8 figures on wall street
ok so the question is how unlikely is it, how farfetched is it, how "pie in the sky" is it for someone to make 20-50 million cash AFTER tax within a 10-15 year period of working on the street? Im sure questions like this have been asked before, im sorry i am new to the forum and i have a general background on wall street and know the basics but i dont know all the specific details and intricacies of the business. Without questioning why I ask this or saying "u should be happy making 500k a year" can someone just give me an honest answer to the question or maybe give an example as to some people that have done it or come close. i know some of the superstar hedge fund guys like ken griffin david einhorn and bill ackman to name a few have done it but OBVIOUSLY that is not the norm. Im not stupid i understand the average pay is great on the street but its nowhere near what im talkin about if your only looking at the short-medium term time span that im talking about. just how good or how lucky do u have to be to make it happen, and can it be done in your guys opinion in this day and age, like will wall street still remain just as lucrative as it has always been in the next 20 years or so in the future (I know u guys arent psychics but just a general consensus on what u think.). Sorry for long post remember plz just answer the question no matter if u think my motives are stupid or its a dumb question.
@"Flake" got another one
thanks for heeding to my advice in the question
if you knew anything about income percentiles, you know that no matter what the career path, the likelihood of netting mid 8 figures after tax is incredibly small. I'd guess 0.0001% of the population net this in cash flow, if not less. you have to remember that cash flow is not how people are comped, it's base, plus bonus (which is usually cash & equity), as well as equity interest, carry, etc. for those people who actually do get cash from that, I'm guessing it's more along the lines of dividends/carry + salary + rental income from properties they own, instead of just salaries.
i wasnt talking about income ANNUALLY, to me it sounds like u interepreted as if i meant 8 figures a year by the time i was in my 15th year of my career. I meant ACCUMULATING that as a net worth, like over a 15 year span, can u put 20 million cash in the bank by the time your 35 or so. And im sorry i shouldnt have put 50 million thats jus really lost in the sauce where although 10-20 million is still extremely hard to obtain in a 10-15 year time frame, at least its not nearly impossible.
Enough.
Think you answered your own question there, champ
I understand why u guys think im a retard for saying it, i knew it would come with the territory of asking a question like this but just if u guys could atleast answer it honestly that would be great and brofessor thanks for your input
do the math chief. if you assume an 8% annual return, you'd have to sock away over 700k per year for 15y to get to 20mm liquid. since there are very few jobs you can get that you would even be making enough money to defer 700k by your 15th year in the business, I'd say chances are it won't happen.
Why waste time answering a retard's question? You're not going to get any less retarded.
It's very unlikely to make that type of money over a 10-15 years time period, especially after taxes. You figure $20-50MM post tax is more like $40-100MM pretax. That's basically averaging $2.6-$10MM annually. Leaving aside the outliers who will actually do that, averaging that amount of money early in your career would be very, very difficult. If you're really successful (and not a hedge fund superstar), and for example you're an IB MD you could be making towards the annual lower range annually after 15 years, but there's very few people who will make that type of money over the first 15 years of their career.
And the more important number is how much you've saved/spent. You could have netted $50MM by the time you're 40 but if you spent $49.8MM, you're worse off than the guy who made $5MM and has seven figures saved or invested.
Zero chance, period.
The only way you get that kind of money is through an IPO, top CEO, PM at a hedge fund or having your business bought out. You aren't going to be a key employee at a company that IPOs, 15 years isn't enough time to be that level of CEO and you won't get the AUM or returns as a PM to get that cash, and you aren't inheriting a $200MM business.
Your chances of making 500k/yr after tax in 10 years is probably 0.1%, assuming everything goes well, maybe 1% chance in 15 years (you making 500k after tax, not having millions in the bank).
At some of the quant hedge funds, it might be possible. I knew someone from college (he was a senior when I was a freshman) who went to work for a reputable quant hedge fund after graduation. I've kept in touch with him on and off over the years, and in a recent conversation he told me he paid all-cash for an apartment on the Upper West Side of Manhattan. I don't know the exact apartment unit, but he told me the name of the building and he said it was 2-bedrooms. Based on my non-exhaustive research, starting prices for a 2-bedroom in that building (based off public information, websites like streeteasy) are around $2million, so I'm guessing his net worth should be well into the 8-figures range. His parents are middle-class immigrants so he doesn't come from any family wealth.
Troll city.
I'd agree that the 15 year thing is probably the toughest constraint in your whole wet dream scenario. If you expand your horizon to 20-30 years (e.g. a full career), you're probably able to get close to 0.1% will have cumulative wealth >10mm (i'm using orders of magnitude because its such a horseshit hypothetical). For under 15 years, you'd really need to kill it at a HF or some other alt shop for 7-8 years and then spin off your own deal, and continue to kill it raising AUM, plus have a few really strong years at the end once your AUM is ramped up. It's certainly not impossible but it's pretty rare, maybe one kid a year can actually make it happen, probably most of whom are in Asia.
For annual comp over $10mm, don't hold your breath. I think we've got one person over $20mm in annual comp (he runs 12-figure AUM), and there's probably two others in the firm that are close to that ballpark. Maybe 20 people in the U.S. across all long-onlys (although I'm not sure about some of the employee owned firms e.g. Capital, Dodge etc?? maybe they've got dozens of senior ppl in this range?). I'm sure our friends in the HF world can offer much better odds... go knock yourself out.
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