How to Become an Actuary in 2025
What Does an Actuary Do?
Actuaries are professionals who use mathematics, statistics, and financial theory to study uncertain future events, especially those that concern insurance and pension programs. They assess risk and help businesses and clients develop policies that minimize that risk and its financial impact. Think of them as financial risk managers.
What makes this career appealing to many is the combination of analytical thinking, problem-solving skills, and the opportunity to make a significant impact on the financial security of individuals and organizations. Actuaries work in a variety of industries, from insurance companies and consulting firms to government agencies and investment banks.
A key definition to know is risk. In actuarial terms, risk isn't just about danger; it's about the probability and potential financial impact of future events, whether those events are someone getting sick, a car accident, or a natural disaster. Actuaries quantify this risk, predict its likelihood, and develop strategies to manage it. This can involve setting insurance premiums, designing pension plans, or advising companies on investment strategies. They create spreadsheets and models, often requiring advanced software skills.
Another vital concept is the time value of money. Actuaries must account for how money changes value. They must account for interest rates, inflation, and investment returns to make sure the organizations they work with are prepared financially to meet obligations in the future. The Society of Actuaries offers additional info. https://www.soa.org/
Actuary Educational & Certification Requirements
Becoming an actuary involves a combination of education and professional certification. The academic foundation often starts with a bachelor's degree, and certain subjects provide a strong advantage. Common degree choices include actuarial science, mathematics, statistics, economics, and finance. Coursework in these fields builds the quantitative and problem-solving skills needed for success.
While a specific major isn't always mandatory, a solid grounding in math is key. Look for programs with courses in calculus, linear algebra, probability, and statistics. Many universities now offer dedicated actuarial science programs that specifically prepare students for the actuarial exams.
Beyond the bachelor's degree, achieving actuarial credentials requires passing a series of rigorous examinations administered by professional actuarial organizations. In the United States, the primary organizations are the Society of Actuaries (SOA) and the Casualty Actuarial Society (CAS). The SOA focuses on life insurance, health insurance, retirement benefits, and investments, while the CAS concentrates on property and casualty insurance. Each organization has its own set of exams that must be passed to earn credentials like Associate (ASA or ACAS) and Fellow (FSA or FCAS).
The exam process is lengthy, often taking several years to complete. Candidates typically start taking exams during their undergraduate studies or shortly after graduation. The exams cover a wide array of topics, from probability and statistics to actuarial modeling and financial economics. Preparation often involves self-study, exam preparation courses, and practice exams. The SOA provides resources on its website: Society of Actuaries. The CAS also provides resources at its website: Casualty Actuarial Society.
In addition to passing exams, actuaries usually complete other requirements, such as Validation by Educational Experience (VEE) credits, which can be earned through specific college courses or approved alternative assessments. Some companies also offer on-the-job training programs to support employees preparing for the exams. Gaining practical experience through internships or entry-level positions is also beneficial for career advancement.
Step-By-Step Guide to Becoming an Actuary
Becoming an actuary involves a combination of education, exams, and experience. Actuaries assess and manage financial risk, working primarily in the insurance industry, but also in consulting, government, and finance. Here's a breakdown of the steps you'll need to take to achieve this rewarding career.
1. Obtain a Strong Education:
A bachelor's degree is the foundation. While a degree in actuarial science is ideal, it's also possible to succeed with degrees in mathematics, statistics, economics, or finance. Regardless of your major, make sure you have a solid background in calculus, probability, statistics, and finance. Coursework should cover topics like regression analysis, time series, and financial modeling.
2. Pass Actuarial Exams:
These exams are administered by professional actuarial organizations, the Society of Actuaries (SOA) and the Casualty Actuarial Society (CAS). These are rigorous, and can take hundreds of hours of study per exam. Start with the preliminary exams, such as Exam P (Probability) and Exam FM (Financial Mathematics). Passing these exams is a critical step in demonstrating your knowledge and commitment to the profession. Each exam passed increases your job prospects. Visit the SOA's website to find the exam requirements: https://www.soa.org/ and the CAS' website at https://www.casact.org/
3. Gain Relevant Experience:
Internships are invaluable for gaining practical experience and making connections in the field. Look for actuarial internships at insurance companies, consulting firms, or government agencies. These internships will give exposure to real-world actuarial work, such as pricing insurance products, reserving funds for future claims, or modeling financial risks.
