Actuary Career Guide

Table of Contents

Overview

Job Responsibilities

  • Gather and organize statistical data and other information for further analysis
  • Estimate the probability of events such as death, sickness, an accident, or a natural disaster and their likely economic cost
  • Design, test, and administer insurance policies, investments, pension plans, and other business strategies to  maximize profitability while minimizing risk
  • Formulate reports such as charts and tables to explain calculations and proposals
  • Explain statistical findings, analysis and proposals to decision-makers such as company executives, government officials, shareholders, and clients

How Much Does an Actuary Make?

Actuaries made a median salary of $102,880 in 2018. The best-paid 10 percent made more than $186,110 that year, while the lowest-paid 10 percent made less than $61,140.

Common Requirements

  • An undergraduate degree in actuarial science, mathematics, statistics, or any other analytical program
  • Coursework in statistics, economics, and corporate finance
  • Coursework in computer science, programming languages, and the ability to use and develop spreadsheets, databases, and statistical analysis tools
  • Classes in writing and public speaking
  • Certification from  Casualty Actuarial Society (CAS) and the Society of Actuaries (SOA)
  • Applicants must also pass seven exams for associate-level certification after completing hundreds of hours of study and months of preparation
  • Fellowship certification

Similar Careers

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Mathematicians

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Common Skills

Analytical skills

Communication

Computer skills

Mathematics

Problem-solving

Interpersonal skills

Project management

MEDIAN SALARY

$102,880 per year
$49.46 per hour

JOB OUTLOOK

20%

NUMBER OF JOBS

25,000

A Comprehensive Guide to Becoming an Actuary

An actuary makes use of advanced mathematical and statistical tools to accomplish their duties. They make use of specialized computer programs that are unique to their field of work. Also, they undergo several years of study and exams before they get a professional status. Suffice to say, becoming an actuary is not an easy feat, but if you have a natural love for numbers, computers, and endless learning, you might just be cut out for the job.

What Does an Actuary Do?

Actuaries calculate the possible cost of risk to the companies they work for. They also help to find ways to minimize losses due to these risks. Below are more detailed responsibilities of actuaries:

  • Gather and organize statistical data and other information for further analysis
  • Estimate the probability of events such as death, sickness, an accident, or a natural disaster and their likely economic cost
  • Design, test, and administer insurance policies, investments, pension plans, and other business strategies to maximize profitability while minimizing risk
  • Formulate reports such as charts and tables to explain calculations and proposals
  • Explain statistical findings, analysis, and proposals to decision-makers such as company executives, government officials, shareholders, and clients

Signs You Should Consider Becoming an Actuary

Actuaries have certain specific traits and characteristics that are unique across all of them. Some of these traits may come off more prominently than others. However, people who make excellent candidates for actuaries have a balanced mix of the following qualities:

Your favorite subject is mathematics 

Becoming an actuary may be the right career decision if you constantly feel a pull towards mathematics during your student years. If complicated formulas and advanced computations do not faze you, you might just have a deep enough love for the level of maths that it takes to deal with responsibilities that actuaries come face to face with every day.

Principles like Calculus, Statistics, and Probability should come off as easy for you since these are the types of knowledge you will use as a basis for your decisions and recommendations in quantifying risk. Your deductions should be meticulous and trustworthy enough since it will be the basis of big business decisions that could make or break a company’s status.

You like playing the devil’s advocate.

Risk calculation is the main responsibility of an actuary, so if you are planning to become one, it will help if you have somewhat the mind of a skeptic. Actuaries often like to err on the side of caution. It is their duty and obligation to know how things can go wrong and how much it could potentially cost an organization.

You are independent and self-motivated.

An actuary’s role is a solitary one most of the time. Therefore, someone who is independent and does not mind working alone will suit the part just right. And because you work alone, it means that you are not only self-sufficient but also self-motivated since you are solely responsible for pushing yourself to meet your goals.

