Studying for the CFA can be challenging and stressful because you have to review large amounts of information. However, there are ways you can make it easier and ensure that you pass the exam. In this article, we talk about preparation tips for the CFA exam. Let’s get right into it.
CFA Exam Preparation Tips
Tip #1: Focus on Relevant Material for Each Level of the Exam
The CFA exam covers a lot of material. It is why it is divided into three sections because it is impossible to cover all the relevant topics in one. Due to this, each part of the exam tests for different areas relevant to the field. So, focus on topics that are most likely to appear at each level. For example, part 1 has the fewest questions relating to technical analysis, derivatives, wealth management, or portfolio management. However, topics like ethical and professional standards appear more often. Lastly, you can find this information on the CFA’s website.
Tip #2: Time Management
Like with everything in life, time management is critical in preparing for the CFA exam. Schedule a time to study for the CFA exam every day and follow through. Most people taking the exam are working professionals, along with other responsibilities. You will have to learn to manage your time effectively to ensure that you do not miss a study session, as that could jeopardize your preparation.
Tip #3: Use Online Prep Courses
You must cover most of the topics that appear on the CFA exam. However, seeing as how you have to cover a vast amount of material, it can be challenging. It can lead to you missing critical deadlines, under-learn crucial material, and mismanaging your time. Online resources like Wiley CFA prep ensure that you cover everything important and not overlook anything.
Tip #4: Develop a Plan
According to Princeton Review, you should conceptualize a plan six months before taking the exam. It does not matter the number of dedicated hours you want to put in. Whether it is 150, 300, or 600 hours, plan at least six months before taking the exam. Doing this will help you create a solid and consistent study routine. It will also give you ample time to review enough material for passing the exam. Lastly, in case of any emergencies that force you to miss sessions, giving yourself enough time will allow you some breathing room to make up for them.
Tip #5: Eliminate Every Distraction
After you have decided to take the CFA exam and developed a solid study routine, you should eliminate ALL distractions before and during your sessions. Discuss your goal with your family and friends and tell them that you will be busy until you pass the exam.
Tip #6: Focus on Concepts
Today, the CFA exam focuses more on concepts than mathematical models. So, spend the time to review relevant formulas that appear on the exam. In addition, highlight formulas proving too difficult to memorize and consider moving on from them.
Tip #7: Take Mock Exams
Each level of the CFA exam is 6 hours. Although you do not take them consecutively, that is still a total of 18 hours. Memorizing large amounts of information is one thing you also need to recall on command. So practice taking mock exams as much as you can. It will help you familiarize yourself with the test and improve your recall ability. Lastly, the CFA Institute can provide you with all the mock exams you need.
Tip #8: Use Breaks
Remember, it is a marathon, not a sprint race. So, allow yourself to take a breather when you can’t concentrate. Sometimes, your brain needs a 5 to 10-minute break. Go out in the sun as sunlight refreshes you and signals your body to stay awake. You can also take a walk as it is healthy and refreshes you.
Tip #9: Master Your Financial Calculator
You can bring one of two financial calculators to the CFA exam. Whichever one you decide to use, master it before the exam not to be confused about operating it during the exam.
Tip #10: Join a Study Group
Study groups are very effective when studying for exams. In a study group, you gain a better overall understanding of the subject matter. It is because you are actively engaging with the material you are learning. In addition, everyone learns differently, and because of this, you can understand the topic from more than one perspective.
In addition, studying in a group helps you retain more information than when you review alone. Research has shown that study groups can help you remember as much as 90% of what you learn compared to just 60% when you study alone and 10% when you are in a classroom. Also, in a study group, you can motivate each other when you feel lazy and make sure everyone stays on track.
Furthermore, you will gain valuable team experience, which will help you in your career. Studying in a group will also help with procrastination. Lastly, you will develop and sharpen your problem-solving skills.
Tip #11: Stop Procrastinating
Taking exams is nerve-racking. The possibility of failure dawns on you as you imagine taking the test. Stop that. Instead of focusing on the test, which could be six months away from now, focus on what you can do to prepare at this moment.
In addition, you can try meditation to help you combat procrastination and any anxiety you might be feeling about the exam. There are a ton of guided meditation videos you can use from YouTube. We recommend Wim Hof and Michael Seeley.
Tip #12: Plan for Setbacks
Passing the CFA is not impossible but certainly challenging. There are chances you could fail a level of the exam. Therefore, spend extra time on topics that count heavily towards the final grade and are challenging for you. You can visit the CFA website to figure out the weight of a topic towards the final score. In addition, planning will allow you to set up timely retakes.
Tip #13: Relax
We have emphasized the fact the CFA exams are tough. Now it is time to emphasize that you should not let that get to you. Yes, you should do all you can to prepare for the exam, but you should also take some time off to relax. It can include ordering your favorite food and watching your favorite TV show. You can also visit your family and friends and go out for a picnic. Or you can travel by yourself to your favorite destination. We are trying to make that you must allow yourself to relax mentally. The last thing you want is mental fatigue, causing burnout and losing focus. Taking some time off will help you stay consistent with your study routine and track your goals.
As we mentioned, CFA exams are a tough challenge to overcome. However, you can make it easier by focusing on important material. In addition, use time management, online prep courses, and plan. Also, eliminate all distractions, study concepts more than mathematics, and take a lot of mock exams. Furthermore, use breaks in between sessions, master your financial calculator, and join a study group. Lastly, stop procrastinating, plan for setbacks, and take time off to relax to avoid mental fatigue.