How to Become a Risk Analyst and Boost Your Salary

Becoming a risk analyst can be a highly rewarding career move, especially if you're looking to boost your salary. According to the Bureau of Labor Statistics, the median annual salary for risk analysts was $83,610 in May 2020.

To get started, you'll need a solid foundation in finance, business, or a related field. Many risk analysts hold a bachelor's degree in a field such as finance, accounting, or economics, and some even pursue advanced degrees.

Risk analysts typically work in a variety of industries, including finance, insurance, and healthcare.

To become a risk analyst, you'll need to start by earning a degree. Typically, a bachelor's degree in finance, economics, or a related field like accounting or business administration is required. This usually takes about four years to complete, with around 120 credits.

You can prepare for risk analyst roles through undergraduate courses like derivatives and risk management, investment, business analytics, and mathematical models in finance. These courses will give you a solid foundation in the skills you'll need for the job.

Most bachelor's programs require a high school diploma or GED certificate, transcripts, essays, and recommendation letters for admission. Many schools also ask for SAT or ACT scores.

After completing your degree, you'll need to gain some work experience. This can be done through finance internships or entry-level finance roles. One to five years of experience in a junior position can lead to a risk analyst job.

Here are some key steps to become a risk analyst:

In terms of skills, risk analysts need to have a strong foundation in risk management (19.31%), risk assessments (5.87%), and data analysis (3.54%). They also need to be proficient in tools like PowerPoint (5.51%) and portfolio management (4.96%).

As a risk analyst, you can expect a high demand for your skills in various industries, good salary and benefits packages, and opportunities for advancement and career growth. You'll also have the chance to work with diverse teams and departments, and enjoy flexibility in work arrangements and schedules.

Risk analysts typically earn above-average salaries, with entry-level analysts averaging around $69,000 annually as of May 2023. Late-career professionals can average up to $94,000, but industry and specialization can affect earning potential.

According to the U.S. Bureau of Labor Statistics (BLS), financial risk specialists had a median annual salary of $95,080 as of 2022. Risk management jobs provide comfortable wages and opportunities for upward mobility, making them a great career choice for those interested in this field.

The salary and career prospects for risk analysts are quite impressive. The average Risk Analyst salary in the United States is $81,484 per year or $39 per hour, with salaries ranging between $59,000 and $112,000 per year.

Entry-level risk analysts can earn around $69,000 annually, while late-career professionals can average $94,000. However, salaries can vary depending on factors such as industry and specialization.

Risk analysts in finance and investment can earn a median salary of $95,080, according to the U.S. Bureau of Labor Statistics (BLS). The BLS also projects a faster-than-average growth rate of 9% between 2021 and 2031 for financial analysts overall.

Here's a breakdown of median salaries for risk analysts in different industries, based on BLS data:

Risk management jobs also provide comfortable wages and opportunities for upward mobility, with a median annual salary of $95,080 for financial risk specialists, as of 2022.

In the investment world, risk analysts play a crucial role in evaluating potential risks associated with various investment options.

They examine risks tied to stocks, bonds, mutual funds, and alternative investments to ensure clients' portfolios align with their risk tolerance and financial goals.

Risk analysts use mathematical and statistical models to assign numerical values to risk situations, providing valuable insights into potential risks.

By recommending appropriate risk management strategies, risk analysts support clients and financial institutions in making informed investment decisions.

Risk analysts help clients avoid, mitigate, share, or accept potential risks, making sound business decisions a reality.

A Risk Analyst is a detail-oriented and analytical professional responsible for identifying and analyzing potential risks that may impact a company's financial stability, reputation, or safety.

To excel in this role, a Risk Analyst typically holds a Bachelor's degree in Finance, Economics, Business, or a related field. Proven experience as a Risk Analyst or in a similar role is also essential.

Strong analytical skills and attention to detail are crucial for a Risk Analyst to effectively conduct risk assessments and report on potential risks. Knowledge of risk assessment tools and methodologies is also necessary.

A Risk Analyst's responsibilities include conducting detailed risk assessments, analyzing and evaluating financial documents and investment portfolios, and developing and implementing risk management policies and procedures. They must also work with various departments to understand processes and assess risks, prepare reports, and present findings to management and key stakeholders.

