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Engineer to Actuary...smart choice???

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  • Engineer to Actuary...smart choice???

    I might just be living proof of the frustration inherent in the engineering profession today. I've been a practicing engineer for 10 years now, and I'm seriously considering becoming an actuary. Over the past decade or two, the top executive positions in engineering firms in corporate America have been preferentially filled with folks groomed from the business department, in lieu of folks from traditional engineering roles. Moreover, most engineering companies list 2 career tracks for engineers...management and technical, but few companies really support highly paid engineering fellow positions. For those companies that do, they are nowhere near the compensation and prestige as the exec positions...like CFO, CEO, COO etc. And the management track seems limited to the workhorse positions in middle management, where the workload and hours far exceed the moderate increase in compensation. Engineers that are fortunate enough to break through the glass ceiling, more often than not do so because of 'being at the right place at the right time', or because they know someone that carries them along. An old adage I heard in in engineering school was, engineering students that get A's go to grad school, get PhDs and teach. Engineers that get B's work in industry and are managed by those that get C's...and how true it is. I worked for numerous Fortune 100/500 companies where, more often than not, managers were technically inept.

    I am seriously considering becoming an actuary. The engineering profession does not present the opportunities and technical challenges I need to stay engaged. I am a well-respected senior research engineer at a very successful Fortune 40 Company. My background is heavily concentrated in computer based test, measurement and automation, with a work history in a variety of industries.

    My principle considerations for changing careers are: Math…I love it, highly intelligent mixed gender peer group (being an engineer feels like working in prison, there are no females), solving difficult business problems, and most importantly…$$$. I’ve been teetering around 90-120k (the range illustrates mostly geographic cost of living differences) for the past 4 years, with no real opportunity for advancement. Even if I strive to become a technical fellow, it will take 10-15 additional years for only a moderate increase in pay. If I become an actuary, I estimate my pay will be much higher at the 5 year mark, than if I stay in engineering. Assumptions being I achieve FCAS in 5 years and I am at the top of the pay range listed on the D.W. Simpson website:

    http://www.dwsimpson.com/salary.html

    Any thoughts on this?…I am being optimistic or naive?

    According to my research, actuaries are preferred for executive leadership in insurance and other risk management related companies. I’d love to have the opportunity to work towards a CFO position…and be selected because I’m qualified, and not because the CEO is my golfing buddy.

    A little more about myself:
    Degree: BS Mech Eng, MS Nuclear Eng
    School: Illinois Institute of Technology
    GPA: 4.0/4.0
    Work demographics: Government, Academic, Commercial, Consulting
    Industries: Aerospace, nuclear, automotive, medical, communication
    Recent Positions held: Engineering Manager, Project Manager, Senior Engineer, Consultant
    Age: 34

    My major concern is compensation…are the D.W. Simpson salary tables an accurate representation for salaries of traditional actuarial roles? Please advise…and congrats if you made it through my entire posting. This has been a great exercise in documenting my thoughts thus far…

    Thanks in advance for your comments
    Last edited by MechEngr; January 10 2006, 03:21 PM.

  • #2
    Originally posted by MechEngr
    I might just be living proof of the frustration inherent in the engineering profession today. I've been a practicing engineer for 10 years now, and I'm seriously considering becoming an actuary. Over the past decade or two, the top executive positions in engineering firms in corporate America have been preferentially filled with folks groomed from the business department, in lieu of folks from traditional engineering roles. Moreover, most engineering companies list 2 career tracks for engineers...management and technical, but few companies really support highly paid engineering fellow positions. For those companies that do, they are nowhere near the compensation and prestige as the exec positions...like CFO, CEO, COO etc. And the management track seems limited to the workhorse positions in middle management, where the workload and hours far exceed the moderate increase in compensation. Engineers that are fortunate enough to break through the glass ceiling, more often than not do so because of 'being at the right place at the right time', or because they know someone that carries them along. An old adage I heard in in engineering school was, engineering students that get A's go to grad school, get PhDs and teach. Engineers that get B's work in industry and are managed by those that get C's...and how true it is. I worked for numerous Fortune 100/500 companies where, more often than not, managers are technically inept. An interesting example occurred once during a presentation I gave to the Director of Software Products at one of the nations premier defense companies, where the director was dumbfounded when I illustrated how data can be retrieved from a database via a remote terminal. His exacts words were, "You mean I can pull up data from a server in the lab, using my office computer? ''', computers are really getting sophisticated." I was in awe, and wanted to ask him if he ever surfed the internet before, but I refrained.

