Risk Analyst Salary: Career Guide and Job Prospects

As a risk analyst, your salary can vary greatly depending on factors such as location, industry, and level of experience.

In the United States, the median salary for a risk analyst is around $80,000 per year, according to the Bureau of Labor Statistics.

Risk analysts with a bachelor's degree and 0-5 years of experience can expect to earn around $60,000-$70,000 per year, while those with a master's degree and 5-10 years of experience can earn upwards of $100,000 per year.

Many risk analysts work in the finance and banking industry, where salaries can be significantly higher, often ranging from $120,000 to over $200,000 per year.

Risk analysts work in various sectors, including finance, insurance, government, nonprofits, and tech companies. They help make sound business decisions by identifying, assessing, and mitigating potential risks.

Risk analysts can specialize in areas like operational, legal, information security, sustainability, or climate risk. This means they can focus on specific types of risks that are relevant to their employer's goals and constraints.

Risk management frameworks guide how risk analysts do their job. For example, federal agencies must follow the National Institute of Standards and Technology's risk management framework.

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The average annual salary for risk analysts is a crucial factor to consider when pursuing a career in this field. According to the U.S. Bureau of Labor Statistics, the median yearly salary for risk analysts is about $102,120.

Salary levels can vary depending on factors such as education level, industry, and location. Experienced risk analysts can make upwards of $175,720 annually.

If you're just starting out, you can expect a starting salary of around $59,510 or $28.61 per hour. However, with experience and a strong education, your salary can increase significantly.

Here are some approximate salary ranges for risk analysts in different stages of their careers:

Keep in mind that these figures are intended as a guide only, and actual salaries may vary depending on the organisation and location.

To become a risk analyst, you'll need the right education and qualifications. A bachelor's degree is a good place to start, as it can equip you with analytical, statistical modeling, and data analysis skills.

You can pursue a degree in a business-related field like finance, economics, or statistics. Coursework in mathematics and accounting is also beneficial.

Many employers seek candidates with a degree in finance, mathematics, or statistics. If you don't have a degree, you may be able to enter the profession with experience in finance or insurance, along with professional qualifications.

To increase your chances of getting hired, consider specializing in a particular type of risk analysis. For instance, if credit risk analysis interests you, you can pursue specialized certifications like the Credit Risk Certification from the Global Association of Risk Professionals.

Here are some relevant subjects that may increase your chances of getting hired:

A postgraduate qualification, such as an MSc in financial-related risk management or financial markets, can improve your employment prospects.

As a risk analyst, you'll need a strong foundation in various skills and competencies to succeed in this field. A bachelor's degree in a business-related field like finance, economics, or statistics is a great starting point, as it equips you with analytical, statistical modeling, and data analysis skills.

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To become a risk analyst, you'll require strong analytical skills, which involve reviewing large data collections, market trends, and investment portfolios to determine risk levels. You'll also need to communicate complex information to clients and stakeholders, which requires strong written and verbal communication skills.

Risk analysts must also possess decision-making skills, which enable them to quickly analyze data and make informed decisions. Additionally, project management skills are essential to ensure timely completion of projects and tasks.

Some of the key skills and competencies required for a risk analyst include:

Having a keen eye for detail and the ability to work independently are also essential for success as a risk analyst. With the right combination of skills and competencies, you'll be well on your way to a rewarding career as a risk analyst.

Career growth and prospects for risk analysts are quite promising. You can expect above-average salaries, with entry-level analysts averaging around $69,000 annually as of May 2023.

A typical career path in a large financial institution might look like this: credit risk analyst, senior credit risk analyst, risk manager, senior manager or managing director. This structured career route offers opportunities for advancement and professional growth.

Risk analysts in finance and investment made a median salary of $95,080 in 2022, according to the U.S. Bureau of Labor Statistics. The BLS also projects a faster-than-average growth rate of 9% between 2021 and 2031 for financial analysts overall.

Here are some potential career paths for risk analysts:

Risk consultancies offer the opportunity to move into the lucrative area of consultancy, and many offer graduate programs in risk management.

As you climb the corporate ladder, you'll likely encounter the terms "manager" and "leader" being used interchangeably, but they're not exactly the same thing.

A manager typically oversees day-to-day operations, making sure tasks are completed on time and within budget. They often focus on financial areas like risk analysis.

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Risk analysts usually have a technical, finance-specific emphasis and focus on gathering and evaluating data, which risk managers use to inform organizational policy and decisions.

In contrast, leaders inspire and motivate their teams to achieve long-term goals, often looking beyond financial metrics to consider non-financial areas like health and safety.

Risk managers, on the other hand, look at an organization's overall risk-related practices, including non-financial areas like health and safety.

