A Detailed Guide On Work Experience Requirements For CFA

CFA is among the highest distinctions in the investment management profession, and for the right reasons. A CFA charter holder not only has a higher salary and compensation package, but they also have many more benefits. One of them is a strong foothold in the finance industry with practical knowledge and a preference for multinational firms.

Students are attracted by all these golden benefits, but the thing is, getting CFA distinction is not that easy. You know by this point from your research that you’ll need 4,000 hours of experience in a minimum of 36 months, but that’s not all.

There are a few other minor details that students miss before attempting the CFA Level I exam and then suffer the consequences. But you have got nothing to worry about since we will be covering all those minor details on the work requirements and how to calculate them so you can be prepared for the exam. Let’s get into it!

What are the Work Requirements for CFA?

After passing all the levels of the CFA exam, candidates must meet a number of requirements before becoming eligible to become a CFA charter holder. The CFA exam and requirements go hand in hand. The more research you do, the clearer you become about the situation. Everything begins with the CFA Program entrance requirements, which include both educational and work experience requirements. You can also get in touch with IMS ProSchool to check your eligibility and enquire about the work requirements along with courses for the CFA Level I exam.

CFA Level I exam enrollment work requirements

The requirements are straightforward, even for registration in the CFA Level 1 exams. A minimum of three consecutive years of higher education and/or 4,000 hours of work experience (which need not be investment-related) are required. That is 1,000 hours per year for higher education, if applicable.

CFA experience requirements for CFA charterholders

You must join the CFA Institute as a member after passing all three levels of the CFA exam in order to be eligible to use the CFA designation. You’ll need two to three professional references for this, as well as the necessary work experience.

Focusing just on the work experience requirement, you’ll need:

  1. At least three years’ worth of equivalent work experience, totalling at least 4,000 hours. These don’t have to be continuous and can be accumulated from any current or previous position.
  2. The hours of relevant work experience must be directly related to the process of making an investment decision or to producing a work product that supports or enhances that process.
  3. Before, during, or after your enrollment in the CFA Program, work experience obtained through full-time, part-time, or remote work arrangements may be accepted.

How To Know If Your Experience Qualifies You For the Exam?

Your professional experience will be taken into account for regular membership in the CFA Institute if:

  • It has a direct connection to the process of making investment decisions, or it is creating a work product that contributes to or enhances that process;
  • It is accumulated prior to, during, or subsequent to CFA programme participation. Keep in mind that working full-time, part-time, or remotely is acceptable.
  • The information in your membership application is accurate.
  • Your credentials are backed up by references.

One of the ways to self-identify if you would qualify for the CFA Level I exam is by answering the questions below:

  1. Have I worked in eligible fields?
  2. Are my total working hours over 4000?
  3. Was it gathered in a minimum of 36 months?
  4. Is my work related to working with financial or statistical data for securities or other similar assets?
  5. When have I accrued the work experience?
  6. Is my experience described in the application?
  7. Are you involved in teaching any finance related courses
  8. Do my duties in jobs involve the investment decision-making process?
  9. Was I engaged in any sort of financial planning during the job?

If you are still unsure about your eligibility, you can use the Work Experience Self-Assessment tool by the CFA Institute.

How to Demonstrate Work Experience in the Application?

Having the required work experience to qualify for the CFA Level I exam is not enough. You need to know how to present it in an application to get accepted. Simply stating that you worked is not going to be enough at all.

When entering your work experience in your application, you must adhere to a few rules:

  • Make sure you are only entering the relevant work experience from the list above.
  • Detailed job requirements must be included in addition to job titles.
  • You must certify that the responsibilities you fulfilled in each of the roles met the requirements for accepted work.
  • Consider mentioning the kind of client you worked for and what specifically you did for the client in order to adequately describe your independent analysis and work product.

Here are a few examples of how you should describe your work experience in the application:

  1. In order to make recommendations to the investment committee, I create financial models based on reviewed data, evaluate value acquisition targets, and examine fundamentals.
  2. I carried out projections, cash flow analyses, and durational analyses of individual health insurance policies as part of an annual actuarial valuation process and benefit calculations. The investments selected to support the reserves for these blocks of business were directly influenced by these analyses.
  3. I carry out an actuarial valuation process every year to determine whether a defined benefit (DB) pension plan is funded. This includes, among other things, carrying out statistical analysis and making long-term projections of the interest rate, inflation, and demographic data. This analysis reveals the characteristics of the pension liabilities and the DB scheme’s surplus or deficit, which have an immediate impact on the investment strategy for the pension assets.

Conclusion

We anticipate that this analysis has improved your understanding of how to complete the CFA work experience requirements. Therefore, if you have any questions, kindly contact us. Or, find out more about the exam by reading IMS Proschool’s top CFA study materials, getting answers to frequently asked questions about the CFA exam, or learning what the Level 1 exam entails.