Every actuarial exam problem, case study, or interview question rewards the same core skill: disciplined thinking under constraints. Over time, I have found a simple loop that keeps you fast, accurate, and confident:
- Read with intent. Don’t rush to formulas. Identify what is being asked, what is given, and what is missing. Rewrite the question in your own words. If you can’t do that, you don’t understand it yet.
- Model the situation. Draw a timeline, a cashflow diagram, or a small state sketch. Translate words into structure. This is where most errors are prevented, not fixed.
- Compute efficiently. Choose the simplest method that works (not the fanciest). Keep units consistent, and write intermediate steps so you can spot mistakes quickly.
- Sanity check. Ask: does the magnitude make sense? Are probabilities between 0 and 1? Are interest rates applied over the correct period? Would a small change in an input change the answer in the expected direction?
- Explain in one paragraph. State the approach, key assumptions, and result. If you can explain it clearly, you own it.
Use this loop as your default. It turns practice into performance!