Is It Really About The Money?

Lately I've been running into a lot of folks that I haven't seen for 4-5 years -- mostly because I've been spending some quality R&R time in my hometown before getting started in IB this summer. Coming from a small-ish city, the "running into people" thing is inevitable...people from high school, parents, etc.

Another thing that's inevitable is the ubiquitous "what are you up to?" question, to which I generally respond that I'm between jobs but will be starting a finance role in June.

Some people leave it at that, but most dig deeper..."so what exactly will you be doing?"

Now, I hate to start the "is it all about the money?" debate again, but hopefully this will be a *new* take on the age-old question.

A lot of people -- mostly those who are familiar with investment banking -- wish me good luck, remind me of the hours, but mention the fact that the long hours don't come without their benefits. This can range from "I always thought you'd make good money" to "wow, you're going to be f***ing loaded, I'm jealous"...obviously, in either case, being at the receiving end of such comments is awkward and something I'd prefer to avoid. I'm happy to talk about IB and why I'm interested in it or why I want to commit to it for a few years, but would rather steer clear of the topic of $.

Anyway, this got me to thinking, once again, about what the money actually means. There's no denying that comp is part of the impetus for wanting these finance jobs, but from reading these boards and speaking with a lot of people (some of whom spoke candidly about this topic), it's rarely the root cause.

For me personally, I'm a reasonably simple guy -- I like to take a nice vacation, I like to buy things at mid-grade clothing stores (BB, BR, RL, etc. -- not exactly expensive stuff), and I like for my living quarters to be in alright shape. Alcohol doesn't sit well with me, and bottle service seems like an egregious waste of money. To me, money is about security: i.e. because of my quite conservative spending habits, I know, at least as a single guy for the next several years, I won't have to worry about my bank account ever. That's an awesome feeling, coming from constantly worrying about it during college and most of high school. But I could get a job working 50 hours a week earning $65K and not worry about my bank account (disclaimer: I don't, nor do I ever intend to, live in NYC).

Maybe I'm weird, but if my reasons for doing investment banking were graphed on a pie chart, money would probably be the smallest slice. Desire for a challenging career would likely be #1, followed by growth opportunities/learning experiences. Culture is also important, and most of the bankers I've met are a far cry from the models and bottles guys that the internet seems to want them to be -- working alongside good, smart people is ALWAYS a plus. Can I find the right blend of compensation and the above in another field? It's possible, but I'm not entirely sure...certainly wasn't the case for me in the software industry, the new kid on the block for "target" graduates.

Anyway, is money your #1 reason? If so, why? If not, what's the biggest reason for wanting to do IB? Ever feel awkward when people seem to only want to talk about "the money" when you tell them what you're up to?

Thanks for reading.

 

DonVon, it will be interesting to see how your perspective changes after grinding for a few years. The monotony and culture of greed/shallowness that exist in finance can certainly wear on people but it sounds like you have a good head on your shoulders. I took my first job because I was desperate for a job and willing to do whatever it took to get to the next level. I stayed in the field primarily because the money was too good to pass up and the fact that I did not know anything else but I was also fortunate to have established a network of high quality (character, knowledge, integrity, etc.) people that have enriched my life. I was also able to build a fairly broad and valuable skill set. Overall, I am happy with my decision as I do not think that I would have had the same opportunity to learn as much as I did in such a short amount of time in other fields. The most important lesson that I have learned is that

Money is life's great magnifier, it brings out the best and worst in people and has the potential to magnify an individual's most noble traits and greatest flaws.

 
junkbondswap:
DonVon, it will be interesting to see how your perspective changes after grinding for a few years. The monotony and culture of greed/shallowness that exist in finance can certainly wear on people but it sounds like you have a good head on your shoulders.

Money is life's great magnifier, it brings out the best and worst in people and has the potential to magnify an individual's most noble traits and greatest flaws.

This is pretty accurate. I can't be too pessimistic, Von, because I had the same enthusiasm and innocence coming into banking that you have. I was open to the long hours and sacrifice and I understood (at least I thought I did) that parts of it would suck, but that there would be development and I would be compensated fairly for the hard work I was putting in and the sacrifices I was making.

The excitement and genuine happiness in what you are doing starts to quickly fade when your dreams of being the "go to guy" and the hardworking rockstar, are replaced with a relationship more akin to a dog who is constantly kicked by his owner. Instead of heaping bowls of Dog Chow and raw hide bones as far as the eye can see, you are instead met with a dog bowl one quarter full and a water bowl that is stale, floating remnants of partially disintegrated Dog Chow clinging to the perimeter.

