Financial Analyst vs. Actuary: An Overview

The financial industry is full of careers for analytical people, including financial analysts and actuaries. These are good careers for those who love math, statistics, charts, and models, and those who can dive into a subject and pick apart its complexities. But, these two professions are very disti♔nct from one another.

Financial analysts and actuaries focus on different areas of the financial industry. Financial analysts typically conduct research and review financial data to make predictions about corporate financials and investment opportunities among other things. 澳洲幸运5开奖号码历史查询:Actuaries, on the other hand, work in different industries doing risk and loss analysis. Keep reading to learn more about these two professions and how they differ.

Financial Analysts

Financial analysts provide expertise for businesses and 澳洲幸运5开奖号码历史查询:investors in economics, markets, investments, regulations, taxes, or 澳洲幸运5开奖号码历史查询:corporate governance. A financial analyst primarily offers accurate information and makes recommeꦓndations based on that information. Corporations, private companies, public agencies, defense contractors, and nonprofits all employ financial analyst🍬s.

Since there are many different kinds of financial analysts (buy-side, sell-side, institutional, industry-specific, corporate, private, and so on), there is no defined career path or set of necessary skills to become one. ꦇEvery financial analyst should be gifted at analytical problem-solving and be able to communicate effectively with non-experts, but there are relatively 🔜few additional hard-and-fast requirements.

Common areas of study for financial analysts include finance, economics, statistics, accounting, mathematics, or other business-related fields. Many financial analysts eventually pursue other professional designations such as the 澳洲幸运5开奖号码历史查询:Chartered Financial Analyst (CFA) designation. Some financial analysts have advanced degrees, such as a 澳洲幸运5开奖号码历🅷史查询:master of business administration (MBA).

Actuary

Actuaries work in the insurance industry, making them important industries where insurance plays a prominent role. They compile and analyze 澳洲幸运5开奖号码历史查询:statistics about risks and the individuals who are exposed to risk. They also work for large financial institutions where they assess risks on loan products. Actuaries measure the potential for loss in an 澳洲幸运5开奖号码历史查询:investment portfolio, which directly crosses over into the r𒁏ealm of financial analysis.

There are comparatively few actuaries in the U.S. Actuarial work involves long hours of dedicated analysis and statistical modeling and appeals to a relatively small subset of the populati♉on. Another key reason is that actuaries spend several years passing a series of rigorous certification exams before most companies will consider them.

Aspiring actuaries are encouraged to pursue an undergraduate degree in a field such as mathematics, statistics, or actuarial science. Some corporate finance and business coursework is typically also done. After receiving a degree, actuaries work toward credentials through one of two professional associations: the 澳洲幸运5开奖号码历史查询:Society of Actuaries (SOA) or the smaller 澳洲幸运5开奖号码历史查询:Casualty Actuarial Society (CAS).

Actuaries don't have to be licensed, but very few employers consider hiring applicants who are not working toward these credentials. There are both associate and fellow levels. Candidates must pass a series of exams. Students often take the first exam or two before graduation. It can often take up to seven years just to pass all the exams for the associate level. However, one can work after passing the first two exams.

Key Differences

According to the Bureau of Labor Statistics (BLS), the median salary for an actuary in the U.S. is $120,000 as of 2023, though aspirants are unlikely to earn near the median salary without starting to pass exams from the CAS or SOA. The BLS expects an add🌟itional 22% percent increase in actuarial positions between 2023 and 2033, much faster than the average for all occupations.

There are over 30,000 actuaries in the U.S. There aren't many licensed actuaries to go around, so businesses must compete to hire good people.

As of 2023, the median salary for financial analysts is $99,890. The BLS estimates that financial analyst positions will increase by 9% between 2023 and 2033, which is much faster than average growth.

Special Considerations

The average financial analyst works between 40 and 50 hours per week and usually doesn't work holidays. Unlike many of their compatriots on Wall Street, financial analysts are not generally expected to dedicate their entire lives t♓o their work.

Actuaries spend even less time at the office💦 than financial analysts. Most actuaries work about 45 hours a week at most. Actuaries who pursue their credentials can expect to study for the exams outside of work. Some employers offer study time during work, but it is usually not enough on its own to pass an exam.

Some investment banking actuaries may wo♈rk more than 50 hours a week and may also be expected to travel often to meet with clients. Financial analysts who work for investment banks often do so as well.

Financial analysts don't receive the same accolades about job desirability, but this career is a better fit for people who like the Wall Street environment, who like working in support of multiple teams, and who may eventually want to move into another financial career, such as investment banking or private equity.

The Bottom Line

Financial analysts and actuaries are just two of the career paths for professionals in the financial industry. Financial analysts provide important information for companies and investors so they can make more informed decisions about the way they spend and invest. Actuaries help companies determine risk and the potential for loss in the insurance and financial services sector♒s.