3 LETTERS WHICH COST ME 6,000 USD AND MORE THAN 1,000 HOURS
In March 2018 I received my CFA charter and below you could find an approach I used for preparation, exams experience and overall opinion about reasonableness of this endeavour.
First I want say – CFA charter looks awesome! I was not expecting to receive anything on paper, thus it was a good surprise. It could also play as an additional motivator to put more hours in preparation for the exam.
*costs for 43 cm x 56 cm frame are not included in calculations
Background: my specialization in Finance Management at the university helped me a lot: I have been already familiar with many themes in Economics, Equity Investments, Corporate Finance and Statistics. Experience in Big4 audit department helped me with Financial Reporting. I also used to think about myself as an ethic person, which is why Kaplan materials from torrents was not an option for me. Thus, significant portion of the exam topics (at least for Level I and Level II) was easier for me to prepare to.
On average, I spent more than 300 hours on each of the exams. Unluckily, I was not tracking my time those days. 1,000 hours is the best estimation I have.
CFA LEVEL I
Date of the exam: 6 Dec 2014
Beginning of the preparation: June 2014
Costs:
- Program enrolment fee – 450
- Exam registration – early fee – 650
- Kaplan – Study package – 899
- Texas Instruments BA II Plus Professional – 88
- Texas Instruments BA II Plus – 70
- Live mock exam – 60
- Allen app – 50
- Total: 2,267 USD
Planned study approach: read Kaplan books, watch Kaplan videos, solve Kaplan tests.
Factual study approach: read Kaplan books, watch Kaplan videos, delay solving of Kaplan tests to the November.
I solved last Q-bank questions at the last week, which is fine, because most of them were just another variations of statistical questions.
Pluses of Q-Bank:
– questions are almost equal to questions, which you will see on exam. As you know, the best way to prepare to any situation – to practice it beforehand
– for each question you have an explanation for the right answers
– THOUSANDS of questions and all topics are covered – practice makes perfect
– you could compare your results with others
If I had to choose only one study material, I would stick with a Q-Bank for all exams and just tested myself with it for 6 months per each level.
I think, there are no significant differences between paid providers; more or less they should have identical products. Of course, they will market it as the best available product with genius training system. It is up to you (and size of your wallet), which provider to choose.
I also paid Q-Bank from Allen resources for their iOS app, thus I could solve tests when commuting or when I had a spare minute.
Another important topic – calculator. It is impossible to overestimate importance of the knowledge of how to use an approved calculator on the CFA Level I exam. Read the guide, watch youtube videos. Practice, practice, practice. Yes, you will be able to answer some questions without it (and even more questions on following levels), but it is unreasonable not to use all available tools (at least to check your answers). It is also better to buy the professional version due to availability of additional functions, which could save you some time – which is the most important resource at exam day.
Live mock exam:
To prepare myself to the exam atmosphere I decided to pay for live mock exam. Overall, I think it is not really so valuable – there are better ways to spend this time and money.
Exam:
With this preparation I had only one surprise at the exam – it is not so easy to fill 240 circles.
Overall, exam questions did not surprised me, thus it was easy to go through them relatively fast. Thus I checked answers one more time, reconciled answer blank with calculations (some circles were filled incorrectly) and left the building earlier
Exam results:
CFA LEVEL II
Date of the exam: 6 June 2015
Beginning of preparation: Feb 2015
Costs:
- Exam registration – standard fee – 950
- Kaplan – Premium Instruction Package – 1,099
- Kaplan – Secret Sauce – 90
- Allen app – 50
- Total: 2,189 USD
Planned study approach: the same as for Level I
Actual study approach: also the same
Allen resources were not so helpful for me this time because it was harder to solve tests in short periods – some questions have the same format as questions from the actual exam: this is a reasonable way to create them, but is not convenient for on the go study on the phone
During this time I read a good advice about preparation and exam results – the worst case scenario – you spend your time and learn something new (and hopefully useful).
Important considerations:
For many students Kaplan materials become less useful from Level I to Level III. I could partially agree with it, especially for Level III.
Exam:
This exam was more harder for me. Even though number of question is lower, number of themes and topic is lower.
