Fractional vs Interim vs Full-Time CFO, Which Do You Need?

A fractional CFO, an interim CFO and a full-time CFO all lead the finance function, but each is engaged and paid differently. Choosing between a fractional vs interim vs full-time CFO depends on how much senior finance time you need, for how long and how quickly. 

A fractional CFO works part time, often on a retainer, usually one to three days a week. An interim CFO works full time on a fixed assignment, often three to nine months. A full-time CFO is a permanent employee on your payroll. 

This guide compares the three on cost, commitment, scope and timing. 

Key Takeaways

• Fractional CFO. Part time, one to three days a week, at $175 to $325 per hour. 
• Interim CFO. Full time for three to nine months, at $12,000 to $20,000 per month as a contractor.  
• Full-time CFO. Permanent, on $170,000 to $400,000 base plus bonus, equity and a search fee. 
• Fractional suits growth when you need senior judgment but not a daily leader. 
• Interim suits sudden departure, turnaround or transaction. 
• Full time suits private equity ownership, exit preparation and other permanent complexity. 

Fractional vs Interim vs Full-Time CFO, What Is the Difference?

A fractional CFO is a part-time finance leader on an ongoing retainer, usually one to three days a week. An interim CFO is a full-time finance leader hired for a fixed period, typically three to nine months. A full-time CFO is a permanent employee who runs the finance function and sits on the leadership team. 

Note: Fractional and interim CFOs are usually engaged as contractors. 

How Much Does a Fractional vs Interim vs Full-Time CFO Cost?

A fractional CFO costs $175 to $325 per hour, which comes to roughly $6,000 to $34,000 per month at one to three days a week. An interim CFO costs $12,000 to $20,000 per month as a contractor. A full-time CFO costs $150,000 to $400,000 in base salary, plus bonus, equity and a search fee.

Fractional figures assume about 35 hours a month for each day per week. All figures are planning ranges. Interim rates assume a contractor arrangement. 

* Fractional and interim CFOs rarely carry a separate placement fee. The firm’s margin is usually built into the hourly or monthly rate, though some charge a one-off fixed fee instead. 

Per hour, an interim CFO is the cheaper option. A $16,000 monthly fee for full-time hours works out at under $100 an hour. Fractional support costs less overall at one day a week. At two to three days a week it can match or exceed a full-time interim. 

For a full-time CFO on a $300,000 base salary with a $25,000 signing bonus, a one-off 28% search fee comes to $91,000.  

When Should You Hire a Fractional vs Interim vs Full-Time CFO?

Hire a fractional CFO when you need senior financial judgment but not a full-time leader, often through a period of growth or to prepare for and lead a fundraising exercise. Hire an interim CFO when a CFO leaves suddenly or a turnaround or transaction needs full-time cover. Hire a full-time CFO when the finance workload is permanent and daily. 

How Do You Move from an Interim or Fractional CFO to a Full-Time CFO?

For many businesses, fractional vs interim vs full-time CFO is a sequence rather than a single choice. A fractional CFO supports early growth, an interim CFO covers a departure or transaction and a full-time CFO is hired once the workload is permanent. A permanent CFO search takes an average 10 to 15 weeks, and notice periods add two to four weeks. 

• Moving From a Fractional to a Full-Time CFO 

A business usually outgrows fractional support when the finance team grows, lenders or investors want more frequent reporting or a transaction is planned. The fractional CFO’s hours rise toward full time. Many businesses then ask that CFO to help brief the search.  

• Using an Interim CFO During the Search 

An interim CFO keeps month-end close, cash management and lender reporting on track while the search runs. That removes the pressure to accept the first available candidate.  

Our article on should you hire an interim CFO while you search for a permanent one covers timing, cost and handover.

• Converting an Interim or Fractional CFO to Permanent 

Some businesses hire their interim or fractional CFO permanently because that person already knows the business. The provider charges a one-off conversion fee, usually lower than a full search fee, which is best agreed upfront. 

How Do You Hire a Fractional, Interim or Full-Time CFO?

A full-time CFO is usually hired through a CFO executive search. The search firm uses CFO headhunting to approach finance leaders who are not actively looking. Fractional and interim CFOs are usually placed by CFO recruiters, often within a few weeks. They can also come from fractional CFO consulting firms, which keep a bench of CFOs who work with companies on a fractional basis. Some CFO recruitment firms place all three. 

When comparing CFO executive search firms, ask three questions. 

• Do the CFO headhunters place fractional, interim and permanent CFOs? 

• Do the CFO search firms on your shortlist recruit only finance leaders? 

• What fee basis, conversion fee and guarantee apply? 

Conclusion

Choosing a fractional vs interim vs full-time CFO comes down to the problem your business needs solved. A fractional CFO brings senior judgment to a growing business without a full-time hire. An interim CFO keeps finance under control through a departure, turnaround or transaction. A full-time CFO owns finance permanently once scale and complexity demand it.