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Financial Analyst Career Guide

What is a financial analyst?

A financial analyst helps businesses and individuals make smart investment decisions by understanding financial markets. They look at trends, risks, and opportunities to guide important financial choices. They’re super valuable in any company looking to grow financially.

Duties and responsibilities

As the name suggests, financial analysts mainly do financial analysis. They use software to look at financial data, predict what’s coming, and come up with plans. They do stuff like make financial reports, spot trends, and find good investment chances.

They give advice about the risks and benefits of business decisions. They research what’s happening in the industry, find investment chances, and suggest what to do with money. They also simply explain their findings so that big decision-makers can understand.

Work environment

Financial analysts usually work in offices. They might work for banks, insurance companies, mutual funds, and other places that need deep financial analysis. Sometimes they meet with clients or go to business meetings.

Typical work hours

Financial analysts often work long hours, especially at busy times like end-of-year budgeting. They usually work about 40 hours a week, but this can change based on the job’s needs. The hours can be long, but they often get paid well, which makes up for it. Some jobs in this field let analysts work harder during busy times and relax a bit when it’s quieter.

How to become a financial analyst

Becoming a financial analyst involves several key steps, from education to gaining the right experience and skills.

Step 1: Earn a bachelor’s degree

Start with a bachelor’s degree, ideally in finance, accounting, economics, math, or business. Courses in statistics, calculus, and economics give you an edge. Classes in cost management, analyzing financial statements, and investment management are super helpful.

Step 2: Secure an internship

An internship with a financial institution or a company’s finance department is a great way to apply what you’ve learned. It boosts your analytical skills, helps you make meaningful business connections, and teaches you about financial markets and investments.

Step 3: Gain work experience

After your internship, aim for entry-level jobs in finance or accounting departments, brokerage firms, or investment banks. This experience deepens your industry knowledge and hones practical skills, setting you up for more advanced roles.

Step 4: Consider a master’s degree (optional)

While not required, an MBA or a similar advanced degree can up your game. It expands your understanding of business and finance, potentially leading to higher positions.

Step 5: Get certified

The Chartered Financial Analyst (CFA) certification is a big deal. Offered by the CFA Institute, it involves passing three tough exams on a range of topics, from ethics to portfolio management. It’s a globally recognized achievement.

Step 6: Develop necessary skills

Critical skills for analysts include analytical thinking, financial software proficiency, and strong communication. Skills like economic forecasting, financial modeling, risk assessment, and asset valuation are also vital. Keep honing these skills throughout your career.

Step 7: Stay current

The finance world changes fast. Keep up with market trends and financial news, read industry reports, and attend seminars. Staying informed will help you make better decisions.

How much do financial analysts make?

Compensation for financial analysts varies by experience, industry, education, location, and organization size. The complexity of the financial tasks, analytical expertise, and the presence of additional certifications like the CFA can significantly impact their compensation.

Highest paying industries

  • Securities and Commodity Contracts: $106,130
  • Management of Companies and Enterprises: $92,670
  • Management, Scientific, and Technical Consulting Services: $88,340
  • Data Processing and Hosting: $86,450

Highest paying states

  • New York: $133,130
  • California: $110,120
  • Colorado: $102,230
  • Connecticut: $100,780
  • Oregon: $96,640

Browse financial analyst salary data by market

Types of financial analysts

There are several different paths you can take as a financial analyst, each with its own focus and specialties.

  • Investment analyst: Investment analysts dive into private equity and hedge funds. They use their deep knowledge of financial markets to recommend investments. 
  • Portfolio manager: Portfolio managers handle and invest clients’ money in the stock market. They figure out risks, come up with investment strategies, and explain their choices and how well the investments are doing to clients and others involved.
  • Risk analyst: Risk analysts protect assets by identifying, evaluating, and reducing risks. They monitor current events, how companies are run, and changes in laws to predict potential risks. 
  • Ratings analyst: Ratings analysts assess whether companies or governments can pay back their debts. They look closely at financial trends, income, assets, and debts to give a rating that shows how likely they are to do so. 
  • Securities analyst: Securities analysts focus on stocks, bonds, and other investments. They study these and give advice or trading ideas based on their performance to companies and clients.
  • Quantitative analyst: Quantitative analysts, or “quants,” use advanced math and statistics to understand complicated financial and investment systems. They usually work in investment banking and hedge funds, creating models to figure out prices for securities and coming up with trading strategies.

Top skills for financial analysts

If you’re aiming to be a successful financial analyst, there are specific skills you should focus on developing:

  • Analytical skills: You’ll deal with financial statements, market trends, and investment data often. It’s important to spot patterns, draw conclusions, and base your recommendations on your analysis.
  • Mathematical proficiency: A strong grasp of numbers is essential. You’ll work with numerical data daily, and your calculations and modeling skills are critical to your performance.
  • Attention to detail: Details matter a lot in this job. Small things can hugely impact financial data, so thorough analysis and double-checking are crucial.
  • Communication skills: You’ll need to explain complex financial ideas to people who aren’t finance experts. Being able to clearly communicate your findings and advice is just as important as your analysis.
  • Technical expertise: Knowing how to use financial software and computer systems is a big part of the job. This includes common tools like Excel and specialized software for analyzing and predicting financial trends.
  • Business acumen: Understanding different industries, how businesses work, and strategic thinking will help you give more useful analyses and advice that fits each company’s needs and goals.

Financial analyst career path options

As a financial analyst, there are several directions your career can take as you gain experience and expertise. Here’s a look at some of the paths you might follow:

Senior financial analyst

With more experience, you might become a senior analyst. You’ll oversee newer analysts and tackle more complex analyses in this position. It often involves more responsibility and a deeper involvement in decision-making processes.

