What Does a Financial Analyst Do?

Financial analysts gather and interpret financial data, market trends, and forecasting insights to help internal stakeholders make informed business decisions. Their analysis can influence everything from external spending and internal hiring strategies to revenue and top-line planning. These data-intensive roles require strong analytical thinking, business acumen, and clear communication skills.

This guide explores the key responsibilities of a financial analyst, the skills needed for success, and how you can start or advance your career in this field. 

What Is a Financial Analyst?

Financial analysts often work for large corporations, investment firms, or individual clients. They generally conduct risk assessments, evaluate investment portfolios, and make investment and financial recommendations. 

Why Financial Analysts Are Essential

Financial analysts play a key role in business management and planning. Senior analysts often work directly with financial decision makers within a firm, such as company executives, senior leadership teams, or management teams. They are responsible for delivering reports or presentations, while junior financial analysts spend most of their time gathering and analyzing data and insights. 

These roles help with:

• Driving business decisions: Financial analysts provide valuable data-driven insights and analytical reports to allow companies to make informed investment decisions and strategically plan for the future. 
• Investment and risk management: These workers also conduct risk assessments and make investment recommendations to companies and clients. 

Key Responsibilities of a Financial Analyst

While specific financial analyst job duties vary from company to company, there are several key responsibilities that most financial analysts must perform. Let’s explore these responsibilities and include some Udemy courses that can teach you the necessary skills. 

• Financial statement analysis: Financial analysts evaluate company financial statements, including balance sheets, income statements, and cash flow reports and assess performance. Our Financial Statement Analysis course teaches students how to evaluate and interpret financial statements effectively. 
• Forecasting and budgeting: These analysts assist the company with financial planning and budget preparation by predicting future trends and performance. They work closely with business leaders to incorporate strategic priorities and directional changes into spending trends – rolling these insights up into company-wide forecasts that support smarter decision-making. Udemy’s Financial Planning & Forecasting course helps students learn forecasting techniques to improve business strategy. 
• Investment research and valuation: Financial analysts conduct investment research and make buy, sell, or hold recommendations for various assets, including stock, bonds, and commodities. They also determine the value of assets using various techniques, such as comparable company analysis (Comps). Our Investment Analysis & Portfolio Management course covers valuation methods and investment strategies. 
• Risk assessment: They’re responsible for identifying and assessing investment risks, including changes in macroeconomic trends, and developing strategies to mitigate them. Udemy’s Financial Risk Management course teaches risk management techniques for finance professionals. 
• Communicate with stakeholders: Financial analysts are responsible for delivering their findings to business leaders through informative reports and presentations. They are also responsible for working with business leaders to drive findings. Our free Mastering Data Storytelling and Presentations course will teach you how to transform your data into compelling narratives. 

A Day in the Life of a Financial Analyst

Financial analysts work in a number of industries, including investment banks, insurance companies, hedge or mutual funds, securities firms, or private equity groups. Almost any medium to large-sized firm requires a finance team in some capacity. While specifics might vary from role to role, a typical day in the life of a financial analyst includes:

• Researching global or national financial news or relevant shifts in the market
• Reviewing internal financial data and reports
• Responding to emails and priority requests
• Analyzing data sets and updating forecasts
• Building, reviewing, or modifying financial models
• Preparing investment reports, models, and presentations using spreadsheets and financial software
• Presenting findings to stakeholders and making investment recommendations
• Conducting deep analyses
  Performing risk assessments and offering mitigation strategies

Essential Skills and Personality Traits

Let’s take a look at the key skills you should obtain before starting a career as a financial analyst and the top personality traits candidates in this field have. 

Key Skills for Financial Analysts

The key skills a financial analyst should possess include:

• Financial modeling: Financial analysts need to analyze data and create models highlighting key results. Examples include 3-D statements, discounted cash flow reports, and option pricing models. 
• Data analysis: They must be skilled in financial tools, such as Excel, to analyze data, identify trends, forecast performance, evaluate investments, and assess risks. 
• Accounting principles: Financial analysts must have a full understanding of core and regulatory accounting principles, including generally accepted accounting principles (GAAP). 
• Communication and presentation: They need the ability to transform complex data and market insights into easy-to-understand reports, models, and presentations. 
• Critical thinking and attention to detail: Financial analysts must display a high level of attention to detail and use critical thinking skills when gathering and analyzing data, provide accurate recommendations, and predict future performance. 
• Artificial Intelligence and Machine Learning: As data volumes grow, financial analysts are turning to AI and machine learning to handle complex datasets, uncover patterns, and generate predictive insights. Familiarity with AI tools and techniques can help analysts automate repetitive tasks, build more accurate forecasting and risk models, analyze market sentiment using natural language processing (NLP), and identify investment opportunities through algorithmic pattern detection.

