Making and sticking to a budget is crucial for any successful business operation, as it is the road map to a company’s success. A well-rounded budget should be developed by managers, executives and department heads. Additionally, budgets need to be organized and examined, and that’s where budget analysts come in.
As companies grow, their operations and related finances become more complex. Business owners need to know how best to position cash flow and how to handle debt as they respond to external forces such as economic pressures and competitor inroads. The only way for organizations to make sure they are on the right financial path is to establish a budget and stick with it.
A budget analyst is trained to gather and study relevant financial data and develop a plan for how best to use resources. This is one of the most critical roles in any company, and most business owners rely on the knowledgeable guidance of a trained analyst to be sure the budget is sound.
Budget Analyst Job Duties
Budget analysts are responsible for giving companies advice on how to best structure their finances. They work in the private and government sectors, examining program data and recommending budget categories based on their analyses.
Besides working with executives, budget analysts also work with middle management and department heads to ensure the budget best supports the needs of each division within the company. They also should develop a working knowledge of laws and regulations, so they can make sure the budget remains in compliance.
Their recommendations drive critical decisions made by the top executives, so it’s vital for their analysis to be complete and accurate. They use methods such as cost-benefit analysis to review budgets and consider alternative funding, and might also use past budgets as resources.
They monitor budgets throughout the year, and that may require writing reports to explain any discrepancies between budget and actual spending, as well as checking in on various organizational programs and initiatives to make sure they are performing as predicted – and if not, why that is.
Budget analysts who in the government sector might also be required to appear before congressional committees to explain recommendations, and work on legislation related to government budgets.
Job Outlook and Salary
According to the Bureau of Labor Statistics, this field should grow 7% between 2016 and 2026 due to the continuous need for analysts to manage budgets in all sectors. As of May 2016, budget analysts made a median annual salary of $73,840, with the lowest 10% making $48,300 and the top 10% making $111,460. Budget analysts working in professional, scientific and technical services had the highest average salaries at $81,550.
Job statistics vary from state to state, so job seekers are encouraged to conduct their own independent research.
How to Become a Budget Analyst
Before considering this career path, assess your skills and make sure you have the abilities needed to succeed in this role. Budget analysts need to be detail-oriented, able to communicate well, analyze and perform basic and advanced math.
Most budget analysts are required to have a bachelor’s degree, but many go on to obtain a graduate level degree, such as a master of science in applied business analytics. Some employers will allow finance-related experience to be substituted for degrees.
Government budget analysts can also obtain a Certified Government Financial Manager credential through the Association of Government Accountants. This certification requires a bachelor’s degree, 24 credit hours in financial management and two years of experience in government financial management. Retaining the certification requires 80 hours of continuing education every two years.