I'll pretty much second what Midlifeflyer wrote. There is really no best way to prepare for the knowledge test - it's purely a matter of personal preference. I would recommend that you ask your flight instructor for his or her opinion, check with other students and recently licensed pilots, and sit in on a ground school class. It won’t take too much effort to find several people who have used each method. When you make your own decision, just remember that, like choosing you flight instructor, this is no place to skimp on quality.
Some people find a formal ground school to be preferable. They like the way the instructor is able to spend one-on-one time with each student. However, the quality of the course is dependent upon the instructor’s “classroom abilities”. Simply put, some ground school instructors are good and some aren’t. Ground school courses are readily available from several sources. They are commonly offered as adult education courses at local high schools and community colleges; your flight instructor and/or flight school may offer them; and they are frequently offered as “weekend courses” in most major cities. (I don’t usually recommend the “weekend courses”. They tend to “teach the test” and not the materials you need to know and understand. However, they are a good review for those who have previously completed a thorough exam preparation course and just need a quick brush up prior to taking the examination.)
As far as home study courses go, there are several excellent computer and video courses available to prepare the student to successfully pass the knowledge exam. These courses utilize the latest in computer-generated graphics and make learning the material very easy and enjoyable. They have the advantage of excellent presentation, but they tend to be a bit more expensive than the formal ground schools. These courses are readily available from several sources. Perhaps the easiest way to obtain one is through mail-order. Any of the aviation oriented magazines such as “Flying”, “Private Pilot” and “Plane & Pilot” will have several advertisements offering suitable courses. Your CFI will be able to make some recommendations if you decide to go this route.
For what its worth, I have a tendency to prefer the computer and/or video ground school courses. Having a home study course allows you to go over the materials once or twice before your flight instruction actually begins. I have found it to be advantageous for most students to have the background that the study material provides prior to beginning any actual flight training.
Lead Sled