Is becoming a financial analyst right for me?
The first step to choosing a career is to make sure you are actually willing to commit to pursuing the career. You don’t want to waste your time doing something you don’t want to do. If you’re new here, you should read about:
Still unsure if becoming a financial analyst is the right career path? Take the free CareerExplorer career test to find out if this career is right for you. Perhaps you are well-suited to become a financial analyst or another similar career!
Described by our users as being “shockingly accurate”, you might discover careers you haven’t thought of before.
How to become a Financial Analyst
To become a financial analyst, you need a combination of education, skills, and experience. Here are the general steps you can take to pursue a career as a financial analyst:
- Obtain a Bachelor's Degree: Earn a Bachelor's Degree in Finance, Accounting, Economics, or a related field. Coursework in financial analysis, investments, financial accounting, and statistics will provide a strong foundation for your career. Consider pursuing internships or part-time positions in finance-related roles to gain practical experience.
- Develop Strong Analytical Skills: Financial analysts need strong analytical skills to interpret financial data, analyze investment opportunities, and evaluate company performance. Enhance your quantitative and analytical abilities through coursework, independent study, or online resources. Familiarize yourself with financial analysis techniques, valuation methods, and financial modeling.
- Gain Experience: Seek internships or entry-level positions in finance to gain practical experience and exposure to financial analysis. This could include roles in financial institutions, investment firms, corporate finance departments, or consulting firms. This experience will help you understand industry dynamics, develop financial analysis skills, and build a network of professionals in the field.
- Obtain Relevant Certifications: While not mandatory, certifications can enhance your qualifications and credibility as a financial analyst (see below).
- Continue Education (Optional): Pursuing a Master's Degree in Finance or Business Administration can provide advanced knowledge and open up more opportunities for career advancement. Some financial analysts choose to pursue an MBA or a specialized finance degree to gain a competitive edge in the job market.
- Develop Strong Technical Skills: Financial analysts should be proficient in financial software and tools commonly used in the industry. These may include spreadsheet software (e.g., Excel), financial modeling software, data analysis tools (e.g., SQL, Python), and financial research platforms. Familiarize yourself with these tools and stay updated with advancements in financial technology.
- Build a Professional Network: Attend industry events, join professional associations, and connect with finance professionals to expand your network. Networking can provide insights into job opportunities, industry trends, and mentorship opportunities. Participate in finance-focused events, workshops, and seminars to stay updated with industry developments.
- Job Search and Application: Utilize job search platforms, company websites, and professional networks to find financial analyst openings. Tailor your resume and cover letter to highlight relevant skills, education, and experience. Prepare for interviews by researching the company, practicing technical questions, and demonstrating your ability to analyze financial statements and investment opportunities.
The following certifications can provide a competitive edge in the job market, validate your knowledge and skills, and enhance your credibility as a financial analyst. Each certification has its own requirements, including exams, education, and professional experience. Research the specific prerequisites, exam formats, and continuing education requirements for each certification to determine which aligns with your career goals and interests.
- Chartered Financial Analyst (CFA): The CFA designation is highly regarded in the finance industry. It is offered by the CFA Institute and demonstrates expertise in investment analysis, portfolio management, and ethical standards. The CFA program consists of three levels of exams that cover topics such as economics, financial reporting and analysis, equity investments, fixed income, derivatives, and more.
- Certified Financial Planner (CFP): The CFP certification is focused on financial planning and is offered by the Certified Financial Planner Board of Standards. It demonstrates proficiency in areas such as personal financial planning, retirement planning, estate planning, investment management, and tax planning.
- Financial Risk Manager (FRM): The FRM certification is offered by the Global Association of Risk Professionals (GARP) and focuses on risk management. It covers topics such as quantitative analysis, financial markets and products, risk management practices, and risk modeling and valuation.
- Certified Investment Management Analyst (CIMA): The CIMA certification is provided by the Investments & Wealth Institute. It focuses on investment management and covers topics such as portfolio construction, asset allocation, risk management, investment strategies, and ethics.
- Certified Public Accountant (CPA): While primarily associated with accounting, the CPA certification is also valued in the finance industry. It demonstrates expertise in financial reporting, auditing, taxation, and other accounting-related areas. CPAs often work in financial analysis roles, particularly those involving financial statement analysis and financial reporting.
- Financial Modeling and Valuation Analyst (FMVA): Offered by the Corporate Finance Institute (CFI), the FMVA certification focuses on financial modeling, valuation techniques, and Excel skills. It covers topics such as financial statement analysis, discounted cash flow (DCF) analysis, financial modeling, and mergers and acquisitions (M&A) analysis.