Getting a job at BB with M7 degree and only 2 years experience before MBA?

keyboardcat:

Going to a BB from a top mba sounds like a terrible idea

i think this is too much of a generalization. there are people who really are interested in investment banking and don't mind the hours.

and to cashcow, i think most people are not primarily driven by the need to make over $500k a year. i even know someone who left HBS and then go went into nonprofit (and she told me she wasn't alone among her section-mates)

CashCow:

Is the same not true for GS/MS/Laz/BX m&a/GHL, etc which also hire single digits?

Most people at HBS have strong resumes and interviewing skills or they wouldn't have got in, but there are very few positions at top banks. Why are you basing your statement on, jjc?

GS and MS hire more than single digits from HBS and wharton.

I'm basing this on talking to people who went to those schools. One wharton alumni told me that when he was there, regular investment banking jobs were not considered "prestigious." The top PE firms and hedge funds were the most coveted, and the ones who couldn't get those jobs went into banking.

CashCow:

Why is there a lot of interest in P&G, Coca Cola, Google, Apple, HP, etc?

Isn't it nearly impossible to make more than 500k/year if you remain at one of these places until you're 50 years old?

Jesus Christ, why are you so desperate to make more than 500k a year (not trying to be preachy, just curious why you and so many others here think not making such an exorbitant amount of money is a life or death issue)?

CashCow:

Why is there a lot of interest in P&G, Coca Cola, Google, Apple, HP, etc?

And as far as upshot in IB, he also mentioned that many of his classmates were laid off in 2008-09. Many may not be willing to take that risk with couple of kids.

theATL:

I think it has more to do with work life balance. I will give you the reasons I have heard and the advice I have been given from friends, family, etc

First: You are given a lot of responsibility at these F500 firms. I know a person who was a Finance Director within 8 years of his MBA, and by that point he managed the finance operations for an entire brand throughout Latin America. Rose to VP of Finance by the age of 45.

Second: You do work more than 40 hrs/week but nowhere near IB hours. Also, you get fantastic benefits, and you actually lead a normal life. You get to see your wife, kids, etc. You get to enjoy the money you are making.

Third: You do get paid well. You do make north of 100K your first year out. You can make A TON of money, especially if you want to live overseas. I have heard of compensation packages reaching 800K for people 10-15 years out of their MBA. One package that I can give details about that I am 100% sure is true is as follows: 10K monthly housing stipend, private school tuition for children, $1500 monthly food stipend, 2 trips annually back to the USA for the entire family, and salary + bonus of around 500-600K. Sounds absurd, I know, but that is the way people are treated overseas with big companies (especially in LA or some Asian countries).

Bottom line is you make a good living but you are also on a management track. The company treats you well and expects you to manage groups, divisions, regions, etc. They put you to work and give you a lot of responsibility, all while still giving you a life.

I can attest to these figures, I know personally people in these category. A lot of these companies also sponsor expat memberships as well. Their jobs are also a lot more interesting in my opinion, but also risky in dealing with corporate/legal culture of another country. Those a lot of these benefits in certain countries are being scalled down due to downturn and more people willing to live overseas.

Regardless, it becomes a lifestyle choice in my opinion. Yeah, 2 million a year is great, but what's the point when you can't enjoy it. Being an overseas director/VP is pretty sweet lifestyle along with 500 K along with MANY Perks. I guess it's a matter of absolute wealth vs. relative wealth in the "choosen region". How big of a swing d*ck you want to be and what type.

Buyside CFA:

You can't make over $500K in F500? You've never read a proxy statement, dude. Plenty of guys are making 7 figures total comp by their 40s. IB is def a better path to wealth but there is plenty of upside in general management.

I agree. My post above was addressing pure compensation amounts.

There are a lot of great gems in corporate America.

I think IBD/consulting are great to build the network needed to get those plum jobs.

alumni/MBA networks help too.

Mezz:

pfff, fck that. every incremental 100k I earn makes me a happier person.

Every incremental $100k you earn may net you about $40k in take home pay after taxes (which are going up). When you trade that off against the amount of work you have to do for that incremental $40k, it becomes pretty obvious why so many would not see it as worth the effort.

theATL:

veritas,

Even with wife, kids, house, cars, etc, you should be more than fine making 500K a year.

Let's look at a breakdown. Let's assume 40% tax (which is high if you have 3 kids).

Let's start it off by taking out $500/month for benefits (from what I have as benefits that is pretty average). Let's also take out $15,500 a year for your 401K (assuming no company match) Then let's just use a standard deduction of $11,400.

So we get a taxable income of $467,100 and an after tax income of $291,660 (and trust me this is LOW, you will have many deductions and you will not have an effective tax rate of 40%, but let's continue anyway).

More assumptions: - You buy 2 cars, each at $30,000 (b/c you like to look sweet in your ride, and your wife needs a nice, but not super nice SUV). You put $0 down and you have a 5.9% interest rate, so your yearly payments are roughly $13,900

-You buy a $1 million home, but you put 20% down because you are responsible. So your yearly payments (including tax of 1.25%) are roughly $66,000 a year.

• Your kids have to go to private school that costs $15,000 a year, so there is $45,000.

Now you are only left with $166,760 a year. I guess if you can find a way to blow that much money on insurance, food, entertainment, then you are not very smart.

Even if you say food is $3,000 a month, insurance is $1,000 a month and entertainment is $5,000 a month you still have TONS of money left, as in over $50,000 of loose change.

