Financial Analyst Salary:

Although the salary you’ll make as a Financial Analyst will depend on variables like your employer, industry focus, rank, and experience, the average salary for Financial Analysts in 2021 in the U.S. was $96,000. Before committing to a career as a Financial Analyst, it’s important to know the salary range. Depending on the type of financial position you have, your salary may vary significantly. For example, Insurance Underwriters make $76,000 annually, Budget Analysts earn about $80,000 a year, and Financial Managers can expect a salary of $132,000. The more you understand the professional paths and corresponding pay rates available in finance, the more opportunities you’ll have to optimize your salary expectations when you’re on the job hunt.

What is a Financial Analyst?

Financial Analysts study financial data and perform various research tasks to spot investment opportunities and analyze possible outcomes for business decisions. These professionals play an integral role in helping to create more informed investment strategies for their organization or its clients. To do so, Financial Analysts routinely perform tasks for their employer like studying current events and developments in the market, examining financial statements, and creating financial models that can anticipate future performance. They also may study macroeconomic trends or hone in on particular industries or sectors. Financial Analysts rely on their background in math, accounting, research, reporting, communication, critical thinking, and data analytics to perform these tasks.

Because of how valued they are by organizations, Financial Analysts often find employment with large corporations like insurance companies, security firms, investment banks, venture capital firms, or government agencies. They play an integral role in supporting an organization’s budgeting initiatives, as well as writing financial status reports and recommendations. Their process often involves steps such as collecting data, organizing information, performing data analysis on these numbers, providing projections or forecasts, offering recommendations, creating Excel models, presenting their findings to organizational stakeholders, and writing reports or dashboards to convey suggestions. Depending on their professional focus, Financial Analysts do extensive research on their organization’s buy-side and sell-side financial data. They often focus on either credit markets or equity markets.

Read more about what a Financial Analyst does.

What Affects Your Pay as a Financial Analyst

Like any profession, your salary as a Financial Analyst will vary based on several factors. Those with more education, such as graduate-level study or certifications, will likely earn more than those with only a bachelor’s degree. In addition, your physical location, area of specialization, and industry of focus will also dictate your pay rate. Experience working in finance is another contributing factor that can lead to higher pay. The following sections will briefly explore each of these factors: 

Education

There are no formal educational requirements to pursue a career as a Financial Analyst; instead, the qualifications are much less well-defined than other high-paying jobs. Whereas medicine and law require educational minimums, financial analytics educational requirements vary depending on your job duties and employer.

For the most part, a bachelor’s degree is the minimum requirement for employers to consider applicants for Junior Financial Analyst positions. A degree in a field like finance, statistics, or economics is common for these professionals. Some other popular majors are math, accounting, or engineering. Your undergraduate major may also allow you to specialize in a given industry. This is why some people choose to major in fields like biology to pursue a finance career. Many of the largest investment banks pay the highest salaries to new graduates recruited from top-tier universities like Princeton or Harvard. 

Because of how competitive financial analytics is, it’s common for job applicants to not only earn a bachelor’s degree but to pursue an advanced degree as well. In particular, those who completed undergraduate study at a less prestigious school may want to improve their job prospects by continuing their education. This next step may involve completing a master’s in finance or an MBA. Individuals with MBAs can often secure Senior Analyst positions as soon as they graduate. 

In addition to undergraduate and graduate study, some individuals interested in a career as a Financial Analyst may also wish to earn certification. Earning a popular certification, such as the Series 7 or the Chartered Financial Analyst, is an excellent way to showcase your understanding of accounting practices and investment terms, as well as the technical skills necessary to succeed as a Financial Analyst.

Experience

One main contributing factor to your salary as a Financial Analyst is your experience working in this field. Those who just graduated from college with a bachelor’s degree may wish to pursue an internship with an investment bank, volunteer at an investment firm, or explore entry-level positions such as Junior Financial Analyst. The more real-world experience you have working with financial models, budgets, and investments, the more valuable you’ll be to employers. 

Once you’ve accumulated two or so years of experience as a Junior Financial Analyst, you may wish to progress to more senior positions within your organization or explore other job paths at other companies. Typically, Senior Analyst positions are competitive and expect you to have advanced training, such as that provided an MBA or CFA certification. These educational achievements indicate to employers that you have the necessary training and knowledge to help their organization achieve its financial goals. 

After working as a Senior Analyst for several years, you can climb the finance ladder even further and consider more advanced roles. If you’re employed in the securities industry, you may wish to explore a position as a Portfolio Manager or Fund Manager. Your knowledge and expertise may also qualify you for a job as a Chief Financial Officer or Chief Investment Officer, where you will manage a company’s financial activity. 

Industry

The industry in which you’re employed will also be a contributing factor to the salary you will earn. Financial Analysts who work at major corporations will likely make more than those employed by small businesses. In addition, tech firms tend to pay higher salaries than small nonprofit organizations. Although Freelance Financial Analysts can decide on their own pay rates, they typically work closely with small to medium-sized nonprofits or businesses to decide on a pay range. Some of the most common industries that employ Financial Analysts are investment, government, business, banking, and insurance. 

Location

Where you live is another factor that will dictate your pay rate as a Financial Analyst. In 2022, the state that paid Financial Analysts the most was New Mexico, with an average pay rate of $135,000 annually. Alaska, Connecticut, California, and New York were also among the highest-paying locations for Financial Analysts. The lowest pay rates for this profession were in Texas, Georgia, North Dakota, and Massachusetts. Analysts in these locations typically earn less than $82,000 a year.

