How to Become a Financial Analyst

Financial Analyst Key Stats
Education 3-4 Years
Job Outlook 10.8%

The role of a financial analyst is to determine the risk of various financial ventures, and to advise based on these findings.

To become a financial analyst, you’ll need to have a strong academic background in finance, and also some work experience behind you as well.

If you have a good head for figures, enjoy research, and are looking for a rewarding role in the financial services, then you might like to become a financial analyst.

Working s a financial analyst is one of the most sought after roles in the finance field.

An analyst spends their time reading reports, analyzing data, and completing other financial research.

Based on their findings, they make recommendations to the company they work for, and courses of action to take.

For instance, they could make recommendations to buy or sell a certain stock, or to invest in a new opportunity.

Education Requirements to Become a Financial Analyst

A role as a financial analyst is one that you would take on after some years of experience in the finance industry.

There’s no formal qualification required, but many in this position are qualified accountants, most have a postgraduate degree such as an MBA.

To become a financial analyst, you’ll need to first complete a four year degree in finance, accounting, economics or a similar area.

A bachelor’s degree may land you a role as a junior analyst in a firm; however these positions are quite competitive.

An alternative way to become a financial analyst is to gain a few years of work experience in another part of the finance industry.

For instance, you may work as a banker or an accountant.

You may be able to work as an assistant to someone working as a financial adviser.

After you have some experience, you could move on to a junior financial analyst position.

For a role as a senior financial analyst, you will most likely need to have a postgraduate qualification such as an MBA.

While some choose to complete this degree right away, another option is to start working in a position such as an accountant or banker, and work towards your postgraduate qualifications part-time.

You may wish also to become a CFA, or certified financial analyst.

This can open up many more job opportunities for you.

This involves having an accredited undergraduate degree, and taking two exams to get licensed.

You can find out more about the CFA program at the CFA Institute website.

Financial Analyst Job Description

When you become a financial analyst, you will spend much of your time conducting research into various markets and ventures.

You will use a variety of macroeconomic and microeconomic data to determine a course of action for your employers in regards to particular stocks, investments, and developments.

Here are some of the tasks of a financial analyst:

  • Keep up to date with current financial trends
  • Analyze financial data
  • Analyze past performance of stocks, bonds, and commodities
  • Analyze the performance of property and development
  • Prepare reports
  • Device a course of action

Financial Analyst Salary and Career Path

When you become a financial analyst, you will likely start out as a junior analyst or a research assistant.

With postgraduate qualifications, you can expect to be promoted to the role of senior analyst.

Most financial analysts specialize in a particular field.

For instance, they may be an expert at investments in an emerging market like China or Brazil, or they may specialize in the commodities market or property investment.

There is a lot of opportunity for professional development and promotion within this field.

Some financial analysts go on to become portfolio managers.

Many go on to become financial advisors, some even starting their own consultancy businesses.

The median wage of a financial analyst is $73,000 a year.

The highest 10% of earners make over $140,000 a year.

Some similar roles to that of a financial analyst include:

While the pay for a financial analyst is quite good, this is also a competitive field to enter.

Growth is in this sector is strong; however it may take time, hard work, and education to enter your chosen role.

If you’re interested in financial markets, and want a challenging role with a good salary, then you might like to become a financial analyst.

BLSThe below information is based on the 2021 BLS national averages.

  • Annually
  • Monthly
  • Hourly

National Average Salary

* Salary information based on the May 2021 Occupational Employment Statistics (OES) Survey for Financial and Investment Analysts, Financial Risk Specialists, and Financial Specialists, OCC Code 13-2098, BLS.
* Employment conditions in your area may vary.

Frequently Asked Questions

What does a financial analyst do?

A financial analyst can manage a wide range of different aspects of other people’s money.

For example, some specialists work for insurance companies and banks; their main aim is to ensure that the financial flow is positive no matter what.

Other financial analysts can work for a brokerage firm or independently as investment advisors; in such a case, they would have to manage different clients’ portfolios.

There are also financial analysts that are hired in case a company is buying another one or to determine whether two companies should combine in order to make more money.

All-in-all, financial analysts can have different areas of expertise and their main responsibilities are to evaluate the financial situation in their field and generate the appropriate reports.

How much do financial analysts make?

On average, a financial analyst earns a little over $79.500 per year in the United States.

In case you decide to choose this career path, you can expect to earn anywhere between $48.500 and $129.500 annually.

The salary would certainly depend on your experience, education, and the employer.

Entry-level financial analysts can make around $23.50 per hour; while top-level professionals with plenty of experience earn $62 and more per hour.

In general, the larger the company, the more it is able to pay to its financial analysts.

If you become a specialist in Chicago, your starting salary might be nearly 22% higher than the average across the country.

How much does it cost to become a financial analyst?

You would certainly need to acquire a bachelor’s degree, in order to become a financial analyst.

You can choose finance, economics, accounting, business administration, or statistics.

A year in a university can cost you anywhere between $8.000 and $30.000 depending on a variety of factors (bear in mind that books, supplies, and accommodation are not included in the price).

In some cases, you would need to obtain a license (in case you work on the sell side of the industry); in general, employers sponsor the license.

If you decide to pursue a Chartered Financial Analyst certification, you would have to pay over $450.

What is the demand for financial analysts?

Between 2016 and 2026, the financial analyst market is expected to grow by 10.8%.

The industry is mainly concentrated in Texas, California, and New York.

There is a lot of competition in the industry, even for entry-level positions.

The candidates that have a bachelor’s degree and certification will be able to apply for the highest-paid positions.

How long does it take to become a financial analyst?

You would need 4 years to obtain a bachelor’s degree.

After that, you have to decide what field you want to specialize in (whether that’s a specific region, financial product or industry).

At one point in your career, you might want to pursue a master’s degree (that will take you 1-2 years).

In order to get certified, you would need to have at least 4 years of working experience.

Jamie Willis
Career Specialist at BecomeopediaHi, my name is Jamie Willis, and I have been helping students find their perfect internships and education paths for the last ten years. It is a passion of mine, and there really is nothing better than seeing students of mine succeed with further studies.

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