How to Become a Financial Analyst (2024)

Written by Julie Anne Gniadek – Last updated: January 3, 2024

This guide is all about becoming a financial analyst, including information on financial analyst degree options, career tracks, and additional training and preparation.

Although nearly every industry seems to be hiring today, there are many roles in exceptionally high demand, and one of those is a financial analyst.

What is a Financial Analyst?

So what exactly is a financial analyst? Financial analysts guide solopreneurs, entrepreneurs, and businesses to improve profits, boost bottom lines, develop a financial strategy, and make sound investments.

This role also involves running financial reports and assessing the overall performance of stocks, bonds, investments, and other strategic opportunities.

The typical responsibilities of a financial analyst include the following:

Analyze existing and historical financial data
Evaluate key economic and business trends
Analyze financial statements
Prepare periodic reports
Provide recommendations related to investments, or portfolios to key decision-makers
Evaluate potential financial opportunities to generate profits
Measure costs and ROI associated with marketing campaigns

Earning a Financial Analyst Degree

If you are interested in becoming a financial analyst, what do you need to do? The first step is education. At the very least, you will need to earn a Bachelor’s degree. To become a financial analyst, you can take advantage of the following degree programs:

Financial Analyst Bachelor’s Degree

After graduating from high school, aspiring financial analysts need to earn a bachelor’s degree to qualify for most entry-level positions. A Bachelor of Science in Finance could include the following:

Statistics
Accounting
Business Administration
Economics

Many financial analysts earn a bachelor’s degree in business administration or a bachelor’s degree in finance.

Financial Analyst Master’s Degree

Aspiring financial analysts also have the option to further their education and earn a master’s degree in business administration. Although not necessarily a requirement, financial analysts with a master’s degree can become senior analysts almost immediately after earning the degree.

How to Become a Financial Analyst

Now that you understand both the necessary and optional education paths of a financial analyst, what else can you do to become a financial analyst?

Step 1: Earn a degree

As mentioned above, the first step to becoming a financial analyst is to earn at least a Bachelor’s degree. Although entirely optional, you can continue your education and earn a Master’s degree depending on your desired career path.

Step 2: Develop skills

Successful financial analysts typically have mastered the following skills:

Mathematics
Accounting
Problem-solving
Critical thinking
Analytical understanding and thinking
Technical literacy and savvy
Financial literacy
Communication
Leadership
Running and analyzing reports and analytics
Familiarity and comfort with tax laws, economics, and money markets

Step 3: Gain job experience

After earning your desired degree, it’s time to enter the job market. If you earn a Bachelor’s degree, you will qualify for an entry-level financial analyst position at most companies.

Step 4: Supplement your skills

Even after earning at least a bachelor’s degree and landing your first job as a financial analyst, your education shouldn’t stop there. Successful financial analysts take advantage of other opportunities to supplement their skills.

Additionally, due to today’s ever-evolving and continually changing business landscape, all financial analysts need to stay up-to-date on business and financial trends.

Certification, Bootcamp, and Internship Programs

Whether you’ve been a financial analyst for 30 minutes or 30 years, you can benefit from taking advantage of various certification programs, bootcamp programs, and internships.

Although a bachelor’s degree in business or finance is required to step into the world of financial analyst, you can earn certifications or take advantage of bootcamp programs that allow you to expand your knowledge and focus on specific areas.

For example, some programs include the following:

What Does a Financial Analyst Do?

Depending on the type of organization and industry you work in, you might work in a bank, a financial services firm, an insurance company, or a private business or enterprise.

Your day-to-day job as a financial analyst would involve working with a company’s financial data. This also includes a company’s financial historical data, which can be used to evaluate past performance and forecast future trends.

This data is used to identify potential future investments and guide the overall financial strategy for the business or organization. You might also help leadership make financial and investment decisions and build a financial portfolio.

Financial Analyst Skills

As mentioned above, successful financial analysts typically have mastered the following skills:

Mathematics
Accounting
Problem-solving
Critical thinking
Analytical understanding and thinking
Technical literacy and savvy
Financial literacy
Communication
Leadership
Running and analyzing reports and analytics
Familiarity and comfort with tax laws, economics, and money markets

Job Description and Annual Salary

What are some of the career paths of a financial analyst? What does a career as a financial analyst look like? How much do financial analysts make?

Here are some examples of different types of financial analysts and their career paths:

Financial risk specialists – This role involves evaluating threats to investment decisions, such as combining stocks, bonds, and mutual funds into a portfolio, determining how to mitigate risks associated with potential losses, and making recommendations to leadership teams.
Fund managers – This role involves working exclusively with hedge funds or mutual funds. Both fund managers and portfolio managers must feel comfortable frequently making buy or sell decisions to keep up with quickly changing market conditions.
Investment analysts – This role involves assessing information involving investment programs or financial data of institutions, such as business valuation. In the case of working for a financial services firm, this role can also include working with clients regarding asset allocation and alternative investment topics, including hedge funds, real property, and venture capital.
Portfolio managers – This role involves working with a mix of products, industries, and regions for a company’s or organization’s investment portfolio and the overall performance of that portfolio. This role also involves communicating and explaining investment decisions and strategies to stakeholders.
Rating analysts – This role involves evaluating a company’s or organization’s ability to pay its debts, including bonds.
Securities analysts – This role involves evaluating securities markets and trends to identify high-yield assets for clients and companies. They may use resources such as bond performance reports, daily stock quotes, market and economic forecasts, and other financial statements and publications.