My point is that the money isn't what it used to be and the perception banks sell to incoming hopefuls is a beautifully packaged one. Just make sure you have your eyes and ears open, and treat everything that is told to you with a healthy dose of skepticism. Your bosses and senior guys aren't your friends, they will stab you in the back in a heartbeat if saving money on your bonus helps their pool and puts more money in their pockets. Keep your enthusiasm for as long as possible. But when you start getting to the point where you realize it's just abuse and you are making others rich, you should start planning your exit....

 
rufiolove:
This is pretty accurate. I can't be too pessimistic, Von, because I had the same enthusiasm and innocence coming into banking that you have. I was open to the long hours and sacrifice and I understood (at least I thought I did) that parts of it would suck, but that there would be development and I would be compensated fairly for the hard work I was putting in and the sacrifices I was making.

The excitement and genuine happiness in what you are doing starts to quickly fade when your dreams of being the "go to guy" and the hardworking rockstar, are replaced with a relationship more akin to a dog who is constantly kicked by his owner. Instead of heaping bowls of Dog Chow and raw hide bones as far as the eye can see, you are instead met with a dog bowl one quarter full and a water bowl that is stale, floating remnants of partially disintegrated Dog Chow clinging to the perimeter.

My point is that the money isn't what it used to be and the perception banks sell to incoming hopefuls is a beautifully packaged one. Just make sure you have your eyes and ears open, and treat everything that is told to you with a healthy dose of skepticism. Your bosses and senior guys aren't your friends, they will stab you in the back in a heartbeat if saving money on your bonus helps their pool and puts more money in their pockets. Keep your enthusiasm for as long as possible. But when you start getting to the point where you realize it's just abuse and you are making others rich, you should start planning your exit....

This is proof that the quality of your IB experience is incredibly group-dependent.

I know plenty of people that are satisfied (if not fulfilled) and happy with their job. I know plenty others that share a sentiment similar to the one you express here. The bottom line is to be careful where you choose to work in IB, although I realize that is easier said than done.

"For all the tribulations in our lives, for all the troubles that remain in the world, the decline of violence is an accomplishment we can savor, and an impetus to cherish the forces of civilization and enlightenment that made it possible."
 
Best Response

Let's be real about this. I'm no saint, I do what I do for the money. But the money isn't what the end game is, it's just the best possible way to keep score. I'd do what I do for free if there was still a scoreboard somewhere that we all accepted as actually meaning something. You want to be in the competition that finance provides because you want to be challenged, you want to be respected, and you want to put yourself up against everything/everyone else that's out there.

Having said that, I try to avoid the topic of money in social situations at all costs (no pun intended). There's nothing worse than creating that awkwardness from everyone cupping your balls over how much you may or may not make, or the awkwardness of everyone feeling ashamed when they realize how little they make in comparison. Either way it sucks. I like to tell people I work in finance but leave it at that, maybe go as far as to say "investing," or "I pick stocks," and past that nobody really asks questions unless they have some experience in the field somehow.

At that point I'll have a casual conversation that's a little more in-depth, but I don't want to have to listen to some Towers Watson executive compensation analyst douchebag harp on about why my fund should buy a health care REIT just because he wants to feel like a big boy for a while sipping on his $9 Amstel Light and exchanging business cards with an actual finance professional for once in his life.

I hate victims who respect their executioners
 
BlackHat:
Let's be real about this. I'm no saint, I do what I do for the money. But the money isn't what the end game is, it's just the best possible way to keep score. I'd do what I do for free if there was still a scoreboard somewhere that we all accepted as actually meaning something. You want to be in the competition that finance provides because you want to be challenged, you want to be respected, and you want to put yourself up against everything/everyone else that's out there.

Having said that, I try to avoid the topic of money in social situations at all costs (no pun intended). There's nothing worse than creating that awkwardness from everyone cupping your balls over how much you may or may not make, or the awkwardness of everyone feeling ashamed when they realize how little they make in comparison. Either way it sucks. I like to tell people I work in finance but leave it at that, maybe go as far as to say "investing," or "I pick stocks," and past that nobody really asks questions unless they have some experience in the field somehow.

At that point I'll have a casual conversation that's a little more in-depth, but I don't want to have to listen to some Towers Watson executive compensation analyst douchebag harp on about why my fund should buy a health care REIT just because he wants to feel like a big boy for a while sipping on his $9 Amstel Light and exchanging business cards with an actual finance professional for once in his life.

