CFA later in life? Anyone do it and how did it work out for you?

[opihiman2]

I am thinking of writing the CFA 1 exam and perhaps do the entire charter.  Although, at my age, I don't know if it would help me in terms of my career--which is not in the financial industry.  I was wondering, has anyone done this later in life (over 40)?  Had it made a significant impact on your career? 

 

 

 

[jschembs]

I don't think it would be that helpful (and that's coming from a nearly 10-year charterholder). You could get a similar education reading well-written books on the same topics.

[leeway]

I got CFA quite late (but not that late), and I don't think it helped my career in any meaningful way. Granted I was already in the industry back then (10+ years ago). Sometimes I wonder if it is worth keeping paying close to $300 yearly to maintain it. Now more young people prepare for the exams in college years, so I would guess the value would likely be even less in the future.

[fareastwarriors]

I am thinking of writing the CFA 1 exam and perhaps do the entire charter.  Although, at my age, I don't know if it would help me in terms of my career--which is not in the financial industry.  I was wondering, has anyone done this later in life (over 40)?  Had it made a significant impact on your career?

 

What industry are you in?

[oddballstocks]

What are you hoping to do with it?

 

I took Level 1 & 2.  Failed 2 and decided to spend my time analyzing stocks instead of reading about analyzing stocks.  I don't consider it a waste though.  I took one econ class in college where I received a C-, and no finance classes.  The CFA was my finance education (to a point, other books as well).  And being forced to sit and read and study gave me rigor to learn the details I would have otherwise glossed over because they were boring.

 

One of these days I tell myself when I have time I might take L2 and L3 just for a sense of completeness, not that it matters for anything.  I just hate leaving things unfinished.

[jay21]

What are you hoping to do with it?

 

I took Level 1 & 2.  Failed 2 and decided to spend my time analyzing stocks instead of reading about analyzing stocks.  I don't consider it a waste though.  I took one econ class in college where I received a C-, and no finance classes.  The CFA was my finance education (to a point, other books as well).  And being forced to sit and read and study gave me rigor to learn the details I would have otherwise glossed over because they were boring.

 

One of these days I tell myself when I have time I might take L2 and L3 just for a sense of completeness, not that it matters for anything.  I just hate leaving things unfinished.

 

I always thought it was ridiculous when some value investors would completely dismiss the CFA curriculum. If you are interested in finance, at least 50% (and up to 75%) should be interesting and/or helpful.

[mcliu]

I did L1 & L2.

 

I think it covers a pretty wide-range of topics, but it won't help make you a better value investor.

 

Unless you're planning on working in the industry, it's not that useful.

[Tranloi]

I passed the exams in 2008.  I don't think it would help much with the career as well, but does provide a good overview.

[writser]

I started this year. I don't have a finance background and the curriculum seems like a decent way to learn the fundamentals of accountancy / valuation / economy in a structured way. Any career upside is a free kicker.

[one-foot-hurdles]

I was determined to sit for the CFA exams more out of interest and finance education. Completed all three levels but havent bothered with applying for the charter.

[Hielko]

I did L1 & L2.

 

I think it covers a pretty wide-range of topics, but it won't help make you a better value investor.

 

Unless you're planning on working in the industry, it's not that useful.

I have done L1 & L2, and think it was pretty useful for me, but it might depend on your background. I didn't know anything about finance when I started investing, and while you can learn a lot just reading annual reports and using Google/Investopedia when you encounter something you don't understand you still keep some gaps in your knowledge. And sure, if you pick the right accounting/economics/equity valuation books you can probably learn that as well, but having an exam to work towards also gives you some extrinsic motivation to work through the boring stuff.

 

Doing L3 now because I like to finish what I started, but that part is unfortunately pretty useless for me since it mainly focusses on wealth/portfolio management.

[Guest notorious546]

I did L1 & L2.

 

I think it covers a pretty wide-range of topics, but it won't help make you a better value investor.

 

Unless you're planning on working in the industry, it's not that useful.

