How much saving per year from MBB consulants?
How much can a post-MBA associate/consultants from MBB save per year? What's a good amount to spend on rent per month for a MBB associate/consultant's salary? How much money per much do you spend on paying back your MBA loan?
Do you include loan payments as savings? You can allocate money to savings, or to loans, depending on interest rates and other preferences.
I'm a pretty big saver. Here are my stats for first year post-MBA (not including sign-on bonus, including performance bonus).
Rent = $1325 / month, but I split rent with my girlfriend, so call it $663
Savings + loan payments in first year out = ~$65k.
Taxes really suck. Between federal income, payroll taxes, and state income (I live in California, so state income taxes add up), I'll pay nearly 40% in taxes.
$180 income - 40% going to taxes = $108k after tax.
108k after tax - 65k savings = 43k to live on
Keep in mind, expenses during the week are covered, and vacations can be mostly paid for with miles/points
Hope it helps
Is your 180k base from a project leader/engagement manager's level salary? I thought associate from McKinsey and consultatns from BCG made around only 140k base.
He said the $180k includes performance bonus.
Yep.
140 + ~25 performance (conservative, perhaps) + 401(k) = ~180, maybe a touch more
Dude, you didn't give us your location, family situation, or anything else. If you have two kids and a Manhattan apartment, it's probably a bit different than if you have a working spouse, no kids, and live in Atlanta.
Also, do you have an MBB offer @xmasboy ?
Can anyone comment on savings at the pre-MBA analyst levels?
@moosen: 80-90k/yr pay, assuming 35% tax --> $50-60k take-home pay. My target savings is $10k/yr.
All expenses covered during the week, only expenses are rent+car, and weekend food+drinks. This comes out to $2k/month for me, so something like $25-35k left. Vacation travel and hotel can usually be covered with alternate travel arrangements and points, so it basically comes down to how much you spend on miscellaneous purchases/expenses (think drinks, parties, gifts, gambling, etc.).
Thanks, guys. Just trying to understand the industry here, so 401k is pretty good from MBB and how much can yourself contribute to your retirement fund if you want?
xmasboy,
like any 401(k), the limit is ~$16.5k per year of personal contributions, or +5k if you're over 50 years old. Or something like that. It changes every year (adjusted for inflation). Maybe it will be more than 16.5 in 2014...
you can also contribute a few thousand to IRA, and if younger, a roth-ira (there ar eincome limits on roth ira. Something like 110k or 120k or something...post-mba MBB you will make too much for roth ira)
finally, just a heads up for the 401(k) -- company contributions are almost a regular 401(k). However, your personal contributions often can be a roth 401(k) if you choose. The upside here, besides the whole "is it better to be taxed now or later (exactly equal assuming tax rates are the same)" is that 16.5k of post tax money (roth) is more than 16.5k of pre-tax money (regular), so it allows you to up the contribution limit a bit.
Disposable Income in MBB offices (Originally Posted: 06/20/2013)
I've heard a lot about how taxes and rent dilute banker's salaries to the point where they have very little to nothing left to save at the end of the year. As a future consultant, I'm wondering if we'll face the same issues. One of my goals as a consultant is to save up a good chunk of change to eventually fund a startup. Could some people who've worked in MBB tell me about how much free cash they typically have to work with after all their expenses are taken out? What is a realistic savings target to aim for in 3 years MBB?
Living where? NYC?
split based on lifestyle type?
I'll probably choose one of the smaller offices - say Dallas or Houston - simply because in NYC the rent is too damn' high.
We'll say moderate. I plan on going out with my co-workers a good amount of the time, but I definitely won't be splurging like a lot of bankers do.
Are you an analyst? As an analyst, the real impediment to saving a huge pile of cash is that your salary is ~$75k and your bonus is smaller than a bankers'. It's more than enough to live comfortably, but even in a non-NYC/SF city I'd be shocked if you managed to save more than $10k per year.
^
wait, what? as an MBB consultant you should be capable of saving well north of 10k a year, easy... unless you go out to shop at ferragamo's or gucci's every weekend.
i saved 25k last year as a consulting analyst, and i don't make mbb analyst level salary. and, i live in nyc.
this brings me to wonder how much a typical mbb analyst saves per year.
Saving 25k in NYC will be difficult. Elsewhere it's pretty achievable. Taxes and rent will also be your largest expenses. Not sure if you're including 401k, but that's a good way to boost your savings. 3 years in MBB should net you around 100k in savings (part of it in 401k) in an average CoL city.
I'm with you, granted I don't have expensive tastes...I'm able to save a lot more than 10k in the city.
Yah as a Consultant I chose to live in Philly because I could just buy a house near the airport for 50k. Rent it out to tenants for $600/month for positive cashflow. There's versatility to the job if you fully leverage it. Per diem covers all my meals for every week and then some (I grocery shop). So I pocket around 40k a year.
Maybe I'm a bigger spender than most. I excluded my retirement account - that's another $15k, so maybe $25k in all. That said, most of my friends aren't ascetics, so I stand by the $10k cash savings per year as an upper bound.
It all depends on how badly you want to save. Longer commute? Roomates? Not partying every weekend? Getting staffed out of town and couch-surfing in town? People run the whole spectrum.
Tips on Consultant Paycheck Budgetting/Saving (Originally Posted: 03/17/2011)
I've been a prospective monkey on the board for a long time and I remember the post on the IB side about budgeting the pre-bonus paycheck each month. As an undergrad it was extremely eye opening about what to expect from the lifestyle in NY, so now that I've decided to do consulting I was hoping that all of you experienced consulting monkeys could help some of us younger guys get the ball rolling on this side with any good tips, advice, or just a good healthy serving or reality.
Personally: I'm a recent college grad and first year analyst with an all-in salary of roughly 80k, working with a MBB firm.
I'm based out of Charlotte, NC and it was not necessary for me to relocate/move to take this position, so I actually did not receive a sign-on bonus.
Mon-Thursday I'll be on site with a per diem of $75 typically or all expenses reimbursed (depending on client).
So again all personal stories, experiences, advice on saving, or any heads-up as to what I should expect would me much appreciated.
Here's the IB post in reference: http://www.wallstreetoasis.com/forums/breakdown-your-banking-paycheck
Also interested
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