Resumes & Cover Letters

10 Skills Financial Analysts Need To Master

March 18, 2021

The required skill set of a financial analyst can range from the ability to use sophisticated accounting software to having good communication and interpersonal skills. Financial analysts may also need a combination of unique skills to their field to perform their job duties as well as generalized skills that can be an essential part of any career path. In this article, we explore the skills a financial analyst should have, how to improve your own financial analyst skills and how to highlight these skills when applying for jobs and attending interviews.

Examples of financial analyst skills

Financial analyst skills can include a combination of hard skills and soft skills. Generally, financial analysts need technology, software and mathematical skills in addition to analytical, problem-solving, communication and interpersonal skills. When hiring a financial analyst for their firm, employers might require the following skill sets:

1. Accounting skills

Accounting skills may encompass the general knowledge you might be required to have to work effectively in finance. General accounting skills may include knowledge of accounting principles, standards and techniques, as well as calculating budgets, cost analysis and reduction, managing cash flow and a general ledger, reconciling bank statements, and basic knowledge of accounting programs and the mathematical formulas involved in these calculations.

2. Interpersonal skills

This skill set refers to a soft skill that can be generalized for most career paths, however, it can prove to be a very crucial aspect of skill development in a financial career. Financial analysts may possess interpersonal skills that aid them when interacting with colleagues and investors, when interpreting nonverbal communication cues and presenting projects as well as collaborating with teammates on analytical tasks.

3. Communication skills

Financial analysts should also possess communication skills, as these skills can directly influence interpersonal skills. Effective communication as a financial analyst can mean being direct when sending emails, leaving phone messages, speaking to an investor about important financial information and utilizing nonverbal communication to navigating professional and working relationships.

4. Problem-solving skills

Financial analysts are also problem-solvers. This can mean solving financial equations effectively or finding solutions to a company's debt problems. Similarly, the outcome of gaining investors for a company may sometimes rely on an analyst's ability to come up with creative solutions to financial issues should they arise.

5. Technical skills

Oftentimes, financial analysts use sophisticated accounting and bookkeeping software, and prior knowledge of programs like Hyperion, SAP, SQL, QuickBooks and other software programs can be highly beneficial when working in this field. Similarly, technical skills can include the ability to learn new software or applications that may be necessary for performing effectively as a financial analyst.

6. Leadership and management skills

Financial analysts may sometimes be in charge of full finance departments or teams, and leadership skills that can be effective to the job may be required by an employer. Effective team communication, professional mentoring and directing collaboration are some of the skills that many managers may possess.

Related: 15 Leadership Qualities That Make a Great Leader

7. Financial literacy skills

Another soft skill essential to a financial analyst is their ability to decipher financial situations, commonly referred to as financial literacy. Knowledge of things like the current investment market, interest rates among lenders and other financial current events can help a financial analyst better perform their duties.

8. Critical-thinking skills

Critical-thinking can relate to problem-solving, and oftentimes, the two skills can be combined. Financial analysts may need to possess excellent critical-thinking skills that ultimately can aid them when finding the best investments for their company, deciding whether to sell an asset or buy new financial software that may help their business keep track of financial records. Essentially, to ensure success in the job, a financial analyst should be able to think through financial questions before making big decisions.

9. Organizational skills

This soft skill can benefit financial analysts as they may be required to keep track of financial records as well as the current processes of a business. Being able to organize records, information, numbers and financial data of an organization can be a critical skill to have.

10. Analytical skills

The ability to forecast, plan, prioritize, rank and recognize financial problems are all qualities of an effective financial analyst. Possessing these skills means that a financial analyst can gauge and solve problems utilizing strategic planning and analysis of financial resources, markets and products to help their company make sound financial decisions.

Read more: Hard Skills vs. Soft Skills

How to improve financial analyst skills

As you move up in your field, you may need to develop and improve your current skill sets as well as build new skills. Follow these steps to help you build your knowledge and develop your financial analyst skills:

1. Identify areas for improvement

You might start developing your financial analyst skills by identifying the area you feel needs improvement. For example, you may feel you need to communicate with supervisors more effectively, or you may want to learn new accounting technology.