Best-Fit Personality Types

The following personality types are best suited to this role:

• Strong analytical thinking attributes
• Detail-oriented
• Curious mindset
• Enjoys working with data and numbers
• Ability to work independently or collaborate with teams
• Adaptability (able to adjust to fast-changing markets or business conditions)

Common Tools Financial Analysts Use

There are several financial tools and software every financial analyst should understand and know how to use efficiently. Listing any of the skills below on your resume can help you stand out from other candidates: 

• Excel and Google Sheets: Advanced formulas, pivot tables, and modeling
• Power BI or Tableau: Data visualization and dashboard creation
• Bloomberg Terminal or Reuters: Market data and financial research
• SQL: Database querying and data manipulation
• Python or R: For more technical or data science-focused roles

How to Become a Financial Analyst

Follow these steps to start or advance your career as a financial analyst.

1.  Learn the Foundations 

A bachelor’s degree in finance, accounting, economics, or a related field can be helpful—but it’s not required. Many successful financial analysts come from different academic backgrounds or transition from other careers. What matters most is your ability to understand financial data, think critically, and solve business problems.

Whether or not you have a degree, you can learn the foundational concepts of financial analysis through flexible, online courses. Platforms like Udemy give you access to courses that cover real-world insights, practical tools, and emerging trends that traditional programs may not discuss. These courses often guide learners through projects that you can add to your portfolio to showcase your skills and expertise to potential employers.

2. Develop Key Skills

To stand out as a financial analyst, focus on developing these in-demand skills:

• Financial modeling: Create spreadsheets and models to forecast outcomes and value investments.
• Data analysis: Use tools like Excel or Python to interpret data and identify trends.
• Accounting principles: Understand concepts like GAAP, revenue recognition, and financial statements.
• Risk management and forecasting: Learn to evaluate uncertainty and make informed predictions.

3. Gain Practical Experience

Many colleges work with local businesses to connect students with viable internships. If your school doesn’t offer these opportunities, you can scour online job boards to find an internship. 

Many begin their careers with entry-level roles. Entry level rotational programs are a great way to gain broad experience across corporate finance functions. These roles and programs provide an overview of what it’s like to be a financial analyst. Several years of experience at the entry level may be necessary before you can move up the ladder. 

4. Build a Portfolio

A well-crafted portfolio allows you to showcase your technical abilities, your strategic thinking, and your commitment to ongoing learning. Whether you’re applying for internships or full-time roles, a portfolio helps you stand out and gives hiring managers confidence in your capabilities.

Here are several high-impact ways to build a compelling financial analyst portfolio:

• Build Mock Financial Models: Choose real or historical companies and build detailed financial models from scratch. Include three-statement models, discounted cash flow (DCF) valuations, or merger & acquisition analyses. Even if you’re not working with live data, demonstrating a deep understanding of modeling logic and assumptions is key.
• Conduct a Public Company Analysis: Pull real financial data from sources like SEC/EDGAR, Yahoo Finance, or your school’s database access. Perform a deep-dive analysis: calculate key financial ratios, assess year-over-year performance, and benchmark the company against competitors. You’ll sharpen your analytical skills while producing impressive work samples.
• Create Forecasts and Valuations: Go beyond historical analysis by making forward-looking projections. Build revenue and expense forecasts based on growth drivers, macroeconomic trends, or industry reports. Use valuation techniques like comparable company analysis or precedent transactions to assess a firm’s worth.
• Publish on a Website or GitHub Repository: Hosting your work in a central location—like a personal website or GitHub portfolio—makes it easy for recruiters or hiring managers to browse your work. Include documentation that explains your assumptions, methodology, and insights. Think of it as a living resume that grows as you do.
• Share Your Insights on LinkedIn: Document your learning journey. Share posts or mini case studies that explain what you learned from each project. This not only builds your personal brand, but also shows that you can communicate complex ideas clearly—a vital skill for any financial analyst. Bonus: it can help you attract recruiters and industry mentors.

