5 Key Steps & Skills to Becoming a Financial Analyst

Financial analysis is one of the most desirable careers in two highly valuable domains. The job role of a Financial Analyst is associated with the financial sector as well as the domain of data analysis. As a part of a core function of any business, the scope of financial analysis is massive.


So, what is financial analysis? Financial analysis can be defined as the evaluation of transactions, investments, businesses, and projects. These kinds of analyses can involve fetching numerical metrics or simply determining if assets or entities are stable, liquid, and profitable in the future.


Businesses are always on the lookout to cut costs, analyze markets and make decisions based on predictive analytics. This puts financial analysts in high demand. The key role of financial analysts is to use data for evaluating investments, identifying opportunities, and predicting anomalies in order to help with business decisions.


For instance, a company might wish to compare the operational costs of two different types of projects. In this process, various factors such as performance benchmarks, the efficiency of machines, the efficiency of manpower, infrastructural costs, energy costs, etc., will be taken into account. Then the differences in these cost-bearing factors will be calculated. The reason for the additional cost being incurred can then be identified to optimize the project that can be improved.


Financial analysts are also tasked with analysing how well a company is doing financially and forecasting prospects for revenue generation. This is why data-driven financial analysis is extremely crucial. Even traditional finance courses in India have started including modern financial analysis technologies in their modules and syllabuses. 


Finance is a sensitive sector, and professionals working in it are required to be extremely skilled in their respective roles.


How to Become a Financial Analyst

Skills required for a Financial Analyst job role

Financial analysts have the following responsibilities within the organization to carry out internal or external (clients of the organization) evaluations. 


  • Analysing past or current financial data to prepare reports.
  • Identifying trends in reports in order to optimize financial performance.
  • Analysing project or investment performance along with making predictions or projections.
  • Evaluating financial transactions and optimizing costs.
  • Forecasting and preparing financial models.
  • Evaluating depreciation of assets and capital expenditures.
  • Identifying investment opportunities and analyzing them.
  • Preparing profit plans or evaluating third-party business models (For example, if a start-up approaches an investment bank to help them in raising funds).
  • Collaborating with the finance team for reviewing financial information.

Outside of the standard technical skills of the trade, financial analysts must also have various soft skills that will help them excel at their job. 


  • Logical and critical thinking: This skill enables financial analysts to solve problems and help their respective organizations to identify the best investments. Financial analysts also have the responsibility of aiding companies to make financial data-driven decisions such as buying or selling assets. Mathematical thinking is essential for financial analysts.
  • Foundational accounting skills: General accounting skills such as bookkeeping, cost analysis, cash flow management, and the ability to use accounting programs are a few of the essential skills required for financial analysts working for any business. Financial analysis also requires knowledge of accounting principles, mathematical formulas, accounting ratios, and budget calculation. You must also learn how to create financial models based on accounting standards and techniques.
  • Communication and interpersonal skills: Due to the nature of their work, financial analysts must interact a lot with stakeholders, clients, investors, and even representatives of companies that are looking for investment. This is a very sensitive job and thus requires you to have the skills to subtly the navigate corporate world. It is crucial to project the right financial information to others and guide them in regard to how the information can be used. Financial analysts should also have the ability to influence or persuade investors and clients.
  • Technical skills: An aspiring financial analyst, must first learn how to use bookkeeping software and other accounting programs. It also helps to know SQL, SAP, and other technologies. More than anything, you should be open to learning new technologies as companies generally train their financial analysts in the systems and protocols they use. Knowledge about ERP products or experience using ERP software is also a plus. Finally, you must also have excellent presentation skills and the ability to create compact but insightful reports.’
  • Strategic and leadership skills: Financial analysts must have decision-making skills and the ability to approach situations in an analytical manner. Assessing situations logically helps in guiding your coworkers as well. Sometimes, financial analysts might even be given the responsibility to handle the entire finance department or manage a team. Thus, leadership skills are also important.
  • Other organizational skills: Financial analysts must have other skills such as meeting deadlines and the ability to multitask. It is definitely a plus if you are great at time management and if you pay attention to detail. Companies expect financial analysts to be organized and not leave any room for errors.

Steps to become a financial analyst

The sky is the limit for talented financial analysts, and you might soon see yourself heading the finance department of a successful org in the future. If you are wondering how to become a financial analyst in India, you can use the following steps to map out your journey.


Step 1: First, you must finish your bachelor’s degree. It is preferable if this degree is related to Accounts or Finance.

Step 2: Hone your mathematical skills as much as you can and develop logical thinking abilities. Try to develop your communication skills as well during this period.

Step 3: Gain the necessary technical skills through specialized courses for financial analysts or other finance courses in India. Hero Vired’s Certificate Program in Financial Analysis, Valuation & Risk Management can help you learn the necessary skills starting from financial accounting to foundational concepts of modern finance. The course covers banking, investments, regulations, equities, risk management, and trading. You will also learn how to use Excel and VBA (Visual Basic for Applications).

Step 4: Gain a certification. Hero Vired’s program also comes with an industry-acclaimed certification. A good certification makes you stand out among other candidates.

Step 5: Create a portfolio with various projects and sign up for meaningful internships that give you real-world training. Projects such as loan prediction forecasting models, product pricing models, or personal finance management models carry a lot of weightage.

Financial analyst salaries in India

Financial analysts earn handsome salaries in India and across the world. Entry-level financial analysts earn an average salary of INR 4,22,952 annually, while mid-career professionals working with financial analysis make INR 6,04,977 per annum on average (based on 573 salaries).


When it comes to senior financial analysts, the sky is the limit and one can keep earning higher salary packages. On average, senior financial analysts earn INR 6,07,220 annually, but most earn more than INR 10,00,000 per annum. Financial analysts who have more than 10 years of experience earn an average of INR 8,72,444 per annum (based on 138 salaries), while professionals with over 20 years of experience earn INR 13,47,500 annually on average.


The salary outlook also looks promising for future financial analysts, as there has been a steady increase in the salaries of financial analysts over the years. According to U.S. News, 25% of financial analysts in the US earned a median salary of $112,460 in 2020.


A career in financial analysis definitely has a bright future. Financial analysis is also one of the fastest-growing domains in India. If you search for financial analyst jobs on LinkedIn, you will be given over 6000 results. That’s something, isn’t it? 


Check out Hero Vired’s Certificate Program in Financial Analysis, Valuation & Risk Management in order to find out what is financial analysis in a detailed manner, and gain the skills a financial analyst requires to succeed. 






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