These types of monthly/yearly cash flow exercises are useless. They assume no change in the expenses or revenues. You cannot simply click and drag like in Excel. The real world changes.

You fail to account for risk and volatility.

As someone with 500k+ salary, the increased responsibility would make me more likely to be fired, or to be targeted for layoffs during a poor business cycle, or to be held accountable for the mistakes of my subordinates.

500k+ jobs don't grow on trees. If I am ever fired/laid-off, it will take longer for me to find an acceptable position (would not want to drop down in seniority/authority/rank).

If I have a $1M house and kids in school, I will not be geographically mobile. This further restricts my employment pool.

At 500k in salary, I will have attained a level of specialized expertise that will be difficult to transition to a new career in the event of a major disruption to my current industry.

Taxes can above 40%. Inflation can wipe out large portions of my savings. Energy, health care and anything related to commodities will increase in cost.

I laugh at all of those retirement savings calculators offered by brokerages. They will all be wrong by multiples.

Ari_Gold:

Wow, you are really risk averse. Might as well plan out how to avoid "once-in-a-lifetime" recession. Possible 100 year floods as well.

As much as we like to think our smarts, good education, and hardwork ethics can accomplish all that we set out to do, e.g. $1 million + salary. A lot of it comes down to straight luck and being at right place and right time. Being smart, knowledgeable, and working hard along with amibition is a given. The more I work and think about it, a lot of it comes from taking advantage of once in a life "lucky" situation.

All those people who made billions in the ninetities and eightities on Wall Street was at the right place to take advantage of a new market. They had the brains and guts to do it. But at the end of the day. What really differenated them from those who got burned in the 2007-2008 and then laid off. In fact, the "caliber" of people on Wallstreet during 2007-2008 and the amount of working hours are probably for the most part longer than in the past.

Or the new billionares of China that happen to be head of SOE right before they went public. These guys were just at the right position at the right time as well. I'm sure they worked hard to get there, but it's a matter of coicidence.

My risk aversion comes from my understanding of luck and randomness.

Those people in the 80s and 90s were NOT all smart. They missed huge exposures (six sigma, long tail, black swan, whatever). They rode asset bubbles to success then crashed because they never understood how things could change.

More and more people enter wall street every year. That increases the likelihood of some people doing well simply from luck. (bigger sample pool = more success stories).

People love the narrative. They love to believe past success is an indicator of future success.

The key to risk is to understand how little you know. Build diversity and redundancies and stop-loss provisions.

But you can also discover what others are forgetting and swing big (see: everyone who shorted mortgage exposure).

theATL:

Veritas,

A couple of things you should consider:

1) Having a corporate job where you make 500K a year (keep in mind I was looking at it as total comp, not just base) is NOT that risky. Heck it is probably MUCH safer than these banking jobs where you are making $1 million +.

2) Sure the real world changes, but what I showed you was an EXTREME example of where your cash could go and you would still have tons of money, if you are risk averse, then you wouldn't buy a $1 million home or spend that much on cars. Off of 500K you can easily pocket $100K a year after taxes, after 401K.

I just don't see where you are getting your notion that $500K is not enough. I have friends and family that hover around that amount and they do very well for themselves. Most of them have been making that much for 10+ years. You have to think of corporate job security, not banking job security, two very different things.

Survivorship bias. We only notice the VPs of finance who keep their jobs. The ones who get fired drift off into anonymity. I've started to track the personnel of the various companies with which I work. There is a lot more turnover than I casually observed.

However, I agree with point #2 on spending. That is generally my approach.

rodneymullen:

Veritas,

Your a tool. Most of the country manages to survive quite nicely on a lot less than 500k a year. Cut the greed and down talking, and just be. No amount of money is going to give you a bigger penis - just learn to live with it.

Don't worry, I have my penis insured for $1 million. That's at least ONE thing I don't have to worry about. Unless the insurer defaults.

(Although to respond to your comment: You are just displaying classic survivorship bias. We only see the winners. The losers drop off the map. No one talks about the Forbes Billionaires who don't make the list next year...)

Ari_Gold:

60%, Damn. Gods I hope not. You'll paying most of the work you do to taxes. Uhhh. But these things waxes and wanes. If it does get to 60%, time to spent 2 years in B-school. Hopefully those tax hikes would be repealed after 2 years. Then again, I doubt I'll be in the 60%, maybe 45-50%, which is pretty bad as it is.

lol, if the tax rate exceeds 50% I think it will be time for the mass exodus of white collar workers from nyc to greener and tax-friendly pastures. nyc would be nuts to institute a 60% all-in tax rate for top earners, basic economic theory suggests that companies and professionals will begin relocating elsewhere...maybe houston will be the new financial capital of the world

theATL:

You also have to think of your effective tax rate. Even if you fall in the 40% bracket you usually don't pay 40%. There was an article recently about how Warren Buffet paid a smaller percentage in taxes than many Americans. The article also went on to explain why he thought the mega wealthy should be taxed more.

Buffett doesn't pay that much in terms of percentage because the vast majority of his wealth is in stocks and other investments, which are taxed at the much lower capital gains rate. And this applies to most ultra-wealthy people. But the young professionals who live in manhattan and make between 250K and 1 million, will get hit hard by the tax increases. Obama and his democratic buddies have magically decided that 250K constitutes "wealthy" and that those people should bear a higher burden of taxation, although they already pay more than their fair share.