A day in the life of a financial analyst consists of more than just numbers.
Financial analysts can take on a wide range of roles with differing responsibilities. In fact, becoming a financial analyst is one of the most common paths for anyone who majors in finance. Aside from having many different opportunities, the salary for financial analysts is typically higher than most jobs.
Whether you’re considering becoming a financial analyst or are looking to gain greater knowledge on the occupation, you can find all you need to know about financial analysts below.
What is a financial analyst?
Put simply, financial analysts study and predict future monetary gains or losses for a company. Since all companies need to make money, a financial analyst’s career can be anything from working for an investment firm to working for a tech start-up.
Financial analysts evaluate the current state of a company or financial situation in question, then they generate reports based on that evaluation. Through analyzing past financial data, current business trends, and the state of the business, financial analysts can successfully outline the performance of stocks, bonds, and other types of investments.
Often times a financial analyst is the individual responsible for assessing the risk of the investment. Meaning if a company follows through with a specific investment, they determine how much the company could lose.
Financial analysts can also conduct financial accounting, which is the preparation of statements and transactions inside of a company.
Overall, a financial analyst is responsible for analyzing, then translating all of the finances in a company for the director-level individuals and beyond.
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Financial analyst salary
According to the Bureau of Labor Statistics, the median annual wages for financial analysts in the top industries were as follows in May 2018:
- Securities, commodity contracts, and other financial investments and related activities- $101,410
- Professional, scientific, and technical services- $84,540
- Management of companies and enterprises- $83,640
- Credit intermediation and related activities- $81,420
- Insurance carriers and related activities- $78,870
In summary, financial analysts made a median salary of $85,660, with the highest-paid 25 percent making $114,980 that year and the lowest-paid 25% making $64,390 that year.
How to become a financial analyst
Almost all financial analyst positions require a bachelor’s degree in finance, economics, statistics, or accounting. But there’s more to becoming a financial analyst than just getting your degree.
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Aside from the standard degree, a financial analyst can then become CFA certified.
What is a Chartered Financial Analyst (CFA)?
In order to advance your salary and career as a financial analyst, you should consider getting a CFA. In order to become CFA certified, you must have a bachelor’s degree, four years of work experience, and pass three exams.
Top three skills of a financial analyst
When applying for a job or deciding if you’d like to pursue a career as a financial analyst, it’s good to know the skills you’ll need. As a financial analyst, you, of course, need to be analytical, but you also need to have interpersonal and decision-making skills. Having interpersonal skills is important when dealing with clients and stakeholders of your company. Being decisive is a top skill because at some point after analyzing and predicting outcomes, you must decide whether or not a wise investment is being made.
Do something you love
No matter what you’re doing, you should love doing it. If you love diving into data and providing an analysis on every facet of an investment, then I hope you’re a financial analyst, if not, it might be time to consider becoming one.
If you’re on the hunt for a new job, then you should be memorizing the answers to the most common interview questions to make sure you’re prepared for whatever the recruiter throws at you.