Banking doesn’t sound as bad when you consider other paths.
I’ve been thinking about this a lot lately, about the hours that you face in IB.
Everyone is always talking about the 100 hour work weeks, which might realistically be only 70-80 hours on average but are still daunting. These hours aren’t as bad as when you compare the other career options of the same prestige, I guess.
Engineering is a big one. I feel as though what people fail to realize is that studying engineering; you have 3-4 years for undergrad and then you’ve got your masters for another 2.
The amount of studying that goes into engineering is nothing short of long, not to mention the difficulty as opposed to business subjects.
Your 2 years in the masters could be compared to your 2-3 in banking to switch to the buy-side but with banking, you make a nice 6 figure salary whilst gaining valuable industry experience.
Medicine and law are just as similar to the engineering pathway. I feel as though people exaggerate the intensity of it with respect to the other options of a similar nature.
Anyone else have a take on this? I have seen no one else mention something similar.
I have multiple degrees in both engineering (electrial) and finance. No mba. Most of my college friends went into entertainment, law, medicine, teaching, engineering, a few into politics.
Personally, I think a major you pick can be a lot easier if you have a knack or interest for it. Most engineers are actually into technical stuff, they already know a lot and don't mind the hardcore math, coding, semiconductors or anything like that. My family members are mostly in medicine and, while a difficult subject, they had the goal to be in this field for life.
After multiple industries and countries, I don't believe there is an "easy way to success", regardless of the area you are in. But if you turn your hobby into your job, it really is more fun.
that’s a real good point you make about the interests however the workload of the two is considerably different when it comes to academics doesn’t it?
I found academics in finance to be easier than engineering. But engineering was more fun, not as boring. There are lab hours, experiments, you have practical applications and actual success stories (I learned how to design my own PCBs, printed them and had actual ICs running, even wrote the software myself. You go from zero to your own physical product in a few weeks!). I never had any internships in my life, but based on my friends' experiences, an engineering internship is way more fun than pure finance stuff. Engineering has a decent amount of finance in it and can be applied to many more industries.
In finance, if a model balances you do have a sense of accomplishment - but it is not mind-blowing.
I have noticed a typical trend of people in banking or people who want to be in banking when talking about different prestigious career paths to always mention medicine, law or engineering. Why? Prestige is too subjective. Maybe you tend to tunnel vision on those specific careers that's why banking does not seem so bad but imo banking out of those is easily the worst in terms of work life balance due to the fact that the careers you listed have some moments that can make up the brutality of them. I know some friends in medicine and engineering.
Can banking match the enjoyment of saving someone's life, improving someone's quality of life, easing someone's pain etc.?
Can banking match the enjoyment of tinkering on something you have built yourself that you know few people have the knowledge/skills to build/make etc.?
These things can drastically make up for the intensity or at least negate it.
In banking the only negation that I can personally speak for is money and that gets old real quick. Because I know even when I suck it up and show up at work tomorrow and I feel like death and the monotony of excel/ppt are sending me in an existential crisis, I will have nothing to show for it except some money I guess.The skillset is unfulfilling, the work hours are bad, the work itself is tedious, lack of meaning etc. You can pick worse careers sure but sure as fuck you can pick a lot better too.
i can definitely see that, but on the long term i was viewing it that you would exit to the buy side after 2-3 years and work on asset management, just as engineers, lawyers and before doctors are entering the workforce. personally i would find this more interesting opposed to engineering or law but medicine definitely has a leg up on the fulfilment part.
i’m not in industry yet so i don’t have any experience but i would assume that those who are genuinely interested in finance would find that more fulfilling than the other professions?
Honestly don't get how engineering is scene as prestigious. Be it traditional engineering or computer science, I have not once seen anyone give a shit what school you went to or anything of that nature. A lot of people put more emphasis on what do you know and what did you make.
of course, i think it’s just because the work is of a different nature. it requires a high level of intelligence in terms of math and sciences, it contributes to society more than banking does and it also comes with money.
i think people tend to associate anything that earns large amounts of money with prestige.
OP you are 100% correct. Those who complain about banking are just looking for something to complain about.
I'm a current engineer working on something that "makes a difference". I have multiple friends in banking and will be trying to break in after getting an MBA.
Engineering is a quick way to hate your life. I had 2x to 3x the amount of schoolwork in undergrad as my college roommates who were finance majors. They now make 15K more base pay and receive large bonuses. Bonuses are non-existent in engineering. In addition, engineers are encouraged to go to grad school at night after working. This resulted in 60 - 70 hours at the office, 10 hours on campus for class, and 20+ hours of homework and projects. All of this for no upwards mobility in any company as an engineer.