    I am seriously considering becoming an actuary. The engineering profession does not present the opportunities and technical challenges I need to stay engaged. I am a well-respected senior research engineer at a very successful Fortune 40 Company. My background is heavily concentrated in computer based test, measurement and automation, with a work history in a variety of industries.

    My principle considerations for changing careers are: Math…I love it, highly intelligent mixed gender peer group (being an engineer feels like working in prison, there are no females), solving difficult business problems, and most importantly…$$$. I’ve teetering around 90-120k (the range illustrates mostly geographic cost of living differences) for the past 4 years, with no real opportunity for advancement. Even if I strive to become a technical fellow, it will take 10-15 additional years for only a moderate increase in pay. If I become an actuary, I estimate my pay will be much higher at the 5 year mark, than if I stay in engineering. Assumptions being I achieve FCAS in 5 years and I am at the top of the pay range listed on the D.W. Simpson website:

    http://www.dwsimpson.com/salary.html

    Any thoughts on this?…I am being optimistic or naive?

    According to my research, actuaries are preferred for executive leadership in insurance and other risk management related companies. I’d love to have the opportunity to work towards a CFO position…and be selected because I’m qualified, and not because the CEO is my golfing buddy.

    A little more about myself:
    Degree: BS Mech Eng, MS Nuclear Eng
    School: Illinois Institute of Technology
    GPA: 4.0/4.0
    Work demographics: Government, Academic, Commercial, Consulting
    Industries: Aerospace, nuclear, automotive, medical, communication
    Recent Positions held: Engineering Manager, Project Manager, Senior Engineer, Consultant
    Age: 34

    My major concern is compensation…are the D.W. Simpson salary tables an accurate representation for salaries of traditional actuarial roles? Please advise…and congrats if you made it through my entire posting. This has been a great exercise in documenting my thoughts thus far…

    Thanks in advance for your comments
    It sounds like you've done quite a bit of research into the career. That's a great start.

    DW Simpson is a fairly representative survey, but you also have to consider that the scale is somewhat skewed towards the higher end because of individuals in the bigger insurance/consulting companies in metro areas, like Chicago and New York.

    If you work for a smaller insurance company, you might not be paid as much as the survey indicates, but the benefits may outweigh the monetary compensation.

    I think some of the biggest obstacles you may have to overcome is your extensive experience in a relatively unrelated field and a lack of exams. Understand that you'll most likely be competing against 20-somethings out of college that already have a few exams under their belt, several of whom may already have had internship experience in the actuarial field.

    I think my advice at this point in time would be to sign up for Exam P (February's the closest one, but registration's closed, so I think the next administration will be in May) or Exam FM (which will be in May 2006), study for it and try to pass it.

    Getting through the exams is probably the biggest priority of actuarial students. To get to FCAS, I believe you'll need to take 9 exams, of which 3 of them are only offered twice a year, and 5 of them being offered only once a year. It is feasible to say that you may be an FCAS in 5 years, but it will take you passing all 9 exams in a row, assuming you're taking one at a time.

    Whatever you decide, I wish you the best of luck.

    Comment


    • #3
      Probability, statistics, and stochastic processes can be very useful to engineer. Micro and macro economics, corporate accounting, and financial mathematics may be almost useless to a rank and file engineer, but are paramount for a person inspiring to be executive, in any industry. Even more for a financial executive. The above subjects are either in actuarial exams, or VEE. I would suggest to learn them, if they were not in your university syllabus.

      Comment


      • #4
        I would suggest maybe getting 3 or 4 exams before applying...If you go in with less you will probably be making too little for your comfort and if you go in with more companies may not be interested in someone with so many exams but zero experience.

        Just my opinion. Good luck with whatever you decide.

        Comment

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