2. Set improvement goals

After identifying the area of improvement, set a goal for yourself that can help motivate you toward mastering your skills. For instance, you might set a goal to learn how to use the company's new accounting software by the end of the first quarter so you can print reports from the new program.

3. Use tools and resources

Consider finding and utilizing any tools and resources you might need to reach your improvement goal. For example, in the case of learning a new accounting program, you might read through the user guide or spend a few minutes daily with a colleague who can show you how to navigate the program.

4. Attend professional training

Continuing education can typically be advantageous for advancing and developing in your career. Consider attending training, information courses or professional development programs. If, for instance, you are required to lead a team project in the next month, you might attend leadership training to help you develop the skills it takes to lead a professional team.

5. Implement technology

You might utilize technology resources to help you develop your skills. For example, you could use how-to guides or instructional videos to help you learn how to use the components of new accounting software.

Related: Setting Goals to Improve Your Career

Financial analyst skills in the workplace

When working as a financial analyst, utilize the full potential of your skillset to help increase your achievements, realize success and continue to develop and advance in your career. The following tips can help you continue to develop in your career:

  • Apply your analytical and problem-solving skills by offering your input on projects, budget meetings or preparing financial reports to show potential investors.

  • Stay updated on current news and market trends, as well as changes in finance rates, like interest rates, to contribute information to team brainstorming sessions and decisions on financial topics.

  • Learn to use the most current software or applications for financial record-keeping, stock purchases, current liabilities and other accounting details. Similarly, if your company uses a specific program, you can further develop your knowledge and skill with it.

  • Brush up on your knowledge of financial formulas, such as asset-to-debt ratio and principal cost ratio.

  • Develop your leadership and collaboration skills. Oftentimes, financial analysts may direct a team during projects like finalizing reports and presenting analyses. You can help increase team productivity as well as create a positive atmosphere for collaboration.

Read more: The Best Job Skills to Make Your Resume Stand Out

How to highlight your financial analyst skills

When applying for jobs in the finance industry, it can help to highlight your financial analyst skills on your resume, in your cover letter and during an interview. Consider the following tips to help you make your financial analyst skills stand out:

Financial analyst skills for your resume

Consider the job description and if there are specific required skills mentioned. If there are, use these requirements to help you list your top skills that are relevant and required for the position while also relating these skills to your professional achievements.

Financial analyst skills for your cover letter

In your cover letter, highlight a combination of your hard and soft skills that can benefit the company or business you are applying to. For instance, expertise in the latest accounting software and an ability to persuade investors can help illustrate to potential employers how you can be a beneficial addition to their organization.

Financial analyst skills for the job interview

During an interview, the hiring manager may ask questions that allow them to gauge your financial competency and fit for their company. Consider connecting the skills you discuss to achievements you made individually and as a team member. This can allow the interviewer to get an idea of how you may be an asset to their company.

Read more: 21 Job Interview Tips: How to Make a Great Impression

Types of financial analysts

There are several types of financial analysts. Even though the day-to-day responsibilities of financial analysts may vastly differ, the skills these professionals need are often very similar. Here are four examples of financial analysts and what they do:

Portfolio managers

Portfolio managers supervise and support a team of analysts to select a mix of industries, regions and products that will satisfy their company portfolio. Oftentimes they will explain investment strategies and decisions when meeting with investors.

Fund managers

Fund managers are typically involved exclusively in working with hedge funds or mutual funds. They may be in charge of making buying and selling decisions based on their analysis of quickly changing market conditions.

Rating analysts

Rating analysts evaluate and assess the ability of a company or government entity to pay debts, bonds or loans. They may rate the risk or gain of a company's inability to pay off liabilities.

Risk analysts

Risk analysts assess and evaluate risks associated with investment decisions. They may also help an organization determine the unpredictability of investment choices, including the risk of loss or going into debt.

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