Seems like a lot of engineers I've met have dealt with and dreaded the same type of bs, office politics, meetings, etc that bankers or literally any junior level person goes through too. I'm sure there's a portion that do, but viewing engineering as working on your life changing inventions and passions seems to be the same exaggeration as bankers living some crazy Hollywood type lifestyle.
i agree with that, like sure, banking wouldn’t be as glamorous as it’s made out to be, but engineering doesn’t even seem glamorous to begin with so it’s a downward pathway from there.
most engineers don’t even work on their life changing work, it would be solving meaningless problems for massive mining/construction companies or oil companies. granted, they are not all doing that but even as an electronics engineer or mechanics majority of it is engines or small appliances.
software engineering would have the greatest opportunity i would assume (if you would consider it engineering) and even then, you could get to that through other means.
i was hoping for a comment like this, so thanks. it’s really unfortunate for those engineers. gathering the fact that you’re on WSO, are/have you made a transition to finance? also, what type of engineering were you in?
Also, forgot to mention the office culture at engineering companies is ancient. Everyone is old, hates their job, is tired of being babysat by management, and have next to zero social skills.
I self taught myself valuation / accounting. Taking the GMAT now. Have had lots of discussions with banks about post-MBA.
I'm in aerospace.
Agree
It obviously depends what your interests/passions are. To someone who really finds medicine interesting, they don't mind studying long hours in med school. Same with engineers who are passionate about math. Most people hate IBD because they work their asses off and don't really like the work or find it interesting.
ofcourse, but for someone interested in finance, the hours don’t seem shocking when you consider the fact that those studying those degrees haven’t even left school yet. i feel as though IBD can be your masters degree, whilst getting paid handsomely for doing so.
the hours shock you when you actually have to work them
Most engineers don't get masters degrees and their classes might be harder but engineering employers don't even consider their GPAs for hiring
Also if you are an engineer, you could just go into finance whenever you wanted right? Let's be honest, you don't need a finance degree or MBA in order to do finance. I would say 60% of my BB analyst class has a degree in engineering/stats.
ofcourse, that’s also a fair point but when comparing a finance career (and undergrad) with becoming an engineer it’s much better. wouldn’t surprise me that’s a key reason for so many engineers switching to finance.
and to be fair, stats is often a degree for getting into finance roles, it’s a real broad degree and i’ve even considered it due to its pathway into quant finance.
yes but those extra years and tough years of study when you could be in IB, starting your career and earning 6 figures to getting an engineering degree, it is much better. if i’m not mistaken, engineering requires a masters to get certified, atleast in Australia?
like BSDYD said, some ppl have other interests/passions besides getting rich bud
It doesn't require a masters in the US and the income is way higher than IB at least for software engineers, which is the most popular engineering role by far.
Like I said, the study isn't that crazy since there's no stress about your grades and employment is purely merit based, meaning most big firms don't even require a college degree.
This is patently incorrect
dude, we need doctors and engineers in this society. Not everyone's is interested in finance or is obsessed with money
yeah thankfully
that’s obvious. not everyone wants to do finance, not everyone wants to do one thing and of course we need people to contribute to society.
i’m saying that those who DO want to go into finance do not have it as bad as they make it out to be when compared to people going into those professions.
Yeah there's a ton of people in med school or MDs that only did it for the money & prestige and not for the real reasons of why you should become a doctor.
you don't need a masters to be an engineer... unless you are not talking about software?
also, it's not just the hours of banking that are shitty. it's not like you're working every hour of banking, a lot of it is wasted time doing meaningless formatting tasks, only to have a few hours of free time while BEING ON CALL.
that said it sounds like banking is for you and you're justifying it to yourself + others so good on you. it's important to find something you like.
sorry, should’ve outlined that, i was referring to civil and other types of engineering. and yes, i can see how the worthless tasks would be shitty but it also makes the workload less if that makes sense, it’s not like 70-80 hours of straight chaos.
It sure is compared to being a tiktok star
Can you think of another career where literally more than half the people take a 50% pay cut at some point because they simply cannot take the hours and stress anymore?
like someone mentioned above, doctors, lawyers and engineers face this too.
i know for a fact many off shore oil rig workers face the same thing due to their tough work conditions regarding stress, hours, risk and such things.
many nurses dislike the hours of which they face when working shift work and often switch to much lower paid, clinic roles.
there’s a reason bankers get paid so much, it’s because of the grit, determination and strength that it takes. i’m not discounting that fact but it’s not exclusive to banking.