I have done L1 & L2, and think it was pretty useful for me, but it might depend on your background. I didn't know anything about finance when I started investing, and while you can learn a lot just reading annual reports and using Google/Investopedia when you encounter something you don't understand you still keep some gaps in your knowledge. And sure, if you pick the right accounting/economics/equity valuation books you can probably learn that as well, but having an exam to work towards also gives you some extrinsic motivation to work through the boring stuff.

 

Doing L3 now because I like to finish what I started, but that part is unfortunately pretty useless for me since it mainly focusses on wealth/portfolio management.

 

i think it will help, if nothing it can teach you to prepare and work hard for success.

 

i'm writing level 3 in the few weeks! good luck to everyone who is writing as well.

 

[tng]

The CFA has a lot of value for financial professionals in China and some other countries because they value an American credential (rightfully or wrongfully, people there trust American). A lot of investment firms like their analysts to have it because it is good from a marketing perspective. I'm not on the sales side, so I don't know how much it helps, but many of the big investment management/advisory companies like it. A small part of it may be a legal butt-covering exercise because it is a thing they can list to show that they are doing their fiduciary duty. A lot of students take it (or at least some of the exams) because they want to prove that they are interested in investing and they don't have much they can put on their resume.

 

But I think for people who are already in the industry, it doesn't really help your career. You learn far more doing your job. I finished all 3 tests and I felt that it actually took away from my abilities because I was spending so much time studying for some of the more useless topics than going into greater depth on the stuff that is most useful to me. I'm not sure how useful it is if you want to switch from a different field into investment management. I hear people say that is not as useful as it used to be because firms are less willing to hire unconventional candidates today. Most of the larger investment companies are playing by the book post-financial crisis as clients don't want anything weird (they don't want to invest in the fund that is made up of lots of people from random backgrounds).

[Straddle]

It depends where you work I guess. In Western Europe I don't see the added value really. I finished level I and stopped there as the course was consuming too much of my free time. If you work for an investment bank it will probably add some value, but in the general finance industry I don't think it will make much of a difference.

[SharperDingaan]

I did my CFA later, but spent time in the industry before doing the CFA. The CFA itself is just a toolbox, but you get most value out of it if you are NOT in the industry. 

 

The reality is that a industry CFA is primarily a sales person. In NA he/she is there to write market blurbs to support the team, accompany the team to lend credibility to the client visits & hospitality events, & to come up with on-the-spot market changers that impel clients to transact. Very little original share analysis involved.

 

The CFA designation has also debased in great measure - as while everyone has the same skill set, we do not all live in the same place. You can routinely buy the CFA skillset in Asia at 50% of what it would otherwise cost in North America - and yes, the resultant report (in whatever language you want) will have grammatical errors; but it is nothing that an hour of local editing cannot fix. Somebody else does the analysis.

 

An industry CFA is hired on an up or out basis. To create the space for the annual new entrants, you need bodies; 15% annual attrition over 5 years - means 44 survivors out of an original cohort of 100. Its a high stress business, participants age very rapidly, there is preference for youth, and a strong survival bias towards herding. The bulk of older folks do not make it past years 3-4.

 

SD

 

 

[rukawa]

I completed the CFA. Its useful if you have no finance knowledge and you want to understand basics about the financial industry. But the cost of the degree is huge and the benefit is poor. I would say its most useful if you are planning on becoming an analyst or portfolio manager. I once called Francis Chou he recommended it if you want to manage money. It will destroy your summers and it will be super frustrating if you don't pass a level.

[constructive]

I recently passed both levels of the CAIA as I found the content more tailored to my interests than the broader CFA. I'm planning to get an MBA and get into asset management.

[opihiman2]

Wow, lots of really interesting and useful replies.  Thanks everyone.  To answer some of the questions, I was in IT but made a break from it into management consulting.  I had an oppty to get into a really junior role at a local asset management company running a value investing fund (200 mil AUM), but I decided to forgo it for government work.  I would like to make a break from what I'm doing now to do portfolio management for public entity pension funds.  Maybe working at CalPERS or CalSTRS. 

