How to Study for and Pass the CFA Level III Exam

If you’re here, that means you probably passed Levels 1 and 2. Congrats! And now, you’re wondering what the best strategy is to crush CFA Level 3 and finally become a CFA® charterholder.

In this post, I’m sharing what I did to successfully pass Level 3, along with some tips and tactics that I recommend you do in order to get through this final test.

My CFA® Certification Timeline

Let’s kick things off with a quick overview of my 18-month CFA certification timeline. I took Level I in December of 2016 and passed. Then I took Level II in June of 2017 and passed (barely). And finally, I took Level III in June of 2018, passed, and became a CFA® Charterholder shortly after.

For Level III, I only had about 6 to 8 weeks to study. I run ReisUP full time and had to put my business on pause for all of May and June of 2018 to pass this exam, but I got it done. I learned a lot along the way, including some big mistakes I made that almost put my passing success in jeopardy. So here are my top tips to help you pass Level III:

#1 - Don’t Underestimate CFA Level III

First and foremost, don’t underestimate Level III and think it’ll be a cake walk. I almost did that, but I caught myself early and changed my game plan. Lucky I did, because I probably wouldn’t have passed otherwise.

Don’t get complacent, no matter your finance background or other financial credentials. I thought my CFP® pro background would make studying easier. While it helped with certain topics like taxes, life insurance, and private wealth management, it didn’t give me nearly as much of a leg up as I thought it would.

ReisUP How to Pass CFA Level 3 Exam

#2 - Read the text and take notes

Yes, actually read the material the CFAI gives you. It’s not as long as the other two levels, but it is dense, which means you need to give yourself ample time to get through it. There are a lot of details and nuances hidden in the text that I’ve heard other prep providers ignore or neglect to mention.

#3 - Register for a bootcamp

This was actually the only level for which I bought third party prep materials and thank god I did! I registered for the LevelUp Bootcamp in NYC and it was a game changer.

Long story short, Marc knows his stuff. There were numerous things he told us to watch out for that I probably would have glazed over, and guess what? They showed up on the exam.

#4 - Practice essays under timed conditions

I didn’t do nearly enough of this and it bit me in the ass on exam day. I moved way too slowly through the morning essay questions. With 20 minutes left to go, I still had 4 full item sets to get through. I ended up leaving a few question parts blank, and almost failed the entire exam because of it.

I knew heading into the afternoon section that I had to give the performance of my life in order to pass. Thankfully, I crushed the PM portion and skated by the curve. But it could have just as easily gone the other way! Don’t put that kind of pressure on yourself and have to rely on your PM score to pull you through. You never know what will show up in the afternoon.

#5 - Pay attention to multi-step equations

I can’t give any examples for ethics reasons, but as you’re studying, take note of private wealth, economics, and equity formulas that require multiple steps to get to a final answer. These are easy targets for essays, and you should at least be able to get partial credit on them.  

#6 - Don’t do the essays in order

On the essay portion, do not start with the first question. It’s almost always the hardest and most confusing. Instead, decide which topics you’re going to attack in what order ahead of time, then do just that on the exam. Skip around and answer questions you know you can get right first, then try your hand at the harder ones or topics you’re not as solid on.

This was my strategy and it worked. I filled most of my time answering questions that I knew I could get right. When I ran out of time, the questions I had to leave blank and therefore got zero points for were questions that, honestly, I probably wouldn’t have been able to answer anyway.

#7 - Focus on sets of concepts

This was the same for Level I… CFAI loves to test you on the difference between things that come in pairs or groups. Make sure you can identify or explain the similarities and differences between things that fall under a common category.

#8 - Think “Don’t be shady” on Ethics questions

Repeating this phrase to myself over and over again on Ethics questions pulled me through on every single exam. I’ve always scored really high in Ethics whereas I know a lot of other people struggle with this topic.

Depending on what the question is asking you, you’ll either want to choose the least shady or the most shady answer. This is especially true for Level III. A lot of my fellow test takers were complaining about the difficulty of the Ethics questions post-exam, but I thought they were all pretty straightforward when put to the “shady” test.


How is your Level III study process going?


Tara Falcone, CFA, CFP® | Instagram: @reisupllc | YouTube: reisupllc