Some of the key skills required for a Risk Analyst role include analytical thinking, attention to detail, and strong communication skills. Familiarity with financial markets and banking regulations is also beneficial.

Here are some of the core competencies required for a Risk Analyst role:

A risk analyst's toolkit is a powerful one. They need to be proficient in statistical analysis software and Excel.

Strong analytical skills and attention to detail are a must for risk analysts. They should be able to work independently and as part of a team, with excellent communication and presentation skills.

Risk analysts typically have a Bachelor's degree in Finance, Economics, Business, or a related field. They often have proven experience in a similar role and a strong understanding of risk assessment tools and methodologies.

Some of the most common skills that risk analysts use at work include risk management, risk assessments, and PowerPoint. Here are some specific skills that risk analysts often possess:

Additionally, risk analysts often possess soft skills such as computer skills, time-management skills, and interpersonal skills. They use computer skills to analyze financial data and trends, create portfolios, and make forecasts. Math skills are also essential for risk analysts, who use mathematics to estimate the value of financial securities.

Risk analysis and management are critical components of a risk analyst's job. Risk analysts must possess strong quantitative analysis skills, as they rely on statistical models, financial data, and other quantitative methods to evaluate and manage risks.

They collaborate with portfolio managers to construct and maintain investment portfolios that minimize risk while maximizing returns. This involves developing and implementing risk management strategies that protect clients' portfolios from various risks, ensuring wealth preservation and growth.

Risk analysts work closely with financial advisors to develop tailored investment strategies that align with clients' risk tolerance and financial goals. They also advise on hedging strategies, such as derivatives and other financial instruments, to protect clients' portfolios from specific risks, such as currency fluctuations or market volatility.

Risk analysts need to stay abreast of advancements in artificial intelligence and machine learning, as these technologies can enhance risk assessment and management capabilities. They must also monitor and assess the impact of geopolitical events and other global developments on financial markets, identifying potential risks and opportunities for clients.

Here are some key skills required for a risk analyst:

Risk analysts conduct regular risk assessments to evaluate clients' portfolios, identify potential risks, and recommend adjustments to align with clients' objectives and risk tolerance. This process helps ensure that clients' financial goals are met while managing risk.

Risk analysts report their findings and recommendations to senior management, providing valuable insights to inform investment decisions and overall wealth management strategies. This information is crucial for making informed decisions.

Risk analysts need strong reporting and presentation skills to convey their findings and recommendations to senior management, clients, and other stakeholders. Effective communication is key to successful risk management.

Risk analysts ensure that clients' portfolios and financial institutions' operations comply with relevant regulatory requirements, reducing the likelihood of fines, penalties, and reputational damage. By staying on top of regulatory changes, risk analysts can protect clients' wealth.

As new regulations emerge, risk analysts must stay informed and adapt their risk management strategies accordingly to protect clients' wealth and maintain regulatory compliance. This requires ongoing education and a commitment to staying up-to-date on changing regulations.

Certifications can be a great way to demonstrate your skills and knowledge as a risk analyst.

The Certified Risk Analyst (CRM) certification is offered by the Global Academy of Finance and Management and requires an approved graduate degree and at least three years of risk management experience.

You'll need to complete a five-day course covering risk management fundamentals, risk categories, and operational and strategic risk.

The CRM certification costs $378 and is valid for two years. You'll also need to commit to 15 hours of continuing education a year and agree to the American Academy of Financial Management ethics guidelines.

The Chartered Financial Analyst (CFA) credential is another popular choice for risk analysts, with less strenuous education requirements than the CRM.

You'll need to pass three progressively complex exams covering portfolio management and investment analysis. Registration fees range from $900 to $1,200, plus a one-time enrollment fee of $350.

Both certifications require ongoing education and commitment to maintaining your skills and knowledge.

As a risk analyst, effective communication is crucial to convey complex concepts and findings to various stakeholders.

Risk analysts must be able to communicate complex concepts and findings clearly and concisely, both in writing and verbally, to inform investment decisions and ensure clients understand the risks associated with their portfolios.

Strong written and verbal communication skills are essential for risk analysts to articulate their analysis and recommendations.

Interpersonal skills are also vital for risk analysts, as they must collaborate with various professionals, including financial advisors, portfolio managers, and compliance officers, to develop and implement effective risk management strategies.