The Certified Public Accountant (CPA) certification is one of the popular certifications in the world of finance. With salaries ranging from average to astonishing, CPAs are among the highest-paid professionals in the industry.
CPAs generally excel in accounting, auditing, and taxation but how much money does a CPA typically make.
Now, let’s take a look at the amount of money they make.
What we will cover?
How much money does a CPA make?
- Average Annual Salary for CPAs in the United States:
- Without bonuses: ~$120,000.
- Salary by Experience:
- Less than one year of experience: ~$78,000 annually.
- More than 20 years of experience: ~$150,000 annually.
- Factors Influencing CPA Salary:
- Employee’s experience.
- Size of the company.
- Certification Impact:
-
- CPAs earn 10–15% more than non CPA counterparts.
Here are some average salary ranges for CPAs in different industries:
-
| Sector | Salary Range |
|---|---|
| Public Accounting | $65,000 – $150,000 |
| Corporate Accounting | $70,000 – $160,000 |
| Government | $60,000 – $120,000 |
| Non-Profit | $55,000 – $100,000 |
| Consulting | $80,000 – $200,000 |
The location also significantly affects CPA salaries. Major cities like New York, Los Angeles, and Chicago tend to offer higher wages than smaller cities and rural areas.
Factors Influencing Earning Potential
Education
In the United States, becoming a Certified Public Accountant (CPA) requires a minimum of a bachelor’s degree in accounting or a related field, passing the CPA exam, and meeting other state-specific requirements. However, some employers may prefer a master’s degree in accounting, business administration, or a related field.
Degrees and other academic credentials, such as majors, have a significant impact on CPA salaries. What is a major in the context of academic credentials? Generally, the more related your major is to the role you are applying for, and the higher the level of education, the higher the salary you can expect to earn as a CPA. CPAs with specialized certifications, such as Certified Financial Planner (CFP) or Chartered Financial Analyst (CFA), may also earn higher salaries.
BLS reveals that the median annual wage for all accountants and auditors, including CPAs, with a bachelor’s degree as of May 2021 was $77,250. However, entry-level salaries for new graduates may be lower. CPAs with a master’s degree in accounting or a related field, such as financial analysts, can expect to earn higher salaries at $91,580 annually. CPAs with a Ph.D. in accounting or a related field may have opportunities for higher-level positions in academia, research, or consulting. Based on data from Payscale, the average salary for a CPA with a Ph.D. is around $108,000 per year.
Years of Experience
According to data from the BLS, the average annual salaries for CPAs can be expected based on experience: Entry-level CPAs with 0-2 years of experience earn an average of $60,000 – $70,000. Mid-level CPAs with 3-5 years of experience earn an average of $75,000 – $90,000. Senior-level CPAs with 6 or more years of experience earn an average of $90,000 – $120,000 or more depending on location, industry, and specialization.
| Role | 0-2 years of experience | 3-5 years of experience | 6+ years of experience |
|---|---|---|---|
| Accountant | $61,902 | $70,156 | $77,378 |
| Tax Accountant | $60,870 | $66,029 | $82,279 |
| Senior Tax Accountant | $69,124 | $85,526 | $111,523 |
| Audit Manager | $94,916 | $107,185 | $133,425 |
| Account Receivable Manager | $82,536 | $103,170 | $128,963 |
Job Location
Data from the BLS reveal the District of Columbia, New York, New Jersey, Virginia, and California as the five highest-paying states for CPAs in the U.S.
| State | Annual Mean Wage | Total Employment |
|---|---|---|
| District of Columbia | $103,930 | 10,660 |
| New York | $98,650 | 112,030 |
| New Jersey | $91,960 | 39,820 |
| Virginia | $85,720 | 42,200 |
| California | $83,910 | 148,500 |
| Texas | $81,330 | 116,000 |
| Florida | $70,050 | 73,910 |
| Pennsylvania | $74,730 | 52,150 |
The higher-than-average salaries for CPAs in these areas can be attributed to several factors:
There is a high demand for accounting services due to the state’s large population and strong economic backing, which in turn creates a high demand for accounting services in a range of industries such as finance, technology, healthcare, and real estate.
The cost of living is generally higher in these states, so the CPA average salary by state tends to be higher to annul the higher cost of living. Other factors also influence the CPA average salary by state.
Industries such as finance, entertainment, and technology are concentrated in these states, and CPAs with expertise in these areas can command higher salaries. These CPAs are in demand for their specialized skills.
Many accounting firms may offer higher salaries to attract and retain the best CPAs. Accountants are among the most sought-after workers across industries.
These states tend to have higher requirements for becoming a CPA, such as additional education or experience requirements beyond the standard CPA certification. This can lead to a more highly skilled and specialized workforce, which can command higher salaries.
In conclusion, the amount of money a Certified Public Accountant (CPA) can make varies widely based on factors such as experience, location, industry, and specialization. From entry-level to senior roles, CPAs can earn a range of salaries, from around $60,000 to over $120,000 per year. With their expertise in accounting, auditing, and taxation, CPAs are in high demand and can command competitive salaries. Additionally, many CPAs choose to start their own or take on consulting roles, which can lead to even higher earning potential. Whether just starting or well-established in their careers, CPAs have the potential to earn a comfortable and rewarding income.
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