By treating your portfolio like a professional showcase, you’re not just telling employers what you can do—you’re showing them.

4. Pursue Professional Certifications

A great way to boost your earning potential and career prospects is to pursue professional certifications, such as Chartered Financial Analyst (CFA) or Financial Modeling & Valuation Analyst (FMVA). Depending on your specific role, you may also need to secure a license with the Financial Industry Regulatory Authority (FINRA). 

5. Take Udemy Courses

If you’re looking for a way to stand out from other candidates, taking Udemy courses can be the ideal solution. Completing financial analysis, valuation, risk assessment, and financial modeling courses from industry experts can highlight your in-depth knowledge and desire to keep your skills up-to-date.

Here are some highly rated Udemy courses to consider:

• The Complete Financial Analyst Course 2024
  Covers Excel, financial modeling, accounting, and valuation—all in one course. Great for beginners or professionals looking for a refresher.
• Accounting & Financial Statement Analysis: Complete Training
  Focuses on understanding and analyzing financial statements, income statements, balance sheets, and cash flow statements.
• Microsoft Excel – Excel from Beginner to Advanced
  Excel is a core tool for financial analysts. This course covers formulas, pivot tables, VLOOKUPs, charts, and financial functions essential to the role.
• Data Analysis and Visualization with Python
  For analysts looking to future-proof their careers, learning Python can open doors to advanced analytics, automation, and AI-driven finance.

You may also be interested in taking courses that will improve your presentation skills, business communication, VBA, or other technical skill sets (such as PowerBI, AWS, Tableau). Here are some Udemy courses that help hone some of these skills:

• Mastering VBA for Excel – Automate Reporting
  Automate repetitive Excel tasks and financial reports using VBA macros.
• Microsoft Power BI
  Build interactive dashboards and bring your data to life with visual storytelling.
• Tableau 2024 A-Z: Hands-On Tableau Training for Data Science
  Learn to visualize and analyze financial data with one of the industry’s most popular BI tools.
• AWS Cloud Practitioner Essentials
  Cloud literacy is becoming more important in finance. This course gives you a strong foundation in AWS and cloud-based data solutions.

By completing one or more of these courses, you can gain practical experience, expand your resume, and demonstrate your initiative to recruiters and hiring managers.

The Job Market for Financial Analysts

The demand for financial analysts remains strong and is expected to grow by 9% over the next decade, which is substantially higher than the national average. 

Several additional factors make becoming a financial analyst a strong career choice, such as: 

• Post-pandemic trends: Even during the pandemic, the need for financial analysts remained in high demand. In fact, the fluctuating market and financial uncertainties during and after the pandemic make the role of a financial analyst even more valuable. 
• Data-focused roles on the rise: As technology makes it easier for businesses to collect vast amounts of data, the demand for those who can analyze and interpret that data grows. For example, there’s an increased demand for analysts who can work with large data sets and tools such as Python and Power BI. 
• Global opportunities: A career as a financial analyst can take you around the world. The health care, tech, investments, government, and energy sectors are always looking for financial analysts from the United States. 

Career Opportunities for Financial Analysts

Financial analysts enjoy a variety of job opportunities across industries, including banking, insurance, manufacturing, and technology. Let’s take a look at some of the top career paths for financial analysts: 

• Corporate finance: Many financial analysts choose a career in the corporate finance sector. These roles often involve budgeting, forecasting, financial reporting and analysis, strategic decision-making, and financial planning for major corporations.
• Investment banking: Working in investment banking requires a strong understanding of various investment opportunities and risk management. Financial analysts review financial records, offer advice on mergers and acquisitions, and provide recommendations on corporate investment and capital-raising opportunities.
• Equity research: Financial analysts working in equity research continuously track and analyze stock, market, and industry trends to provide investment recommendations and identify associated risks.
• Risk management: Risk managers identify potential risks to the company’s operations or financial health and conduct comprehensive risk assessments. These professionals also develop mitigation strategies to minimize the effects of any potential risks.
• Portfolio management: These professionals oversee and evaluate a company’s or client’s investment portfolio. They also provide financial advice and investment recommendations to help clients maximize return, mitigate risk, and reach their financial goals.
• Investor Relations: Analysts in this role act as a bridge between the company and its investors. They help communicate financial performance, manage earnings calls, prepare investor materials, and ensure transparency and confidence in the company’s financial strategy.
• Business Analytics: In this path, financial analysts apply their skills to broader business questions—analyzing sales, operations, and customer data to support strategic decisions, improve efficiency, and identify growth opportunities.

