Timothy Peck 5 min read Career Advice, Career Path Breakdowns

How to Become an Actuary: Steps to Take from High School

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If you love numbers, are savvy with computers, and like the idea of projecting future outcomes, you might make a great actuary. Helping businesses manage risk in a variety of industries—including insurance carriers, banks, and investment firms—these analytical individuals have a bright future. The Bureau of Labor Statistics (BLS) predicts job growth for actuaries to grow 20% between 2018 and 2028. For comparison, the average growth rate for all occupations is 5%. 

 

If you’re interested in this promising career, here’s what you need to know about becoming an actuary.

 

What Does an Actuary Do?

 

At their most basic, actuaries manage risk—they determine how unsafe a situation is and strategize on how to best manage it. To do so, actuaries use mathematics, statistics, and financial theory to predict the likelihood of future events, find ways to reduce the chance of undesirable happenings, and minimize their impact if they do occur. 

 

Although actuaries are employed in a variety of fields, their primary employers are in finance and insurance (71%). Outside of finance and insurance, actuaries also work in private businesses, technical companies, and the government. A good rule of thumb is that wherever there’s risk that needs managing, there’s an opportunity for an actuary.

 

How Much Do Actuaries Make?

 

The path to a career as an actuary is rigorous with intense courses and exams requiring hundreds of hours of preparation. Many jobs also necessitate continuing education. For those who make it, the reward is a well-paying job in a fast-growing industry. The average annual salary for actuaries as of May 2018 was $102,880. The highest paid 10% of actuaries earned more than $186,110, while the lowest 10% earned less than $61,140. In addition to being well paying, careercast.com ranked the work environment of actuaries “very good” and the stress level for them as “low.” 

 

How to Become an Actuary

 

Successful actuaries possess an abundance of different abilities. Math, computer, analytical, and problem solving skills are of course vital. When it comes to soft skills, actuaries must also be strong communicators and have excellent interpersonal abilities, as they often work in teams and must effectively report their findings. While the road to becoming an actuary is long, students can begin honing in on many of these qualities as early as high school. 

 

High School

 

The track to a career as an actuary is filled with numbers, and high school is an excellent place to build a strong foundation of math skills. Advanced courses such as AP Calculus and AP Statistics are good preparation for the challenging math you’ll encounter in college. Similarly, enrolling in computer science courses will be especially advantageous. This is particularly true if you can begin familiarizing yourself with programming. 

 

Participation in an actuarial summer program or a summer program with a heavy math focus will also help set students up for success in future endeavors. The Math Olympiad Summer Program, Ross Mathematics Program, and Mathcamp are just a few of the prestigious programs available to aspiring actuaries looking to fine-tune their math skills. 

 

Students should also look to join team-based extracurriculars that will help them build the communication skills vital to a successful actuary. You might consider activities like sports, debate, robotics, Science Olympiad, or Model UN.

 

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College

 

Many students hopeful for a career as an actuary will pursue a degree in actuarial science—check out our blog The List of All U.S. Colleges With an Actuarial Science Major to see what schools offer this program. In addition to preparing students for an eventual actuarial career, an actuarial science degree equips students with the tools needed to pass the challenging exams required to work in the field. 

 

While an actuarial science degree is the most direct path to a career as an actuary, it’s not the only degree path taken. Many come to the field with degrees in subjects such as mathematics, statistics, business, finance, and economics. You can make the case that these degrees offer more flexibility to students unsure of exactly where they see themselves working in the future. 

 

Whatever degree you set your sights on in college, if a future as an actuary is on your mind, you’ll want to make sure to take courses in advanced algebra and calculus. Considering how the vast amount of work actuaries do involves software and spreadsheets, computer science and programming are helpful as well. Computer classes focusing on Excel and programming languages like SQL and VBA are particularly beneficial. 

 

Certification

 

In order to become a full-fledged actuary, students need to pass a series of exams administered by professional societies. Two professional societies—the Casualty Actuarial Society (CAS) and the Society of Actuaries (SOA)—sponsor programs with two levels of certification: associate and fellow. The Society of Actuaries (SOA) is an organization for actuaries working in life and health insurance, employee benefits, and finance. The Casualty Actuarial Society (CAS) is for actuaries working in automobile, fire, and liability insurance along with workers’ compensation and malpractice. 

 

Undergraduates in their senior year are able to apply for membership into a professional actuarial group and begin their certification process and further specialization. It’s recommended that students have passed one or two of the aforementioned exams before graduation. It cannot be stressed enough: these exams are extremely challenging. It’s recommended that test takers study 100 hours for every hour of test time, which equals 300 hour per exam. On top of that, the pass rate is typically only 30- 40%. To be accepted into a profession actuarial group, candidates are also required to take online seminars on professionalism and actuarial practice.

 

Because of the enormous amount of time needed to study for these exams, along with the fact that many people will need to retake them, it typically takes 4-7 years to achieve associate-level certification. Regardless of the actuarial group you join, the first three exams taken are the same, before diverging and specializing from there. Those in both CAS and SOA will need to pass six exams to earn associate status. 

 

Fellowship usually takes between two and three more years. Moving through your membership group’s exams is a key way to progress in your career. For example, according to the SOA, experienced fellows have the potential to earn from $150,000 to $250,000 annually, which is considerably more than the $102,880 annual average salary. It’s also common for fellows to have teams of actuaries working under their supervision. To become a Fellow of CAS, you’ll need to pass three more exams. On the other hand, the SOA has six different tracks to fellowship, which all have unique requirements. 

 

The road to becoming an actuary is long and challenging. One of the best ways students can prepare for the demanding path ahead is by getting into a good college that will support them in their efforts. Get a jump on the college competition and sign up for our free online platform that offers step-by-step applications recommendations, financial aid support, essay-writing help, and more.

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Timothy Peck
Blogger at CollegeVine
Short bio
A graduate of Northeastern University with a degree in English, Tim Peck currently lives in Concord, New Hampshire, where he balances a freelance writing career with the needs of his two Australian Shepherds to play outside.