How to Become a Financial Analyst

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Updated October 31, 2024

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Financial analysts play an important role in business success. These professionals combine sharp analytical thinking, creative problem-solving, and risk management skills to help companies maximize their financial resources.

The financial analyst career path begins with a bachelor's or master's degree, which may lead to entry-level financial analyst employment. From there, many financial analysts can choose to pursue specialized certifications that open doors to career growth.

This career guide explains how to become a financial analyst in complete detail. Use it to better understand the steps you will need to take to launch and build your career.

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Steps to Financial Analyst Jobs

Most financial analysts start with a bachelor's degree, gain work experience and basic licensing, and then progress toward additional degrees or high-level certifications. A common path is as follows, although yours may be different:

  1. 1

    Earn a Bachelor's Degree

    Aspiring financial analysts typically pursue business-related majors as undergraduates. Relevant subject areas include business administration, economics, and statistical mathematics. Many schools offer bachelor's programs in finance, which make an ideal educational background.
  2. 2

    Build Experience

    Most financial analysts seek professional experience after completing their bachelor's degree programs and then return to school to upgrade their educational credentials. You can also continue straight into graduate education before entering the workforce. Entry-level finance jobs include banking analyst, budget analyst, credit analyst, loan officer, and tax specialist roles, among others. In an entry-level role, you may also start to gain the basic licenses to work in the industry through the Financial Industry Regulatory Authority (FINRA). Your employer may sponsor your FINRA licensing if you need it for your job.
  3. 3

    Consider a Master's Degree or MBA

    Some employers prefer to hire finance professionals with advanced degrees. You can earn a master of science in finance, or a specialized MBA with a finance or investment management concentration. Explore the differences between an MSF and an MBA if you are unsure which to pursue.
  4. 4

    Get Certified

    While optional, financial analyst certification can play a critical role in advancing your career. Employers widely consider the chartered financial analyst (CFA) certification as the gold standard.

Required Education for a Financial Analyst

You will need, at minimum, a bachelor's degree to become a financial analyst. Given the technical and specialized nature of financial analysis, you should major in a directly relevant field.

Finance degrees are ideal, and colleges typically offer them at the bachelor's level and higher. You could also major in:

You can become a financial analyst by pairing a bachelor's degree with multiple years of professional experience in related entry-level roles and certifications. However, a master's degree could accelerate the process.

By pursuing graduate education, you will also deepen your knowledge. Doing so can help you succeed on the challenging exams you must pass to become certified.

While technically optional, a master's or professional degree may also boost your earning power. As of July 2024, Payscale reports that professionals with a bachelor's degree in finance earn an average salary of $74,000 per year. That figure rises to $81,000 with a master of science in finance and to $107,000 with a finance-related MBA.

Required Credentials for Financial Analysts

According to the Bureau of Labor Statistics (BLS), many finance professionals engage in work duties involving the promotion or sale of financial products. You may perform such duties as you work toward becoming a financial analyst, or after you become one.

In such cases, you will likely need to obtain a Series 7 license and register with FINRA. If you do not already hold a license or have registered status, your employer may sponsor your pursuit of these credentials.

To get your license, you must pass FINRA's Series 7 exam. The exam's content assesses your knowledge in four key areas:

  • Standards for seeking business from clients looking to buy or sell financial products
  • Financial profiling of clients and evaluating client investment goals
  • Processes for disclosing risks, keeping records, and making recommendations
  • Technicalities of financial product transaction processes

You can learn more about the test by consulting FINRA's Series 7 exam content outline.

Optional Financial Analyst Certifications and Degrees

The CFA certification carries significant weight among finance professionals. Some employers require it for financial analyst positions, and those that do not may still prefer it.

Payscale data from August 2024 highlights the value of CFA certification. The site lists an average salary of $106,000 per year for professionals who hold the credential.

The CFA Institute issues CFA certifications. To earn yours, you must meet eligibility standards and pass a series of challenging examinations. The CFA Institute issues Level I, Level II, and Level III exams.

After passing the Level I exam, you may proceed to Level II. Upon passing the Level II test, you can become eligible for the Level III exam leading to charter status. Explore the CFA certification process in detail to learn more about how to become a financial analyst.

