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CFA or MBA: Could Certification Replace a Degree in Finance?

Finance professionals who consider pursuing the CFA certification often think about an MBA, too. We have a debate on CFA vs CPA on this site, so let’s discuss whether one should pursue the CFA or MBA.

Here is the transcript for those who prefer to read the text:

CFA or MBA

MBA is Better Because…

1. A More Well-Rounded Education + Networking Hub

A typical MBA program includes not only financial and investment analysis but also accounting, marketing, and general business. More importantly, it is a great place to interact with other students and is a valuable networking opportunity.

2. It is a Master’s Degree

Some firms specifically look for professionals with degrees beyond the undergraduate level. Also, for professional designations that require advanced education (e.g., CPA), the MBA degree can get you qualified.

3. Faster to Complete

Although you can theoretically complete the CFA program within 18 months, most candidates need 4 years to get it done. A typical MBA program is 2 years and is, therefore, faster to complete.

4. No Maintenance Cost after Getting the Degree

Once you get your MBA, the knowledge and title are yours for the rest of your career.

For the CFA, you will have to pay the annual fee and fulfill the necessary CPE requirements. The amount isn’t much, but it can be a hassle.

The CFA Designation is Better Because…

1. The CFA is a More “Solid” Qualification

The CFA designation is granted by one single entity, and all CFA charterholders go through the same series of exams to earn this title. For the MBA, it is more complicated since the quality of the issuing school can be vastly different. Getting an MBA from an unknown school adds little value when it comes to recruiting and career advancement.

Put in another way, for those who cannot get into the top MBA program, the CFA Charter can be a great equalizer that puts you on the same level playing field.

2. More Relevant

If you are looking for investment-related jobs, people seem to appreciate the CFA qualification.

3. Less Expensive

The total cost could be as low as $3,170, which is more affordable than a typical MBA program. Furthermore, most people also work full-time and earn a living while studying for the CFA exam.

4. No Need to Put Your Career on Hold

Another important reason to consider the CFA over an MBA is that the CFA program is based on self-study and can be done without leaving your current job.

If It’s Hard to Choose between CFA or MBA, Can We do Both?

I see the MBA and CFA quite differently: an MBA is an academic degree, while a CFA is a professional designation. For the MBA, the critical point is where you are getting the MBA from. An MBA from Harvard is likely better than a CFA qualification alone, but an MBA from an unknown school or “diploma mill” will be of little use.

Regarding the practical question of which designation will help find a job, it is complicated because a CFA or MBA alone should not be the deciding factor. The educational and, more importantly, working experience counts a lot too, and so does the performance during the interviews.

Having both is certainly a “win-win” strategy that works for many people, but then, either a CFA or an MBA requires a significant commitment for one to pursue.

At the end of the day, the school or the designation is not what gets you the job – you are!

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