FINACIAL

How to Become a Financial Analyst

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If you’re thinking of going into finance or have just begun becoming an analyst in finance, there are likely to be many questions regarding how to start your career. You might ask:

  • What can I do to prepare to be a good candidate for the job?
  • Do I require any specific certificates or licenses?
  • What can I do to advance my finance career?

Most importantly, you’ll like to know what steps you can take today to ensure you can land the lucrative field. In this article, we look at the work of financial analysts. We provide advice for those interested in becoming financial analysts looking to build their careers and prepare themselves to become leaders in the current financial market.

What is a Financial Analyst?

Financial analysts perform various vital roles across a range of companies across different industries. The most popular tasks are recommending investments or portfolios for investors looking at financial information, analyzing economic trends, reviewing the financial records, and writing written reports. These tasks are essential to a business’s overall success, especially in the present highly competitive business environment, making financial analysts an integral part of many business teams.

Financial analysts are to influence the direction of an organization’s plans for strategic growth, making the position of a financial analyst among the most crucial classes behind-the-scenes within any business. The daily tasks of the financial analyst could affect the management of risk, economic forecasts, and corporate investments.

Financial Analyst Salary and Job Outlook

Based on the Bureau of Labor Statistics (BLS), financial analysts earn an average of $83,660 a year, with some individuals earning up to $160,000 per year. The significant compensation financial analysts earn made the position one of the most lucrative financial jobs for those starting in 2022.

In addition to the high pay, potential financial analysts may be sure of a promising career outlook. The BLS estimates that over 492,000 financial analysts were working within the U.S. as of 2022. The BLS estimates that around 31,300 new positions for financial analysts will be added in 2030. This is which is an increase of 6 percent. The rapid market growth means that there will soon be a significant demand for skilled job candidates.

How to Become a Financial Analyst

Financial analysts require an individualized education, the ability to master the related skills, and experiences that allow you to surpass customer expectations as you adapt to the constantly changing digital environment. Here are five essential steps to begin your financial analyst career.

1. Learn the necessary abilities.

From analyzing a company’s financial statements to making recommendations for individual investments, Financial analysts perform numerous essential organizational tasks that require specific capabilities.

Some of the essential capabilities for financial analysts are:

  • Interpersonal abilities: Analysts must effectively communicate their message to their clients, managers, and potential investors. Mainly, mastery of corporate communications is crucial for the performance of financial analysts communicating with both external and internal audiences.
  • Analytical capabilities: Financial analysts spend their time analyzing vast quantities of data from businesses to assist their clients in making better decisions. This leads to the requirement to be proficient in data analysis and analytics.
  • Organization: To effectively suggest investments, create reports, and display data to customers, financial analysts must be organized. In conjunction with their communications skills, Financial analysts can best communicate their message if it’s collected and clear.
  • Mathematical abilities: To accurately analyze financial records, Financial analysts need to have high-level knowledge of maths and statistics. These are essential elements of economic analysis since people in this field regularly examine the data and numbers when working with pension funds, banks, and security companies.
  • Technologies: To perform their tasks effectively, financial analysts likely require various digital tools. Software such as Tableau, for instance, is hugely beneficial for helping analysts design graphs and charts that visually display their data while communicating with the project’s stakeholders. Additionally, working knowledge of ERP software (ERPs) is frequently needed since accounting systems aid accountants in linking pertinent data with various departments like inventory and human resources.

2. You can earn a bachelor’s in finance.

There are many methods to build the abilities necessary to succeed in the financial analyst field. A bachelor’s degree earned in an area of study related to finance like the Master of Science in Accounting and Finance Management is a well-known option. It is usually required to get entry-level jobs.

Nine out of ten jobs created in 2018 went to those with university degrees, meaning getting a bachelor’s will significantly increase the chances of being hired as an analyst in any field. People who have an undergraduate degree usually earn more lucrative salaries. In 2022, those with a bachelor’s degree made $19,000 more than those with an associate’s degree. This is about $27,000 more per year compared to those with only high school diplomas or GED on average.

A bachelor’s degree will benefit your career in any field; however, those hoping for a career as a financial analyst discover that a bachelor’s degree is required for most available positions. As per the BLS, it is the case that most employers need financial analysts to possess a bachelor’s degree, specifically in a field related to finance, such as accounting and finance, economics and statistics, analytics business management, and math.

3. Get the appropriate licenses and certificates.

You may require additional certifications or licenses above your bachelor’s degree to be employed in certain companies or specific financial positions. For instance, the Financial Industry Regulatory Authority (FINRA) permit is generally required to market financial products. A business or company may choose to employ only people who are certified financial planners (CFPs) or certified public accountants (CPAs). While these are the most commonly used kinds of certificates held by analysts in the field of finance, they are not all. There are a variety of other certificates that are worth selecting from.

The acquisition of these certifications is an excellent addition to a bachelor’s program, giving you the ability to show your expertise in the crucial aspects that make up the role of a financial analyst. The certifications and licenses you decide to get must align with your professional and personal objectives.

4. Learn from the field.

As with any other competitive market for jobs having the appropriate degree of experience is an essential aspect of standing out from the crowd. Many companies have internal training programs for new analysts. Making the most of the opportunities provided by these programs could be a significant factor in your ability to progress and succeed in the business. Networking and mentoring programs can be extremely helpful.

Furthermore, you will benefit from substantial knowledge by getting an education emphasizing hands-on learning with practical experiences. Experience-based learning programs such as the ones at Northeastern provide professional networking and collaboration with industry experts regularly. The connected network will keep you updated on the latest developments, challenges, and possible solutions in the constantly evolving contemporary financial environment.

5. (Optional) Complete your studies.

Although a bachelor’s degree is usually the minimal requirement for many roles in the field of financial analysis, however, furthering your education and getting a master’s degree can add a new dimension to your professional career. You should consider a master’s degree in accounting or finance to improve your abilities and demonstrate to employers your commitment to this field.

Did You Not Know? Bloomberg reports that around 16 percent of bank managing directors hold Master in Business Administration (MBA) degrees and a chartered financial analyst title.

Breaking Into The World Of Finance

Beginning a job as a finance analyst takes perseverance, commitment, and a specific set of abilities and knowledge, which will enable you to excel in this important job. Think about pursuing a similar master’s degree in finance or accounting at a school like Northeastern and start on the path to an enviable career as an expert in financial analysis today.