4. Earn Validation by Educational Experience (VEE) Credits:
VEE credits demonstrate your knowledge in economics, corporate finance, and applied statistical methods. Credit can often be earned through specific college courses. The SOA and CAS have lists of approved courses for VEE credit. These credits supplement the exam process and show a well-rounded understanding of important concepts.
5. Continue Passing Exams and Pursue ASA or ACAS Designation:
After completing the preliminary exams, you will continue on to more advanced exams. The SOA and CAS have different exam tracks based on your area of focus (life insurance, property and casualty insurance, etc.). Passing these exams, completing the VEE requirements, and meeting other requirements will allow you to earn the Associate of the Society of Actuaries (ASA) or Associate of the Casualty Actuarial Society (ACAS) designation. These designations represent a significant achievement in your actuarial career.
6. Pursue Fellowship and Further Career Growth:
After earning your associate designation, you can continue taking exams to become a Fellow (FSA or FCAS). Fellowship is the highest level of achievement in the actuarial profession. With fellowship, there will be increased career opportunities and potential for leadership roles. Many fellows choose to specialize in a specific area of actuarial practice.
How To Network As an Actuary
Building a strong network is key to career growth as an actuary. Actuarial work often involves teamwork and collaboration, so the ability to connect with others, both inside and outside your company, is a valuable skill. Developing strong ties can open doors to new job opportunities, mentorship, and access to industry knowledge.
One great way to start is by attending actuarial science conferences and workshops. These events are filled with professionals in the field, creating perfect opportunities to meet people and learn about their experiences. Don't be afraid to introduce yourself to speakers and other attendees. Bring business cards and be prepared to talk about your interests and career goals. The Society of Actuaries (SOA) and the Casualty Actuarial Society (CAS) both offer numerous events throughout the year. See their home pages for more details on upcoming events and membership information: https://www.soa.org/ and https://www.casact.org/
Another way to build your network is through internships. Aim for multiple internships while you are in school, at different companies, or in different sectors of the industry. This allows you to grow your exposure to the career. Internships provide hands-on experience and allow you to make valuable connections with professionals in your field. During your internship, make an effort to meet people in different departments and learn about their roles.
Connecting with actuarial professionals on LinkedIn is a good way to grow your virtual network. Join actuarial groups and participate in discussions. Share articles and insights, and reach out to people who work at companies you're interested in. A personal message expressing your interest in their work can start a good conversation and potentially lead to a mentorship relationship. Keep your LinkedIn profile current and professional, highlighting your skills and experience.
Actionable Tips & Resources For Aspiring Actuarys In 2025
So, you're thinking about becoming an actuary? Great choice! This field offers excellent career prospects and the chance to use your math skills in a practical way. Getting there requires planning and consistent effort. This section provides some tips and resources to help you succeed.
First, focus on academics. A strong foundation in mathematics, statistics, and economics is key. Excel in courses like calculus, linear algebra, probability, and regression analysis. Many successful actuaries hold bachelor's degrees in these areas. Look at the Society of Actuaries (SOA) or Casualty Actuarial Society (CAS) websites for suggestions on important coursework. Visit the SOA website at https://www.soa.org/ and the CAS website at https://www.casact.org/.
Next, start preparing for actuarial exams early. These exams are challenging and require significant preparation. The SOA and CAS administer these exams, and you'll need to pass a series of them to become fully credentialed. Consider buying study manuals and taking practice exams from providers like ACTEX or ASM.
Also, gain practical experience through internships. Many companies offer internships that provide exposure to actuarial work. These experiences can help you learn about different areas of actuarial science and build your resume. Use your university's career services or online job boards like LinkedIn to search for opportunities.
Finally, network with professionals in the field. Attend actuarial conferences and meetings, and connect with actuaries on LinkedIn. Networking can help you learn about job openings and gain valuable career advice. Consider joining an actuarial science club at your university, if one exists.