Maybe I'm perceiving this incorrectly, but you're saying that if there was a hypothetical score board that measured your success/respect (not in dollar amounts), you'd still do finance?

Now maybe everyone on here will immediately attack me for being "that kid who wants to do IB, but obviously doesn't have what it takes because he's saying this"; however to me if money was completely not an issue, there are so many more fields which would be more of a life-long fulfilling endeavor (philosophy, physics, etc.)

While I don't know exactly what you do and definitely can't tell you that you shouldn't want to work for free given the appropriate conditions, I'm just saying that the whole axiom of finance is that is it all about money.

"History doesn't repeat itself, but it does rhyme."
 
streetwannabe:
Maybe I'm perceiving this incorrectly, but you're saying that if there was a hypothetical score board that measured your success/respect (not in dollar amounts), you'd still do finance?

Now maybe everyone on here will immediately attack me for being "that kid who wants to do IB, but obviously doesn't have what it takes because he's saying this"; however to me if money was completely not an issue, there are so many more fields which would be more of a life-long fulfilling endeavor (philosophy, physics, etc.)

While I don't know exactly what you do and definitely can't tell you that you shouldn't want to work for free given the appropriate conditions, I'm just saying that the whole axiom of finance is that is it all about money.

Agree that I'd never want to do banking in a million years. Anyone who tells me they do banking because they enjoy it is going to attract my skepticism, you typically do banking for two reasons: money and exit opportunities. However, there's no way I can see myself doing anything but what I'm doing right now, which is investing, not banking.

I hate victims who respect their executioners
 

It's about freedom. Money is the key to unlocking freedom.

Just be careful, don't get sucked into what your co-workers do with their high expense life style. You can pull quality girls with $3K or less a month of income if.... You stay in tip top shape, talk constantly to attractive women and avoid telling them what you do for a living.

If you can avoid lifestyle cost inflation, you'll be free to do whatever you want. Maybe you stick around to save a tad more than you need but at the end of the day a pile of cash under your name is the only way you can walk around entirely free.

Now if you're into golddiggers... You may end up like kanye. Don't be getting a girl like that prego.

 

this is the only reason.

WallStreetPlayboys:
It's about freedom. Money is the key to unlocking freedom.
"...the art of good business, is being a good middle man, putting people togeather. It's all about honor and respect."
 
roofstreet:
this is the only reason.
WallStreetPlayboys:
It's about freedom. Money is the key to unlocking freedom.
So, the idea is to work 100 hours a week in IBD for 'freedom'? Something does not compute.

I agree that the primary benefit of money is to get more freedom, but giving up your life for the possibility of more freedom in the future doesn't really work for me. Balance is the key.

Let's be honest, nothing is fun if you do it for 100 hours a week. I would get tired of getting blow jobs for 100 hours a week.

 

All those things can be summed up into one word: Success.

Whether to you that means banging dimepieces, chillin in hawaii for months at a time, driving that ferrari, or less materialistic goals like self worth, feeling good about yourself or being challenged or whatever.

Most people say it's because of the money because it can be traced back to from all those things. It takes money to buy an expensive car or be an 18 yr old's suga daddy.

But overall you want to achieve something, something better than what you currently are or have, and that my friends is called success.

(unless your goal in life is to work 100 hrs a week...but even in that case i can make an argument that its what your definition of success is)

 

Challenge, growth opportunities, and culture are so broad, I don't know how investment banking comes out on top of that list. 65k outside of nyc is still something like 40% above the average college grad starting salary so saying 65k is a low ball number of all you need to live isn't that convincing. Money was my number one motivation for getting into banking. I am trying to rationalize my choices too, so I am not above writing multi-paragraph explanations to convince myself of something, but this rings a little hollow. It sounds like you want to remain down to earth so hopefully you will make your money and still look for more value out of your work than 'just the money'. Good luck!

 

Why does it matter? Everyone has their own motivations in life and if yours happens to be the relentless pursuit of money I think you should embrace it. That was a generic you, not directed at you specifically Von, haha. I think that however you gloss over it, at the end of the day, it comes back to the money. That money can provide you security, women, comfort, food, travel; whatever you want but it doesn't change the fact that finance is a higher paying field than most others and you need the money it provides to do those things. I'm not saying that won't change, as I think it will be reduced for a little while moving forward, but no one in their right mind would work the hours and put up with the stresses if it weren't for the money. Sorry, but I don't think that anyone would be sugarcoating it if their salaries were cut in half tomorrow. It is very easy to say it isn't about the money but very hard to actually live that way.