Here are a few tips for developing a good sense of self-motivation:

  • Surround your workplace with inspiration. It can be as simple as a token of what motivates you to do your best such as a family portrait.
  • Mingle with optimistic and motivated people. Feed on their energy and watch yourself overflow with positivity.
  • Practice positive thinking and try to find silver linings in every situation. Acknowledge bad situations, but try to also see the good in it.
  • Less thinking, more doing. Continuity in activities gives you a sense of momentum, which in turn gives you the drive to keep on going until you reach your goal.
  • Keep track of your progress and celebrate every small win. Having a visual sense of where you are in terms of achieving your target is a wonderful motivation boost for many. 
  • Lend a helping hand to others who are struggling. The thought of helping others do well and motivating others can spread positive energy and give you a sense of accomplishment like no other.

You can also work with others.

Despite having a solitary role, actuaries sometimes also need to mingle with team members and become a top team performer-either as a leader or a member. This means that you have to have some decent interpersonal skills and strong communication that you can bend to relate to people of different situations -from rank and file positions to executives and decision-makers.

You are ambitious

Actuaries have a lot to go through before reaching the peak of their careers. You need to be driven and ambitious enough to rise through the ranks and become successful. A healthy sense of ambition is also useful when handling projects and daily responsibility. It gives you the motivation to excel at the job.

actuary presenting reports

How Do You Become an Actuary?

The road to becoming an actuary is neither short nor easy. It entails years’ worth of study and perseverance. If you think you are willing to brave the elements to become a full-fledged actuary, below is a list of steps you need to undertake. Do remember that some of these steps overlap or might precede each other in varied succession.

  1. Finish undergraduate studies in actuarial science or any related field

Most actuaries have degrees that are related to analytics such as mathematics, actuarial science, and statistics. These degrees often have courses that heavily touch on maths, statistics, business, economics, and corporate finance. 

On top of the courses related to actuarial science, students who want to go all the way into the actuary route need to take classes beyond those that deal with maths as well, such as computer science, programming, public speaking, and communications. 

  1. Obtain associate certification

Two registered societies offer programs that allow actuaries to rise to professional status: the Casualty Actuarial Society (CAS) and the Society of Actuaries (SOA). The former accredits actuaries who work with properties and casualties such as those in automobiles, housing, worker compensation insurance, and medical malpractice. On the other hand, the latter certifies actuaries who work in life and health insurance, retirement benefits, investments, and finance.

Both the CAS and SOA require applicants to have had coursework in economics, finance, and mathematical statistics during their college days. To become an associate, an applicant must pass a total of seven exams to obtain certification. Many employers expect applicants to have initially passed at least one of the seven actuary exams before even stepping out of college. 

It takes between four to seven hours for an aspiring actuary to reach the associate level. That is because the process of preparing for all the exams usually takes hundreds of hours worth of study within several months of preparation for each test.

  1. Obtain fellow certification 

After reaching the associate level, the next step for an actuary is to become a fellow. This step is a bit shorter than the previous as it only takes about two to three years to complete. The CAS offers a general fellowship certification while the SOA offers a more specialized certification with five different tracks to choose from: life and annuities, retirement benefits, group, and health benefits, investments, and finance/enterprise risk management.

If you do decide to become a pension actuary, you will need licensing issued by the U.S. Department of Labor and the U.S. Department of the Treasury’s Joint Board for the Enrollment of Actuaries. The board issued this license to actuaries who have had the required experience and have passed two exams from the SOA.

  1. Participate in continuing education programs

The CAS and the SOA both have continuing education requirements to maintain an actuary’s status. These societies host training and seminars for actuaries. Employers may also provide training and seminars in support of their actuaries and coordination with the two certifying bodies. 

Typically, employers are supportive of the advancement of their actuaries. They usually cover examination expenses, finance study material, support paid study leaves, and give bonuses or a salary raise for every examination passed.

  1. Training and mentorship  

When you start your career as an actuary, you will most likely begin as a trainee under the mentorship and teaching of an older and more experienced actuary. Within the team, your first few tasks will be fairly simple such as compiling data for other departments, such as marketing, underwriting, and product development, to learn all aspects of the company’s work and how actuarial work applies to each one. Gradually, as you gain more experience, you are handling more complex responsibilities, such as conducting research or drafting reports.

