The invention discloses finishing water-soluble acrylic resin and its preparation method and belongs to the technical field of resin. The resin provided by the invention comprises the following ingredients: acrylic acid, methacrylic acid, styrene, butyl methacrylate, butyl acrylate monomer, hydroxyethyl methylacrylate, 2-ethylhexyl acrylate, N-dodecyl mercaptan, methyl methacrylate, N,N-dimethyl ethanolamine, ethanol, water, lauryl methacrylate, Isobornyl methacrylate, hydroxyethyl acrylate, hydroxy-propyl acrylate and AIBN. The preparation method comprises six steps. By the preparation method, the required finishing water-soluble acrylic resin is finally prepared. The finishing water-soluble acrylic resin prepared by the formula and the preparation method can be used to effectively reduce costs and has an effect of environmental protection, can completely meet requirements of a finishing varnish in the aspect of prepared paint properties and overcomes the defect that water-soluble resin is not resistant to water, acid or salt in the field of traditional chemical industry.