On Level I you need just to quickly solve short questions. On Level II – questions are deeper and they are aligned within a context (6 questions per 20 contexts). You could compare Level I with some jogging and Level II with heavy lifting.
Exam results:
CFA LEVEL III
Date of the exam: 4 June 2016
Beginning of preparation: Jan 2016
Costs:
- Exam registration – early fee – 650
- Kaplan – Essential Self Study Package – 649
- Kaplan – On-demand videos – 199
- Kaplan – Secret Sauce – 90
- Allen app – 50
- Total: 1,638 USD
Total costs for all 3 levels – 6,094 USD
Planned approach: read Kaplan books, watch Kaplan videos, solve tests.
Factual approach: read all materials and watch all videos, start solving test and mock exams in May.
Even though I found this guide very reasonable, on practice it was too hard to stick to it.
Allen sources app was not so useful for me on this level, thus I think the best option to use it only for Level I preparation (and when mobility is one of your priorities)
Additional source of study materials – https://sites.google.com/site/cfalevel3examprep/. These notes were like a breath of fresh air after formal texts by Kaplan. I reread them several times during last month preparation alternately with Secret Sauce
From CFAI curriculum I read only the topic regarding Behavioral Finance – I was waiting for my Kaplan books and this topic is the first after Ethics. During last month, I also had a look on topics regarding Fixed income due to difficulties with understanding of some questions.
Q-Bank results (some topics I solved several time, first results were lower):
To boost my commitment to learning I had several day-offs from study at the beginning of May (which I spent playing Uncharted 4). It was like restarting my mind and after that I was ready to dive in into final round of preparations. It is important not to over burn during the preparation.
In the middle of May, I began to practice with essays questions from previous years and Kaplan’s Mock exams. First, I wanted to go through all papers from 2005, but then decided than 6 papers is enough. The main idea is the same – to pass the exam you need to practice all kinds of questions from it. The only new thing for Level III is essays questions – thus you need to invest sufficient amount of time in practicing answering these questions in the most efficient way (google “structured response”).
Results of 6 Kaplan’s mock exams (morning part is marked by myself with detailed criteria):
Due to difficulties with Hedging and Fixed income topics, I re-watched Kaplan videos and solved relevant tests.
During last week I was not able to force myself to study properly, just watched some Kaplan videos without full attention. During the last days before the exam, I learnt by heart some formulas, which than were useful at the exam.
Exam:
Overall, CFA Level III exam was easier for me, than Level II. First, I was quite nervous about essays questions, but practice provided confidence. Moreover, to answer these questions you need not a factual essay, but a constructed response (more on that you could find there)
It was also a good idea not to stumble on any question too much – it is better to answer the easiest ones first and then come back to hardest. As a result, you will have confidence in your knowledge due to solved questions. Again, if you practice writing constructed responses, you will have enough time to answer all questions.
Exam results:
DOES CFA CHARTER WORTH IT?
I think that it is worth it. Even though from the Behaviorial finance (Level III topic) I know, that there is an endowment bias (we value more what we own, than we would value the same object, if we do not have it) and this is a good example for it.
My reasons to pass these exams:
- I wanted to have a career in finance industry
- I wanted to move from the audit to valuation department
- I wanted to test myself – will I be able to pass these exams in 18 months?
- I had free time and money I wanted to invest in deepening my finance knowledge
- It is easier to study when you are young (you have less responsibilities, brains works better), thus if you think about professional qualifications, it is better to get them as soon as possible
OTHER TOPICS
ACCA exemptions – as an auditor at big4 company, I had to obtain ACCA qualification. It was quite a surprise to know, that you could get an exemption for ACCA F3 paper (“Financial Accounting”). But only when you receive your CFA charter. Nevertheless, I was able to pass ACCA F9 paper (“Financial Management”) the same summer I passed CFA level III exam without additional preparation for ACCA exam due to overlap in topics. Furthermore, I used study leaves from big4 to prepare to CFA exam
Study leaves – I highly recommend to have a week-off right before the exam to have some final study time, free your head from working problems and etc. It is better to relax on the last day and have a good and long sleep. I used my vacation days before each of the exams
At the end, I want to wish all CFA exam takers luck and commitment for study!