Financial Analyst vs. Business Analyst

If you browse analyst job descriptions on LinkedIn or Indeed, you’ll likely come across postings for business and financial analysts. Both professions use data analysis and statistical models to help companies make strategic decisions. However, they have different focuses, skill requirements, and trajectories.

Business analysts use data to help organizations improve their internal, day-to-day operations. By contrast, financial analysts leverage data to support investment decisions and other financial strategies.

This article highlights the key differences between a business analyst vs. financial analyst, including responsibilities, skills, educational background, and typical career paths.

Business and financial analysts work extensively with data, but that’s where the similarities end. The day-to-day responsibilities of these roles differ significantly.

Financial analysts help organizations and individuals decide how to manage their money. They use financial analysis methods and software to assess current events, past financial data, and market trends. The insights they gain from this data allow them to provide informed recommendations about investment strategies, budgeting, and other financial decisions.¹

The typical responsibilities of a financial analyst include:¹

• Analyzing data from various sources, such as financial statements, balance sheets, and cash flow statements
• Managing investment portfolios 
• Creating customized investment strategies 
• Evaluating economic trends
• Translating findings into written reports and data visualizations
• Advising stakeholders about financial decisions

Financial analysts often work for securities and investment firms. Other likely employers include credit unions, insurance carriers, and tech companies.²

Business analysts use data to drive and measure organizational change. They assess business challenges and identify potential solutions. Additionally, they work closely with stakeholders to make data-driven decisions and improve business performance.³

Business analysts have a wide range of responsibilities, including:⁴

• Using data analytics to assess internal operations and processes
• Pinpointing problems and detecting growth opportunities 
• Determining project requirements 
• Developing budgets 
• Managing strategic initiatives
• Communicating insights to stakeholders 

These professionals work for businesses, government agencies, and nonprofit organizations in all industries.³

Finance and business analysts both work with data, but they rely on different skills to accomplish their goals.

As you’d expect, financial analysts need strong financial literacy and analytical skills. These abilities allow them to interpret complex financial data and recommend strategic investments.⁵

This type of analyst must also know how to create financial models to forecast future outcomes. For example, financial analysts may use historical stock market data to build models that predict future returns for different investment strategies. Additionally, a financial analyst performs market analyses to monitor industry and macroeconomic trends.⁶

Business analysts collaborate closely with many stakeholders across different departments, so they require excellent interpersonal skills. Communication skills enable business analysts to understand stakeholder needs and translate them into project requirements. These experts must also create accessible presentations and valuable reports that convey complex business data and insights to non-technical stakeholders.⁷

Problem-solving is another essential ability in this profession. This skill enables business analysts to develop actionable solutions to business challenges. Finally, business analysts need strong organizational and time management skills to complete projects effectively.⁷

There’s no one-size-fits-all approach to becoming a financial or business analyst. You can pursue several paths to enter these fields.

Entry-level positions for financial analysts typically require a bachelor’s degree in business, economics, or finance. To advance to more senior roles, you may need a Master of Science in Finance and Analytics (MFSA) or a similar master’s degree.⁵

Additionally, many financial analysts earn professional certifications to demonstrate their expertise and gain new skills. For example, the CFA Institute offers the Chartered Financial Analyst certification. To obtain this certification, you must pass a three-part exam that tests your knowledge of investment tools, portfolio management, and other topics.⁸

Like financial analyst jobs, business analyst positions generally require a bachelor’s degree in business administration or a related field. However, an MSFA can help you qualify for more advanced positions.

Many business analysts also earn certifications from the International Institute of Business Analysis (IIBA). This professional association provides a range of certifications for entry-level, mid-level, and experienced analysts. Beginning and junior analysts can start with the Entry Certificate in Business Analysis (ECBA), which teaches foundational skills and professional behaviors.⁹

Opportunity for advancement is one of the most important factors to consider when deciding between a career as a financial vs. business analyst.

Financial analysts typically begin their careers as junior analysts. These professionals handle basic analytical tasks, such as developing financial models and creating reports for clients.

As they gain experience, they may advance to more senior positions, working as a fund manager or portfolio manager.¹⁰

Business analysts often start in entry-level positions, such as junior or operational analysts. Senior analysts can pursue many specialized roles, including:¹¹

• Business analysis team leader
• Portfolio manager
• User experience analyst

You may wonder, “Can a business analyst become a financial analyst?” Yes. Individuals can pursue this career path if they have the necessary skills, technical knowledge, and industry expertise.

Are you looking for a financially rewarding career? Financial and business analysts have promising career outlooks and can earn lucrative salaries.

According to the Bureau of Labor Statistics (BLS), the median salary for financial analysts is $99,890. The number of jobs in this field is expected to grow by 9% between 2023 and 2033.¹²

Business analysts earn an average of $99,410 annually, and the BLS predicts that the need for these professionals will increase 11% between 2023 and 2033.¹³

The Leavey School of Business at Santa Clara University offers a flexible Online MS in Finance and Analytics program for professionals who want to advance their careers and support strategic decision-making. This innovative master’s degree program provides comprehensive training in business communications, investments, machine learning, and other in-demand skills. You’ll gain hands-on experience working for a leading company and build relationships with potential employers.

To learn more, explore our admissions requirements and schedule a call with one of our admissions outreach advisors today.