The Importance Of Actuaries In Securing Your Financial Future

Regardless of your age, you should be taking steps to secure your financial future, which is why you should consider using actuarial services to assist you in doing so. By all means, speak to your accountant, a financial advisor, and even your lawyer; however, if you want to minimise the financial risks you take and be fully aware of those risks which apply to your financial decisions, an actuary is who you need.

Actuarial Services Defined

Actuarial services are provided by an actuary, and the simplest definition of their job role is that they are risk assessors. However, they are not risk assessors in the usual sense whereby they will determine risks associated with a large project but, instead, an actuary’s risk assessment applies primarily to financial products and financial decisions.

More specifically, an actuary assesses risks associated with pensions, investments and insurance, and their actuarial services can be used both in the commercial sector, such as by an insurance company, and by individuals who might be considering taking out an insurance policy.

For both of these clients, an actuary will use their knowledge, skills, and experience to assess past data and past events, and then using mathematical models will make a judgement on the risk of any of these occurring again. Whilst a fortune teller might use a crystal ball to predict the future, an actuary will use only facts and data.

How An Actuary Can Help You And Your Financial Future

As we have mentioned, an actuary will help companies that create financial products. For example, they will help a pension provider by analysing the likelihood of pension payouts versus what the contributions should be. Another example will be to help insurance companies set the level of premiums for an insurance policy based on their risk assessment of how likely claims under that policy will be.

However, on the flip side, actuarial services are also provided to individual clients, who, somewhat ironically, will be the people who buy or invest in many financial products that another actuary will have advised a financial company on. Here, an actuary will help an individual choose which financial products to invest in by advising on the risk and returns of each of them.


If you wish to create or enhance an investment portfolio, then an actuary can be invaluable. They can use the risk models they have created using mathematics and advise on the levels of risk versus the return of any individual investment opportunity or group of investments.

This can extend to helping you decide what proportion of each investment type you keep in your investment portfolio, such as bonds, currencies, stocks, and shares, based on their inherent risks.

Pensions And Retirement Planning

Planning for your retirement can never start too soon in your life, although admittedly, it can leave many people confused to the extent that they postpone making any decisions. That does not bode well for their future finances, which is why an actuary’s advice can often make pensions less perplexing.

The valuable insights that an actuary can provide into pensions can include determining how much you should invest in a pension for a given retirement income and identifying which pensions are the safest versus those that carry the greatest risk.


By its very nature, the insurance industry is governed by risks made by both the insurance companies and those taking out insurance policies. Insurance companies set their premiums based on the risk of the insured event happening, and individuals take out insurance when satisfied with the premium, and the potential payout is compatible.

An actuary will help to establish the correct insurance coverage for your specific needs and also determine which types of insurance are necessary according to the risk factors that exist based on your circumstances, lifestyle, and so on.