My 5 Reasons Why the CFA Title May NOT Be Worth It

You may be surprised to find such a post on a CFA exam preparation site.

After seeing many people who have regretted starting the CFA journey for various reason, we want to ask each of our reader to stand back and ask him/herself this basic question:

CFA title a bad idea?Why are you pursuing the CFA?

Here are the common answers…

  • Better career prospect
  • Promotion; get paid more
  • Interest in the materials
  • Personal challenge

… and here are our comments.

1. CFA Exam Preparation is a Huge Commitment

A typical candidate spends 300 hours to prepare for each level of the CFA exam. With 3 levels (and assuming no retakes) we are taking about 900 hours. This is a huge amount of time that you could have spent with your family and friends; for working hard and get the recognition at work; for a hobby; for volunteer work, or simply for a more relaxed lifestyle.

Many candidates are willing to put in 900 (if not more) hours to take this exam because they find the topic interesting. If you don’t have passion in most of the topics, you may set yourself up in wasting 2-3 years of valuable time.

2. The CFA Program Could be Costly

First of all, there are registration and exam costs involved. Given the low pass rate (37%-51% for Level 1-3), it is common to have a few retakes. You will most likely get the CFA review materials as supplement to the text books… all in all you can easily spend $3,000+ on this project.

Once you become a chartered member, the membership fee and CPE requirement, while not too costly, is an annual expense.

3. The CFA Title Alone Cannot Land You an Investment Job These Days

In the good days, getting the CFA can prove that you are committed and that you have sufficient knowledge to perform the tasks. With an interesting resume and good interview skills, you may be able to break into a front-office investment job.

Unfortunately, investment industry has been shrinking since the financial crisis in 2008 (slowly recovering since, but very slowly). It’s a challenge for existing professional to keep their jobs. Unless you have something outstanding to convince the interviewer, it is going to be an uphill battle to rely on your CFA title to get into the industry.

Having said that, for those who like to make long-term plans, getting the CFA designation now may still be useful years down the road when the economy picks up again.

4. Is The Title Really Useful?

Getting back to the goals of getting the CFA title — most people are aiming for better career prospect and better pay. In this regard, I would say, in most cases, that only those who are working in the investment industry will find it useful. The CFA designation is almost like a requirement nowadays for promotion, or even for survival within the firm.

In other words, whether the CFA title means something to your employer depends on how your employer value the CFA designation. Put it simply, if your existing or future boss is a CFA, the designation and your effort will be recognized; if not, it may not be worth it.

5. Don’t Do It Simply for Personal Challenge

Some candidates go for the CFA purely for interest and for personal challenge. You will be much better off by reading a few good books or taking a course without the need to go through the stress and cost to get chartered.

Please note also that you need to accumulate 4 years of relevant experience to get the designation. The definition is very broad and covers anything from accounting to finance, but if you are, say a IT person, you may never be able to get the CFA title unless you change your career path and work in finance.

Our Thoughts

At the end of the day, the CFA Charter is not the answer to anything. If you understand this and still think getting the CFA is a good idea, then make the jump! We will help you out as much as possible via this site.

You can start the process here, or browse through the frequently asked questions.

Illustration courtesy of Hiking Artist.

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