Finance manager

After excelling as a senior analyst, you could move up to become a finance manager. This role puts you in charge of the financial well-being of an entire department or organization. You’ll lead a team of analysts and make strategic financial decisions.

Chief financial officer

For those with leadership skills and a strategic vision, the role of CFO could be a goal. The CFO is a top executive position, typically reporting to the CEO. In this role, you’re responsible for managing all of the company’s financial activities.

Academia or consulting

Your career path doesn’t have to stay within the corporate world. Some choose to go into academia, focusing on research and teaching. Another option is to become a financial consultant, where you have more flexibility and the chance to work with various clients. As a consultant, you’ll provide advice to improve business efficiency and growth.

  • Evolving skill set: There’s a growing demand for analysts who can blend classic skills with robust data analysis capabilities. Proficiency in software systems and the ability to derive insights from large data sets are becoming increasingly important.
  • Rise of AI in finance: The use of artificial intelligence in financial analysis is on the rise. Being familiar with AI-driven analysis can be a significant advantage.
  • Global perspective: The globalization of business requires analysts to understand international markets and regulations. The ability to navigate and analyze diverse financial landscapes is more important than ever.

Employment projections

According to the U.S. Bureau of Labor Statistics, the employment of financial analysts is expected to grow by 9 percent through 2031, faster than the average for all occupations. This growth is driven by the increasing variety of financial products and a need for thorough knowledge of geographic regions. Analysts will be crucial for evaluating investment opportunities, particularly as new businesses emerge and existing ones expand.

Financial analyst career tips

Understand financial markets and instruments

Keep up with changes in financial regulations, policy shifts, economic trends, and market behavior. This knowledge allows you to make informed decisions. Develop a strong grasp of financial modeling and calculating financial ratios.

Master relevant tools and software

Excel is fundamental, but also get skilled in other financial software like QuickBooks, SAP, Oracle Financial, and SAS. Familiarity with business intelligence, database management, and financial reporting tools can greatly improve your work efficiency and accuracy.

Create comprehensive, readable reports

Your ability to turn data into clear, understandable reports is crucial. It’s more than just number-crunching; it’s about crafting a narrative from the data and offering strategic recommendations.

Build a professional network

Networking is key for career advancement and professional growth. Connect with peers and experienced professionals to stay on top of industry trends, learn about job opportunities, and gain insights into improving your performance.

  • The Financial Management Association International (FMA)
  • The American Finance Association (AFA)
  • The Professional Risk Managers’ International Association (PRMIA)
  • Global Academy of Finance and Management (GAFM)

Commit to continuous learning

The financial sector constantly evolves, necessitating ongoing education. Stay current with the latest developments in financial products, regulations, and global economic trends.

  • Consider becoming a CFA
  • Pursue an advanced degree in finance or a related field
  • Regularly attend seminars and workshops relevant to finance
  • Read industry blogs, books, and research papers to keep updated with new trends and technologies

Where the financial analyst jobs are

Top employers

  • JP Morgan Chase
  • Goldman Sachs
  • Morgan Stanley
  • Citigroup
  • Bank of America

Top states

  • New York
  • California
  • Texas
  • Illinois
  • Pennsylvania

Top job sites

  • zengig
  • Indeed
  • LinkedIn
  • Monster
  • CareerBuilder


What are the key skills required for a financial analyst?

Key skills include strong analytical abilities, excellent communication skills, and proficiency in financial software. Knowledge in economics, accounting, and statistics is also important. They should also have problem-solving skills and the ability to make well-informed decisions.

What is the typical work environment for a financial analyst?

They typically work in office settings at banks, investment companies, insurance companies, or any business that requires significant financial analysis and decisions. Some work from home, although this is less typical. Their work can involve a significant amount of travel, particularly if clients are in different geographical locations.

What is the role of a financial analyst in decision making?

Their insights provide the basis for managerial actions and decisions. They study financial data, identify business trends, and create financial models to help executives make the best decisions on investments, market growth, and acquisitions.

Are there different types of financial analysts?

Yes, there are several types of financial analysts, including investment analysts, budget analysts, risk analysts, and ratings analysts, among others. Their responsibilities vary, but they all perform some form of financial analysis.

What kind of education is required to become a financial analyst?

Most positions require a bachelor’s degree, typically in finance, economics, accounting, or statistics. An MBA is often desirable and may provide more job opportunities or advancement. Additionally, they may pursue professional certifications such as CFA to gain specialization.

Can a financial analyst work remotely?

While traditionally, they work in an office setting, the rise of technology and data accessibility has made it possible for some to work remotely. However, it can vary depending on the organization and their specific role.

What is the difference between a financial analyst and a financial advisor?

An analyst usually focuses on a specific sector or region to help businesses make informed financial decisions. In contrast, an advisor provides clients with a broad range of finance-related advice, such as wealth management, retirement planning, and estate planning, rather than focusing on investment decisions for businesses.

Is programming a necessary skill for a financial analyst?

While not always required, programming and technical skills are becoming increasingly valuable in the finance industry. Proficiency in programming languages such as Python, SQL, or R can be beneficial for data analysis, automating tasks, and creating financial models.

What are the long-term career prospects for a financial analyst?

With experience, they may progress to positions such as finance manager, portfolio manager, investment banker, or consultant. Some may choose to specialize further in areas of interest or move into related fields such as financial risk management or commercial banking.

Is stress management an important aspect of being a financial analyst?

Yes, they often work under tight deadlines and high-pressure situations. They are expected to provide accurate and timely analyses, which involve crunching numbers and predicting future financial trends. Stress management techniques and the ability to work under pressure are important for success in this profession.

What types of industries employ financial analysts?

Key industries employing analysts include banking, insurance, asset management, real estate, manufacturing, and various levels of government. Nonprofit organizations and consulting firms may also have positions for them.