How Much Is a CPA? Factoring Costs & Salary

Becoming a Certified Public Accountant (CPA) represents a significant achievement in the financial world, signifying a high level of expertise and ethical conduct. This designation is widely recognized, opening doors to diverse career opportunities across various sectors. Attaining the CPA license involves a series of investments, encompassing both substantial financial outlays and considerable time commitments. This article will explore the costs and time involved in pursuing the CPA designation, as well as the potential financial returns.

Educational Investment

Meeting the educational requirements for CPA licensure is the foundational step, typically requiring 150 semester hours of education. This often means completing a bachelor’s degree (120 credits), followed by additional coursework or a master’s degree to reach the 150-hour threshold. Pursuing a master’s degree in accounting (MAcc) or taxation (MST) is a common approach, providing the necessary credits and specialized knowledge.

The financial costs associated with this educational phase can vary significantly based on the type of institution. Tuition at public universities generally ranges from tens of thousands to over one hundred thousand dollars for the full 150 credit hours, while private institutions can cost considerably more. Beyond tuition, students also incur expenses for textbooks and other academic fees.

CPA Exam Expenses

The monetary costs directly related to the CPA Examination begin with application fees to state boards of accountancy, which can range from $20 to $250. Each of the four distinct examination sections also carries a fee, typically ranging from $150 to $265.57 per section. If a candidate needs to retake a section, additional reapplication and section fees apply.

A substantial cost in preparing for the CPA Exam comes from study materials, particularly comprehensive review courses. These courses, available online or sometimes in-person, offer structured content, practice questions, and simulated exams. The cost for a full CPA review course can range from approximately $1,000 to $4,000. This investment in study resources is often considered important for increasing the likelihood of passing the exam.

Licensing and Maintenance Fees

Once the educational and examination requirements are satisfied, there are financial costs involved in obtaining and maintaining a CPA license. Initial CPA license application fees charged by state boards can range from $75 to $250. Some states may also require candidates to pass an ethics exam, which can cost between $150 and $320, depending on the specific state’s requirement and whether it’s the AICPA’s self-study ethics exam.

Maintaining the license involves periodic renewal fees, which are often annual or biennial and can range from $60 to over $300. Furthermore, CPAs must meet Continuing Professional Education (CPE) requirements to keep their knowledge current and their license active. The costs associated with CPE can include fees for seminars, online course subscriptions, and professional organization memberships. These ongoing expenses ensure compliance with regulatory standards.

Time as an Investment

Becoming and maintaining a CPA involves a significant non-monetary investment: time. Completing the 150 semester hours of education typically takes about four to five years, combining a bachelor’s degree with additional credits or a master’s degree.

Preparing for the CPA Exam demands hundreds of hours of dedicated study. The entire exam may require 300-400 hours, with individual sections needing specific time commitments. For instance, the Financial Accounting and Reporting (FAR) section typically necessitates 100-120 hours of study.

Auditing and Attestation (AUD) may require 70-90 hours, and Regulation (REG) about 80-100 hours. The chosen Discipline section generally requires 60-120 hours of study. After licensure, maintaining the CPA designation also requires ongoing time for Continuing Professional Education (CPE) to meet annual or biennial requirements.

Earning Potential of a CPA

The investment in becoming a CPA often translates into a notable financial return through enhanced earning potential. The average salary for a CPA in the United States is around $79,284, with some reports indicating an average closer to $100,000 to $122,000 per year. This is significantly higher than for non-CPA accountants, with CPAs potentially earning 10-15% more on average.

Starting salaries for CPAs can range from $51,000 to $74,000, influenced by location and employer. Entry-level CPAs in public accounting might expect to earn around $55,000 to $65,000, while those in private accounting roles could start at approximately $55,000. Salary typically progresses with experience; mid-career CPAs can earn between $68,000 and $82,000, and those in manager roles may see salaries from $82,000 to $95,000. Senior managers and directors can command $95,000 to $105,000 or more annually.

Factors such as location, industry, firm size, and specialization significantly influence earning potential. CPAs in major metropolitan areas or those working for larger firms, including the Big Four accounting firms, often command higher salaries. Specializations in areas like audit and assurance, tax, or financial reporting can also lead to increased compensation. CPAs working in finance and insurance, for example, tend to earn higher annual salaries.