Why is pension an intellectual black hole?

[Arthur Kade]

I'm trying to come up with professional goals for 2012. Not a single thing that would improve me professionally in any conceivable way is related to my job.

I would like to continue to develop my understanding of finance (capital markets, financial economics, etc) - but I have to do this as a purely personal project b/c it's got nothing to do with delivering liability results to my clients.

I would like to continue to develop my programming skills - but I have to do this as a purely personal project b/c all we use is Excel and a proprietary valuation system (even Access is considered akin to voodoo)

I would like to continue to develop my modeling skills (A/L, economic scenario, cash flow, etc) - but I have to do this as a purely personal project b/c everything we do is deterministic (I'm sorry, is this 1950? wtf?)

And even if I manage to do all this on my own it isn't going to help me get out of pension anyway b/c the only thing prospective employers value is what I've done not what I may or may not now.

Is there some clearly identifiable point in time or event at which pensions became the intellectual ghetto of the actuarial world, or has it always been this way?

[Mark Cavazos]

I have found pension work to be intellecually challenging.

I have never been more than a basic programmer (Visual Basic, actually), but even with proprietary valuation programs, I was the one people came to when there was a difficult plan. I could make the programs do more than they were designed to do. (Once, with a long ago system, there was a limit to the number of benefits and the numbers and formulas and such. I ran into an unusual error. I was not sure, but I asked one of our programming group if it meant that I had used to many operations [+, -, *]. She replied "You're not suppose to hit those limits in production." So, I guessed that was a "Yes".)

Liability is only half of a pension equation. Recently, we have gotten into providing financial advice. Even when our clients do not use these services, we use our knowledge to guide them.

One of my favorite assignments was providing retirement counseling. A client wanted to outsource counseling about the DB plan. It was enlighting to talk to participants because they have a different perspective than actuaries (or plan administators - which I have also done). I went over one guy's benefit and he asked "Okay, but what am I getting?" For a while, I could not understand what he mean - the benefit was right there. Then, it hit me - he was talking about after withholding. Over 25 years in the profession and it never occurred to me. When I got back to the office, we set about building one.

[Lane Meyers]

Originally Posted by Arthur Kade

I'm trying to come up with professional goals for 2012. Not a single thing that would improve me professionally in any conceivable way is related to my job.

I would like to improve my understanding of finance (capital markets, financial economics, etc) - but I'd have to do this as a purely personal project b/c it's got nothing to do with delivering liability results to my clients.

I would like to improve my programming skills - but I'd have to do this as a purely personal project b/c all we use is Excel and a proprietary valuation system (even Access is considered akin to voodoo)

I would like to improve my modeling skills (A/L, economic scenario, cash flow, etc) - but I'd have to do this as a purely personal project b/c everything we do is deterministic (I'm sorry, is this 1950? wtf?)

And even if I managed to do all this on my own it isn't going to help me get out of pension anyway b/c the only thing prospective employers value is what I've done not what I may or may not now.

Is there some clearly identifiable point in time or event at which pensions became the intellectual ghetto of the actuarial world, or has it always been this way?

Do you want some cheese with your whine?

We all understand that you think the pension world is beneath you. So get out already, you certainly won't be missed. The only thing stopping you from leaving is you. Your posts have become obnoxiously redundant.

[MountainHawk]

Originally Posted by Lane Meyers

Do you want some cheese with your whine?

We all understand that you think the pension world is beneath you. So get out already, you certainly won't be missed. The only thing stopping you from leaving is you. Your posts have become obnoxiously redundant.

This seems to be the standard response whenever pensions are attacked, which kind of proves the OP's point.

[Arthur Kade]

Originally Posted by Lane Meyers

We all understand that you think the pension world is beneath you. So get out already, you certainly won't be missed. The only thing stopping you from leaving is you.

Actually, the only thing stopping me from leaving is that other actuarial (and certainly broader financial) lines of business can't tell that I'm not as ignorant about programming, modeling and finance as your average pension actuary.

It's impossible to wash off the stench of an entire industry in a 60 minute phone interview.

[George Oscar Bluth]

Originally Posted by Arthur Kade

I'm trying to come up with professional goals for 2012. Not a single thing that would improve me professionally in any conceivable way is related to my job.