Conversely, many individuals from other ‘prestigious’ career paths, choose to do an MBA with the intention of breaking into investment banking. So it’s clearly not that cut and dry. Job isn’t for everyone.
I want to be a Cro-Magnon in the Paleolithic Era and hunt mammoths, paint caves, and run with wolves.
I think a lot of people above hit the nail on the head - it really just depends on interest, passion, talent, etc.
That being said, my wife's a resident right now and it's not the best. I worked about three years at a boutique where hours were relatively easy, then went into corp fin / corp dev. She did four years of med school that costs $$$ and is finishing up three years of residency where she'll be making ~$55k during that time. At the end of it all, we'll probably be close to each other in total compensation.
She did have some friends / acquaintances who were in the medical field doing it just to make $$$, and to that I'd say IB has an easier pathway to riches than medicine. At the end of the day though, we both value our careers and can't see ourselves doing anything else. She's happy and she'll eventually make good money so comparison doesn't really matter to her and it shouldn't.
i agree with that in the sense that it does come down to where you passion lies.
but for those with a passion for finance, that go into banking do not have it as bad as they make it out to be. as you explained about your wife and her 4 years, that takes money, time and everything else. then there’s residency and the whole lot.
with finance it’s banking for two-three years then an exit to virtually anywhere you want (as long as you put the work in to get there).
also on the financial outcomes of both fields, would it be fair to say that one takes a lot more effort? especially towards your mid 30s-40s where you may be working longer and more intense hours compared to finance. at least with finance, whilst you’re slugging it out in banking, they will be the longest hours you’ll work regardless of where you end up. on the other hand, the med/law/engineering students would still be in school, yet to face their longest hours, diving into debt.
yes, totally agree. for those who do like finance then yes, going that route is definitely easier in terms of time / effort for the return you're getting monetarily speaking. like i said, we both will end up around the same total compensation in the next 3-5 years, but overall i definitely feel my pathway was a lot easier in terms of the time and effort i spent to reach this point.
This is a bit misinformed. Going into SWE doesn't require a 2yrs master and yes you'll get paid there. You'll also get paid in Law or Medicine after more schooling but the banking angle allows for a higher income trajectory which other careers may not offer. Simply put, the grind in banking isn't that bad in the context of other careers but the end objective which bankers shoot for yield different results that those who go in to SWE, or medicine might look for. Law is the only tangible parallel, especially at a biglaw firm, but even then the salary progression and exit opportunities are entirely different.
One can draw logical parallels from any of these but it's not really a comparable path, especially for those who stick with it and didn't impulsively jump into any of those
yes i’m coming to understand that, i was referring to the others forms of engineering as here in Australia SWE does not have the same income potential early on.
i was also referring to the first two-three years of banking in terms of comparison with the other fields who would still be in school. but you are correct, they would yield more in the end, maybe not always monetarily but definitely in the fulfilment section.
might i add though, excluding SWE, the other fields (Law, Medicine and Engineering) require a lot more work to yield these slightly higher results. so it may be equal in terms of the effort put into a finance career and that of a law, engineering or medical career.
It does (sort by highest to lowest).. there are just fewer high paying companies than there are in the US' main tech hubs. Same deal in other markets. And even within the US, the established tech companies able to pay above standard amounts of total comp or the startups capable of generating substantial windfalls employ the minority of SWEs.
Ballpark it at maybe ~200k SWEs out of ~1-2m total SWEs with above standard earning / startup windfall potential? The trouble is that number goes from the like 10-20% in the US down to maybe 1-5% in other countries with some bigtech / startup presence (bearing in mind market adjustments - Indian comp looks very different to London comp) and even 0% if the country doesn't have any big tech companies or VC-backed startups based there (i.e. just "normal" companies).
The fact of the matter is, SWEs, outside of a few select bubbles of existence, make about the same as traditional engineers. Roughly $60-90k starting and plateau of ~$150-160k unless you move into management. Don't let the bigtech / startup bubble contort your view of reality.
The financial payoff of the "IB grind" is definitely better than med, law, etc in terms of where you get to at 25 and how that will compound into the future, but at some point it has to come down to your personal interests and strengths as well.
i completely agree with that. i intended for my OP to make that clear, that for those who enjoy finance (and investment banking) have it better than those who don’t and take other paths.
I'm an engineer by trade (Electrical Engineering), but also took a BBA on the side, and MBA later.
While the majors are wildly different in content and workload, in the end, people that are drawn to engineering - and enjoy engineering - are the types that enjoy the domain, as mentioned earlier in this thread.