Salary Expectations for Entry-Level Roles

As with most careers, you can expect your potential earnings as a financial analyst to increase as you advance your skills and experience. Earning relevant certifications or specializing in a certain aspect of financial analysis can also increase your earning potential. 

While salaries vary based on industry, location, role, and other factors, the average earnings per job level are:

• Entry-level financial analyst: $60,000–$75,000
• Junior investment analyst: $70,000–$85,000
• Corporate finance associate: $65,000–$80,000

Challenges of Being a Financial Analyst

Becoming a financial analyst can be an extremely rewarding career, especially for those who enjoy working with data and numbers. While the job outlook and earning potential are high for this career, there are some drawbacks, including: 

• Long hours: You can expect to work long hours, especially in the investment banking industry, when there are sudden shifts in the market, during the earnings season, or when meeting strict deadlines. 
• High attention to detail: Accuracy is a must in the financial industry. Even small mistakes can lead to costly decisions for the company. 
• Constant learning: Markets, industries, and technology change rapidly. You must have a desire to stay up-to-date on the latest news and a willingness to learn new technologies and models. The ability to quickly adapt to market changes is essential. 
• Pressure to perform: At first glance, becoming a financial analyst may not seem like a stressful job. The reality is that the company is counting on you to make accurate assessments and recommendations to help grow the business. You also face strict deadlines with quick turnaround times. 

The Future of Financial Analysis: Skills and Technologies to Watch

The financial analyst role is evolving rapidly in response to technological innovation and shifting market demands. While traditional skills like Excel modeling and financial statement analysis remain essential, forward-thinking analysts are embracing new tools and techniques to stay competitive.

Here are some future-proof skills and emerging technologies shaping the future of financial analysis:

• Data Analytics and Visualization: Analysts are increasingly expected to work with large datasets. Proficiency in tools like Python, R, SQL, and Power BI allows analysts to uncover deeper insights and present findings in more engaging, actionable formats.
• Machine Learning and AI: Financial modeling is being augmented by machine learning algorithms that detect patterns and forecast outcomes with greater accuracy. Analysts who understand how to interpret and apply AI-driven insights will be better positioned for strategic roles.
• Automation and Fintech Tools: Automation is streamlining repetitive tasks such as data entry, report generation, and even risk assessment. Familiarity with fintech platforms and robotic process automation (RPA) tools can free up analysts to focus on higher-level thinking and strategic advising.
• Scenario Planning and Predictive Modeling: In uncertain economic climates, scenario analysis and stress testing are increasingly important. Analysts who can build flexible models that account for various future possibilities bring added value to their teams.
• Soft Skills for Strategic Influence: As financial analysts become more embedded in cross-functional teams, strong communication, storytelling, and business acumen are critical. Being able to translate data into strategic decisions is just as important as the technical analysis itself.

Udemy Courses to Help You Become a Financial Analyst

If becoming a financial analyst seems like the right career choice for you, Udemy can help you obtain the skills and knowledge you need to be successful on the job. Our courses can also help you advance your current career. 

Some Udemy courses that can help you become a financial analyst include: 

• The Complete Financial Analyst Course: Covers financial modeling, accounting, Excel skills, and valuation
• Introduction to Financial Modeling: Teaches how to build financial models from scratch
• Business Finance Essentials: Explores budgeting, valuation, and risk management techniques
• Investment Analysis & Portfolio Management: Helps you understand asset allocation and market strategies

Become a Financial Analyst Today

Starting a career as a financial analyst offers strong prospects, high earning potential, and plenty of opportunities for growth and development. Taking the time to develop key skills, expand your experience, and earn industry-recognized certifications can help you build a successful career. Whether you’re just starting out or working to advance your career, Udemy courses allow you to elevate your resume and stand out from other candidates. Ready to start your career as a financial analyst? Find out how our financial analyst courses can help you start or advance your career and grow your earning potential.