What Is an Actuary and How to Become One

An actuary is a professional who uses mathematical models to analyze and manage risk in finance, insurance, and other industries.

Actuaries are highly skilled mathematicians and statisticians who have a deep understanding of probability theory, statistics, and economics.

To become an actuary, you'll need to earn a bachelor's degree in a field like mathematics, statistics, or actuarial science.

You'll also need to pass a series of exams administered by the Society of Actuaries (SOA) or the Casualty Actuarial Society (CAS) to become certified.

These exams cover topics like probability, statistics, and financial economics, and can take several years to complete.

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Actuaries are problem solvers and strategic thinkers who use their mathematical skills to help measure the probability and risk of future events.

They use their skills to predict the financial impact of these events on a business and their clients.

Actuaries are increasingly in demand as businesses and governments rely on their expertise to help them model and plan for the future.

Risk management expertise can help businesses navigate the evolving landscape and make informed decisions.

Actuaries help businesses and governments make sense of complex data and turn it into actionable insights.

Their work has a direct impact on the financial well-being of individuals and organizations.

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To become an actuary, you'll need to pass standardized exams, which vary depending on your role. Actuaries typically start with preliminary exams administered by the SOA and CAS, including Probability Exam (SOA Exam P) and Financial Mathematics Exam (SOA Exam FM).

You don't need to pass every available exam, but rather select one or more practice areas and complete the associated exam(s) to progress into related professional roles. The specific exams you'll need depend on your career goals, such as specializing in investment-associated risks, which might require passing the SOA Exam IFM.

Here are the preliminary exams administered by the SOA and CAS:

To maintain your credentials, you'll need to complete continuing education (CE) hours annually, with at least 30 hours required by the American Academy of Actuaries. This includes 6 hours of organized activities, 3 hours of professionalism training, and 1 hour of anti-bias training.

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To become an actuary, you'll find that the required education is more about preparation than hard requirements. Neither the SOA nor the CAS specifically require a particular degree for actuarial certifications.

Employers consider your education, but they often place more emphasis on preliminary exams when filling vacancies. This is why it's essential to focus on building the knowledge you need to pass actuarial exams.

To get started, consider a degree in actuarial science, accounting, economics, finance, or mathematics or statistics. These fields will provide a solid foundation for your future career.

Here are some specific degree programs to look into:

For associate-level VEE requirements, you'll need to cover coursework in accounting and finance, economics, and mathematical statistics.

To become an actuary, you'll need to meet certain credentials requirements. The Society of Actuaries (SOA) and Casualty Actuarial Society (CAS) have specific exams and requirements that you'll need to meet. You'll start with preliminary exams, which include the Probability Exam (SOA Exam P) and Financial Mathematics Exam (SOA Exam FM).

The SOA and CAS also administer other exams beyond the preliminary level, which focus on specific professional practice niches. These exams cover topics such as business economics, financial, economic, and risk modeling, financial reporting, predictive analytics, ratemaking, and liability estimating. You don't need to pass every available exam, but rather select one or more practice areas and complete the associated exams to progress in your career.

To give you a better idea, here are the exams you'll need to pass for each level of actuary:

Note that the specific exams you'll need to pass will depend on the exact nature of your role and the society you choose to pursue. The SOA and CAS have different exams and requirements, so it's essential to research and understand the differences before making a decision.

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Majoring in Actuarial Science can be a great choice if you're interested in a career as an actuary. However, it's essential to consider the pros and cons of specializing in this field.

You'll find that the SOA and CAS don't require a specific degree to qualify for their actuarial certifications. Instead, they use "verification by educational experience" (VEE) to evaluate your education. Associate-level VEE requirements cover coursework in accounting and finance, economics, and mathematical statistics.

Actuaries typically begin with preliminary exams administered by the SOA and CAS, including the Probability Exam (SOA Exam P) and Financial Mathematics Exam (SOA Exam FM). The specific exam(s) you'll need depend on your role and interests.

