Have you got keen management and business skills? If your risk management ability urges you to seek a profession in this field, you must know how to become an actuary. On becoming an actuary, you’ll imbibe asset management, liability management, and valuation skills. An actuary is a profession that will allow you to get involved with all the investment cubicles that you desire to be in. Given below are the various aspects of becoming an actuary.
If you need more such career-guidance, also read our blog:-
Who is an Actuary?
An actuary is a financial expert who applies statistics, probability, and risk management theories. The risks and uncertainties arise in case of insurance, pensions, annuities, e.t.c. There should be an individual who, by his skills, can help the people to overcome these situations and plan a risk-free life. The actuary has to analyze the coming risks and suggest a better solution to overcome it. Our life is also uncertain. In our day to day life, we face many risks. These risks can come in the form of accidents, sickness, theft, fraud, disability, etc. Individuals cannot predict these risks, so there comes his need. The actuary, with their analysis of statistics, can prevent us from these risks. Nowadays, companies, government organizations, firms, and universities appoint them to manage risk factors.
What are the Roles and Duties of an Actuary?
To know how to become an actuary, another significant thing is to know their role and responsibilities. An actuary:
- applies its knowledge and abilities to overcome the risk problems
- deals with all the uncertainties, whether it is in the form of accidents, insurance, medical insurance, etc
- helps individuals and businesses to overcome the risks in an effective way
- performs many operations
- to compile the whole data and come out with solutions to financial problems
- for drafting the policies of an organization and explains it to those who will enjoy it
- work for a specific organization or many organizations at a time
Roles of an Actuary
- Actuaries provide long term solutions to financial problems.
- They can very well analyze the uncertainties and can provide the solutions too.
- They think and are innovative.
- Come up with effective strategies.
- Analyze both the aspects of the balance sheet, i.e., assets and liabilities
- Consult the experts for data modeling and ways to overcome them
- Consult companies in profit sharing policies
- Provides views and suggestions on the financial position, i.e., current and forward-looking
- To govern the high officials in the financial matters, especially the government bodies.
- Analyzing the past
- Prepare reports and present them in front of investors.
- An Actuary can take instant steps if they feel that the work is not going fine.
- Calculating premiums
- Giving ideas to generate funds
- Helps in decreasing the undesirable impact on finance that usually occurs
The Canadian Justice System asks actuaries to give expert witnesses on the issues of lost future earnings. The need for an actuary is increasing due to uncertainties occurring in the lives of individuals and businesses.
How to Become an Actuary – About the Career
Choosing a career is not at all an easy task. It is one of the most important decisions of your life. So you should consult some experienced person or a counselor before taking this significant step in your life. You should analyze your strengths, potential, interests, and abilities before choosing this. Do not follow the rat race. Know yourself first. Are you good at solving problems?? Or are you more interested in doing creative things??? It all depends on your caliber. Your future depends on your decision. So, before knowing how to become an actuary, you should first get sorted with your ability to manage this career.
If you are good at mathematics, creative things, and financial and social issues, you must opt for a career as an actuary. Besides a financial professional, they also works as a consultant. The primary work of an actuary as a consultant is to assist employers, labor unions, and administration for pensions and benefits. The emerging trend in the medical insurance sector, employee benefit plans, mutual funds, etc. is also paving the way for the actuary. Such high rising trends engages one to know how to become an actuary and start a full-time career option in it.
What Are the Different Career Options For an Actuary?
The demand for an actuary is increasing with rising risks. In the past decade, there was a large increase in the consulting area. If we talk about the insurance sector, then it is still a booming sector. So it will remain a significant player for the actuaries. There is an increasing demand for actuaries in non-traditional roles such as compensation management.
Some careers that An Actuary can choose could be:
- An advisor in the insurance industry
- Under government bodies
- Can work as pension planner
- Financial services
- Environmental specialists
- Medical insurance
- Construction industry
The actuarial profession is global due to its recognition worldwide. As the law, medical, and engineering, it is also considered as a reputed education form. Its career opportunities are also enriching, diverse, and exciting. So, becoming an actuary carries quite a reputation due to its intricate exam patterns. Any math lover can become an actuary. Their involvement in any judgments and decision-making activities lead them to higher posts.
Skills and Training For an Actuary
An actuary should be an expert in skills such as mathematics, statistics, probability, creativity, etc.
Also, they should have a sound knowledge of computers, economics, marketing, investments, e.t.c. If you own these skills, you can also try your hand at becoming a notary in Florida or a pharmacist, which is a patient job. Other relevant skills could be:
- They should be self-motivated
- Independent with their decisions not biased
- Knowledge about general management
- Managing the financials
- Designing of insurance products
- Selecting the right people for the insurance industry
- Should keep the given commitments
- Natural problem-solving ability
- Research skills
- Analytical skills
- Comprehension skills
- Desire to learn new things
- Undertaking responsibilities
- Making good relations with the customers
In a nutshell, the abilities of a successful actuary include an excellent business sense with profound knowledge of finance, mathematics, economics, accounting, management, and computers. Besides this, an actuary should love his work and enjoy doing it. They should enjoy communicating with people, solving their queries working in teams or sometimes alone. The work of the actuaries depend more on the macro-level, sets high-level parameters, and provides excellent results. To be an actuary is to hold the responsibility of protecting the legal benefits promised to the companies. By making use of their prior experience in solving complex problems, they safeguard the financial interest of the public.
Next, how to become an actuary is the discipline that they undertake. Here are some training criteria that they follow:
- Three basic requirements- education, experience, and completion of the relevant exams
- Good hold on mathematics, algebra, and calculus during high school
- Understanding of economics, business administration, commerce, and computers
- Should have a graduate degree in economics or business administration or commerce or mathematics
- Should have cleared the certification exams for insurance, investment, and pension
- International fellowships are also provided for those who clear the exams.
One perk of an actuarial profession is that you study for professional qualifications while earning a salary. After graduating, the actuary can work with companies needing actuarial services. Alongside this, they can pursue their professional qualifications through correspondence, self-study, or self tutorials.
How Much Does an Actuary Earns?
Since actuary needs a high level of professional qualifications, so the compensations are also top. The salaries varies as per geographical location, experience, skill, and organization. According to a report by the Bureau of Labor Statistics (BLS), the median annual pay of an actuary was $108,350 as of May 2019, the most recently available data. The actuaries can increase their starting income by updating knowledge and skills. Other benefits an actuary can have are:
- Health benefits
- Retirement benefits
- Good compensation
- Pension plans
- Medical insurance