Ask an Actuary
Ask an Actuary
Craig Reynolds, FSA, MAAA, is president of the SOA, and is the principal & consulting actuary at Milliman Inc in Seattle, WA.
Q: When did you first decide to become an actuary?
I decided to become an actuary late in my first year of graduate school, where I had been studying pure mathematics. I was planning to get married, and I had this crazy idea that married people should have jobs. I had few marketable skills at the time, and actuarial work was one of the few fields with which I was familiar where someone with primarily math skills would be welcome.
Q: Who or what influenced your decision?
When I was an undergraduate, an actuary had visited our campus on a recruiting trip. He painted a vivid picture of what the profession could be like. He described important problems that actuaries could solve and laid out an attractive career path. So when I decided to leave school, actuarial work was the natural choice.
Q: What is your educational background? Where did you attend college, and what was your major? Did you have any internships during college?
I attended college at MIT, where I was a math major who also studied a lot of Physics. While there, I worked during my first two summers developing educational software for Apple ii computers. I spent the summer after my junior year helping to add an addition to my parents' home. I also did a year of graduate school at the University of Washington. During graduate school I was both a TA (Calculus) and RA (modeling cubic splines in Fortran and S).
Q: What classes did you take in college that helped prepare you for the career? What class was most helpful? What non-quantitative classes were helpful?
It is hard to single out any one class. I am glad that I had a strong mathematics background of course. But I did not take any classes that were actuarially focused as such. The basic courses were the most directly relevant. Calculus. Differential Equations. Probability and Statistics. But really, college was about learning how to think. And about developing grit and confidence. Perhaps surprisingly at MIT, some of the humanities courses that I took are the most memorable, such as a great course that I took called "Aggression, War, and Civilization". The readings were outstanding, and it exposed me to some great social science concepts such as the Prisoners' Dilemma. If I were to go back to school now, which I might do after I retire, I would study more history and psychology and behavioral economics. I imagine I would also study data science—a field that hardly existed when I was in college.
Q: What was your first job in the profession? How did you get the job? Did you start as an intern or in an actuarial training program? What type of work did you perform in you first actuarial job?
My first actuarial job was in the actuarial training program at John Hancock. This was a much different time, and if you had a math degree, decent grades, and a pulse, you could get a job. I was able to send out six letters, get five interviews, and four job offers. I don't recall why I took the Hancock job over the others—probably not for any reason that was actually meaningful or appropriate. But it turned out to be a great fit for me. I had a very patient boss and peers who taught me a lot. I spent most of my time pricing payout annuities to fund lottery prizes, though we also did some SPDA and VA pricing. It was a great experience.
Q: Was the job like you expected? Did you have any second thoughts?
It was much better than I expected. Really, I thought the actuarial career would be a temporary job until my wife gradated from MIT. I would then return to graduate school and get my PhD. To my surprise, I found that all the things I liked about college were still here in the working world. Challenge. Variety. Camaraderie. Interesting problems. The only regret that I have is that I left gradate school before at least getting my Masters degree. I hate leaving things unfinished. But even that is not a serious regret. My life has been good. The harder I work, the luckier I get. Things have worked out very well.
Q: When did you take your first exam? How long did it take for you to get through the exam process? Did you find studying for exams to be very helpful for your work?
At that time, the first exam covered primarily calculus, differential equations, and linear algebra, I got credit for it without even taking it by getting a good score on the GRE. My first real exam was part 2, which, more or less, is the equivalent of exam P today. I took it four months after starting at John Hancock. I was a diligent and consistent studier, and I finished my last exam four years after I took part 2. I imagine almost everything I learned was helpful, but the exams that today would correspond to P and MLC were definitely the most helpful. And, as with college, learning how to learn was really the most important thing.
Q: What was your career path from your first job to your current position?
I left John Hancock after only 1.5 years, heading west towards my roots. At that time, I got job offers from Milliman and Farmers New World Life Insurance. I took the job at Farmers, because I had liked Hancock, and I thought it was best to pick a job in insurance rather than consulting, as it was more likely to be like Hancock. I worked at Farmers for 2.5 years, continuing my exams while doing pricing for UL, Term life, and SPDAs. I got restless there, as I did not sense a real growth path, and called up Milliman to ask if the job offer was still open. They made me interview again, but did give me an offer. They were tough negotiators and made me take a pay cut, but I trusted my instincts and took the new job anyway. It was a fantastic decision for me. I made up for the pay cut quickly, and I have had a fantastic career here at Milliman, where I have been for almost 27 years now.
Q: What type of work do you do on a day-to-day basis in your current position?
This is an unusual year for me, as I am also serving as President of the Society of Actuaries. That work occupies over half my time, where I work on helping to develop strategy for the SOA, as well as coordinating relationships with other actuarial organizations and being a representative of the profession and the organization to our members, our employers, and Universities. In my day job, I co-manage the Seattle Life consulting practice of Milliman. I am mainly responsible for business development and people management, as well as quality control, and helping to shape the culture of our team. I feel like I am helping to build something at Milliman, and I want the practice to be a lasting legacy for me.
Q: How long have you been in the profession?
I will finish my 31st year this summer.
Q: What do you like best about your job?
It would be much easier to write about what I do not like, since it would be a much shorter list. But I will follow directions and mention some of the most significant things that I like:
- Variety: I rarely know for sure what I will be doing on any given day. Most every project brings something new to my life.
- Challenge: People rarely hire us to do easy work. I teach my staff that if something is too easy, they should find someone with a lower billing rate to do it.
- People: I like the people, coworkers and clients, that I work with. They are smart, dedicated, interesting people.
- Relevance: Work we do matters, I feel personally responsible for helping to secure the financial future of our clients and the public.
- Opportunity for growth: I learn something new almost every day, and each passing year has brought new responsibilities, new challenges, and new opportunities for growth.
- Self direction: As a Milliman consultant, I can do the work I want to do. If I am (or can become) qualified to do a project, someone wants to pay me to do it, and it is legal and ethical, I can do just about anything. I have always felt in control of my own destiny.
- Compensation: I am paid very well for the work I do.
- Respect: Actuaries are almost always recognized as the smartest people in the room.
Q: What advice would you give to students who are interested in becoming an actuary?
It can be a great profession for anyone attracted to the attributes I defined above. But it is not for the faint of heart. You need to be smart and determined. You need to be an outstanding communicator, both orally and in writing. You need to be confident. You need to want to work on big business problems. You must have outstanding math, computer, and critical thinking skills. And you must be the sort of person that never gives up.
Early in your career, exams may be the most important key to growth. Don't underestimate them. Strive for a ten on every exam. You may not get it, but you should never strive for mediocrity. Develop a consistent study schedule of approximately 80-100 hours of prep time for every exam hour. Study every day, but stop studying for the week and have some fun if you finish your target study hours for the week.
Take the job that is best for your growth and the most interesting, even if it pays a bit less than the others. If you are doing something you love, the rest matters a lot less, and it will probably come with time anyway. You should be in it for the long haul. Your career will likely be around forty years long. Make sure it is one you enjoy.