Banking vs. Law

Hi everyone,

I’m an incoming intern at a mid-tier BB but I’ve always been interested in law (specifically securities law, think Davis Polk, Skadden, Cravath type work). It seems like more and more people are going to IB (and then PE, MBA) over Law and I wanted to get some insight as to why.

How does a career in Law (say aforementioned firms) compare to IB (say BBs, and include the PE route) in comp, lifestyle, long-term comp ceiling, job security, etc.

Are people just choosing IB because the immediate payoff is much higher or is IB truly a “more desirable” path for legitimate reasons?

For context: I have a legitimate interest in either career and don’t have an overwhelming preference for either. And, again, I’ll be joining a mid-tier BB in IB and I’m confident I can land a top 5, 6, or 7 law school (based on GPA and LSAT)

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I think this forum is a bit too doom-and-gloom about law. I worked in legal practice and I know lots of lawyers at all levels who are happy, successful, and get paid well. The pay ceiling in IB is higher, but on average you'll be working quite a bit more than your legal counterparts. Law also seems to have a more defined career path (defined partnership track or get 3-5 years experience and exit to a cushy in-house or government job). It's a career for more risk-averse people (makes sense as your entire job is to mitigate risk). I also think it's significantly easier to get a high-paying job at a law firm than to get a high-paying IB job at a BB or EB.

However, in the end, it all comes down to what your interests are. If you like reading and writing, go with law. If you like numbers, go with IB. If you're indifferent and all you care about is money, go with IB. If you're indifferent and all you care about is "prestige" to random people you meet, go with law, because the vast majority of Joe Blows know law is a "prestigious" career, but most will think you're a bank teller if you tell them you work in IB.

 

Also agree with you and GuyLafleur that this should be taken with a massive grain of salt. While it is true that a transactional lawyer's role involves being the scribe in a dealteam, an M&A lawyer does have opportunities to be creative in a deal, for instance when negotiating with the opposing counsel and trying to find a workable solution. For example, when a legal issue comes up, an M&A lawyer doesn't just ask the client what they want to do and draft accordingly - the lawyer is expected to offer possible solutions and advise on what is considered "market," so it is definitely more than just being the scribe (also as a side note, being a scribe isn't easy as it sounds - it's not actually all about being able to write in fancy legalese that no one understands but writing in a way that the language can be interpreted in your favor in certain situations and being sufficiently ambiguous when that's advantageous, while taking into account how certain terms have been interpreted in specific courts/jurisdictions, etc.).

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