How to become a budget analyst: a comprehensive guide

By Indeed Editorial Team

Published 22 November 2022

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Budgeting is an inseparable part of modern business as it helps companies achieve their financial goals, control costs, prepare for emergencies and attract investors. Budget analysis enables organisations to collect and interpret financial data to make decisions, develop plans and start projects. Learning possible career paths for budget analysts can help you pursue a career in this field. In this article, we explain how to become a budget analyst, discuss who these professionals are, outline their duties, list essential skills and provide information about their work environment.

What is a budget analyst?

Budget analysts are professionals who operate in the financial field and review budgets to collect and evaluate data. They often rely on their evaluations to make recommendations or create comprehensive reports. Budgeting helps companies assess available financial resources and allocate them efficiently to achieve their goals. In some cases, it may also help external investors analyse the company's performance and make investment decisions. These professionals also help organisations remain accountable for how they use their financial resources and improve budgeting procedures. The budget analysis is also important for strategic planning during project implementations or business expansion.

Related: How to manage a budget: techniques and a step-by-step guide

How to become a budget analyst

Learning how to become a budget analyst can help you follow the optimal trajectory to achieve your goals. In addition, it can help you determine which industry corresponds to your field of expertise and where you can find open positions. Consider following these five steps to become a budget analyst:

1. Choose your specialisation

As budgeting plays a considerable role in determining the success of a business, most companies rely on budget analysts to make financial decisions and create financial forecasts. Therefore, your potential employer's needs may differ significantly in size and scope. Consider conducting preliminary research to identify the benefits of working for different companies to make an informed decision.

For example, it helps to determine if you want to work for a large company with a budget analysis department and a team of professionals or if you want to work for a small organisation and conduct budget analysis independently. Analyst positions can differ in working environments, responsibilities and the use of different techniques that match the business's size and scope. Choosing your specialisation during the early stages of your career can help you develop relevant skills as you advance in your training.

Related: Budgeting types and examples (with benefits and tips)

2. Earn a bachelor's degree

Once you decide which aspects of budget analysis are important for your career, you may pursue a bachelor's degree. This step is important as most employers require candidates to have at least this credential to apply for a role. Furthermore, companies that conduct financial operations on a bigger scale may propose strict requirements for education. You can benefit from choosing an education that reflects your specialisation in budgeting. Consider studying bookkeeping, cost management, statistics, project management, financial planning, financial forecasting, budget analysis or business analysis.

Related: 7 types of financial analysis (with useful examples)

3. Obtain work experience

In most cases, hiring managers search for applicants with at least several years of relevant experience. Therefore, consider finding an entry-level job if you have minimal training. This job may help you improve your employment history and develop role-specific skills and knowledge. For example, you can search for junior business analyst positions or junior data analyst roles. These jobs may allow you to learn from other specialists and develop your professional network.

4. Pursue a master's degree

While not all employers require a master's degree to become a budget analyst, it may help you advance your career significantly. In addition, you can pursue a master's degree to narrow your specialisation and boost your competitiveness within a specific field. For example, you may want to use budget analysis to attract investors and execute projects. To achieve this goal, you can pursue a master's degree in risk and investment analysis. It may also serve as an opportunity to secure an upper-level job or transfer to another field, such as financial crime investigation.

Related: Budget vs forecast: differences and steps to forecast budget

5. Seek employment

Once you earn a master's degree and gain sufficient working experience, you can search for open budget analysis positions. You can also create a CV to show your skills, qualifications and experience. Consider researching information about the companies you're applying to and adjusting your application to match their requirements. For example, if an employer lists industry-specific skills in the job description, include these skills on your CV before sending an application.

Skills for budget analysts to develop

Here are the skills that recruiters frequently search for when hiring budget analysts:

Technical knowledge

Technical knowledge is one of the most important skills for this role. As these professionals frequently work with complex budgeting concepts and use advanced indicators, it's crucial they understand the economic meaning of these indicators and how to interpret financial data into clear and concise reports. Moreover, budget analysis involves using advanced software and tools, which may require users to have advanced technical knowledge and computer literacy.

Related: How to read financial statements (with types and guides)

Data analysis

Data analysis and statistics are vital elements of budget analysis. Employers may require budget analytics to work with significant amounts of financial data and use the most recent data analysis techniques. It may also help you recognise trends and make accurate projections.

Maths

Even though these professionals conduct most of their calculations with the help of a computer, it's essential to have strong maths skills to fully utilise the functionality of budgeting software and lessen input mistakes. You can also rely on your maths skills when creating complex formulas and calculating specific indicators. Mental arithmetic can help you make preliminary assessments or identify potential calculation mistakes.

Related: How to build a financial model (with definition and tips)

Analytical thinking

Another vital skill is analytical thinking. As budget analysts interpret financial data and statistics, they may use critical thinking to create accurate forecasts and make rational recommendations. You may also benefit from analytical thinking when developing new algorithms to analyse data.

Communication

Hiring managers usually search for candidates with strong interpersonal skills regardless of the position. Budget analysis isn't an exception, as analysts frequently communicate with other financial professionals. In addition, they may use their interpersonal skills to present ideas on how a company may improve its budgeting strategy.

Attention to detail

Working with data requires great attention to detail. This skill is important for professionals who work with financial data to minimise losses. Attention to detail may help you create accurate forecasts and reports.

Budget analyst duties

Budget analysts perform diverse duties related to data analysis and documentation. Their responsibilities may also differ depending on the employer, industry and analysis objectives. For example, budget analysis during project planning may involve some duties that differ from financial forecasting. Here are several core duties this role involves:

  • using digital technologies and software to automate budget analysis

  • creating budget proposals and documenting findings

  • presenting information to key stakeholders

  • providing recommendations to optimise budgeting and reduce costs

  • preparing financial reviews and budget reports

  • searching for opportunities to attract financial investments

  • evaluating the financial performance of a business

  • forecasting possible financial outcomes

Budget analyst work environment

Since most businesses rely on these professionals to evaluate and manage their finances, budget analysts can work in a variety of environments. Even though the work environment may depend on the industry or the specific employer, there are some features most budget analysis positions share. For instance, these specialists usually work full-time in an office environment and spend significant time at a computer performing calculations. Budget analysts may consult organisations, work in a budget department or provide budget analysis services as independent contractors.

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