Updated: Mar 26
Obtaining a CFA charter is a notoriously challenging process that requires extensive theoretical knowledge and practical experience in the field of Finance. However, in most cases, the value of earning the CFA designation outweighs the cost of fees and time spent on exam preparation. Having said that, let’s see the 5 major benefits of becoming a CFA charterholder.
1. You earn a globally recognized professional designation
The CFA charter is probably the best globally-recognized professional qualification in the field of Finance. This means that once you earn it, you get a higher chance of getting a job at any company no matter where it is located. As we shall see later, many top companies in the world value the CFA qualification and choose to work with charterholders.
2.You undergo intensive training
To become a chartered financial analyst you need to undergo intensive training in a number of areas.
One of the requirements to earn the designation is to pass 3 quite difficult exams covering a broad variety of topics such as Economics, Quantitative Methods, Financial Reporting, Equity & Fixed Income, Alternative Investments, Portfolio Management, Corporate Finance, and Derivatives.
To that end, you will have to go through a rigorous exam preparation. Even highly qualified professionals with a lot of professional experience risk to fail if they don’t prepare well. Historically, pass rates have been under the 50% mark as per the CFA Institute records. So, no doubt the CFA exams are quite tough! But this is actually one of the best things about them. The more you learn, the better prepared you become. Right?
3. Obtaining the CFA charter is cost-effective
The price you pay for obtaining the CFA charter is relatively low compared to more expensive and time-consuming alternatives such as MBA programs, for example. Overall, to get the CFA qualification, you will have to pay several thousand dollars for registration fees and learning materials.
Moreover, you don’t need to quit your job to study. Most people prepare for the exams while being on the job. In contrast, a full MBA program can cost you a lot of time and tuition fees and living expenses of 100, 000 dollars or more.
We shouldn’t forget that the CFA Institute offers scholarships for students, professors and other candidates who cannot afford to pay the full registration fee for the program.
4. Getting more career opportunities
Holding a CFA charter increases significantly the chances to reach the next level in your career. It is a well-known fact that the biggest banks in the world such as Morgan Stanley, Bank of America, Barclays, and Goldman Sachs employ a high percentage of chartered financial analysts.
This is also valid for many big private equity and asset management firms. While obtaining the charter does not guarantee you a job in any company, it definitely makes your resume more attractive.
Another benefit you get by earning the charter is that you join a global network of around 170, 000 top industry professionals. There are approximately 170 locations in the world where you can meet members of local CFA societies. They organize various events to help you expand your professional network and keep up with your continuing education.
5. A chance to receive a higher salary
In general, when occupying the same job positions chartered financial analysts receive higher salaries compared to non-CFA-charterholders. The CFA Institute estimated that in 2018 professionals with a bachelor’s degree and a CFA designation earned around $163K on average. While professionals with a bachelor’s degree who were not CFA members earned about half as much. The results cover different professions that can be practiced by chartered financial analysts.
However, it is important to note that compensation depends on other factors such as an employer’s size and strategy, various economic conditions, and quite importantly, an employee’s performance. Needles to say, to get the maximum salary for your job position, you need to be an outstanding worker.
To sum up, becoming a chartered financial analyst is a true testament of two things. First, you have extensive theoretical knowledge. And second – you have practical experience in the field of Financial Analysis, Portfolio Management and Investments. The qualification is prestigious and valid all over the world. So, you can easily apply for a job at top companies and compete successfully with other candidates.