To become a leader, you'll need to develop strong communication and interpersonal skills, which are essential for guiding and influencing others.

Here are some key differences between managers and leaders:

While both managers and leaders are essential to an organization's success, leaders have the potential to drive real change and growth.

You can expect good career prospects in the field of risk analysis, with opportunities to progress to management roles in large organizations.

A typical career path in a large financial institution might be: credit risk analystsenior credit risk analystrisk managersenior manager or managing director.

Entry-level risk analysts can earn above-average salaries, with an average annual salary of $69,000 as of May 2023.

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Risk analysts in finance and investment made a median salary of $95,080 in 2022, according to the U.S. Bureau of Labor Statistics.

With a faster-than-average growth rate of 9% projected between 2021 and 2031, the demand for risk analysts is expected to increase.

Sub-specializations can make a significant difference in earnings, with investment-focused careers offering a median salary of over $134,060 annually.

Risk consultancies offer the opportunity to move into consultancy and may provide graduate programmes in risk management.

Working as a risk analyst is an exciting career that involves reviewing markets and stocks. The typical work schedule of a risk analyst is between 35 and 40 hours a week, with a regular 9 a.m. to 5 p.m. work schedule.

You'll spend most of your day in an office environment, working on a computer using risk management software and spreadsheets to analyze data and generate reports. Client meetings are infrequent, but occasional presentations to stakeholders do occur, and some companies allow their risk analysts to work from home.

Working as a risk analyst also offers opportunities for advancement, with the general job outlook being good, with an 8% growth for financial analysts through 2032, and an average of 27,400 jobs every year for this occupation.

Working as a risk analyst is an exciting career that involves reviewing markets and stocks. You'll spend most of your day in an office environment, working on a computer using risk management software and spreadsheets to analyze data and generate reports.

You'll work with a variety of colleagues, including financial managers, credit officers, and financial planners. You might also be working closely with operations managers and data analysts, as well as other specialists like information analysts, consultants, and financial analysts.

The typical work schedule of a risk analyst is between 35 and 40 hours a week, with a regular 9 a.m. to 5 p.m. work schedule. However, you might need to work a few evenings or occasional weekends when there's additional work.

As a risk analyst, you'll start in an entry-level support position and work your way up to a senior risk analyst position. With experience, you can earn a promotion to become a risk manager or a chief risk officer.

Here's a breakdown of the typical career progression for a risk analyst:

The general job outlook for risk analysts is good, with an 8% growth projected for financial analysts through 2032. This growth is mainly due to the increased complexity of financial markets and the need for risk management in various industries.

Working as a risk analyst can be a challenging yet rewarding career, and understanding the different types of financial risk analysts is essential. Credit risk specialists analyze the risk to the company of its customers not paying for goods or services.

In this field, you'll work closely with financial data to determine the creditworthiness of clients. Market risk specialists analyze the risk of outside factors that may affect the share price or the market.

They typically work closely with traders to calculate the risk associated with specific trading transactions. Operational risk analysts look at the likelihood of risky events, such as system breakdowns and employee fraud.

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Regulatory risk analysts look at the impact that new legislation may have on the company. Let's take a closer look at the different types of financial risk analysts and their roles:

There are several types of risk analysts, each with a unique area of specialization. Credit risk analysts determine a client's ability to repay a loan, analyzing financial data and creditworthiness.

A credit risk analyst's job is to assess the risk of lending to a client, which can be a crucial role in investment banks, mortgage firms, and insurance companies. They work closely with financial data to make informed decisions.

Regulatory risk analysts, on the other hand, analyze policy or legislation changes and their impact on a company. They determine the impact of disciplinary actions and fines on a financial institution's reputation.

Here are the main types of risk analysts:

Market risk analysts analyze and review the stock market to check a company's share price, identifying potential risks to the company's assets and investments. They examine economic trends and financial data to make informed decisions.

Operational risk analysts assist businesses in reducing risks in their daily operations, helping companies avoid events such as product malfunctions, employee fraud, and data breaches. They work closely with companies to identify and mitigate potential risks.

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Professional development is a crucial aspect of a risk analyst's career. Training is typically on the job and involves a mix of in-house and external courses.

Graduates on a risk graduate scheme will usually spend 12 to 18 months getting experience across the different risk functions before specialising in a particular area, such as risk analysis. This breadth of training provides you with an understanding of the whole range of risk functions.

To keep up to date with the constantly evolving field of financial risk analysis, you'll need to undertake continuing professional development (CPD). Employers will often support you in taking relevant examinations leading to industry-recognised qualifications.

Some of the industry-recognised qualifications include:

To gain certification with GARP as a FRM, you'll need to pass a two-part exam and have a minimum of two-years' full-time work experience in finance or a related field.

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