How to get started with your CFA exam preparation

The CFA exam is a big commitment. Do you plan to make a career in finance, or are you still in university intending to enter the industry with good prospects? Are you interested in the CFA designation but don’t quite know if it’s right for you? Or are you already registered for the CFA exam and don’t know how to study in the best way? You will a lot of information and links in the text below that help you find answer to these questions. Step by step we will go through the most important points related to studying for the CFA exam, what to do, what to avoid, and – the most important thing – where to start.

If you would like to read up on what exactly the CFA is, please head over to the CFA FAQ on this page first. Once you have decided to make a go at the exam, you can register directly with CFA Institute here. After you have done all this, let’s get started with your exam preparation.
 

Get the right study material

As I pointed out in several articles, I believe you will most effectively prepare with the original reading material that you receive in the mail from CFA Institute after signing up for the exam. The original syllabus is very well written and covers everything you need to know in the language of CFA Institute. There is really no substitute when it comes to knowledge acquisition, but once you have read the material, I suggest you get a simple study solution that will help you practice for the exam. You can use the Financial Analyst CFA Study Notes or the Schweser QBank (or both). That’s what I did, and I passed all three levels in the first go.

The Financial Analyst CFA Study Notes are based on the Learning Objectives (LOs) and the original readings, but they briefly summarize the most important concepts you will have to master for the exam. They are perfect for practicing and reinforcing the material after reading, or you can use both side by side. Get the CFA Study Notes here. You can also subscribe for a free sample in the box to the right.
 

Organize your study material, make a study plan

The required reading material is really vast. Every CFA candidate will tell you they were quite overwhelmed with it. It’s therefore very important to organize everything properly and to get an overview first. If you have at least six months prior to the exam for your preparation, this would be ideal, otherwise it will be quite stressful. To prepare in less time is possible, especially if you have relevant experience in finance, economics, or accounting, but it’s much better to have enough time to prepare properly. Ideally, you should have read the original reading material at least one month before the exam date, make sure to take this into consideration when making your study plan.

There are spreadsheets floating around that will precisely calculate the number of pages for you to read per day, but you might as well just use pen and paper for your study plan. Let’s say you plan to study on four days per week for five months, that would be 4 * 4 * 5 = 80 days that are available for your reading. Add up the page numbers of the CFA books and divide this number by 80 to find out how much reading material you must cover per day. During your reading sessions, take notes and prepare summaries that you can later use to practice the concepts in your review sessions. I suggest you mark all pages that contain the exercise at the end of the chapters with little post it marks. This way you can later quickly find where they are located. This has proven to be quite a time saver for me! Then strictly stick to your study plan, otherwise you will fall behind.
 

Final stretch: Practice for the exam

During the last month before the exam, make use of your summaries together with the Financial analyst CFA Study notes. Also solve as many practice questions as you can find. There are practice exams available on the CFA site, but Schweser makes also practice exams that are OK for level 1 and 2. The QBank is quite useful for level 1, but I have not found it particularly helpful for later levels.
 

What to avoid

You should really understand all the concepts in the original CFA reading material. Obviously, you need not be an expert, but you should have the overall gist of everything covered. Don’t gloss over any of the topics, hoping they won’t show up on the exam this year. This just adds extra stress to your exam experience in case they do (which almost always is the case). Find other study sources or other candidates that will explain the topics to you that you are not sure about. Having a CFA Study Group is also very handy here, and you should really make use of this if you can. You can sign up for a CFA Study Group here.

On the other hand, you should avoid going too deep with any of the topics beyond the required level of knowledge. If you understand the overall idea, you can safely move on in the reading and get the next subject covered. You don’t have enough time when you prepare for the exam to drill into the footnotes, so don’t waste time doing that. The Financial Analyst CFA Study Notes mentioned earlier can also help you save time, as they summarize the most important concepts in a few sentences.
 

Conclusion and recap

Now you are familiar with the most basic steps to get started with your CFA exam preparation. Congrats for reading this guide, you are already on the best path to successful exam preparation! There are a number of candidates who hope they can just somehow wing it, but you should really not be one of them. If you take the exam preparation seriously you will be rewarded. Each level builds onto the previous one, so if you really know your stuff, this helps you study faster in the future.

I believe the last month is the most important. That’s where you can go into overdrive mode and practice everything you have read again. Several study providers offer preparation classes, so if you can afford it, you should take one if they take place in your area. I know they are quite expensive, but they will also put you in touch with other candidates. If you can’t attend such a class, take at least advantage of the inexpensive preparation resources that are available online.

As your next step, you can read this article: “How to Master the CFA Exam in 10 Steps.”

I wish you all the best for your CFA exam preparation!