Preparing for an
Actuarial Career at Washington & Lee (Draft Version)
So you think you might want to be an actuary, eh? Or maybe you're
not sure what an actuary is... or maybe you just found your way here by
mistake. Read on, my friend, and learn what it means to be
an actuary and what Washington and Lee can do to help you
Actuaries combine strong analytical skills (in mathematics and statistics) with
their knowledge of business and economics (and
some psychology too)
to try to predict the likelihood of various future events and
to try to prepare for them. For example, an actuary could determine the
probability of a hurricane striking Florida, and then figure out
how much money an insurance company should put aside to cover that
risk. Or, he/she could try to predict when people are going to
choose to start taking Social Security benefits. Or, an actuary might be asked
to determine how much to charge a twenty-year-old male driver
for car insurance, given the likelihood of his getting into
an accident. Usually, actuaries specialize in one of the major areas
of risk analysis (life insurance, pensions, casualty, health insurance),
but they can also be found in many other fields.
Actuaries are paid very well. Right out of college, starting salaries are
in the 40 to 60,000 range. After 10 years, most earn between
125 and 240 thousand dollars. Salaries are dependent on how quickly you
progress through the exams (see below for more information on these
The following external links will tell you a bit more
about being an actuary.
For more information, or to sign up for classes, contact
Dresden (or go to his
Actuaries take a series of exams to advance in their career. You can
start these while still in school, and continue them while working
for an actuarial firm. (Most companies will pay you to study!)
The exams do not need to be taken in any order.
It's best to have passed at least one exam before you graduate. This
will increase your chances of getting a good job
(and also give you an idea if the career is for you).
The Mathematics Department here at W&L gives
exam prep courses for Exam P and Exam FM (and others if
time and resources permit), and sometimes we even
administer the exams on campus. Study notes and sample exams
can also be found at the SOA
Site (click on
ASA, CERA, or FSA for details).
covers probability. We recommend you take
Mathematics 101 and then either Mathematics 118 or
Mathematics 309 before preparing for this exam.
Exam FM is on Financial Mathematics (mostly interest theory, present value,
bonds, coupons, and stuff like that). You'll definitely want
Mathematics 102, and
Business 210 or 221 also seem to be good courses to prepare for this one.
The course Business 302 (Seminar in Financial Derivatives) is occasionally offered by
Professor Schwartz. Oh, and
Economics 360 wouldn't hurt, either.
Exam M covers Actuarial Mathematics. The Mathematics Department
will give an independent-study course in this area, depending on
student interest and department resources. Mathematics 309 is
recommended for this exam.
Exam C is on Construction and Evaluation of Actuarial Models.
Independent study as time and interest permits. Mathematics 309 is
recommended for this exam as well.
Coursework and VEE (Validation by Educational Experience)
In addition to the exams, you'll also need to
show experience in three topics: Economics,
Corporate Finance, and
Applied Statistical Methods. To quote the
SOA's Q&A file on their website,
"It was determined that validation by educational experience is
appropriate for topics that are either best learned in a classroom
environment (applied statistics) or are considered important, but not
core to actuarial work (economics and corporate finance)."
You may be able to do this
simply by taking the appropriate coursework here
at Washington and Lee!
Full information about VEE credit can be found on the SOA website
- VEE in Economics
- You can take
Economics 101 and 102 to satisfy this VEE requirement.
- Last time I checked the SOA website, you can also satisfy this with a score of 4 or 5 on the
AP Economics exam.
- VEE in Corporate Finance
- This will be satisfied by
- This can also be satisfied with an on-line course, a CFA exam, and others; see the
SOA website above.
- VEE in Applied Statistical Methods
- This is satisfied by
- This can also be satisfied with an on-line course or by
other exams; check the SOA website above.
Department of Mathematics at
Washington & Lee University