If you do decide to major in Actuarial Science, you'll have the opportunity to take courses that teach you the concepts tested on the first several actuarial exams. This can put you in a great position to pass them, as I was fortunate enough to experience.

Here are some fields of study that are relevant to a career as an actuary:

Keep in mind that having a degree in Actuarial Science can limit your job opportunities outside of the insurance industry, where most people may not be familiar with the field.

To become an actuary, you'll need a bachelor's degree in actuarial science, accounting, economics, finance, mathematics, or statistics, but it's not the only path. You can also gain experience as a junior actuary and work your way up to a management position.

In the US, having 2-3 exams passed is usually sufficient to get an entry-level actuarial position, while in Canada, 4-5 exams passed is more common due to a more competitive job market.

As a junior actuary, you'll focus on calculations and supporting work in actuarial analysis and modeling, but to advance, you must pass a series of preliminary actuarial exams that cover probability, financial mathematics, and more.

To qualify for actuarial certifications, you'll need to complete college coursework in economics, finance, and statistics, and pass the associated preliminary exams. Earning an associate-level certification can take up to seven years, and to retain it, you'll need to meet continuing education requirements.

In a management position, you'll have a small actuarial team reporting to you and do less technical work, focusing on high-level business planning and thinking. You'll gain more knowledge and expertise, and your team will handle the technical work for you.

Here's a rough outline of the actuarial career path:

Actuaries have big responsibilities to the companies and people they work for, making recommendations that can be the basis for a company's decisions. They analyze data and trends to predict financial impact or risk, and develop strategies to minimize potential losses.

Actuaries use their expertise in statistics and finance to play a key role in ensuring the long-term success and stability of insurance companies. They communicate their findings to stakeholders, often producing written reports that provide valuable insights and recommendations.

Actuaries possess a unique combination of mathematical, analytical, communication and management skills, which they apply to create social impact, inform high-level strategic decisions, and have a significant impact on legislation, businesses, and peoples' lives.

Actuaries have big responsibilities to the companies and people they work for. The recommendations of an actuary can be the basis for a company's decisions.

Analyzing data and trends to predict financial impact or risk is a key responsibility of an actuary. This involves looking at past data to forecast future outcomes.

Developing strategies to minimize potential losses is another important task for actuaries. They use their expertise in statistics and finance to create plans that will help companies avoid financial losses.

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Actuaries often produce written reports that explain their calculations to non-math professionals. These reports provide valuable insights and recommendations for insurance companies to make informed financial decisions.

Here are some key responsibilities of an actuary:

These responsibilities require a unique combination of mathematical, analytical, communication and management skills.

Actuaries spend a substantial portion of their day analyzing data to assess risk, price insurance products, or evaluate financial investments.

This involves cleaning and organizing data, applying statistical methods, and interpreting results to make informed decisions. Actuaries are usually known as "number-crunchers", as they spend most of their day looking at numbers and analyzing risk.

Actuaries typically spend several hours a day analyzing data, with some even working on projects in the morning and returning to them in the afternoon.

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Actuaries work in a variety of industries, including insurance companies, consulting firms, government agencies, and financial institutions. These industries rely heavily on risk assessment and management.

Actuaries are employed in industries where risk assessment is crucial, such as healthcare and investment banking. They also work in enterprise risk management, which is a key part of many organizations.

Actuaries work in a variety of industries, including insurance companies, consulting firms, government agencies, and financial institutions.

Insurance companies are a primary employer of actuaries, as they rely on their expertise in risk assessment and management.

Actuaries are also employed by consulting firms, where they use their skills to advise clients on risk management and financial matters.

Government agencies and financial institutions are other industries that employ actuaries, as they require professionals with expertise in risk assessment and management.

Actuaries work in industries where risk assessment and management are a significant part of the business, such as healthcare and pensions.

Their skills are also in demand in investment banking and enterprise risk management.

I can attest to the fact that actuaries are in high demand, as I've seen many of my friends and colleagues pursue careers in this field.

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Actuaries are in high demand, with a predicted growth rate of 22% between 2023 and 2033. This is significantly higher than the national average growth for all jobs, which is 4%.

