How to Become a Financial Analyst

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.

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:

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.

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:

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

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.

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:

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

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.

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:

Get tips on job searching:

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.