five figures. Then, those who remain in the field and become senior CPAs can expect to net six figures, including those who freelance or own their practice.
The entry-level salary at the Big 4 accounting firms starts at $50k annually. The salary only climbs from there and reaches $135k annually on average for professionals with more experience.
A CPA’s higher pay compensates them for their knowledge, skills, and dedication. Some companies pay their top-earning accountants bonuses, perks, and benefits.
Thus, credentialed professionals can earn a comfortable living in return for their hard work and passion for numbers and regulations.
In 2021, the United States had 1.4M employed accountants and auditors. Although the BLS does not distinguish between CPAs and non-CPAs, the National Association of State Boards of Accountancy estimated that 650k professionals obtained their CPA credentials.
CPAs obtain more opportunities than non-CPAs. Although the possibilities become more niche, they provide better salaries and benefits.
For example, professional athletes, celebrities, high-net-worth individuals, and corporations hire a few staff accountants. But they rely more heavily on credentialed professionals to handle the heavy lifting, such as cross-state taxes and estate planning.
Moreover, credential professionals with solid experience who built a sturdy foundation can branch out.
Licensed accountants can operate solo ventures as solopreneurs, freelancers, independent contractors, and gig workers.
CPAs can also provide their services on retainer for one of two clients.
Keep in mind that professionals can start their careers as entry-level staff accountants. Then, climb the ladder through the employers.
After gaining meaningful experience, start studying for the CPA exam, take some practice tests, and gain pointers from seasoned professionals. Experience is also a great teacher.
Experience also fortifies the education picked up in college. Since the exam has a 50% failure rate, why not go into it prepared with education and experience?
Accounting provides gainful employment and attractive salaries for CPA and non-CPA professionals. However, licensed accountants attract more perks, benefits, opportunities, and wages.