 

I am curious, though, for those who felt that it did help your careers, are you in finance?  If not, what field(s) are you guys working in? 

 

Just wondering if I should do the CFA or MBA instead.  Maybe MBA would open up more different kind of doors. 

[usdtor05]

My Partner and I were just discussing how we think the CPA is actually more useful for investing than the CFA. But you need the accounting degree and can probably just learn it all on your own without getting the CPA itself.

[watsa_is_a_randian_hero]

Wow, lots of really interesting and useful replies.  Thanks everyone.  To answer some of the questions, I was in IT but made a break from it into management consulting.  I had an oppty to get into a really junior role at a local asset management company running a value investing fund (200 mil AUM), but I decided to forgo it for government work.  I would like to make a break from what I'm doing now to do portfolio management for public entity pension funds.  Maybe working at CalPERS or CalSTRS. 

 

I am curious, though, for those who felt that it did help your careers, are you in finance?  If not, what field(s) are you guys working in? 

 

Just wondering if I should do the CFA or MBA instead.  Maybe MBA would open up more different kind of doors.

 

They are not mutually exclusive.  Why not try the CFA, or try both?  There is little downside risk to CFA...worst case is what, you fail?  In the process you at least might learn something, and figure out what you dont know.  There is a lot of risk to MBA (debt and opportunity cost).

 

MBA is different as it is more about networking, case studies, broader managerial learning, etc.  If you tell me you have a Harvard MBA I know that you are well connected, driven individual and must have had a (somewhat) impressive start to your career.  It doesnt necessarily mean you know jack about finance though (I am friends with many). 

 

A CFA on the otherhand tells me you are knowledgeable in a very specific body of knowledge (finance, accounting, etc).  However, conversely to the above, it doesn't necessarily mean that you know jack about how to apply this knowledge in the real world (I am friends with many of these as well). 

 

Also, in my opinion, an MBA is not very valuable unless it is from a top tier school.  For a career in investments, or consulting around investments to other professionals I have the following view:

 

CFA> MBA from non top 5 school

MBA from top 5 school > CFA

Having a MBA from top 5 school + CFA is best

 

Disclosure: I have CFA, not MBA, and work in investment consulting for hedge funds / PE funds.

[SharperDingaan]

I am probably a very good example of the combined approach, and hold all 3 of the mentioned letters.

 

When you have that combination you don't want to be the analyst, or even the PM - you want to be the CFO. You also don't want anything to do with public companies, & stay out of the limelight. At times ... those dark spaces are pretty crowded!

 

SD

[Guest notorious546]

good luck to everyone writing tomorrow.

 

best wishes

[spartansaver]

Good luck tomorrow, should be interesting.

 

[Mohammed Al Alwan]

I just came across an interview with CFA institute president and he mentioned that he got his CFA when he was 40 and after 20 years in the industry .so,I don't think you are starting late.

 

my take on the CFA program

I just sat for level 3 on Saturday and I am professional money manager with 11 years experience. I do mainly equities in frontier markets. I find the CFA program very useful if you work in portfolio management or equity research .will the CFA make you great money manager or analyst I don't think so.based on CFA research published in their website they could not find correlation between successful equity analyst or portfolio manager and the CFA program.However,many successful value investor holds the CFA designation like Mario gabali,bill miller,David Herro,Steven Romick, bill gross,Robert L. Rodriguez, John Neff,John C. Bogle etc. These are just few names that came to my mind.

 

if you study the history of the CFA program its founded by the father of value investing ben graham as way to show that you are serious and committed about investment profession industry .in earlier years the CFA program level 2 was based on security analysis book. The program is evolving since then.

 

the price you pay is high in terms of commitment and social life and most of the value of the charter is that if you are outside the industry and want to break in.if you are already in the industry the benefits of the charter would be in terms of knowledge which as some one mentioned above that you can acquire. Also, the CFA charter is appreciated more in emerging markets vs. developed markets.

 

in conclusion I think its wise to pursue the charter because its a documentation of your knowledge and commitment towards becoming a better investor vs.. if you choose to study on your you need to proof it.