A question that I get asked quite often is whether to pursue an MBA or a CFA to accelerate your career. The short answer is – it depends, so buckle up and follow me through a couple of aspects to consider. You might have heard the saying that an MBA is a mile wide and an inch deep while a CFA is a mile deep and an inch wide.

1. Career Plans

The first and probably most important decision between MBA and CFA is which one will be more beneficial for your career plans. The CFA is focused exclusively on finance (and even within that industry, only for roles with a focus on investments) and will not earn you much credit outside of the industry. For example, in management consulting https://canarywharfian.co.uk/threads/consulting-vs-investment-banking.696/, should you be interested in both, the CFA will not be as helpful. The MBA gives you an overview of all aspects needed to manage a company, which means there’s a lot of ground to cover, so there’s limited opportunity to dig deeper. The CFA offers more flexibility in learning, so it’s easier to pursue alongside a full-time job, as there are no classes at specific times and deadlines for papers, exams, etc., apart from the CFA exam. While an MBA is an academic degree (often from a prestigious institution), a CFA is not. So, if you’re considering additional degrees later on (maybe a DBA or a PhD), an MBA might give you additional credits.

2. Cost

The total cost for a CFA is USD 3,050 with early registration and USD 3,950 with standard registration. This can be higher if you need to resit exams – the pass rate at each level is about 50%, so there’s a chance you might not pass all levels on the first attempt. On top of the registration fees, you might want to buy additional study materials, a pocket calculator, plus travel and accommodation, as the exams are held only at a few central locations. In total, this could amount to as much as 10k.Contrast that with the cost of an MBA, which can easily be tens of thousands in tuition fees (LBS, for example, charges GBP 110k at the moment), plus a year or two without income (minus some internships or consulting on the side) and cost-of-living expenses. True, there are scholarships offered, but these are more likely to be reductions in fees rather than a completely free MBA (as the saying goes: “If they offer you a full scholarship, you should look for a better school”). Preparation for admission tests like the GMAT also costs money, so a good MBA will likely set you back over 100k, if not more.

3. Employer Support

Some employers will help you with your CFA, e.g., by offering training sessions, extra time off, or sponsoring your exam costs. There is also support for an MBA, but because the sums involved are much bigger, your employer will typically ask for something in return, usually requiring you to stay on for a couple of years after graduation. A model that I know from management consulting is that you get your tuition fees paid in full if you stay for three years, but you have to pay back 2/3 of it if you leave after two years, and so on. Support could involve offering extra time off for applications or, if you are pursuing a part-time MBA, financial support, training, coaching, or mentoring.Another aspect to consider is that the CFA is a globally standardized certificate, whereas the quality and reputation of an MBA can fluctuate considerably (worth another post, if not a whole book). If you go for an MBA, you need to choose wisely. Pass rates differ as well – as mentioned above, they are about 50% at each level of the CFA, whereas you will rarely fail an MBA after being admitted unless you don’t attend classes at all.

4. Time Commitment

On the time needed, an estimate you will find frequently is 300 hours of preparation time per CFA level, so 900 in total. This sounds somewhat manageable (90 full days), but bear in mind that you will probably pursue the CFA alongside a challenging job. You might not have much spare time for two to three years.An MBA takes one or two years and can be done full-time or part-time. What is also time-consuming is the application process, which you should start 12-18 months before the actual start of your degree. You will most likely need admission tests like the GMAT, which you will need to study for (probably worth another post), essays, recommendation letters, and/or a language test like the TOEFL. While an MBA is more challenging than an undergraduate degree, there is also the opportunity to take time off and pursue other interests, especially if you’re doing a two-year MBA, which is more common in the US. If you’re looking into founding a start-up, an MBA might be a really good time for that.

5. Starting Time

You can start a CFA at any time, even during your undergraduate studies, which might be a perfect time since you’re somewhat flexible with your time and some of the investment knowledge is still fresh from your classes. The CFA offers a University Affiliation Program for degrees that are closely aligned with the CFA curriculum. To become a charterholder, you need to prove relevant work experience, but you can collect this during your CFA studies and even after you’ve passed all three levels. In theory, you can do a CFA at any age, but you will obviously profit more from it if you start at a younger age.There is a sweet spot for an MBA, usually in your late 20s/early 30s with a couple of years of (relevant) work experience. There are Executive MBA programs if you have more work experience. Basically, consider planning for an MBA after two years in your first full-time job.

6. Networking

A big advantage of an MBA over the CFA is the network, both from your class and your school. You spend a year or two in a classroom working together on challenging assignments, which gives you opportunities to form bonds that will last a lifetime. Business schools have networks with sometimes tens of thousands of alumni in very interesting positions, and being a fellow member gives you a good chance to grab a coffee with someone. A CFA can feel a bit lonely if you study at home (it helps to form a study group), but you will enjoy a community of like-minded professionals, as you need to attend a couple of training sessions, not least to maintain your status as a charterholder.

7. Why Not Both?

And finally, a very valid question: why not do both? You can cover both aspects – finance and management. You might even pursue them together – there is quite a bit of overlap between the finance classes of most MBAs and the level 1 curriculum of a CFA. I would recommend going for both mainly if you are looking for a career in which you can make use of both, e.g., becoming a manager in an investment company.