You’ve probably wondered, should I get an MBA coming from an actuarial science background? Or maybe should I get a actuarial science MBA (from the few schools that offer it)?
What is a MBA?
MBA stands for Master of Business Administration.
Two-year (Full-Time) MBA programs normally take place over two academic years (i.e. approximately 18 months of term time). For example, in the Northern Hemisphere, they often begin in late August/September of year one and continue until May of year two, with a three- to four-month summer break in between years one and two. Students enter with a reasonable amount of prior real-world work experience and take classes during weekdays like other university students. A typical Full-time, accelerated, part-time or modular MBA requires 60 credits (600 class hours) of graduate work.
Accelerated MBA programs are a variation of the two-year programs. They involve a higher course load with more intense class and examination schedules and are usually condensed into one year. They usually have less “down time” during the program and between semesters. For example, there is no three- to four-month summer break, and between semesters there might be seven to ten days off rather than three to five weeks vacation. Accelerated programs typically have a lower cost than full-time two-year programs.
Do many actuaries get MBA degrees?
The short answer is no. The general pathway for many actuaries is they study actuarial science or mathematics in undergrad, get their Bachelors degree, and then work at a company while completing exams until they obtain their fellowship (FSA for Society of Actuaries, FCSA for Casualty Actuarial Society).
What are the benefits of MBA?
An MBA degree is obtained for several reasons. Many people use it to switch careers so it may be useful if you’re switching from actuarial science to finance (investment banking, for example). This is typically the most common reason for people from actuarial science background to get their MBA. The MBA allows people to have a story and transition point in their career flow into a different industry.
There are a lot fewer actuaries who obtain their MBA and subsequently stay in actuarial science. I believe most of these are senior actuaries who just want to obtain management skills.
What are the downsides of MBA?
If you haven’t passed all your actuarial exams and obtained your fellowship in either the SOA or CAS, then passing those exams should be your first priority if you want to become an actuary. Obtaining a MBA degree would put a very heavy wrench in that process.
If you have passed all your actuarial exams and are currently a FSA/FCAS, then you need to weigh the benefits and costs. A MBA degree is expensive and takes typically 2 years out of your working life (lost time and wages) as opportunity cost. Since not many actuaries obtain a MBA degree, it may look weird to employers when you are asked why you left the profession to obtain your MBA. If you are a senior executive with demonstrated commitment to the field, for example a senior actuary with 10 years post fellowship experience, then it’s a much easier sell. Otherwise, people may think you didn’t like actuarial science and did your MBA because you didn’t know what to do.
Conclusion – Focus on Actuarial Exams over MBA
While rare and usually not worth it, there are some reasons why some actuaries wish to pursue a MBA. We suggest you find out more information about MBAs and the business schools that offer it before deciding for yourself. Good luck!