 

I'd argue that I got in for ego and money, as well as knowing that as a young person you can actually do something without wading up the corporate creek for ten years.

Now that I'm in, I don't know how to peel my lifestyle back to 'normal'. In that I mean, what do you do if you're at home for 6-8 hours a day? And you will be at home, because you're not going out every night on what you can earn on the issuer side of the street.

 
overpaid_overworked:
Now that I'm in, I don't know how to peel my lifestyle back to 'normal'. In that I mean, what do you do if you're at home for 6-8 hours a day? And you will be at home, because you're not going out every night on what you can earn on the issuer side of the street.

Same here. I honestly think I would lose it. I have no idea how I would fill my time.

 

There will be moments when you question yourself. Its perfectly normal. Make your own decisions because you will be the one living with them. Not your friends, not your family, and most certainly not your bat crazy mother can change that.

 

Being relatively new (researching the field for a little over a year now) finance guy, I'll throw my two cents in and say once I got a few figures on compensation, I said hell yea sign me up. Coming in a close second were the financial markets and how they operated. I've always had an interest - even when I had no clue how the markets even functioned - with how the financial markets worked and were integrated into the economy and people's wealth. All my friends call me crazy because they can't stand looking at stocks and bonds, but when I tell them some of the compensation packages their attention is grabbed.

I'd say even for a guy like me who has a bit of an interest in the works of finance, the mula is a big incentive. Where else can someone make $100k their first year out of college? Not to mention the places banking can take you in your career and/or life - whether that be up, a another path in finance, or something different. As of right now, the initial pain of corporate hazing will almost inevitably have it's reward.

And who doesn't like a little competition to spice things up?

“Victorious warriors win first and then go to war, while defeated warriors go to war first and then seek to win” - Sun Tzu

Dolores ratione dolor omnis eum ut. Asperiores accusamus alias est corporis repellat corporis aliquam. Adipisci dolorum praesentium velit maiores. Nobis ut architecto omnis.

Quos non explicabo rerum enim iure odio porro. Autem excepturi libero nam at. Beatae beatae eveniet quas distinctio.

jacobzhang.net - my thoughts and portfolio. "Money doesn't talk, it swears." - Bob Dylan See my other WSO Blog posts

Career Advancement Opportunities

March 2024 Investment Banking

  • Jefferies & Company 02 99.4%
  • Goldman Sachs 19 98.8%
  • Harris Williams & Co. (++) 98.3%
  • Lazard Freres 02 97.7%
  • JPMorgan Chase 03 97.1%

Overall Employee Satisfaction

March 2024 Investment Banking

  • Harris Williams & Co. 18 99.4%
  • JPMorgan Chase 10 98.8%
  • Lazard Freres 05 98.3%
  • Morgan Stanley 07 97.7%
  • William Blair 03 97.1%

Professional Growth Opportunities

March 2024 Investment Banking

  • Lazard Freres 01 99.4%
  • Jefferies & Company 02 98.8%
  • Goldman Sachs 17 98.3%
  • Moelis & Company 07 97.7%
  • JPMorgan Chase 05 97.1%

Total Avg Compensation

March 2024 Investment Banking

  • Director/MD (5) $648
  • Vice President (19) $385
  • Associates (86) $261
  • 3rd+ Year Analyst (13) $181
  • Intern/Summer Associate (33) $170
  • 2nd Year Analyst (66) $168
  • 1st Year Analyst (202) $159
  • Intern/Summer Analyst (144) $101
notes
16 IB Interviews Notes

“... there’s no excuse to not take advantage of the resources out there available to you. Best value for your $ are the...”

Leaderboard

1
redever's picture
redever
99.2
2
Secyh62's picture
Secyh62
99.0
3
BankonBanking's picture
BankonBanking
99.0
4
Betsy Massar's picture
Betsy Massar
99.0
5
kanon's picture
kanon
98.9
6
dosk17's picture
dosk17
98.9
7
GameTheory's picture
GameTheory
98.9
8
CompBanker's picture
CompBanker
98.9
9
DrApeman's picture
DrApeman
98.9
10
Jamoldo's picture
Jamoldo
98.8
success
From 10 rejections to 1 dream investment banking internship

“... I believe it was the single biggest reason why I ended up with an offer...”