How to become an actuary
Do you like to work with statistics, mathematics, and financial theory? Consider becoming an actuary to help clients determine and minimize the economic cost of risk. Keep reading to learn what an actuary does and how to enter this field.
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What does an actuary do?
An actuary assesses and manages financial risk. They use statistics to determine the likelihood of economic events and estimate their cost. Actuaries develop policies and programs and help companies minimize financial consequences. They must also clearly explain their work to non-technical people.
Workplace settings
Actuaries often work in consulting firms, banks, government agencies, investment firms, and insurance companies.
Median salary
The Bureau of Labor Statistics reported that actuaries earned a median annual salary of $120,000 in 2023.
Steps to become an actuary
Actuaries usually have a strong business background and a bachelor's degree in an analytical field, such as statistics, mathematics, or actuarial science. To work as an actuary, you must be certified by either the Casualty Actuarial Society (CAS) and Society of Actuaries (SOA). Both organizations offer associate- and fellowship-level certifications. You don't need fellowship certification to pursue an actuary role. However, it can help you stand out or advance in the field.
To become an actuary, you may consider taking the following steps:
Step 1: Earn a bachelor's degree in actuarial science, business administration, mathematics, or statistics
The typical coursework for an actuarial science degree includes economics, finance, business communications, computer science, and math. The math you'll need to learn includes calculus, statistics and probability, and linear algebra. To qualify for certification, a requirement for professional actuaries, you must study applied statistics, economics, and corporate finance.
Step 2: Secure an internship as an actuarial assistant or trainee
Many actuaries who are just starting will begin as trainees. Larger insurance companies often have actuarial internship programs, and many companies may support recent students who wish to become actuaries as they go through their certification process. They may even pay for exams, materials, and study time.
As an intern, you will likely work with experienced professionals and receive simple tasks like compiling data. In time, you may conduct research and write reports. You will also learn how an actuary's work integrates with the organization's larger mission.
Step 3: Obtain certification
After graduation, begin by earning an associate-level certification from either the CAS or the SOA. The CAS certification is for property and casualty actuaries who want to work as commercial, automobile, workers' compensation, and homeowners' insurance professionals. The SOA certification is best for professionals interested in becoming health insurance, life insurance, finance, investments, and retirement benefits actuaries.
Candidates must complete college courses in finance, economics, and statistics for both organization's certifications. They must also pass specific exams and take a class in professionalism. It may take as long as seven years to earn the associate-level certification.
Step 4: Consider earning a fellowship certification
After earning your associate certification, you may wish to go on to pursue a fellowship certification. Although fellowship certification takes several years to complete, it could give you a competitive advantage if you apply for a higher-level position.
The SOA offers five specialization tracks for fellowship certification candidates: corporate finance and enterprise risk management, retirement benefits, life and annuities, quantitative finance and investments, and group and health benefits.
Pension actuaries, who focus on pension plan benefit payments, usually require special licensing from the U.S. Department of Labor and the U.S. Department of Treasury's Joint Board for the Enrollment of Actuaries.
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