Are you ready to take your career to the next level? Becoming an actuary might be right for you.
A specialist in the business world who deals with the financial implications of risk and uncertainty is called an actuary. They use mathematical and statistical methods to assess the risk of potential events and advise businesses on how to minimize the cost of that risk.
So what kind of skills should an actuary have? They should be good at math and statistics, of course, but they should also be able to communicate well and work with people.
They should be able to engage in analytical thought and develop creative responses to complex problems. They should also have the ability to adapt when new situations arise.
If this sounds like the perfect career, let’s explore all you need to know about being an actuary, starting with the necessary skills.
Here Are the Key Skills Actuary Should Have:
Because getting qualified is hard and takes a long time, employers want to hire people who are sure of their skills and want to work.
You need a particular set of skills to become an actuary. Many of these skills don’t come naturally, but you can learn them with hard work and determination.
If you aim to be an actuary, you need to have the following skills:
1. Data Analysis and Visualization
The first skill that an actuary should have is the ability to analyze data and make it visual. This is because data analysis is a vital part of being an actuary, and you need to analyze data to come up with solutions for problems that arise in your work.
Visualizing data is also essential because it helps people better understand what’s happening in their business or industry than if they just had numbers on paper or in a spreadsheet.
For example, an actuary can use data analysis techniques to create visualizations that show how much risk a company has taken on and whether it’s been underwriting its costs appropriately.
This information can help executives decide better what investments they should make and how to manage their existing portfolios effectively.
2. Problem-Solving and Critical Thinking
It’s no secret that actuaries need to be excellent problem-solvers.
The nature of the work requires them to be able to find solutions to complex problems quickly, and in many cases, those solutions must be backed up with math.
This can be difficult for some people new to thinking this way, but it’s an essential skill for any actuary.
It’s necessary to look at a problem from all angles, consider different scenarios, and develop a solution that makes sense.
3. Math & Statistics Skills
Actuaries are required to have a degree in mathematics, finance, or business. They must also be able to apply their knowledge to complex problems and make accurate decisions based on the data they collect.
An essential skill for an actuary is their ability to perform computations with numbers and statistics. They must be able to use advanced math functions like calculus, trigonometry, linear algebra, and differential equations in their day-to-day work.
For them to do this, they need to have an understanding of the connection that exists between the variables, the ability to compute rates of change over time, and the ability to display data sets in a variety of different ways.
You might need help with these calculations if you’re new to the field or it’s been a while since your last coursework.
4. Sharp Business Judgement
An actuary is a financial professional who assesses the risk of a company’s future insurance payments.
They calculate the likelihood of certain events occurring and use this information to create models that predict how much money will be needed in the future.
To do their job well, an actuary must have strong business judgment skills. They must make accurate judgments about complex issues to help their employer make informed decisions about their financial future.
An actuary should be able to consider all relevant factors when making a judgment, including the impact of different policies and decisions on the company’s financial situation.
They need to be able to weigh the costs and benefits of different strategies and make recommendations based on this information.
5. Oral Communication Skills
An actuary needs to be a good communicator. They need to explain complex concepts in a way that people unfamiliar with the field can understand.
They also need to communicate with clients, coworkers, and other stakeholders in a way that makes them feel valued and respected.
This is why an actuary needs to have strong oral communication skills. If you can’t communicate your ideas effectively, no one will take you seriously as an employee or leader.
An actuary must be able to verbalize their ideas and explain them in terms that others can understand.
They also need to listen carefully to gain insight into how other people think, so they can interpret data correctly and present it in the most favorable manner possible.
6. Detail and Accuracy
As an actuary, you’ll be working with a lot of data. Your job is to understand the entire picture and break it down into small pieces that are easier to digest.
That means you need to have the ability to focus on details and be precise in your analysis.
This is important for any number of things: making sure that all the information you’re using is accurate, tracking down errors or inconsistencies in data sets, and making sure that when you present your findings, they make sense to others.
The best way to do this is by keeping track of every detail—including where it came from and what it means—so that you can be confident in your findings and conclusions.
7. Excel Spreadsheet Proficiency
Actuaries rely heavily on Microsoft Excel as one of their primary tools. It’s a powerful data-crunching tool that can crunch numbers, create tables, and perform calculations on your data in seconds.
To be an effective actuary, you must know how to use Excel daily.
One of the most critical skills for an Actuary is creating spreadsheets that calculate valuable data. Actuaries use these spreadsheets to analyze the financial impact of certain events and predict future trends based on past data.
Creating accurate, reliable spreadsheets is an essential skill for any actuary, as it allows them to analyze their data in various ways and make more informed decisions about their financial futures.
To create accurate spreadsheets, actuaries must understand how Excel works, use formulas and functions correctly, and adequately organize their data to make sense of it all.
8. Research Skills
One of the essential skills an actuary should have is research skills. This includes the ability to find data and information and the ability to interpret that data and information.
An actuary needs to know how to find reliable sources of information and interpret them correctly.
The best way to become better at doing this is through practice—reading articles and analyzing them effectively will help you learn how to do it better than before, which will help you become a more valuable employee in your field.
9. Strong Perseverance Skills
The actuary is the person who calculates and evaluates risks and uncertainties that can affect the business.
It is their job to decide whether it’s worth it for a company to take on a new project, how much insurance to buy, or what kind of investments are safe for clients.
When looking for an actuary, you want one with excellent perseverance skills. Perseverance is necessary because being an actuary requires a lot of patience and hard work.
You’ll be dealing with numbers and figuring out what they mean.
If you get frustrated easily or lose focus, this job might not suit you. You must keep calm when things aren’t going well and keep working until they do.
10. Understanding Economics Principles
An actuary should understand economic principles, including essential supply and demand concepts and how they affect the insurance industry.
They should also understand how changes in interest rates and other economic factors can impact the insurance industry.
The actuary should understand how the business cycle affects business owners and consumers across different industries, including insurance companies.
For example, they should know that as the economy grows, so does unemployment, and as the economy slows down, unemployment decreases.
This is a result that when there is a high demand for labor, there is greater availability of employment, and when there is a lower demand for work, there is reduced availability of jobs.
There are several skills an actuary should have, and it is vital to possess all of them to succeed in this field. To become an actuary and enjoy a good salary, you need to understand the basics of math, business, and insurance.
Nevertheless, accounting is also crucial because it gives fundamentals to all the areas you work with. And last but not least, you need a degree in that specific sphere to do everything professionally.
The better your skills and knowledge are, the faster you can develop your career and move up the ranks at work.
Hopefully, you’ve both gained some knowledge about what skills an actuary needs to succeed and discover which are most important. But if you’re feeling a little overwhelmed, don’t worry—actuaries have to start somewhere, too.
The profession requires considerable training and education before regularly working as an actuary. The more you understand the basics, the closer you’ll be to achieving your career goal.