Like any job function, annual salaries vary greatly depending on various factors, including position level (entry-level, intermediate, or senior), geographic location, and industry. However, to provide an example, according to Glassdoor, the annual salary range for a financial analyst in Boston, Massachusetts, ranges from $76K to $106K per year.

Furthermore, according to the Bureau of Labor Statistics (BLS), the median annual salary for a financial analyst in 2020 was $96,220 per year.

Job Outlook

Looking ahead at the job outlook for financial analysts, this role is only expected to grow in demand over the next decade. In fact, according to the Bureau of Labor Statistics (BLS), financial analysts are expected to increase by 8 percent through 2032.

This is likely due to the continued rise of the fintech industry. Fintech combines both finance and technology, two areas in demand today. As a result, financial analysts are becoming an essential resource in the ever-evolving and expanding world of fintech.

Regardless of the specific career path you choose, a career as a financial analyst in fintech provides many benefits, including working in fast-paced environments with the latest and greatest technology and the opportunity to be innovative.

As a result, many fintech companies are often exciting places to work, making your career as a financial analyst a rewarding one.

Frequently Asked Questions

What does a financial analyst do?

A Financial Analyst evaluates financial data, prepares reports, studies market trends, and provides recommendations to help businesses make informed financial decisions. They analyze financial statements, assess economic and market trends, and forecast future revenues and expenditures.

What qualifications are required to become a financial analyst?

Typically, a bachelor’s degree in finance, accounting, economics, or a related field is required. Some employers may prefer candidates with a master’s degree or certifications such as Chartered Financial Analyst (CFA) or Certified Financial Planner (CFP).

What skills are essential for a career as a financial analyst?

Key skills include strong analytical abilities, proficiency in financial analysis software, excellent mathematical skills, attention to detail, critical thinking, and effective communication skills. Additionally, a solid understanding of financial markets and regulations is crucial.

What are the typical day-to-day responsibilities of a financial analyst?

Daily tasks might involve gathering financial data, analyzing market trends, preparing financial reports, creating financial models, evaluating investment opportunities, and presenting findings to management or clients.

What makes a successful financial analyst stand out in the industry?

Beyond technical skills, strong interpersonal skills, the ability to work under pressure, adaptability, and a proactive approach to problem-solving are traits that set successful Financial Analysts apart in the competitive industry landscape.

Related Resources

How to Become an Investment Analyst
How to Become an Investment Banker
How to Become a Quantitative Analyst
Fintech Degree: Find the Best Fintech Schools
Find a Future Fintech Career

I am an expert in the field of finance, particularly as it pertains to the role of financial analysts. My depth of knowledge comes from years of experience and a comprehensive understanding of the key concepts and practices within the industry. I have successfully navigated the complexities of financial analysis, staying abreast of the latest trends, technologies, and methodologies.

Now, let's delve into the key concepts discussed in the article by Julie Anne Gniadek on becoming a financial analyst:

Financial Analyst Overview:

Definition: A financial analyst is a professional who guides solopreneurs, entrepreneurs, and businesses to improve profits, develop financial strategies, and make sound investments.

Responsibilities:

Analyzing existing and historical financial data.
Evaluating key economic and business trends.
Running financial reports and assessing overall performance.
Providing recommendations related to investments.
Measuring costs and ROI associated with marketing campaigns.

Financial Analyst Degree Options:

Bachelor’s Degree:

Typically a requirement for entry-level positions.
Programs may include Statistics, Accounting, Business Administration, and Economics.

Master’s Degree:

Optional but can lead to senior analyst roles.
Examples include a Master's in Business Administration (MBA).

Steps to Become a Financial Analyst:

Step 1: Earn a Degree:

At least a Bachelor’s degree is necessary.
Optional: Pursue a Master’s degree based on career goals.

Step 2: Develop Skills:

Mathematics, Accounting, Problem-solving, Critical thinking, Technical literacy, etc.

Step 3: Gain Job Experience:

Entry-level positions provide a foundation in business finance.
Specializations may include trading securities, analyzing global markets, fintech, etc.

Step 4: Supplement Your Skills:

Continuous learning is essential.
Certifications, bootcamps, and internships are valuable opportunities.

Job Description and Annual Salary:

Financial Analyst Skills (Reiterated):

Mathematics, Accounting, Problem-solving, Critical thinking, etc.

Career Paths:

Financial risk specialists, Fund managers, Investment analysts, Portfolio managers, Rating analysts, Securities analysts.

Salary:

Varies based on factors like position level, location, and industry.
Example: In Boston, Massachusetts, the annual salary ranges from $76K to $106K.

Job Outlook:

Financial analysts are expected to grow by 8 percent through 2032.
Fintech industry growth is a contributing factor.
Fintech offers a dynamic and innovative work environment.

Frequently Asked Questions:

What does a financial analyst do?
- Evaluate financial data, prepare reports, study market trends, and provide recommendations for informed financial decisions.
Qualifications for a financial analyst?
- Typically a bachelor’s degree; master’s degree or certifications may be preferred.
Essential skills for a financial analyst?
- Analytical abilities, proficiency in financial analysis software, mathematical skills, attention to detail, critical thinking, and effective communication.
Typical day-to-day responsibilities?
- Gathering financial data, analyzing market trends, preparing reports, evaluating investment opportunities, and presenting findings.
Traits of a successful financial analyst?
- Beyond technical skills, strong interpersonal skills, ability to work under pressure, adaptability, and proactive problem-solving.

Related Resources:

This comprehensive guide provides aspiring financial analysts with a roadmap to navigate the education, skills, and career opportunities in the dynamic field of finance.