I would like to improve my understanding of finance (capital markets, financial economics, etc) - but I'd have to do this as a purely personal project b/c it's got nothing to do with delivering liability results to my clients.

I would like to improve my programming skills - but I'd have to do this as a purely personal project b/c all we use is Excel and a proprietary valuation system (even Access is considered akin to voodoo)

I would like to improve my modeling skills (A/L, economic scenario, cash flow, etc) - but I'd have to do this as a purely personal project b/c everything we do is deterministic (I'm sorry, is this 1950? wtf?)

And even if I managed to do all this on my own it isn't going to help me get out of pension anyway b/c the only thing prospective employers value is what I've done not what I may or may not now.

Is there some clearly identifiable point in time or event at which pensions became the intellectual ghetto of the actuarial world, or has it always been this way?

your company and/or clients clearly suck. there's plenty of top-notch consulting going on for the biggest and baddest clients. sorry you haven't been assigned to them. wonder if your attitude is the reason.

[Arthur Kade]

There's plenty of top-notch consulting at my firm too. None of it is done by pension actuaries.

Our "consulting" consisted of helping clients make the absolute minimum contribution possible since 2008. Now plans are below the critical 80% threshold unless those clients put up a large amount of cash.

who could have foreseen this?

Don't have the cash? Oh, well, benefit restrictions. Sucks to be your participants. Too bad for them.

And it's not like this is even a reasonably unlikely economic scenario we're experiencing. No black swan here, just a complete lack of risk management.

[Lane Meyers]

Originally Posted by MountainHawk

This seems to be the standard response whenever pensions are attacked, which kind of proves the OP's point.

Please explain to me how your post makes any sense.

[Lane Meyers]

Originally Posted by Arthur Kade

Actually, the only thing stopping me from leaving is that other actuarial (and certainly broader financial) lines of business can't tell that I'm not as ignorant about programming, modeling and finance as your average pension actuary.

But aren't you as ignorant as the average pension actuary? In your first post you talk about all the things that you'd like to improve on but won't because it would require extra effort on your part that isn't a part of your normal work responsibilities. If you aren't willing to put in the extra time and effort you think is needed to improve your situation/career, why should anyone hire you?

Originally Posted by Arthur Kade

It's impossible to wash off the stench of an entire industry in a 60 minute phone interview.

Then you aren't doing it right. Also, see my answer above about not willing to put in the extra time and effort.



Stay in the profession, leave the profession, I don't care. But if you aren't willing to put forth the work it is going to take for you to get a job that you'll be happy with long-term, then you should take a look at the man in the mirror, because it's nobody's fault but his.You obviously aren't happy in the pension world though, so I would think you'd bust your butt to do what it takes to get out and be happy.

[Arthur Kade]

Originally Posted by Lane Meyers

But aren't you as ignorant as the average pension actuary? In your first post you talk about all the things that you'd like to improve on but won't because it would require extra effort on your part that isn't a part of your normal work responsibilities. If you aren't willing to put in the extra time and effort you think is needed to improve your situation/career, why should anyone hire you?

READING COMPREHENSION FAIL.

I didn't say I wasn't willing to put in the effort. I absolutely do put in the effort. I am very rigorous about my continuing education. My OP should have said "continue to develop" as all three of these are already strengths (at least relative to every single pension actuary I've ever met).

Finance - I read the finance literature, I read texts, I even take graduate financial economics coursework.

Programming - I am constantly working on improving my programming skills.

Modeling - I model all sorts of problems of interest to me (some have resulted in publishable articles, others have simply helped me understand a question of interest)

That's not my point. My point was two-fold:

1) Why isn't any of this done as part of my work? Why don't we do stochatic modeling for our clients? The standard answer is that clients don't want to pay for this work. My take on this is that clients have figured out that we don't know what we're doing in this area. Why do we not understand even the most basic tenets of risk management in order to work with our clients?

2) None of this education is going to help me get a job b/c prospective employers don't care what I know. They care what I've done. A certain retired chief technical actuary thinks he knows risk-neutral pricing theory. He doesn't know wtf he's talking about. Prospective employers aren't going to be bothered to try to tell the difference between him and me no matter what I learn.