CFA or CPA Which is More Valuable

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You may wonder which one is more valuable between CFA and CPA. CFA stands for Chartered Financial Analyst and CPA stands for Certified Public Accountant. In the financial field, CFA and CPA are two of the most sought-after credentials. It is because with it, they are able to get promoted, improve their career options and even make more money. If you want to know which one is better between CFA and CPA, you have to know the differences between them in every section so that you can decide the more valuable one for you.

The Difference Between CFA and CPA

According to the Crush The Financial Analyst Exam site, in CFA, people will focus on the skills of recommending individual investment and evaluating financial trends. If you have a CFA, you have the educational equivalent of a master degree in financial analysis. Besides, CFA is a certification which is accepted not only in the United States but also outside of the United States. If you are interested in a career in financial planning as an equity analyst, asset management, fund manager, or hedge fund manager, you can be a CFA.

How about CPA? This certification qualifies you to work in a wide range of financial fields such as non-public accountants, finance professionals, and tax accountants. With this certification, you have the right to sign off on tax and audit reports.

Salary of CFA and CPA

CFA certifications and CPA certifications can make you have a good salary. According to the ZipRecruiter that is also explained on the Crush The Financial Analyst Exam site, each year, CPAs make an average of $72k, but if you have CPA certification with more experience, you can make over $110k a year. How about the salary of having a CFA? If you have a CFA certification, you can make an average of $95k a year. Their upper limit annual salary is $120k.

According to the Investopedia, compensation that is earned by those with CFA varies depending on the location, industry, role, experience and the specific compensation package. If you have CFA certification and you work as a portfolio manager, you are able to make a base salary of $126,000. This number is according to a 2019 study which was conducted by the CFA Institute. However, if you have a CPA, your average salary is around $70,235 to $461,014 as of July 17, 2022. Same as those who have CFA, the compensation earned by those with CPA also vary depending on the company, location, seniority, and specific role.

By earning CPA, it means that you have a more general financial skill set and it will lead you to a wider range of work opportunities because you will be eligible for a lot of positions. Meanwhile, if you earn CFA, you will be more specialized so that it is better to be earned by you if you are looking for a specific career path in investment or corporate finance.

As explained on the Crush The Financial Analyst Exam, the growth of employment for CFA and CPA is stable and consistent. There was a report from The Bureau of Labor Statistics that the job outlook is 7% in the next 10 years for accountants and 6% for financial analysts.

When you have to choose a career path, the thing that you need to consider is about your interest. You need to know what interests you most about finance and whether you are someone who can take risks or more traditional. For your information, CFA has a lower entry barrier, but it takes much longer to complete. If you want to be a qualified CPA, the process is more flexible in a much shorter time frame. However, if you want to have a successful career in the financial industry, these certifications are valuable.

Exam of CPA and CFA

First, let’s take a look at the CPA exam according to the Crush The Financial Analyst Exam site. In the CPA exam, there are four parts and the exam has the content and structure which is the same in every state throughout the US. You are able to schedule the CPA exam since there are specific windows and every window is two months long. A total of four exam windows are available throughout a year, namely January/ February, April/ May, July/ August, October/ November. The content and individual parts of the CPA exam are listed below.

  • Business Environment and Concepts
  • Financial Accounting and Reporting
  • Audit and Attestation
  • Regulation

The rates of the pass for the exam are usually 50% or lower. In 2014, the cumulative pass rates for the four parts of the CPA exam were 46.35%, 55.46%, 47.60%, and 49.41%. The exam is computerized and it consists of multiple-choice questions, task-based simulations and written communications.

Now, let’s take a look at the CFA exam according to the Crush The Financial Analyst Exam site. This exam is offered only on specific dates. This test is not able to be scheduled by you at your convenience because candidates all over the world take the exam on the same day. The offering of CFA Level I is twice a year namely in June and December. Meanwhile, Levels II and Levels III are offered once a year in June. Different from the CPA exam which is computerized, the CFA exam uses a pencil and paper.

Comparative Table of CPA vs CFA

According to the Wall Street Mojo site, here is the comparative table or infographic of CFA vs CPA.

Section CPA CFA
Organized by American Institute of Certified Public Accountants (AICPA) CFA Institute
Pattern One Level Divided into 3 levels
Duration of Course 1.5 years 4 years
Syllabus Regulation, Audit and Attestation, Business Environment and Concepts, Financial Accounting and Reporting Financial Principles, Portfolio Management, Financial Analysis, Accounting
Exam Fees $1,500 $2,500 to $3,500 depending on the time of registration
Jobs Forensic Accountant, Public Accountant, Financial Analyst, Internal Auditor Portfolio Manager, Research Analyst, Corporate Financial Analyst, Consultant
Difficulty It is moderately hard with passing rate of around 50% It is challenging and only around 10% of the candidates can clear all the levels.

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