What are the Knowledge and Skills Needed to be an Actuary?

Becoming a successful actuary is no walk in the park. The same can be said with actually performing the role and being in the shoes of one. To effectively perform at this job, an actuary must possess the following knowledge and skills:

Advanced mathematical knowledge

Actuaries quantify risks using complex mathematical concepts such as statistics, probability, and calculus. You need to have advanced knowledge of these complex concepts to be able to deduce, analyze, and do the job correctly. This is the reason why most actuaries are graduates of math-related degrees, such as statistics. Actuarial science programs are also quite heavy with mathematics-related courses to adequately prime aspiring actuaries for the role they are about to play.

Project management and problem-solving

Aside from assessing and quantifying risk, actuaries also find ways to minimize those risks. They identify challenges that increase those risks and find ways to go around them. During their work, actuaries may even find themselves leading teams for specific projects. Project management has its challenges and therefore requires a fair amount of problem-solving skills.

Advanced computer skills 

Actuaries use and develop spreadsheets, databases, and statistical analysis tools with the help of programming. Programming and computer science courses are usually recommended for those aspiring to enter the field of actuarial science. The area has a heavy reliance on technology, which allows data to be processed quickly and flawlessly. Having advanced computer skills enables an actuary to breeze through the work more efficiently.

Good business sense

Another type of coursework that is recommended for those entering into the actuarial field is business and corporate finance. Actuaries are usually employed by companies or organizations that handle finance, investments, and revenue. Having some solid background on business gives an aspiring actuary a good grasp of business concepts within every organization. It allows him or her to relate to the organization’s business processes to integrate risk analysis seamlessly into the fold.

Strong communication skills

Actuaries should be able to communicate effectively, even to those who do not have any actuarial knowledge. Therefore, being able to translate complex ideas into understandable statements is a definite must. Also, formulating reports and recommendations requires excellent written communication skills. Strong communication skills allow an actuary to convey essential messages clearly for the benefit of the organization that he or she is in.

Looking for an actuary school near you? Below is a comprehensive list of universities and colleges within the United States that offer actuarial programs:

  • Abilene Christian University Texas
  • Anderson University Indiana
  • Appalachian State University North Carolina
  • Arcadia University Pennsylvania
  • Arizona State University Arizona
  • Asbury University Kentucky
  • Ashland University Ohio
  • Auburn University Alabama
  • Austin Peay State University Tennessee
  • Ball State University Indiana
  • Baruch College New York
  • Bellarmine University Kentucky
  • Beloit College Wisconsin
  • Bendictine University Illinois
  • Bentley University Massachusetts
  • Binghamton University New York
  • Bob Jones University South Carolina
  • Boston University Massachusetts
  • Bowling Green State University Ohio
  • Bradley University Illinois
  • Brigham Young University Utah
  • Brooklyn College, CUNY New York
  • Bryant University Rhode Island
  • Butler University Indianapolis
  • California Baptist University California
  • California State University Fullerton California
  • Canisius College New York
  • Carroll University Wisconsin
  • Cedarville University Ohio
  • Central Connecticut State Connecticut
  • Central Michigan University Michigan
  • Central Washington University Washington
  • Clark University Massachusetts
  • Clemson University South Carolina
  • College of William & Mary Virginia
  • Columbia University New York
  • Concordia University Wisconsin Wisconsin
  • DePaul University Illinois
  • DePauw University Indiana
  • Dordt University Iowa
  • Drake University Iowa
  • Drexel University Philadelphia
  • East Carolina University North Carolina
  • Edinboro University of Pennsylvania Pennsylvania
  • Elizabethtown College Pennsylvania
  • Ferris State University Michigan
  • Florida State University Florida
  • Gannon University Pennsylvania
  • George Mason University Virginia
  • Georgia State University Georgia
  • Hofstra University New York
  • Illinois State University Illinois
  • Indiana University – Purdue University in Indianapolis Indiana
  • Indiana University Northwest Indiana
  • Indiana Wesleyan University Indiana
  • Iowa State University Iowa
  • Kent State University Ohio
  • Kettering University Michigan
  • Lebanon Valley College Pennsylvania
  • Lee University Tennessee
  • Lindenwood University Missouri
  • Lock Haven University Pennsylvania
  • Louisiana State University Louisiana
  • Maryville University of St. Louis Missouri
  • MBOA International University Center Region
  • McKendree University Illinois
  • Miami University Ohio
  • Michigan State University Michigan
  • Middle Tennessee State University Tennessee
  • Millikin University Illinois
  • Milwaukee School of Engineering Wisconsin
  • Minnesota State University – Mankato Minnesota
  • Minnesota State University – Moorhead Minnesota
  • Missouri University of Science and Technology Missouri
  • Morgan State University Maryland
  • Murray State University Kentucky
  • New Jersey Institute of Technology New Jersey
  • New York University Stern School of Business New York
  • North Central College Illinois
  • Northeastern University Massachusetts
  • Northern Arizona University Arizona
  • Northern Illinois University Illinois
  • Northwestern College Iowa

