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How to Become a CFA in 2023: My Awesome Complete Guide
This page is dedicated to finance professionals who aspire to become a CFA charter holder.
On this website, we will share with you the steps on how to become a CFA, as well as the necessary steps to plan, study for, and pass three levels of the CFA exam on your first attempt.
How to Become a CFA Charterholder in 10 Steps
The first step is NOT to show you how to enter the CFA program. It is on WHY you want to be one and whether it’s worth it.
1. Identify the Benefits of the CFA Designation
The CFA Institute grants the CFA designation. To enter the CFA program, you must become a member and pay annual fees.
How can you gain as a CFAI member?
- A ticket to take the CFA exam
- Networking opportunities
- A place to go to for resources in developing your skills as a finance professional
Here are more reasons for your consideration:
- 5+3 reasons why you want to be a CFA charter holder
- Why you should NOT go for the CFA designation
- Pros and cons analysis by Investopedia
2. Compare CFA Designation with Other Qualifications
To see if CFA is the one to go for, you must research other relevant qualifications.
There isn’t one that matches exactly with CFA, but a few are close enough in terms of industry coverage and level of recognition.
If you are a finance professional with lots of exposure in accounting (or vice versa), CPA is a good choice, and we recommend taking a closer look at that. If you are more into risk management, FRM could be an equally good qualification.
You can also learn about finance, investment, and management with an MBA as well.
3. Determine the Difficulty: Can You Make It?
The CFA exam is notorious for its difficulty. Level 1 has a very wide coverage, Level 2 goes deeper in similarly wide coverage, and Level 3 is a beast.
Unlike most US professional exams, the CFA program is a marathon, as it takes several years to complete the whole program.
A typical candidate spends 300 hours for each level, meaning 900 hours for the entire exam (and this doesn’t count possible retakes).
Are you ready for this challenge? Back to the first point, have you identified one solid benefit to make the CFA investment worth it?
4. Evaluate the Benefit vs. Cost
Ultimately, most of us get licenses and qualifications for a better future regarding career prospects and salary.
The CFA program is expensive at $3,000 at the bare minimum. This does not count the intangibles, such as the time, sweat, and tears involved. It is a good idea to perform a SWOT analysis and make sure this investment makes sense.
Looking at the longer term, does the CFA title help your personal and professional growth?
5. Fulfill the Exam Requirements
The entry barrier to the CFA exam is surprisingly low. You are qualified if you have a bachelor’s degree in any discipline. Even if you don’t have a university degree, you can still take the exam if you have 4 years of experience in any field.
This means that practically anyone who either studies or works for 4 years after high school can sit for the exam.
Specifically, to take the first (Level 1) exam, you need to have the following:
Bachelor’s Degree OR Work Experience
- Bachelor’s degree; or
- Four years of investment or non-investment related experience; or
- A combination of the above but part-time work cannot be counted.
Good Command of English
- There is no specific requirement, but the exam is conducted in English
Other Requirements
You must sign the Professional Conduct Statement and Candidate Responsibility Statement and have a valid passport.
6. Sign Up for the CFA Program
If you spend the time thinking through steps 1 to 5 and still decide to continue, welcome!
The following steps show you how to register, plan, study for, and pass this exam.
The CFA designation is granted to individuals who complete the CFA Program. A typical aspiring CFA takes 4 years to become a CFA, although, in theory, the program can be completed within 18 months.
Beware of Deadlines
The exam is offered twice a year for level I and once a year for Levels II and III. This is a sequential exam, meaning you must take Level 1 first.
You must plan ahead in order not to miss the CFA exam deadlines or run out of time to study.
The early-bird registration starts as early as 9 months before the exam date.
How to Register
Go to the CFAInstitute.org website. In the horizontal menu, go to “program” and then to “register.”
After logging in, there is specific instruction on submitting the proof of your exam requirements, as discussed in Point 2 above.
If the application is approved, you will receive an official acceptance by email together with the admission ticket within 2-3 days. If you don’t hear from them after 3 days, contact CFA Institute by email.
More details on the process and timeline are here:
7. Create a Study Plan
For good and proper planning, you must review the format and curriculum.
Level 1 Format
- Multiple choice questions only.
- There are 240 questions equally divided into a morning session (3 hours) and an afternoon session (3 hours).
- The questions are NOT adaptive, i.e., each question is independent of the other.
- All questions are equally weighted, and there is no penalty for guessing.
Level 1 Curriculum
The CFA program is graduate-level coursework that includes self-studying of 1o topics relevant to the investment field.
1. Ethical and Professional Standard
2. Quantitative Methods
3. Economics
4. Financial Reporting and Analysis
5. Corporate Finance
6. Equity Investments
7. Fixed Income
8. Derivatives
9. Alternative Investments
10. Portfolio Management and Wealth Planning.
These topics are organized into study sessions, each with assigned readings, learning outcome statements, and problem sets. There are three levels of exams to test the knowledge gained from these study sessions.
8. Prepare for the Exam
The CFA Institute provides comprehensive reading materials, known as the CFAI textbook, as part of the package.
In theory, you don’t need third-party guides to take the exam; but in practice, 70-80% of all candidates get supplements to speed up their studying or to work on their weaker areas.
Kaplan Schweser and AnalystPrep are the two most popular CFA review courses.
- Pros and cons of major CFA review courses
- Kaplan Schweser — my review of this popular CFA exam course
- AnalystPrep — most affordable CFA study materials
9. Fulfill Experience Requirements
Once you pass Level III, you must accumulate 4 years of relevant experience before obtaining the charter. You can do this before, during, or after the exams.
Relevant experiences are defined quite broadly. Examples include:
- Evaluating or applying financial, economic, and/or statistical data as part of the investment decision-making process involving securities or similar investments;
- Supervising, directly or indirectly, persons who practice such activities; or
- Teaching such activities.
Click here for details on CFA work experience requirements.
10. Join CFA Institute as Charter Member + Keep CPE Current
Upon completing the third (Level III) exam and 4 years of relevant experience, you will be invited to become a CFA charter holder.
However, continuing professional education (CPE) is required to maintain the charter holder status. But don’t worry–several companies now offer CPE courses online. For instance, Becker has a flexible schedule of online courses that meet the CPE needs of CFAs as well as other accounting professions. Therefore, you’ll have lots of options to keep your CPE requirements up-to-date.
How to Become a CFA in the Fastest Way?
It depends on your commitment and whether you can pass the 3 exams on your first try.
The fastest you can accomplish this is 18 months — Level I in December, Level II in June, and Level III in June the year after. Here is a video on how you can achieve that:
Would You Like More Information?
We know the process sounds complicated, but once you take the first step on how to become a CFA, it’s very doable. We are more than happy to help you along the way!
If you find this article helpful, you may check out this frequently asked questions page. Best of luck with your CFA exam journey!