Although major metropolitan areas like New York City, Seattle, and San Francisco pay Financial Analysts more than other areas, it’s important to remember that the cost of living is much higher in such cities. While pay rates may be tens of thousands of dollars a year higher in these locations than in rural Texas, the cost of rent, food, and entertainment in these locations is also likely much lower. Therefore, when deciding where you’d like to pursue a career as a Financial Analyst, it’s important to consider the cost of living in addition to salary.

Specialization

Both small nonprofits, as well as large investment firms, recognize the value skilled Financial Analysts can bring to their organizations. This means that you have a range of career opportunities available if you’re interested in pursuing a career as a Financial Analyst. You may choose to specialize in a field like treasury, investment banking, financial planning and analysis, equity, or corporate development. You may choose to work at a local firm, a major corporation, or for the U.S. Government. Niche career options are also available, such as those specializing in hedge funds, venture capital, private equity, corporate finance, or commercial banking. Along with more specialized roles often comes higher pay.

Pay Range for Financial Analysts

Pay rates for Financial Analysts remain high across the U.S. In 2021, Financial Analysts made an average base salary of between $74,000 and $77,000. This number varies based on several factors. For example, those with a year or less of experience in financial analytics make $68,000 a year, whereas individuals with a decade or more experience can expect to earn around $87,000. Geographical location also factors into salary rates. Indeed.com notes that Washington, D.C. has the highest salary rates for Financial Analysts at $82,000. Financial Analysts in New York make around $78,000 a year, whereas those in Phoenix or Georgia earn $72,000 annually. 

In addition to physical location and experience, having certain skills and certifications also dictates pay rate. Individuals with a background in strategic planning earn about 87% more than those without this training. Earning the CFA certification leads to 14% higher pay, and having CPA licensure leads to a 10% higher salary.

Highest-Earning Job Titles for Financial Analysts

A job in finance can be a high-paying job for those with a background in analytics and math. The following are some of the jobs in this field with the most competitive salaries, as well as a brief description of what each position entails:

• Hedge Fund Managers perform similar tasks to Investment Bankers. However, they often work with Investors who pool capital for investing and have higher risk and reward portfolios. Their job involves protecting investors by monitoring markets. The average pay for a Hedge Fund Manager is $84,000.

• Insurance Advisors help people with their immediate and long-term insurance needs. They also advise customers on investments, as well as which home and auto insurance policies are most suited to their needs. These professionals make $89,000 annually.

• Financial Software Developers make about $94,000 a year. These individuals develop programs and software for end-users and financial institutions.

• Private Equity Associates earn an average of $92,000 annually. Their job involves networking with investors to acquire private equity. This equity is then applied to business investments to add diversity to investors’ portfolios.

• Chief Compliance Officers oversee various departments and duties pertaining to meeting compliance standards. This may involve performing compliance modeling and policy management to ensure their organization performs efficiently and isn’t burdened with non-compliance fees. These professionals make $115,000 a year.

• Chief Financial Officers earn a competitive salary of $123,000. These individuals perform a wide range of tasks, such as managing financial teams, overseeing budgets, and making financial decisions about technology infrastructure.

Learn the Skills to Become a Financial Analyst at Noble Desktop

Noble Desktop, an educational provider located in New York City, offers a range of classes devoted to financial modeling and analysis. Financial Modeling Bootcamp is a hands-on, 18-hour course that teaches students fundamental financial concepts, such as corporate valuation, accounting, and finance. Participants in this small class create their own discounted cash flow using Microsoft Excel. Over three days, expert instructors also help students develop a comprehensive financial model for an actual company. As a prerequisite to this bootcamp, students should have intermediate Excel proficiency.

Noble also has a Financial Analyst Training Program that provides expert instruction on timely corporate and financial concepts, such as making a full valuation model. Those enrolled in this intensive program receive instruction on fundamental Excel skills, such as using shortcuts and PivotTables. Advanced Excel techniques are also covered in this 30-hour program, like Goal Seek and cash flow projection tools. All learners also receive instruction on creating a three-statement financial model for a public restaurant company.

In addition to the Financial Modeling Bootcamp and Financial Analyst Training Program, Noble Desktop also has in-person and live online financial modeling training courses. The

Excel Bootcamp offers 18 hours of instruction on core business Excel skills like working with VLOOKUP, INDEX, MATCH, and What-If Analysis for Goal Seek. FinTech courses are also available, like Algorithmic Trading with Python, Python for Data Science Bootcamp, and FinTech Bootcamp. This course provides students with hands-on training from expert instructors in FinTech skills like working with Python and SQL for data analysis, creating machine learning models, and working with different data types like integers, floats, and strings. All students have the option of a free course retake for up to one year, as well as one-on-one mentoring.

Key Takeaways

• The average pay rate for a Financial Analyst in the U.S. is between $74,000 and $77,000.
• Salary rates for Financial Analysts depend on factors such as education, experience, industry, location, and specialization.
• Some of the highest-paying jobs in financial analytics are Chief Financial Officers and Chief Compliance Officers.
• You can receive comprehensive training to become a Financial Analyst through an in-person or live online course with Noble Desktop.