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actuary in front of computer

How to Get a Job as an Actuary

Getting an actuarial job can still be quite a challenge, although it is foreseen to have a very fast-growing number of positions until 2028. If you are set on wanting to become an actuary, you need to fix your career compass early onto getting to the job as quickly as possible. Here are some things you can do to help you get a job as an actuary:

Pass at least two exams from a certifying agency

Usually, actuaries who get their first actuarial job have between one to three exams already under their belt. It is recommended that students begin taking the exams while still studying so that they have at least one or two exams done before they start applying for jobs.

Choose between the CAS or the SOA, depending on your perceived long-term career goals. Do you want to work with property and casualties? Or do you want to deal with insurance and retirement industries? Deciding early on which path you wish to undertake will give you a clear perspective on which direction your career should go.

Get an actuarial internship.

One of the best ways you can secure an actuarial job soon after college is to get an actuarial internship. Internships are often offered to college students in their final year of study. If you cannot find a placement for an actuarial position, internships in related fields are similarly helpful. 

Internships provide you with useful work experience, advanced knowledge, and referrals, which can come in handy when looking to apply for your first official full-time job as an actuary. Additionally, according to a survey, paid internships usually end up in full-time employment, so there is a whole lot more long-term value in an internship.

Get a related job while your exams are still ongoing.

Once you have graduated, the chances of getting hired as an actual actuary are still pretty slim. What you can do to remedy this is starting with a related job that offers entry-level positions. Below are some examples of such similar jobs:

  • Data analyst – collects and analyzes large amounts of data. The resulting analysis would be used to make business decisions such as price adjustments, marketing strategies, and a lot more.
  • Underwriter – classifies and approves insurance applicants. Underwriters also work closely with actuaries, and in-depth knowledge of insurance is beneficial for an aspiring insurance actuary.
  • Risk analyst – oversees a company’s asset portfolio, analyzes it for any potential risks, and quells any losses. These people work closely with investment actuaries.

Look into industries that commonly hire actuaries.

There is a published Directory of Actuarial Employers that you can look up as a reference to see which industries and businesses you could work for as an actuary. In terms of actual hiring entities, Actuarial Employers -Global Listing can provide you with much-needed reference to hiring entities across each state. Their website allows you to filter employers based on country, size, and type. This site is perfect and convenient for actuaries who want to search for jobs based on location. 

