FRM® Certification Requirements: 3 Steps to Become a Financial Risk Manager

Becoming a certified Financial Risk Manager often leads to a six-figure salary.

But what do you actually have to do to earn that certification?

Some professional certifications need you to jump through endless hoops just to qualify to sign up for their exam program. Luckily, the FRM® certification does no such thing. In fact, as far as professional certifications go, earning the FRM® is about as straightforward as it gets.

Today, I’ll walk you through the three steps candidates can’t miss if they want to succeed and give you a comprehensive roadmap for getting it all done.

Key Takeaways

• Straightforward Steps: The FRM® certification process involves three main steps: passing two exams, gaining two years of work experience, and submitting it for approval.
• No Degree Needed: You don’t need a specific educational background to enroll in the FRM® program, making it accessible to a wide range of candidates.
• English Proficiency Required: The exams are in English, so candidates must be fluent enough to understand and answer complex questions.
• Prep Materials Are Key: A solid prep course and study materials are critical for passing the rigorous FRM® exams, which require 200–300 hours of preparation per part.
• Work Experience Flexibility: Candidates have five years after passing Part II to complete and submit their two years of qualifying work experience.

3 Key Requirements for the FRM® Certification

Let’s look at what’s required for FRM® candidates to graduate from the FRM® Program. While the path to certification involves a lot of hard work and dedication, the steps themselves are, fortunately, very straightforward:

1. Pass Part I of the FRM® Exam

The FRM® Exam is split into two parts, and your first step is to pass Part I. The first exam focuses on foundational concepts in risk management, including:

2. Pass Part II of the FRM® Exam

Next, you’ll have to pass the second and final leg of the FRM® exams. This section digs deeper than the first. You’ll cover advanced topics such as:

👉 Pro Tip: You must pass Part II within four years of passing Part I to remain eligible for certification.

3. Earn and Submit Relevant Work Experience

Once you’ve passed both exams, you’ll need two years of full-time work experience in risk management or a related field. Qualifying roles might include:

• Risk analysis
• Model validation
• Trading or portfolio management
• Treasury operations
• Audit or consulting with a focus on financial risks

You have five years after passing Part II to submit your work experience. If this step isn’t completed within that timeframe, you’ll need to retake both exams to become eligible again.

Other Information to Know

There are a few more elements candidates need to consider:

• Exams are given in English only, so candidates must be fluent enough to take and pass a difficult exam in this language.
• Candidates must agree to the candidate responsibility statement given by the Global Association of Risk Professionals (GARP). To summarize, it ensures candidates have read and agree to their exam policies and will adhere to their professional code of conduct.
• Candidates must have a valid government-issued ID to register and sit for the FRM® exam. This ensures proper identity verification on the test day.

Your FRM® Roadmap

Here’s your step-by-step guide to earning the FRM® certification. Use this roadmap to stay on track:

1. Sign Up for the FRM Program
   • Cost: $400 enrollment fee (one-time) + $600–$800 for exam registration per part (depending on when you register).
   • Timeline: Register at least a few months before the exam date.
2. Invest in Study Materials
   • Cost: Budget around $1,000 for prep courses, practice exams, or other materials. Expect to pay more if you choose a higher-priced prep course.
   • Timeline: Plan for at least 200–300 hours of study per exam part, spread over 3–6 months.
3. Study and Prepare
   • Use GARP’s official curriculum and third-party resources to master key topics like risk models, market risk, and financial markets.
   • Stick to a study schedule to ensure you’re ready by exam day.
4. Take and Pass FRM® Exam Part I
   • Cost: Registration fee (included in Step 1).
   • Timeline: Exams are offered in May and November. Results are typically available six weeks after the exam.
5. Take and Pass FRM® Exam Part II
   • Cost: $600–$800 registration fee for Part II.
   • Timeline: Plan to take Part II within 1–2 years of passing Part I.
6. Gain Relevant Work Experience
   • Requirement: Two years of full-time experience in financial risk management or a related role.
   • Timeline: You have up to 5 years after passing Part II to fulfill this requirement.
7. Submit Your Work Experience to GARP
   • Log in to your GARP account and submit details about your role and responsibilities.
   • Timeline: Allow time for GARP to review and approve your submission.
8. Earn Your Certification
   • Once your work experience is approved, you’ll officially earn the FRM® designation and can add it to your resume!

By following this roadmap, you’ll stay organized and on track to becoming a certified Financial Risk Manager.

Conclusion

Though earning your FRM® designation will be difficult, one of the major pluses goes beyond salary—few professional certifications are as straightforward to earn, with no education requirements and only two years of work experience needed.

So, if becoming an FRM® is a dream of yours, you’re in luck!

What are the next steps? Register for the FRM®, choose your perfect prep course, study for your exams, pass with flying colors, and earn your work experience.

At the end of this journey, you’ll have a shiny new certification in hand that leads to a rewarding career and a full wallet.

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