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When choosing a business career, it is often found that a person will more than likely have to make a decision between two similar career choices. It may not be possible that both career options be pursued but instead more logical to analyze both career choices and the paths leading to success in both these respective careers. After analyzing these options, the right career choice will be able to be chosen wisely and not just pursued by guessing and leaving an important decision to chance. After going over the intellectual, emotional and financial differences between becoming an accountant and becoming an actuary, there will be no contest to why pursuing the career of an actuary is a better career choice than an accountant.
Actuaries and accountants have a lot of similarities but also have some distinct differences in their profession.
Most people know or have an idea of what an accountant is and know them to be the people that deal with taxation or auditing, but almost nobody knows what an actuary is. An actuary is a business professional who deals with the financial impact of risk and uncertainty through expert assessments of financial security systems, with a focus on their complexity, their mathematics, and their mechanisms. (Trowbridge 1989, p. 7) In other words, an actuary is someone who uses complex math systems to assess the financial risks a company may face. Companies often call upon actuaries in order to predict and reduce the loss they may take in the likelihood of an unfavorable outcome. For example, actuaries were called upon to estimate property damage during the event of Hurricane Katrina in New Orleans. The actuaries helped determine long-term damages for insurance companies to accurately price property insurance while at the same time taking a minimal hit to their finances.
Whenever people look to start a new career, the first aspect they look into is salary. Although both accountants and actuaries make a good amount of money, actuaries make significantly more than accountants. According to the United States Department of Labor’s Bureau of Labor Statistics, the median wages of an accountant in May 2008 was $59, 430. (U.S. Bureau of Labor Statistics) That same bureau also surveyed and found that the median wages of an actuary in May 2008 was $84, 810. (U.S. Bureau of Labor Statistics) That makes for an average difference in salary of $25,380, which almost accounts for 50% of an accountant’s salary! For an accountant to even have the same starting salary as an actuary, they have to have a master’s degree and be working at one of the Big 4 firms.(Bureau of Labor Statistics) In financial conditions where money is tight, such as the present recession America is experiencing, financial freedom is a priority. So, if numbers make cents and money is the deciding factor in choosing a career, hands down an actuary is the career of choice.
There is a reason, though, why actuaries make significantly more than accountants do. This is because although they both deal with numbers, actuaries actually make decisions. Actuaries assess the risk from the numbers they interpret and analyze them in a way that can be communicated to a company. So while the accountant is tediously calculating and organizing numbers for a company, the actuary is well involved solving formulas and inputting statistics into equations to use the numbers previously calculated to further progress the company’s goals.
Demand is also another aspect that an actuarial career choice has over an accounting one. Actuaries are in demand according to the Bureau of Labor Statistics and are expected to see an increase in demand of 21%. That is significant considering the moderate 18% increase in demand accountants are projected to have. A similar study by U.S. News & World Report included actuaries among the 25 Best Professions that it expects will be in great demand in the future, whereas accountants did not make the list at all.(Nemko 2006) This difference in demand of the two careers can be explained easily because while demand for actuaries increases, the number of people getting into the field has stayed the same over the years. So while an accountant has to worry about competing against hundreds of others to get one job, actuaries only have to worry about a relatively few number of competitors when pursuing a position at a company. Education is also another reason as to why actuaries are in greater demand than accountants. An actuary usually has an undergraduate degree in a math-such as statistics or in a general business major- such as economics, to be successful in their career. Accountants on the other hand almost always have a master’s degree. So while aspiring actuaries have graduated and are getting into their profession, aspiring accountants are back in school for one or two more years to earn their master’s degree.
Furthermore, an actuary is a better career choice than an accountant simply because it is more interesting work. Accountants go through the same tedious routine, day after day, in the same office space conversing with the same people and having the same mundane conversations by the water cooler; how fun. This is exactly the kind of uninteresting work that turns many aspiring accountants away from accounting and into the fascinating career of an actuary. Actuaries never have a dull day at work. That is because with every job they incur brings a brand new challenge to assess. What math lover would not want to apply new formulas and equations instead of using the same logarithms? To bring some humor into the situation, an actuary is someone who wanted to be an accountant, but had too much personality for it and an accountant is someone who wanted to be an actuary, but did not have personality for it. (Actuarial Jokes) So if boring tedious work is of interest, then accountant is the career of choice. But if, instead the person is a more interesting person who enjoys the new challenges presented in the everyday profession of an actuary, an actuarial career will be the career of choice.
When it comes down to choosing between these two careers, accountant or actuary, the simpler and much easier route would be to become an accountant. There is very little interpretation involved, less responsibility and you still get to play with numbers. But if you instead consider where you will be happier down the road, financially, intellectually, and emotionally, it will be clear as day to see that Actuary is the better career of choice.
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