I feel that there are a lot of people like me that studied something in the social sciences that come across the CFA and say “Hmm this looks like a challenge” I would like to avoid this post turning into a debate about the pros and cons of actually taking the test and the implications for passing further levels. Instead I simply want to give my very subjective view of how to approach passing level 1 if you have little to no experience in Finance. First some things to remember: 1) Prepare yourself for the possibility that this is going to take you more than one try. There is a reason the CFA is considered the gold standard of finance certifications. It is really, really difficult. There are a lot of people on these forums that will claim that anyone with a basic knowledge of finance should be able to pass level 1, but thousands of candidates with business degrees would disagree. You have to have MASTERED the basics to pass this exam. Because you know nothing of finance, you can’t expect to master this stuff overnight. It’s going to take awhile. Later I will explain what I think the best way is to do this is, but don’t go in expecting this to be a quick and easy thing. 2) Having a social science background is useful to some degree in every one of the sections, especially Economics, Corporate Finance, Derivatives, and Alternative Investments. It gives you an advantage in Ethics, which is arguably the best section to have an advantage in. It is 10% of the score, and can bump you into passing territory if you are on the line. Furthermore, because most of the candidates are quantitatively minded, this section tends to be quite boring for many of them, and requires more of a legal thinking mind. The language can also be quite complicated which can be a problem for non-native English speakers, who make up a majority of candidates. Because so many struggle with this, it is very easy for someone with a social science background to place at or above the 90th percentile. On my exam, the 90th percentile was right above 70% correct. 3) Mastering your financial calculator, and learning to recognize shortcuts, will payoff big time. The CFA Institute Materials are terrible at explaining anything about this. Outside Prep Companies (OPCs from here on out) like Kaplan and Wiley do a much better job. But once you learn how the Time Value of Money, Cash Flow, and Data functions work, it’s actually pretty easy to incorporate them into some calculations that use fairly complex formulas. This forum is actually an excellent resource for this and I may one day make an entire post on it. 4) Sign up as soon as possible. You are going to need all the time you can get, also it’s cheaper when you sign up right away. If you are like me, one of the things that appealed to you about the test is that it is considerably cheaper than a degree. So with all that being said, here is the process that I took, and what I should have done instead. I took the test three times. The first I used mostly CFA materials, the second I used about half CFA and half OPC materials, the third I used mostly OPC materials. If I was trying to pass in one go, I would condense that process and reverse it. Here is what I think a reasonable, 10 month study plan should look like. 1) Register for the test the first day it’s available. Simultaneously sign up with an OPC (I don’t want to get into a Kaplan vs Wiley debate here, there is plenty of that elsewhere). Get hard copies of the books for at least the OPC. The digital copies expire and if you fail, you will have to purchase them again. I don’t recommend the classes because they assume you know the basics, and the whole point of this post is to assume that you don’t. Do get the question bank with the OPCs as well as practice exams, they will be important later. In fact get BOTH the Kaplan AND Wiley question banks for good measure (they can be purchased independently of the programs. 2) 3 months power through the OPC readings and end of chapter questions. The OPC reading tend to be easier than the CFA and go quicker. You don’t have to focus too hard on the questions at this point. The idea is to get an overview of what is going on. some, if not most of it will be over your head. Don’t worry about that either. 3) Once you have done a once through, take a practice exam. This can be on the CFA site or OPC. You will probably do poorly. That is to be expected, don’t worry about it. 4) At this point you should be no less than 7 months from exam day (if it’s less all the better). For the next 6 plus months, start a daily routine. Everyday, try and do a reading, and the corresponding questions. If you can, try and do more than one. This can initially be from the OPC reading, but also do the readings from CFA as you get more used to the topic areas. Focus on the areas giving you the most trouble, but also throw in an ethics reading whenever you can, because it is absolutely essential that you do well on that portion. At the same time, start doing question bank questions. Focus primarily on the OPCs question banks and not the CFA’s. As a side note the CFA website has become much more user friendly over the last few years to the point that the 2018 website makes the 2016 website look like ancient technology. However their question bank questions are generally even more difficult than the majority of the actual test, so they kind of give you a false impression and serve to generally decrease morale. While it’s totally fine to put off readings on busy days and catch back up later, it’s absolutely necessary to do question banks every single day. Because the exam is two tests of 120 questions apiece, I generally tried to do at least 30 questions a night no matter how hard I worked, and up to 240 on a slow day off. Give yourself a time limit per question. If you know you aren’t going to get the answer after a minute, guess, and look at the solution. take notes on what to review, and when you have a bit more free time, spend it memorizing and practicing those types of problems. It should be noted that the question bank is fairly customizable. Generally, I left it open to all questions in all categories. However, at least once a week I would focus at least part of the questions I did on one particular area of study. The good thing about the Question bank questions for people who are not mathematically inclined, is that they tend to focus on questions that will use formulas. So if you set up the question bank to give you 120 random questions, there will be more questions that involve formulas, among those questions than on the actual CFA Level 1 exam. The reason this is so heavily focused on the question bank is because that is what put me over the top. Had it not been for that I would have surely failed a third time. 5) at the end of each month, take a full length 120 question practice exam timed at three hours. This should help track you improvement. Again CFA or OPC doesn’t matter, though it might be best to focus on CFA. 6) With one month to go, start heavily, if not exclusively, focusing on actual exams. Instead of doing questions out of the question bank, start taking the mock exams. If you can’t do a full 120 questions, most of the mock exams can be stopped at any point, and though it’s not the best way to study, it’s better than nothing. Keep in mind, unlike question bank questions, you will not automatically get the answer so you wil have to review the exam once it’s over. for this reason, it might actually be best to start this process two months out if at all possible. Keep up with the readings, again focusing on the areas that are giving you problems, as well as the areas you are likely to do well on. 7) With three days to go start taking it easy. review formulas and anything else problematic. Also focus on problem areas of the subjects you are likely to do well on especially Ethics because that could be what puts you into pass territory. So to simplify, a June exam study timeline would look like this: August-November: Read through of OPC materials. November-April/May: Daily readings and Question Bank problems. Monthly Mock Exams. April/May-June: Mock Exams, review of problem areas and mastery of easy areas. Again this is my very subjective view and the way I would do it over if I had to. I actually didn’t start intensely studying for the June exam until November this last time around. The occasional reading aside, I basically took nearly five months off between my second and third exam. Just trying to make it clear to the haters that I am not offering up a fool proof solution, but rather simply stating what worked for me
I second this. I did many of the things you suggested and achieved great results despite graduating with a non-finance degree. I graduated with a degree in political science and history. I just passed level 1 with a score above the 90th percentile.