Individuals with a talent for mathematical and statistical problem solving are always in high demand. Someone with a real knack or passion for working with numbers might consider a possible career as an accountant or an actuary, two fields where his skills can earn him a high-paying, steady job.
Actuaries and accountants are two of the most unheralded yet essential professions in the financial industry. Accountants work behind the scenes to help out businesses, investors, regulators and auditors. Actuaries make it possible for insurance companies to gauge risk effectively.
Actuaries deal with tons of data – perhaps more than any other profession. These are true professional statisticians and the ultimate quants who use past data to predict likely future outcomes. Such skills make them exceedingly useful for insurance companies or other businesses that sell insurable products. For example, an actuary might be responsible for predicting how much money an insurance company will have to pay out to cover damages from future floods or forest fires. In short, actuaries are needed to develop and effectively price insurance products.
There's a great deal of variety in the accounting field, but all accountants are responsible for compiling and comparing financial records. Accountants service individuals, businesses and governments to help ensure that everything is running efficiently and accurately.
Education and Skills
A bachelor's degree in accounting or mathematics is a huge plus for anyone considering a career as an accountant or actuary. Most accountants and actuaries start out as entry-level employees at accounting firms or insurance companies, where they can work while preparing for a litany of exams before furthering their careers.
Almost all career accountants earn the title of Certified Public Accountant (CPA). Perhaps no job in the industry is as dependent on a single title as accountants are with the CPA designation. Aspiring accountants need to study for and pass the four CPA exams.
CPAs can specialize in many different areas, such as internal audits, forensic accounting, managerial accounting, environment accounts or taxes. The exams are the same, however, regardless of the accountant's area of specialization. Becoming a CPA requires an intense amount of preparation. Most accountants report studying 20 to 30 hours a week for four to six months before passing all the exams. On top of that, most states require at least 150 semester hours of instruction and a college degree before an individual can take a swing at the CPA exams.
As difficult as it may be to become a CPA, it is probably even more challenging to become an actuary. Insurance companies demand that applicants have strong backgrounds in areas such as mathematics, statistics, actuarial science, computer science and calculus. Prior to certification, an aspiring actuary must complete coursework in economics, applied statistics and corporate finance.
There are two organizations responsible for granting professional status to actuaries. The Society of Actuaries (SOA) certifies those who want to work in life insurance, health insurance, investments and finance. Certification with the SOA is offered in five different tracks that range from life and annuities to enterprise risk management.
The second organization, the Casualty Actuarial Society (CAS), is much smaller than the SOA and specializes in certifying actuaries for property and casualty fields, medical malpractice and workers' compensation.
It is standard for an actuary to spend between four and seven years in pursuit of his SOA or CAS certifications.
According to the Bureau of Labor Statistics, or BLS, the median annual salary for an actuary in the United States in 2016 was approximately $100,610. Actuaries are paid so well in part because so few people have the patience or ability to spend five years passing all of the actuarial exams. The downside is actuaries often spend the first half-decade of their careers earning far less than the median salary, toiling away until they can complete all of their certifications.
It's difficult to come up with any meaningful average salary for accountants. A treasurer for a large corporation can earn more than $250,000 a year, while a first-year tax accountant may earn $45,000 or less. Much depends on an accountant's area of expertise and work experience, although it is not uncommon for an accountant to earn closer to $75,000 after a few years.
Accountants and actuaries both tend to have very balanced work life schedules, especially compared to many of their peers in the financial industry. Most surveys and studies, such as the Jobs Rated Almanac, consistently rate accountants and actuaries highly in terms of work stress, hours on the job, job security and work-life balance.
Tax accountants are a special (and temporary) exception. During tax season, which really stretches between the months of February and April, many tax accountants work six or more days a week and 10-plus hours a day. Fortunately, many accountants work short weeks during the months that follow and often take long vacations to recuperate.
Actuaries and accountants are both in-demand occupations. As the U.S. economy demonstrates increasing complexity and regulatory changes, these professions become increasingly essential for individuals, businesses and governments to adapt responsibly.
Overall, there are many more accountants than actuaries in the United States. The BLS estimates that actuarial jobs will grow 22% between 2016 and 2026, while the number of accounting jobs is projected to grow 10% during that time. This compares to an average growth rate for all occupations of 7%.
Which One to Choose
Each of these can be a fantastic career for the right individual. Accounting jobs should appeal to those who are interested in finance or business management and who don't want to deal with constant stress or job uncertainty. Those with a passion for statistics and computer modeling will be hard pressed to find a career better suited than as an actuary.
Both fields require the ability to work through problems logically and deductively, but accountants normally have simpler and more commonly reoccurring issues. A lot comes down to the desire to perform complex mathematical problem solving. Accountants don't need to use complicated math concepts like actuaries do, and many might find the intense data harvesting of an actuary to be a little daunting or too monotonous.