In today’s world of complex financial markets and global uncertainty, the ability to measure, manage, and mitigate risk is a career-defining skill. After all, leading companies like Citigroup, JP Morgan Chase, KPMG, PWC, and Wells Fargo are some of the top employers of financial risk managers. That’s why the Financial Risk Manager (FRM®) credential has become such a respected standard for risk professionals.
Earning the certification isn’t just about passing an exam—it’s about proving you have the technical expertise and real-world judgment to help firms navigate credit, market, and operational challenges. If you’re considering the FRM®, here’s a complete guide to what it takes.
Key Takeaways
- Two-Part Exam: The FRM® program requires passing Part I (foundations, markets, risk models) and Part II (applications in credit, market, and operational risk).
- Work Experience Matters: Candidates must submit at least two years of relevant, full-time risk-related experience to become certified.
- Challenging Pass Rates: Roughly 58% of Part I and 52% of Part II candidates passed in recent sittings, showing the exam’s rigor.
- Time Investment: Most candidates spend 200–300 hours per part studying with official study materials and practice exams.
- Global Recognition: The credential, backed by the Global Association of Risk Professionals, is valued in banking, investment, and corporate risk roles worldwide.
FRM® Certification Requirements at a Glance
To officially earn the FRM® credential and become a certified financial risk manager, candidates must complete all of the following steps:
- Pass FRM Exam Part I – 100 multiple-choice questions covering financial markets and products, quantitative analysis, and valuation and risk models: all key elements of the foundations of risk management.
- Pass FRM Exam Part II – 80 multiple-choice questions focused on applications, including market risk measurement, credit risk measurement, operational risk management concepts, liquidity and treasury risk, portfolio management, and current issues in global markets.
- Submit Two Years of Professional Experience – Full-time work in roles involving risk measurement and management, such as banking, investment, or corporate finance. This must be submitted within 10 years of passing Part II.
- Stay Current with CPD (Optional but Encouraged) – While not mandatory, GARP recommends ongoing Continuing Professional Development to keep up with evolving best practices and risk management tools.
Who Grants the FRM® Credential?
The FRM® designation and exam are administered by the Global Association of Risk Professionals (GARP), a leading organization for risk professionals worldwide. Since its launch in the 1990s, the FRM® program has set the bar for competency in financial risk management, with thousands of candidates each year pursuing certification to advance their careers in banking, investment, and corporate finance.
Exam Structure: Two Parts, One Credential
The FRM® program requires passing two rigorous exams. Both are computer-based and designed to measure technical knowledge alongside application in real-life scenarios.
- FRM® Exam Part I
- 100 multiple-choice questions
- Focus areas: Foundations of risk management, quantitative analysis, financial markets and products, and valuation/risk models
- Emphasis: Core building blocks and theory
- FRM® Exam Part II
- 80 multiple-choice questions
- Focus areas: Market risk measurement, credit risk measurement, operational risk management concepts, liquidity and treasury risk measurement, portfolio management, and current issues in financial markets
- Emphasis: Applying tools and methods from Part I to real-world problems
Candidates must pass Part I before moving on to Part II. GARP allows up to four years between exams, so you have time to pace your studies.
Exam Dates and Testing Windows
The FRM® exams are offered three times per year—in May, August, and November. Seats are filled on a first-come, first-served basis, so early registration is strongly advised. Each testing window provides multiple dates across global locations, giving flexibility in scheduling.
How Much Does the FRM® Certification Process Cost?
Costs for the FRM® program vary depending on when you sign up. There’s a one-time enrollment fee plus an exam fee for each part. Early registration comes with discounted pricing, while waiting until the standard registration deadline means paying more.
The standard registration fee sometimes includes one year of GARP Individual Membership (if you haven’t had it before), which gives access to networking opportunities, resources, and continuing education. However, this isn’t guaranteed.
Preparation and Study Materials
The FRM® exam is known for its rigor, and most candidates underestimate how much preparation is needed. GARP recommends about 240 hours of study per part, though many candidates put in even more.
When you register, you’ll gain access to GARP’s Learning platform, which includes:
- Official FRM® books (available digitally and in print)
- Online learning modules and readings
- FRM® practice exams and practice questions
- FRM® prep courses like AnalystPrep and Kaplan
While third-party course providers also offer prep packages, the official materials provide the clearest alignment with the exam’s exam topics and exam specifications.
Tip: Save with discounts from Kaplan Schweser or an AnalystPrep promo code.
FRM® Pass Rates and Difficulty
The FRM® isn’t an easy credential to earn. In the May and August 2025 administrations, FRM® pass rates stood at about 58% for Part I and 52% for Part II.
The numbers highlight that many candidates don’t succeed on their first attempt. Part I often trips people up with the intensity of its quantitative analysis and breadth of financial markets knowledge, while Part II challenges candidates to apply those principles to risk measurement and management in integrated cases.
This difficulty is deliberate. The exams are meant to test not just theory, but whether you can think like a certified financial risk manager faced with practical decisions.
FRM® Work Experience Requirement
Passing both parts of the exam isn’t the final step. To become certified, you must also demonstrate at least two years of relevant, full-time professional experience in risk-related roles.
Acceptable roles include positions in banking, investment management, corporate risk, or similar fields where you’ve applied risk management tools in practice. You have up to 10 years after passing Part II to submit your experience. This flexibility makes it possible for early-career professionals to pass the exams first, then gain experience before certifying.
Continuing Professional Development
Although it’s not mandatory, GARP encourages certified FRMs to participate in its Continuing Professional Development (CPD) program. Risk management evolves quickly—new risk models, regulations, and market dynamics emerge constantly. Staying engaged ensures your credentials remain relevant and respected in the field.
Why the FRM® Matters for Financial Risk Managers
So why go through all this? For one, the FRM® is internationally recognized. Whether you’re working in treasury risk measurement, credit risk measurement, or management operational risk, the credential signals to employers that you’ve mastered a global standard.
It’s also valuable for career mobility. In fields like portfolio management or operational risk, the FRM® helps distinguish you from peers, especially in competitive hiring markets. And for those in investment management or regulatory roles, it demonstrates a level of technical credibility that goes beyond on-the-job training.
Final Thoughts
The FRM® program is a serious undertaking, requiring you to master everything from quantitative analysis and financial markets to the finer points of risk measurement and management. Between the two exams, the work experience requirement, and the ongoing expectation of professional development, the journey is demanding.
But for those committed to a career in risk, the effort pays off. Passing both exams, logging your experience, and becoming a certified financial risk manager signals not only technical mastery but also a commitment to safeguarding institutions and markets in an increasingly uncertain world.
FAQs
To earn certification, you must pass both FRM® exams, then submit at least two years of relevant full-time professional risk management experience within 10 years.
While some candidates finish both FRM® exams in as little as one to two years, the full certification process — including the two-year work experience requirement — often takes two to four years. The exact timeline depends on factors like exam scheduling, retakes, and when relevant job experience is gained.
Both the FRM® and the CFA® exam are challenging but different. The CFA emphasizes investment analysis and portfolio management, while the FRM® focuses deeply on risk management, credit risk measurement, and valuation and risk models.
Costs for FRM® certification depend on registration timing. Early registration reduces fees, while late registration costs more. Expect to pay exam fees for each part plus a one-time enrollment fee.
Yes—especially for careers in risk, banking, and investment. The FRM® signals technical expertise and global credibility for risk management professionals.
