To say that the CFA Exam is challenging would be an understatement. I mean, with the pass rate for all levels hovering around 50%, it's no debate. As a result, many candidates don’t pass the exam, but the question is, why?
We've done our research and compiled the 4 most common mistakes people can make so keep reading to learn about the top four reasons why people fail the CFA exam.
Too Reliant on Passive Learning
Many students have been taught to learn in passive ways, which leads to many students being bored by school and never wanting to learn. Learning has traditionally been through listening to lectures; the only “active” part is when students take notes on those lectures. Therefore, most students struggle to perform well in examinations because they don’t adequately retain the information conveyed by those lectures.
By contrast, active learning is one of the most effective ways to improve learning outcomes and memory retention. Neuroscientists at Berkeley confirm that it is possible to enhance their critical thinking and reasoning skills when taking an active approach to processing and analyzing data. Instead of watching monotonous videos or listening to tedious lectures, answering practice questions will challenge your brain to analyze, evaluate, and synthesize information. Using flashcards with spaced repetition hacks your brain to better remember information presented at regular intervals.
Here are some ways to switch from passive to active learning:
- Rather than memorizing individual concepts, learn how those concepts fit into the 'bigger picture'.
- Understand why the correct answer is correct (and why the incorrect answer is incorrect).
- Determine how you chose an incorrect answer by reviewing the rationales for the correct and alternative answer choices.
- Identify your strengths and weaknesses, and focus on the relevant CFA exam sections in which you underperform relative to others.
- Reinforce your knowledge using your preferred learning style. If you’re a visual learner, create diagrams that illustrate the concepts; if you’re an auditory learner, talk through challenging CFA concepts with peers.
Poor Time Management
When it comes to studying, the golden rule is quality over quantity. Studying for more hours or pulling all-nighters rarely results in desired learning outcomes. On the contrary, the more you study without breaks leads to diminishing returns, not to mention mental exhaustion. Studies have shown that these study habits can instead reduce the long-term retention of information.
What matters more than how long you study is how well you study. How do you manage the hours you spend studying?
Use the following strategies to maximize what you learn when studying:
Practice Relevant Concepts Tested On The CFA Exam - you can maximize your studying by focusing on the things you are most likely to encounter on the actual test.
Practice In Test-Like Conditions To Build Stamina And Endurance - take mock exams to help increase your chances of passing your actual exams by getting a sense of how it feels to be tested under pressure.
Improve Your Weaknesses - dedicate more time to your weaker exam sections so you can improve.
Be Disciplined About Your Dedicated Study Time - it's essential that you eliminate distractions, including social outings, and unproductive extracurricular activities.
When it comes to the CFA Exam, time management is everything. You need to plan ahead and know exactly when to take breaks during the test and when to stay focused on what you're doing. The course will require a lot of time and attention, but practicing thousands of questions testing relevant high-yield CFA concepts is the more efficient way to learn the material, considering any other responsibilities.
From cramming to procrastination, old habits are tough to break. That’s why you need to change your approach to staying focused. If we're over-indulging in food or drink, that can cause our bodies to suffer from an imbalance. As a result, our bodies can lose their ability to detoxify properly, which leads to health problems. If, for example, you're a perfectionist, and you focus too much of your time and energy on an area that's already strong, you'll never have time to make significant progress in other areas where you lack experience.
Here are a few tips to avoid bad habits:
Avoid Procrastination - cramming may have worked in grade school, but cramming is not effective for taking a long and grueling high-stakes exam.
Mind Your Mental Health - take steps to reduce stress and avoid burnout before taking the CFA exam. So, take breaks and make time for adequate rest.
To Err Is Human; To Improve Is Divine - don't obsess over perfection so much that you never allow yourself time to complete your mock exams. Don't get discouraged if it takes a while to get the hang of things and perfect your technique. Practice makes perfect, right? But if you are ready to learn enough to pass the exam after studying efficiently, then you will have achieved your goal.
Build A Support System - high-stakes tests like the CFA exam will inevitably create some test-taking anxiety for everyone. Please don’t hesitate to ask for help when you need it.
Insufficient Prep Materials
CFA Institute sends out all the information needed to prepare for the CFA exam, but using only the material from the CFAI curriculum might not be enough. If you think that you've already got your CFA exam nailed, then these materials might help but, if you're not satisfied with your score, it's best to try something else. Anything in the curriculum can be tested on the CFA exam, and that volume of material can lead you to some of the bad study habits that you need to avoid.
Does this mean you should ignore the curriculum? No, but studying with a trusted prep provider like MasterCFA in conjunction with the CFAI materials can help you more efficiently prepare for the CFA Exam. Our Level 1 CFA exam prep offers comprehensive, in-depth study resources and interactive learning tools to help you prepare. Likewise, our online platform is built to adapt to your learning style and meet your needs.
Now that you know a few of the reasons why people fail the CFA Exam, you'll be better prepared for success. To get the most out of your preparation, study relevant concepts, create effective habits, and work with a third-party prep provider to help prepare for the exam!