Just a random thought of mine. Would be good to get views from actual seasoned investors or experienced analyst. At what age did you get to $1m net worth or cash? I’m just intrigued to see how quickly most investors working through the ranks from analyst to senior analyst/or PM have at least $1m in cash saved from bonuses over time? According to Chat GPT, most buy side analysts get to $1m in cash by 40 years old from accumulated savings from compensation over time and investing that in the market (earning a compounding interest of 7%). Probably wrong but I’m trying to see if there is any truth in that. Chat assumes you started as a buy-side analyst from early/mid 20s and get to roughly $400k in your late 30s as a senior analyst. And save 40% of your income every year. There are so many variables that can affect this Ofcourse but still worth asking some of you guys. What is your YOE? What is your net worth?
Trending Content - Hedge Fund Forum
| +19 | Final round HF process - is it weird to send another idea? | 10 | 7h |
| +17 | SF HF Roles | 13 | 3h |
| +6 | Next cooked MM? | 1 | 2d |
| +3 | del | 3 | 3d |
Career Resources
Go back to reddit
.
It wasn't, actually
broad range of outcomes. exposure to crypto, NVDA, etc. has been more important than comp in your role for most analysts. making 10x on NVDA vs 30% in SPY is a 8x difference in NW
this is the right answer unless youre one of the few who got lucky and got $1m cash comp very young
its really about pa more than comp early on, which in turn is also informed by family background (student loans, trust fund, etc) than anything else
**.
100% agree. These are small sample sizes, but few people I know with similar exp to me (~5yrs of exp) have close to 1mm or more in liquid NW because of having decent cash comp to invest in the ridiculous market runs over the last few years and a few lucky bets (nvda/crypto/etc.). I'm nowhere near it because of student loans+family support despite having similar/slightly better cash comp.
I am over $1m personally, but fwiw here is some rough math for you. $1m at 40 is wrong unless you are underpaid.
I make around $400k a year and for simplicity let’s say it grows 5% per year (next couple of years it’ll be more like 15-20% but let’s just say 5). I spend $100k a year, after tax that means I’m saving around $160k. If my spending rises with my income I’ll have saved $700k or so over the next four years prior to any market gains. If I’m earning 8% per year on my money that’s >$1m in savings in the next 4 years. I’m 30, if I started from 0 today I should have $2.5-3 million by 40 (likely more if my fund doesn’t blow up / I don’t get fired given I will earn more than that rough math).
Most people in HF / AM should be around $1m by early 30s.
***
HF + 5 YOE after undergrad. Seems typical based on peers
If you’re making 400k/year in your late 20s and it takes you more than a decade to hit $1m… then you have ZERO business managing other people’s money.
Typo. I meant late 30s**
Who tf would have $1 M in cash? Seems excessive for the most of us
Think he means $1mm liquid in your brokerage or something, not tied up in firms stock or carry or incentive pay or whatever.
Yeah that’s what I mean
Most people that have been in the game I’d guess have around $2M-$5M at 40. There are outliers in the $10M+++ range who were MM PM’s for multiple years or invested PA smartly or crypto etc. Most prob cross $1M in early 30’s. Caveats for going back to school, starting families, spending heavily and other things that delay compounding.
Accusantium incidunt facere soluta ut deleniti. Dolore dolore perspiciatis voluptatem. Libero expedita asperiores sed dicta eum vel. Et vitae at repudiandae.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...