I’ve considered going for the CFA before but I’ve been intimidated by the heavy accounting knowledge that even the Level 1 exam seems to require.
I have a decent understanding of basic finance concepts such as Discounted Cash Flow, IRR, Time Value of Money, etc. as I work in commercial real estate. But this is pretty straight forward stuff. Nothing remotely complicated and I know next to nothing about accounting save for one course in undergrad. My knowledge of stocks/bonds is also limited to one intro to corporate finance course I took.
I do NOT have a finance degree or an accounting degree. From my research someone with a degree in one of these two areas really has a leg up.
From what I’ve read the minimum hours of preparation for Level 1 is 300 hours. For a relative novice like myself I would imagine it should be more like 500 or 600 hours? or an online accounting course plus 400 to 500 minimum hours of CFA Level 1 prep?
Anyone with suggestions or input? Is is a waste of time if you are just a mediocre test taker? I am more than willing to put in the effort but the low pass rates and nightmare stories you read about are intimidating.
The suggestion I have for you is if you’re studying for level 1, go for it with an intent to complete all three levels. There’s very little value to just passing level 1. If you’re considering investing time and money into it, might as well go all the way. Level 1 isn’t anything complex (like you’re not deriving abstract theoretical mathematical expressions), and doesn’t require any background in finance as long as you put in the hours. good luck.
First, there is value in the L1 material itself, if you have not already been exposed to those topics. L1 broadly covers a range of topics that everyone in finance should know, while L2 is more focused on accounting and L3 on financial planning. So if you had to learn the material from only one level, it should be L1.
Second, you might not know if you should commit to the full program. Taking the first level is a good way to measure its usefulness, and how difficult it is for you to take it relative to other candidates.
Some candidates reported that Level 2 is hardest among the 3 levels. Others said Level 3 is hardest.
Very very few candidates said that Level 1 is hardest. Take comfort that most of these minority candidates who said so had a non-finance non-accounting background before taking the test. So, I believe that if you manage to pass Level 1, you will have cleared the hardest obstacle (which is to basically start studying from scratch) in your CFA journey!
I appreciate all the replies. Some good food for thought. Though I think some of you have made Level 1 sound easier than it really is? I mean isn’t the pass rate only around 40%…?
Just give yourself the capacity to study 400. Maybe at 300 you’re getting 85% on the mocks and you’re fine. Maybe at 300 you’re getting 45% on the mocks and completely need to revisit FRA. Just remember if you put in 300 hours and fail, you’re going to have to re-study L1 all over again.
