Becoming a CFA: From Enrolling to Certification

Chartered Financial Analyst

It’s no secret the finance industry is a competitive one, filled with many intelligent and determined professionals. If you’re to looking to differentiate yourself and stand out to hiring managers, consider getting certified as a Chartered Financial Analyst (CFA).

While it may not be the easiest process, earning your CFA is incredibly beneficial as it can be a deciding factor for more senior level positions you apply for down the road. The CFA is also notably cheaper than studying for an MBA, rounding out at around $2,300 (including registration and test fees). If you’re in any sort of finance role and are considering studying for your CFA exam, we’ve compiled a step-by-step guide on how to get started.

Step 1: Enroll in the CFA Program 

The very first step to becoming a CFA charter holder is to enroll in the CFA Program. From there, you can register for the first exam and begin studying with their self-paced, online format. Additional resources and classes can be found online beyond the CFA Institute’s website.

Step 2: Start Studying 

While the exam may seem daunting, it’s possible to earn an excellent score on each level with the proper preparation.

Start with practice tests. As with most standardized tests, learning how to take the test, as opposed to just memorizing the material, will give you the real advantage. The CFA Institute recommends at least 250 hours minimum of study time, or about six to eight months of preparation for each exam.

Develop a strategy. Since each exam is timed, you’ll need to flex your time management skills while studying for and taking the exams. Determine from your practice tests which areas are your strongest and which areas are your weakest, so you’ll not only know what to study, but which questions to skip and come back to on the actual exam.

Study together. Find a tutor, review course, or other people studying for the CFA to make studying more manageable. Even though the exams are designed as self-study curriculum, it is not necessary (or even encouraged) to study alone.

Step 3: Levels I, II & III of the Chartered Financial Analyst Exam 

At six hours each, the CFA exams are a test of one’s intellect, stamina and determination. And unfortunately, the complexity increases with each level. According to the CFA Institute, the material breakdown for the exams is as follows:

  • Level I focuses on a basic knowledge of the ten topic areas and simple analysis using investment tools.
  • Level II emphasizes the application of investment tools and concepts with a focus on the valuation of all types of assets.
  • Level III focuses on synthesizing all of the concepts and analytical methods in a variety of applications for effective portfolio management and wealth planning.

Last June, only 43% of test-takers passed Level I, as compared to the 46% who passed Level II and the 54% who passed Level III.

Once you’ve successfully passed all three of the exams, you’ve completed what is arguably the most difficult stage. However, there are still a few more steps before you can claim to be a certified CFA charter holder. 

Step 4: Complete 48 Months (Four Years) of Relevant Work Experience 

When you apply for your regular CFA Institute membership (see below section as well), you need at least four years of relevant experience. Whichever position you end up choosing, it needs to include one of the following to qualify as such:

  • Evaluating or applying financial, economic and/or statistical data as part of the investment decision-making process involving securities or similar investments
  • Supervising (either directly or indirectly) people who practice these activities
  • Teaching these activities

Additionally, at least 50% of your work experience should be spent directly involved in the investment decision-making process.

The good news? If you have any work experience in the field prior to your participation in the CFA program, it can count toward the four mandatory years as long as it fits the above criteria! 

Final Step: Become a Regular Member of the CFA Institute 

After fulfilling all the above requirements, the last thing you will need to do is become a regular member of the CFA. This includes completing a professional conduct statement known as The CFA Institute’s Code of Ethics and Standards of Processional Conduct. It is an ethical benchmark for investment professionals globally and every CFA Institute member or CFA Program candidate is required to follow the Code and Standards.

There is also an annual fee of $275. Members of the CFA Institute may also affiliate with a local chapter, though it is not required. 

While the process to becoming a CFA charter holder is no easy feat, it certainly one to be proud of. Not only will can a CFA help with career advancement, but it is a globally recognized credential that will never expire.