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CFA MBA | CFA vs. MBA Programs? | 1 Page Guide


CFA MBA | CFA vs. MBA Programs?

Many financial professionals ponder over the question whether to obtain the CFA or MBA. The decision to choose one of the other comes down to many factors such as time, money, desired position, etc.

The Chartered Financial Analyst (CFA) is achieved by passing three CFA examinations. The exams are given on a yearly basis but the average CFA charterholder takes 4 years to complete the program. Working full time, the CFA institute estimates it takes an average of 6 months to prepare and study for each examination. The exams themselves are considered the most rigorous within the industry and have a very low passing rate; Level I exam has a passing rate of 40%. If you register at the earliest possible date, the Level I exam will cost $990 and Levels II and III will cost $600 each. That’s a grand total of $2190 for the opportunity to sit for the examinations and the study material the CFA institute provides. This does not include outside study material and/or classes which are highly recommended. A $3,000 to $4,000 expense would be a more realistic cost for this designation. Once you pass the designation, you are required to join as a CFA member, which also has a yearly fee. There is also a strict code of conduct and ethics every CFA charterholder must continually adhere to.

A Masters in Business Administration (MBA) is a post graduate educational degree earned from a university. Assuming you earn your MBA concentration in finance from a top tier school, it will take around 3 years at a cost of $70,000 or more. While the CFA is meant to be achieved while working full time, an MBA is meant to be a full-time job for most students. Although the cost of the degree can be minimized by attending a less prestigious school, the job possibilities become very limited due to lack of networking on wall street. But while a CFA will have no real value outside of the finance industry, an MBA can be applied to almost any position which becomes invaluable if you decide to switch jobs. An MBA is generally regarded as an easier course of study than the CFA as well.

"CFA is mile deep, foot wide, MBA is foot deep, mile wide," is a quote which describes the differences between the two programs. The CFA is three one-day examinations that are generally considered some of the toughest tests in the country. The MBA is a constant flow of homework and studying that will be more time consuming than mentally challenging.

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