As for the work differences...If I spent 12 hours working on some exciting engineering project, or something which required lots of troubleshooting - time really flew by. Before I knew it, the workday was over, and when I went home - I kept thinking about the problem. Worst part about engineering was probably writing documentation and manuals - that part sucked.
that’s a good point i haven’t seen anyone say that regarding how time flies. i’m sure this isn’t the same for IB, but comparing your time in school for engineering (assuming you completed a masters) would that be better than taking in 6 figures, gaining industry experience and making connections?
i failed to make that point clear enough in my OP, just curious to know
I got a degree in Mechanical Engineering and absolutely loved school, learning engineering/physics and doing the labs and research, but no way could I have actually practiced engineering, it's so different. I'm sure I would have loved to be in an R&D division of GM or Boeing or something, but those opportunities are so far and few between, and reserved for smarter people than me haha.
I am going to be biased here and say that engineering is better than banking for many reasons.
Education/Pay. I went to a state school got a BS in Aerospace Engineering and within 2.5 years I started making 6 figures. My college was not a high profile school but it was very technical and I did a-lot of research, which I enjoyed. In industry, the hours in engineering are a solid 40, rarely more than that. Unless you work for SpaceX, those guys would happily work for half the pay and double the work ha. They innovate for sure.
I am currently doing a masters in Finance at Harvard University Extension School. Every class in Finance has been cake so far. Not once I felt I could not understand the material. Very different from undergrad in Aerospace, where every class felt like a weed-out course. I am still a Project/Aerospace engineer working full time, part-time options trader, running a business, playing in a Div 3 soccer league and doing a masters. My gf and I get to spend entire weekends doing stuff, so I’d say engineering allows for a better work life balance. Now, we don’t get sweet bonuses like IBs or hedge fund analysts do but after crunching the numbers, if I were to work 70-80 hrs a week for a year I’d also make $200k+ in my current role.
this gives some real good perspective. it really surprises me that your hours are that “short” at 40 hours a week, must be nice.
if you don’t mind me asking, what’s your reason for switching for a finance role?
40 hours is industry standard. Anything above that is considered comp time and can be considered as time off. Typically, engineers don’t take alot of time off and are required to take vacation/time off because otherwise the company would have to pay lump sums and they don’t want to do that ha. So around Thanksgiving, work typically slow down which is nice.
I chose finance because it is the language of money management. I have learned a great from professors who are successful fund managers as well as my classmates. But I also learned how demanding the Finance industry might be. I have become a more sophisticated investor, learned to optimize portfolios and hedge. I plan to run my own fund so I am currently building my credibility and track record and my degree has provided me with key connections as well as realistic insights. I’d consider joining a hedge fund because of the hands on experience and the pay that comes with it but the work demand would be counterproductive for me. At 40 hours, I am able to grow my business and do all the things I enjoy doing. So it would not make much sense for me to work 70-80 hours, giving up the time invested in my projects which have more earning potential and less stress. So my degree in Finance is my ticket to freedom from the corporate world because it supplements my entrepreneurial ventures.
Engineering undergrad + MBA is the way to go. Engineering for the technical, MBA for the management/business side
i can imagine that would place you in a good position for employment, i’ve heard an MBA is overkill for IB?
Agreed. For me, Engineering + MBA is a great route to senior mgmt positions, which I'd prefer over IB
I was in IB at a top BB when a bunch of my buddies were at FAANG's out in Silicon valley.
It was comparable at first, although maybe not when you factor in lifestyle.
I since left banking and run my own things now. My friends stayed in software. Thank fucking god. as you move up the stock grants these tech places completely fucks banking comp ESPECIALLY after you factor in cap gains tax. It's a fuckin killer. Buddy at Instagram is absolutely railing in cash and bought 2 properties in chicago... for passive income. Mid twenties
ALso othe rposters abover r correct. People don't choose one or the other. It's pretty rare. You're either a technical person who like sengineering or you aren't.
good to know, i was referring to traditional engineering but damn, that’s fucked.
i assume tech would have taken a lot of the talent from banking due to all of that, i’ve heard start ups are where you can get even more gains due to gaining equity, would be more risky of course.
Was EE including masters. Interned at an aerospace company. These jobs can be very tedious. You work on same project /
product for years. Pay progress / promotions are super lengthy. You might be doing some
cool rocket ship, but you aren’t talking w Elon or anything. You are just 1 of 500 people in design/manufacturing/testing for decades unless you are some super senior guy 25 years down the road.
Worked in consulting first and now banking post MBA - both are lot more exciting, will pay you lot more, will move you up much faster and you’ll meet lot more people who aren’t just smart but also work hard (vs clocking out at 5pm). Not for everyone - sure. depends on what you enjoy more
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