It took me eight years to get my CFA designation. It was an uphill battle because I had an English major background, but there were three things that I did which made the process extend way longer than it should have. I would advise all CFA candidates to avoid making these mistakes when preparing to take one of the exams.
Not realizing when you are making the same mistakes
There’s a ton of knowledge you’re required to master in order to pass the CFA exams, but recognize that there are certain topics repeated over and over again. You’re not going to pass if you don’t understand those concepts.
One of the ways that I made the exam preparation way more overwhelming than it needed to be was to focus on mastering everything instead of truly perfecting my understanding of the core concepts. It’s so easy to fall into this trap if you are just going from one lesson to the next without tracking what you are getting right or wrong.
The rule of thumb that I began to adopt at Level II, and that I think was a contributor to my success, was to make a note of all the questions I got wrong on the practice exams. When I repeated the exam, if I got a problem wrong due to a poor understanding of the same underlying concept, then I needed to circle it in red, mark it down on a list and revisit the topic in depth. Then I repeated the questions until I could answer perfectly.
If you get the same thing wrong more than once and it’s a key concept, stop and take a breath and fix it before moving on to the next thing.
Telling too many people
When I took the CFA Level I, there was zero pressure on me because I was the underdog so to speak. I had no finance background and people were shocked when I told them I passed.
When I took CFA Level II, it was an entirely different story. I had told the whole world that I was taking the exam and the pressure was on. When I failed, it was hard to tell people because I was so embarrassed. And everyone was asking.
The other people taking the exam can create so much hype, especially in the days leading up to the exam. I’d advise any CFA candidate to refrain from telling anyone who doesn’t need to know. You may want to tell your boss and your close friends but other than that I would keep mum.
Underestimating Level III
While the whole world quivers in fear of Level II, it is commonly believed that Level III is a cake walk. I messed this one up big time by being overconfident after passing Level II.
I had been laid off from Lehman Brothers in February of 2008. I had all the time in the world to study for Level III, and I didn’t. Maybe I was burnt out from working so much as an equity research associate, or perhaps I had gotten a little cocky from all academic success I had experienced. I got distracted and failed.
Don’t assume you’ll pass Level III. As you can see from the fail rates, it’s still hard enough to take people down.
Getting my CFA designation was no easy task. Many CFA candidates struggle with similar issues, but if you avoid the above pitfalls and put in the necessary hours of study time, then eventually you’ll pass the finish line.
Sara Grillo, CFA, is a financial writer with a focus on branding and marketing for investment management firms and professionals. She is a former associate at City National Rochdale and Lehman Brothers, an investment analyst at hedge fund Diamond Oak Capital Advisors and a financial adviser at Empire Wealth Strategies.
Photo credit: fizkes/GettyImages