The question almost always comes up at the same moment: financial leadership is missing, the search takes time, and someone has to decide whether to fill the role on a fixed term or wait for the permanent hire. The answer hangs on three variables – duration, availability and full cost. Here is the comparison we use ourselves.
A company needs financial leadership and does not have it: the CFO has left, growth has outrun the bookkeeping, an investor demands a robust finance function, or a transaction is coming up. The classic answer is the job advert. It is right – but it solves the problem no earlier than six to nine months from now, once search, notice period and onboarding are added up.
The decision is therefore rarely an either-or, but a question of sequence and time horizon.
Interim CFO: profiles within 24 hours, start usually in one to two weeks. Permanent hire: six to nine months including search, notice period and onboarding. Anyone who leaves the vacancy months out of the calculation is comparing the wrong things.
Interim CFO: day rate EUR 1,400 to 2,500, reference rate EUR 1,800, billed by days worked. Permanent hire: annual gross salary plus around 21 percent employer contributions plus a one-off 25 to 30 percent of an annual salary for the search. At EUR 180,000 gross that is around EUR 218,000 full cost per year, plus roughly EUR 45,000 recruiting in the first year.
Interim: EUR 1,800 × 3 days × 4.33 weeks × 6 months = around EUR 140,000. Permanent: half a year's full cost EUR 109,000 plus recruiting EUR 45,000 = around EUR 154,000 – and the person is most likely not even in the building during those six months. From around nine months the permanent hire becomes cheaper; from a year, clearly so.
Interim: fixed term, defined end, extension or termination at short notice, dependence on one person. Permanent: notice period, a mis-hire costs another six to nine months, but the knowledge stays in the company.
Interim CFOs have usually seen their situation – transaction, migration, turnaround – several times before. A permanent hire is selected for steady-state operation, not for the exceptional situation. Both are right, for different tasks.
… the need is immediate, foreseeably ends or requires specialist experience: covering a vacancy, preparing a funding round or a sale, leading a system migration, carrying a restructuring. Also if the permanent hire is already being sought and the time until then must not stay empty.
… the finance function permanently fills a full-time role, the role can be filled at the available salary, the company can withstand the time to hire and continuity matters more than speed.
… financial leadership is needed permanently, but only one to two days a week. Then neither interim nor full-time fits, but a monthly retainer between EUR 2,500 and 15,000.
… the role is being created and the gap must not stay open until it is filled. The interim CFO bridges, sharpens the profile, helps assess candidates and hands over. In our mandates that is the rule rather than the exception.
Per day yes, over the period usually not. At EUR 1,800 per day, three days a week and six months, the interim CFO costs around EUR 140,000. A permanent hire on EUR 180,000 gross costs around EUR 154,000 in the same half year once employer contributions and one-off recruiting are included. From around nine months the calculation tips in favour of the permanent hire.
When the finance function permanently fills a full-time role, the role can be filled internally and the company can wait six to nine months for the hire. Then it is cheaper long-term and the knowledge stays in-house.
When the need is there now, when it foreseeably ends – vacancy, transaction, migration, crisis – or when a special project needs experience a permanent hire does not bring.
Then the sequence is: interim first, then permanent. The interim CFO bridges the search, sharpens the requirements profile and onboards the successor. That is the most common case in our mandates.
Anyone who needs financial leadership permanently but cannot fill a full-time role is not served by either model. For that there is the external CFO on a monthly retainer, described on the external CFO page.
Only if documentation and handover are part of the brief. With us they belong to the mandate – a fixed-term engagement without handover is the most expensive route.
The service: Interim CFO. The part-time variant is under External CFO, the comparison calculator with your own numbers on the pricing page.
Terms in the glossary: Interim CFO, Fractional CFO and CFO as a Service.
In depth in the articles Interim CFO vs. CFO as a Service vs. permanent hire and What an interim CFO costs in Germany.
Related situation: Covering a CFO departure.
All triggers for an interim CFO engagement at a glance: triggers overview.