The Bureau of Labor Statistics (BLS) predicts a strong demand for actuaries, making it an appealing field. The job itself can be very rewarding, as actuaries consider their work to be intellectually stimulating and feel a sense of contributing to society.

The growing need for actuaries is largely due to the importance of insurance in protecting individuals and society. Without insurance, the world would function much differently.

Becoming an actuary offers a highly competitive salary, making it a great career choice. You'll have a good work/life balance compared to other financial services professions.

As a member of the Institute and Faculty of Actuaries (IFoA), you'll be part of a globally recognised profession. This means your qualifications are internationally-recognised and can open doors to working in many countries around the world.

The IFoA has Mutual Recognition Agreements with overseas actuarial professional bodies, making it relatively easy to transfer to another professional body once you've qualified.

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Becoming an actuary is a great career choice because it allows you to apply highly valued mathematical skills and expertise in a diverse, exciting and challenging career that really makes a difference.

You'll have a highly competitive salary, which is a great reward for your hard work. A good work/life balance is also expected, especially compared to similar professions in the financial services, such as investment banking.

As a member of the Institute and Faculty of Actuaries (IFoA), you'll be part of a globally recognised profession. This means your qualifications will be internationally-recognised, allowing you to work in many countries around the world.

Becoming an actuary can be a rewarding career, but it's not for everyone. You'll need to stay up-to-date with the latest news and activities to support your journey.

To succeed, you'll need to be detail-oriented and have strong analytical skills. Actuaries use statistical data to make informed decisions, so if you enjoy working with numbers, this might be the career for you.

Staying organized is key, so make sure to keep track of events and deadlines. The section about staying up-to-date with the latest news and activities is a great resource to help you do just that.

Actuaries work in a variety of fields, including insurance and finance. If you're interested in these areas, you might find this career path appealing.

Getting started requires dedication and hard work, but with the right support and resources, you can achieve your goals.

Becoming an actuary is generally considered difficult, requiring years of schooling and training to pass or earn the necessary exams and certifications.

The actuarial profession can be demanding, with long hours of desk-based work focused on numbers and statistical data.

Burnout is a real concern, with the Society of Actuaries noting high levels of job turnover in 2023.

Actuaries can earn high salaries, with a median of $120,000 per year, but this comes with the trade-off of job security.

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Becoming an actuary is generally considered difficult. The exams and certifications needed to advance as an actuary are challenging.

The actuarial exams are hard, according to experts. Online resources like those from CAS or SOA can be helpful in preparing for these exams.

Students should take time to learn about the actuarial exam process, especially exams P (probability) and FM (financial mathematics). It's extremely difficult to get a summer internship or a permanent position without passing at least one actuarial exam.

Most candidates must undergo years of schooling and training to pass or earn actuarial certifications.

The actuarial profession requires long hours of desk-based work, focusing heavily on numbers and statistical data.

Burnout can happen, and high levels of job turnover have been noted in the actuarial field, according to the SOA.

Actuaries can earn high salaries, with a median annual salary of $120,000 as of May 2023, and enjoy job security due to a projected 22% job growth from 2023-33, which is much faster than the average growth for all occupations.

However, the demanding nature of the job may not be for everyone, and considering other options might be a good idea if you prefer a different work-life balance.

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If you're interested in learning more about actuarial exams, there's a great post that breaks down exactly what to expect.

Some fields of study are better suited for actuarial work, so if you haven't already got your Bachelor's degree, it's worth taking a look.

Actuarial science is a common Bachelor's degree major, but it's not necessarily the best choice.

To decide which actuarial exam to write first, you should read up on the differences between Exam P and FM.

If you're looking to become an actuary with a math degree, you're already ahead of the game, but you'll still need to pass your first actuarial exams.

You can become an actuary after college by focusing on passing your first actuarial exam, or if you don't have a degree yet, getting your Bachelor's is the first step.

Getting through the first two actuarial exams can take around four years if you follow a specific timeline.

It's worth noting that some people find one actuarial exam easier than the other, so it's worth doing your research.