Actuarial Barriers to Entry

Actuarial Science, a field that uses mathematical and statistical methods to evaluate and manage financial risks, has become increasingly popular. However, this field is not without its difficulties. As noted by Katie Johnson, a student at Illinois State University, "The principal issue with actuarial science isn't the exams themselves; rather, it is the barrier to entry for new students. This barrier to entry is characterized by a lack of knowledge, which I believe is amplified for advanced students who begin their exam journey alongside their college journey." Recognizing this challenge, the Actuarial Development Institute (ADI) invited Johnson to share her insights on the matter.?

For many intelligent and adaptable students who have performed well in school, the task of passing preliminary actuarial exams should be a relatively straightforward task. However, there is a challenge that even the best of students face, which lies in the lack of resources available to these students in regard to studying for exams. As Johnson explains, "These students lack the knowledge of how to study for exams: what materials to learn from, the amount of time and dedication required, how registration works. The most difficult part is that new students don't even know what they don't know, and therefore are unable to remedy the situation until they've already met failure and decided to do something 'easier.'"?

Johnson shares her own experiences in the field, stating, "I began studying for the FM exam the first semester of my freshman year. I paid attention in class and bought Coaching Actuaries, but because I had no prior knowledge of actuarial science and was simultaneously adjusting to college study habits, I did poorly in the class and failed the exam several times before getting the hang of it." Although Johnson overcame these obstacles and now has two exams passed with an internship lined up for the summer, this highlights the difficulty of navigating the field without proper resources and guidance, especially for students who are new to both college and actuarial science.

Unfortunately, early struggles and encounters with failure?often deters students from actuarial science field entirely. Johnson notes, "To keep heart and prevail after a series of unprecedented difficulties is a challenge that not everyone has the ability or desire to rise to. Early failure discourages continued participation , that much is true for anything." She concludes that "the probability of failure given a lack of resources is too high for comfort, and it's hurting our numbers."?

To address these challenges and improve the situation for students, Johnson proposes several solutions. She suggests being more intentional about reaching out to freshman often, providing advice for both college and actuarial exam studying habits, distributing actuarial club board positions amongst different grades, and spreading more information about the field to those who have an interest in mathematics.?

According to Johnson, "This is not the inherent evil of the environment, of course, but its sometimes out-of-touch nature and misdirection of resources." By addressing these issues and providing the necessary support, the field of actuarial science can become more accessible and inclusive for students of all backgrounds.?

In conclusion, the field of Actuarial Science faces several difficulties in terms of accessibility and inclusivity for students. As highlighted by Katie Johnson, a student at Illinois State University, the principal barrier to entry for new students is the lack of knowledge and resources available for studying for exams. Students who could change the field are deterred by early struggles and failures. It now becomes the responsibility of those who were given those resources to make Actuarial Science more accessible and inclusive for students who didn’t receive the same.?