Learn About Geographic and Location Pay Differentials

Below are the pay differentials in terms of state location for actuaries:

State2018 Mean Annual Wage
New York$150950
Connecticut$132910
Washington$131330
New Hampshire$129110
Idaho$121590
California$120680
Pennsylvania$120090
Colorado$119660
Georgia$118790
North Carolina$117190
Minnesota$116150
Massachusetts$114050
Kansas$113910
New Jersey$111580
Illinois$110430
Mississippi$107910
Florida$107850
Oregon$107410
State2018 Mean Annual Wage
Iowa$107390
Texas$107260
Wisconsin$106850
Maine$106660
Nebraska$106630
Rhode Island$102730
Alabama$102080
Indiana$100950
Ohio$100620
Missouri$100180
Maryland$98500
Vermont$98500
Michigan$95120
Arkansas$87730
Nevada$86200
Utah$74180
ArizonaData not released
VirginiaData not released

Report from the Bureau of Labor Statistics

Make Your Resume Stand Out

Here are some of the things you should keep in mind when crafting your resume:

  1. Keep it simple and professional

Mind your choice of color, font, and general appearance. Remember that you are applying for a professional position. Therefore your resume or application should reflect the same vibe in terms of appearance. Choose a plain classic font that looks clear and formal on print like Times New Roman. If you are submitting an online resume, non-serifed fonts like Arial are usually more eye-friendly.

  1. Avoid long and winding statements

Do reserve your paragraphs for the cover letter. The resume should be brief and concise. Get straight to the point. Make use of bullets to enumerate educational attainments, work experience, and accomplishments. This way, it will be easier for the hiring manager to scan through the document and get the gist of the most important aspects of your resume.

  1. Decide on a suitable format

With the choice of format, you can either go chronological or reverse. The latter works best for those who have plenty of recent experience since the most featured parts are your recent employment while the former works best for those who are just starting out since the main highlight would be your education and awards, if any. 

  1. Proofread your finished document

You can not purely rely on system-generated grammar and spelling checks. On top of such applications, you should also take the time to read through your resume. If you can, print it out to see how it looks on paper. Chances are, you may have missed something that is not immediately obvious on a computer screen. Have a friend look over your print out and let them tell you what they think, what could be improved, or if they spotted any errors in it. This step is important because minor errors like misspelled words can turn off a potential employer.

  1. Maximize your referrals

While character references are no longer as popular as they were before, it could still pay off to practice some diligence and include some in your resume. This is especially true if you know you have a strong reference. If you’re not too sure, including a reference could still give you a better chance of catching the manager’s eye enough to call you back for an interview than if you were not to include it. Who knows -the company and your reference might be long lost acquaintances, belong to a shared organization, or are somewhat related. 

Ace Your Actuary Interview

Once you have finally secured an interview for an actuarial position, you can start preparing for possible questions that might be tossed your way. Below are a few examples:

  1. What are the important skills of an actuary?

 

  • Expert knowledge on statistics and mathematics
  • Familiarity with business and finance
  • Computer programming, spreadsheets, databases
  • Communication skills
  • Analytical and problem-solving
  1. What are the benefits of working as an actuary?

The benefits of being an actuary are quite impressive. They include high salaries, flexible working hours, central roles within an organization, widespread scope covering many departments or industries, and international opportunities.

  1. What are some of the most common actuarial software?
  • Milliman Actuarial Software Solutions
  • Moses
  • GGY-AXIS
  • Poly Systems
  • Prophet
  • PTS
  • RMISWeb
  • SAS
  • TAS
  • Towers Watson
  1. What topics or concepts should actuaries be proficient in?

Actuaries need to be proficient in the following concepts:

  • Calculus
  • Linear Algebra
  • Differential Equations
  • Accounting
  • Finance & Management
  • Economics
  • Computer science & communication
  • Probability & Statistics
  • Regression Analysis
  • Time-series Analysis
  1. What is an actuarial report? 

An actuarial report is a report on the current and future condition of a fund such as insurance or pension. This report is used to determine whether the fund meets its beneficiaries’ needs. Actuarial reports from the government may be publicly accessed upon request, while reports from private entities may not be as readily accessible.

Top Online Courses for Aspiring Actuaries

Sharpen your skills in actuarial science by taking these top online courses

Aspiring actuaries have a long learning process ahead of them before becoming full-fledged professionals. If you want to enhance your knowledge to better understand actuarial concepts and practices, here are some highly-recommended online courses from Skill Success:

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