What is this career?
Actuaries most often analyze statistical data, such as mortality, accident, sickness, disability, and retirement rates, and construct probability tables to forecast risk and liability for payment of future benefits on insurance payouts.
Actuaries have also been increasingly applying their training outside insurance to help to manage risk in other parts of the financial sector, as well as working in management consulting firms and governments.
Reasons in favour of an actuarial career
- Reasonably high salary for earning to give. The USA mean is $110,000 and median $97,000. See a highly detailed survey of actuary salaries and bonuses in the USA which suggests earnings are similar across fields, except for pension actuaries who earn less.
- Salaries are just as high in the UK, ranging from £55,000 for graduates to £170,000 for ‘practice directors’.
- Actuarial work is a growth industry in the USA and actuarial graduate unemployment rates are low.
- The intensity of work is on the low end for the salary, with most actuaries reporting working 40-50 hours a week. The less intense nature of the work allows many actuaries to work full-time for decades, which is less common in other ‘up or out’ roles in the financial sector.
- You would have opportunities to promote effective philanthropy to reasonably wealthy colleagues.
Arguments against an actuarial career
- Typically the work you do will help provide incrementally more insurance to the wealth or health of the richest 5% of people in the world, which is a not a very valuable direct impact.
- Initial entry is fairly competitive; actuarial professional associations reportedly make certification exams more difficult than the job itself to limit the supply of actuaries. Accurate and fast mathematics skills are essential.
- There are limited opportunities to advocate about important issues publicly.
- The skills developed in actuarial studies job – though not so much the initial coursework – are relatively narrow and not as easily transferred into other jobs as the skills developed in some other quantitative professions. Actuarial science is also less prestigious than some nearby alternatives.
- The potential for rapid salary growth is somewhat lower than in other professions such as medicine, consulting and software engineering, and much lower than financial trading, which requires some similar skills.
- Actuaries often assist with personal and commercial insurance products, which are likely to be among the most reliably positive or neutral parts of the financial industry. If the risk of doing harm puts you off careers in banking or quantitative trading, actuarial sciences could be a reasonable alternative. If you move outside of traditional insurance, risk management in, (e.g.) the derivatives market can be disastrous if done poorly, though reduce systemic financial risk if done correctly.
- If you are leaving high school, many countries offer four year Bachelor’s degrees in actuarial science. In theory this allows you to start earning to give in a serious way very early in your career. However, we would strongly caution against committing to being an actuary at a young age, and would instead suggest doing an impressive and general quantitative degree, and then doing actuarial science at the Master’s level if you remain interested at that point.
- Note that as of mid-2015, 80,000 Hours staff think that too many of the most talented people we coach are going into earning to give relative to other top options.