Masters in Actuarial Science & Financial Engineering Master Degree Programs

Masters in actuarial science and financial engineering are generally considered to be part of the field of business, these fields of study apply the use of ...

mathematical and statistic methods to assess and manage risk in the insurance, financial and business worlds.

Earning a master’s degree in actuarial science or a masters in financial engineering might lead to new employment and advancement opportunities in the field, or help prepare students to take rigorous certification exams. With a graduate masters degree in actuarial science or financial engineering, graduates are prepared to assess risk and create solutions to help businesses and clients minimize the impact of that risk in a variety of trades including insurance companies, consulting firms, bank and investment firms, large corporations, accounting firms and various governmental agencies.

It is highly recommended to have a mathematics-based undergrad degree when applying for a graduate degree in actuarial science or financial engineering. Such degrees include commerce, mathematics, physics, and engineering.

Actuarial Science and Financial Engineering Master's Program Curriculum

Anyone considering earning a masters degree in actuarial science or a masters in financial engineering should have strong mathematical skills and an analytical thinking process. Students should also possess good business sense, creative thinking, strong computer skills, and be well informed with current financial, economic, and business related trends and legislation.

Actuaries must also pass a series of exams to become certified in the field. These exams are rigorous and it often takes four to eight years to reach full professional status.

The first of these exams can be taken in college and allows the actuary to gain employment. Once employed, companies often pay exam fees for actuaries in their employment and generally increase pay as actuaries complete their exams.

The curricula for financial engineering and actuarial science masters programs vary among schools and a students area of concentration, however; there are several courses that seem to be typical across all programs and concentrations. These courses include:

  • Finance mathematics
  • Life insurance models
  • Risk models and theory
  • Statistical techniques
  • Economics
  • Financial Modeling

Most programs recommend the completion of an internship to prepare students for employment.

Actuary Certification

As previously mentioned, to become a fully certified professional actuary, one must have a degree from an accredited university and pass a series of exams. Courses and study aids are available for exams after the initial exam. The exams can be started while still in college and many companies are now requiring that actuaries pass the initial exam as a condition of employment. Many actuaries graduate with a job or job prospects and employers often pay exam fees for future exams.

Both the Society of Actuaries (SOA) and the Casualty Actuarial Society (CAS) certify actuaries. The initial exams for both societies are the same, but differ in later stages. As such, actuaries are asked to choose an area of specialization. The SOA certifies actuaries in the areas of life insurance, health benefits systems, retirement systems, and finance and investment. The CAS certifies those working in the area of property and casualty, including automobile, homeowners, medical malpractice, worker’s compensation, and personal injury liability. 

Actuarial Science and Financial Engineering Career Paths and Job Outlook

According to the Bureau of Labor Statistics, actuaries held about 24,300 jobs in 2012. They were employed in a variety of industries such as the consulting sector or insurance companies. Other areas of employment included company and enterprise management, brokers and government agencies. Jobs for actuaries were projected to grow by 26% between 2012 and 2022.

Actuarial Science and Financial Engineering Salary

The Bureau of Labor Statistics reported that actuaries earned a median annual salary of $93,680 in 2012.  Specific BLS data was not available for financial engineers, but information was available for the similar occupation of financial analyst. According to the BLS in 2012 finanical analysts earned a medina annual salary of $76,950.

The graph below compares the 2012 median annual salaries of financial analysts and actuaries.

Salary of a Masters in Actuary and Financial Engineer