What Is The Difference Between A Financial Analyst And A Financial Manager?
"I have been trying to narrow down what I want to do with my degree. Right now I’m enrolled as a sophomore in college, and I’m studying finance. I have been looking up different jobs, but I keep seeing these two titles used almost interchangeably: “financial manager” and “financial analyst.” Is there even a difference between the two, or are they two different names for the same exact thing? Which one do you think is better, if they are different?"
asked by Cassidy from Helena, MT
There really is no “better” or “worse” when it comes to jobs, it is just down to whatever it is that you want to do with your life. These two titles should not be used interchangeably, since they refer to two different jobs. They are closely related, though, which may be the reason for some of the confusion you are encountering.
Both financial analysts and financial managers are needed in every sector of business. They also may work for nonprofit organizations or government agencies. Some are employed directly by corporations, while others may work for private consulting firms. A financial analyst works for a financial manager. Financial managers are further up on the chain of command.
Essentially, the job responsibilities may strongly overlap, but the financial manager will have the final call when it comes to decision making. Think of a financial analyst a bit like a nurse reporting to a doctor.
Financial managers are responsible for the financial direction of an organization. This may entail making decisions about investments, mergers, acquisitions, expenditures, payroll, and more. Financial analysts help managers to review data on investments, accounting, and other aspects of business so that financial managers may make appropriate decisions.
It is rare for someone to start working as a financial manager without substantial work experience. One way you can get that experience is by working as a financial analyst. You will need a bachelor’s degree in finance or a related field, so you are well on your way to becoming an analyst or a manager. With a master’s degree, you can become more competitive for either position.
Just keep in mind if you are pursuing management, you will probably be starting out as a financial analyst anyway. Look into certification as a Chartered Financial Analyst (CFA). This is the gold industry standard for financial analysts, and therefore ultimately for most financial managers as well.
Once you get out there in the job force and start working as a financial analyst, you will be able to get a better feel for the different positions and responsibilities associated with each. This will help you to decide whether you are interested in moving up the chain of command, or whether you would prefer to remain in a position as a financial analyst. Financial managers can earn higher salaries, but analysts earn high wages as well. There are plenty of opportunities for growth in both roles. Good luck embarking on a career in finance!