Between tax compliance, payroll, investment portfolios, and capital expenses, the world of corporate finance can be complicated. To handle these and other financial priorities, many companies depend on one, or several, budget analysts. These financial professionals play an important role in corporate finance, helping businesses of all sizes implement financial trends and balance spending and money-making habits.
What Is a Budget Analyst?
Budget analysts help companies create and manage budgets, estimating how much those organizations will spend in a given year. They are also responsible for updating company budgets as the global economy, customer behaviors, and internal operations change.
A budget analyst also plays an important role in improving their employer’s financial efficiency. They manage corporate spending patterns and identify any areas where expenses don’t align with company goals. This includes running audits to ensure that all spending habits are in full compliance with laws, regulations, and internal processes.
Roles and Responsibilities of a Budget Analyst
Many budget analysts work closely with financial analysts and other members of a company’s financial department. They also work alongside project managers, providing insight into how specific projects receive funding, allocate resources, and perform over time.
Here are a few specific responsibilities of a budget analyst:
- Financial reporting: Budget analysts provide regular updates on company expenses, revenue, payroll, and spending habits that determine future performance.
- Forecasting and planning: Budget analysts predict future financial performance based on factors like market trends, sales projections, labor costs, and competitive intelligence.
- Risk assessment: Budget analysts evaluate risks like market volatility, workforce shifts, competitor activity, or production delays that could affect sales.
- Financial analysis: Budget analysts help companies understand how revenue, expenses, and internal operations affect their financial situation.
As budget analysts study a variety of performance data, they learn more about a company’s financial strengths and weaknesses. Analysts share this information with decision-makers, who use it when identifying growth opportunities.
Daily Tasks of a Budget Analyst
Budget analysts handle all aspects of budget planning and execution, from forecasting to cost control.
Here are a few tasks a budget analyst might handle each day:
- Building initial company budgets: Budget analysts create the first version of a company’s financial plan. They’ll consult information on a company’s product and service prices, sales predictions, workforce salaries, and historical financial data.
- Reviewing funding requests: Budget analysts evaluate different proposals from different departments within a company to determine how funds should be allocated internally.
- Reporting to company stakeholders: Budget analysts provide information on financial performance and sales projections to decision-makers within a company.
- Communicating with employees: Budget analysts provide guidance on budget policies to project leads, customer service teams, and other members of the financial department.
These tasks allow budget analysts to study a company’s financial performance and provide that information to executives.
What Kinds of Organizations Hire Budget Analysts?
Companies in virtually every industry rely on budget analysts to make smart financial decisions.
Here are a few environments where budget analysts commonly work:
- Governments: Budget analysts monitor spending activities across city, state, and federal government departments to ensure all transactions are compliant with government standards.
- Educational institutions: Budget analysts help plan budgets that support a school’s academic programs, student services, and teacher payroll.
- Research firms: Budget analysts monitor expenses to ensure all funds support the firm’s research activities.
A talented budget analyst can find employment in almost any industry. Some also work as consultants, providing budget support and advice to a company’s leaders or financial department.
Budget Analyst Salary: Typical Range for Annual Earnings
According to the U.S. Bureau of Labor Statistics, budget analysts can earn between $56,760 and $131,630 each year. Analysts who work in professional, scientific, and technical services earn an estimated $99,200 per year, which is more than the national average. By contrast, budget analysts employed in educational services earn less, averaging $73,590 per year. Your education, experience, and any active certifications, can also affect how much you earn.
How To Become a Budget Analyst
Becoming a budget analyst is a process that requires a few steps. You’ll need to complete any required undergraduate degrees in majors such as business, accounting or finance, mathematics or statistics, or economics. You may also need a postgraduate degree in one of these domains or a similar field, such as business administration.
In addition to educational requirements, some positions may require certifications.
you’ll need to obtain any required certifications. Popular options include the Certified Budget Specialist program from the American Association for Investment and Financial Management (AAIFM), which teaches specific skills in budget methodologies, forecasting techniques, and sensitivity analysis.
The Government Finance Officers Association (GFOA) also offers a Budget Analyst Training program. This certification prepares budget analysts to practice in the public sector.
Aspiring budget analysts also need to develop analytics and soft skills through work experience. Many people earn this experience by working in a related field like finance, economics, or accounting. Roles in international business, or business management, can also translate into a budget analyst career.
Education Requirements
Most budget analysts first need to obtain an undergraduate degree. Complete a bachelor’s degree in business, finance, economics, or a related field to get started. These programs teach critical skills in data analysis, communication, and sales forecasting.
To further improve their candidacy for hire, many budget analysts also complete a master’s degree in global business administration. This program equips future leaders in budget analysis with skills like business foundations and international law.
Key Skills for Budget Analysts
Budget analysts rely on a variety of technical and soft skills each day.
Here are a few of those skills:
- Data analysis: Budget analysts interpret financial information and raw data about inflation, capital expenses, and revenue.
- Financial software navigation: Budget analysts use technology that tracks budget performance, manages accounts payable, and generates financial reports for analysis.
- Critical thinking: Budget analysts develop and test financial theories to create budgets based on real-world company performance.
- Problem-solving: Budget analysts overcome budget issues like changing economic conditions, evolving customer behaviors, and updates to regulatory compliance.
These skills allow budget analysts to address complex financial issues and support sustainable spending habits within a company.
Long-Term Career Progression: From Entry Level to Senior Leadership
After earning a role in budget analysis, it’s important to stay up-to-date on the latest developments in the industry. For budget analysts, this can mean earning certifications or attending professional events to expand your network.
Entry-level budget analyst careers typically include junior and assistant roles, in which you can develop your skills while working alongside industry veterans. As you gain more experience, you can become eligible for more leadership-level roles, including positions like senior budget analyst and finance manager. With time, you’ll become eligible for the most senior positions in finance, including vice president of finance, chief financial officer (CFO), and chief investment officer (CIO) roles.