Required Experience for a Financial Analyst

To complete your CFA certification, you must qualify to become what the CFA Institute calls a "charterholder." Beyond passing all three CFA examination levels, you must also have at least 4,000 hours of qualifying professional experience. You must also obtain this experience in no fewer than three consecutive calendar years.

You do not need to hold any specific job title to earn the necessary experience. However, your work duties must specifically involve one or more of the following:

  • Asset allocation or applied investment knowledge
  • Investment-related legal or regulatory compliance analysis
  • Portfolio or financial risk management
  • Financial or investment modeling
  • Investment or financial management for individuals or business entities

The CFI Institute's experience self-assessment guide offers complete details.

Should I Become a Financial Analyst?

Becoming a financial analyst is challenging. The CFA Institute's certification exams are difficult, and the work experience you must accrue to become a charterholder is highly technical and demanding. Thus, you should not only think about how to become a financial analyst, but whether you want to pursue the path in the first place.

Financial analyst careers offer significant rewards and high levels of job security. Their expertise becomes even more valuable during economic downturns and periods of financial market turbulence.

They also earn high salaries: According to BLS data from May 2023, financial analysts earned a median of nearly $100,000 per year. Financial analysts at the 75th percentile of annual earnings make nearly $130,000 per year, while top earners make more than $175,000.

The BLS also projects strong growth in financial analyst careers from 2023-2033. During that time frame, the BLS projects 9% growth for financial analyst jobs. This equates to 37,900 new positions and more than 30,700 annual openings created by career migration within the profession.

Searching for Financial Analyst Jobs

Qualified financial analysts generally benefit from high demand. Businesses in almost every industry rely on their specialized expertise.

However, landing that all-important first job can pose challenges. You can boost your chances by pursuing internships and practicums as a student, which build hands-on experience while offering excellent networking opportunities. Many business schools also host corporate recruitment programs, and professional organizations like the CFA Institute can also aid your job search.

These four resources can help you find open financial analyst positions:

  • CFA Institute Career Center: The CFA Institute's job board contains a categorized list of vetted and highly relevant career opportunities. However, membership is required for full access to job postings.
  • eFinancialCareers: Operating at the intersection of finance and technology, this job board offers powerful filters that facilitate precision searches. Users can also view profiles of top companies using the site for recruitment.
  • FinanceJobs.net: Launched in 2009, this specialized career search portal brands itself as one of the longest-running online job boards of its kind. In addition to relevant, categorized job listings, the site also offers information on career training and qualifications.
  • FinancialJobBank: This powerful job search tool hosts tens of thousands of job postings for all kinds of finance-related roles. You can use it at any stage of your career development to source relevant opportunities.

Get tips on job searching:

Upward Mobility

Financial analysts already hold high-ranking positions in the finance industry hierarchy. Still, there is room for growth, especially for experienced professionals with advanced degrees.

First, consider the financial manager path. While financial analysts are key contributors, financial managers assume leadership roles in decision-making processes. They earn high pay for their efforts: According to the BLS, financial managers earned a median of $156,100 per year as of May 2023. You can become a financial manager after gaining multiple years of experience in another high-level finance role.

Eventually, you can aspire to C-suite positions. The chief financial officer (CFO) and chief investment officer (CIO) roles are the most directly relevant examples. CFOs and CIOs maintain full executive authority over organizational finance and investment decisions, earning very high pay for their work.

Questions About Financial Analyst Jobs

What are the qualifications for a financial analyst?

A bachelor's degree in accounting, business, economics, finance, or mathematics is the core academic qualification you need. Chartered financial analysts also must have at least 4,000 of advanced professional experience in a financial or investment management role.

You cannot earn CFA certification without a bachelor's degree, and most employers will not consider candidates who lack a relevant college education. While it may not technically be impossible to land a related role through a combination of self-teaching and experience, it is extremely difficult.

The minimum requirements for CFA certification take at least seven years to meet. This includes a bachelor's degree (four years) and 4,000 hours of professional experience accrued in at least three years.

The financial analyst career path poses significant challenges, which begin with your schooling. You must excel at highly technical job duties involving deep, complex forms of financial and investment analysis. You will also need to command elite quantitative reasoning skills and strong problem-solving expertise.

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