With the recent growth of business and financial markets, employers’ interest in qualified individuals to provide financial analysis for their businesses is on the rise. According to Forbes, the growing demand for financial analysts is on track to outpace the demand for professionals in many other careers by 2026. Someone who enjoys math and analytical thinking may be interested in how to become a financial analyst but unsure of what the work entails and what opportunities are available.
What does a financial analyst do?
Financial analysts also called securities analysts and investment analysts — are professionals who collect, monitor, and evaluate information to make forecasts and recommendations relevant to their sectors. Those who become financial analysts are often employed in companies such as:
Banks
Financial planning institutions
Investment advisory firms
Portfolio management providers
Insurance companies
Government regulatory firms
Typical steps for becoming a financial analyst
Earn a bachelor’s degree
Earning a bachelor’s degree is often the most important step a future financial analyst takes toward achieving his or her goals. While general courses in economics, statistics, and other related fields can be relevant to the field of financial analysis, a more targeted degree may be ideal. For example, a Bachelor of Science in Finance can be ideal for individuals who are pursuing a career in financial analysis.
Attain licensing and certifications
Many bachelor’s degree graduates begin their career working in accounting, investment, or banking firms. While additional certifications may not be necessary at the beginning of their work experience, many professionals obtain licenses and designations later in their career.
Any firm or company providing financial products for sale must comply with specific regulations to protect consumers from fraudulent or unfair practices. Some financial analyst positions involve the sale of financial products and based on the state, licensing is a key component of how to become a financial analyst.
The requirements for the Chartered Financial Analyst credential include:
A bachelor’s degree in finance or accounting
A minimum of four years of qualified work experience
Financial analysts may also achieve certification in more specialized areas by demonstrating their expertise and passing additional exams.
Build on-the-job experience
Clearly, it’s important to have both the right education and any needed licensing and certifications to become a financial analyst. Beyond these steps, it’s also important for future financial analysts to get work experience in the financial industry as early as possible and work their way up.
Skills a financial analyst needs
Earning a finance degree and taking the steps to become a financial analyst requires specific abilities and the development of specialized skills. Future financial analysts may have a natural tendency toward analysis and organization, but their studies will help direct and expand these skills.
Finance students and future financial analysts should develop the following important skills:
Critical thinking: making well-reasoned judgments based on logical thought processes
Time management: the ability to use one’s time effectively and productively
Research: the systematic investigation of information to establish facts and draw conclusions
Analysis: the process of examining structures and systems to assess how they may be strengthened
Interpersonal communication: the ability to exchange information and understanding with others.
