Career Bankers, Was It Worth It?

You're starting again as a university freshman with the knowledge of the industry you have now. Do you go down this path again? 


It'd be appreciated if you touched on starting a family, missed life events, etc.
 

Sorry for the repost but the automod moved my thread (again).

 

My true dream in life was to become a gangster rapper; my street name was Cold-Ice.
 

But when my homie Ricky died running down an ally from some rival bloods as they chased closely in a red Hundai shotgun pointed at Ricky I thought I'd give IB a shot.

 

Yes. Hated analyst and associate years but after that’s it’s the dream life. Make 6m just to boss around the juniors and do a couple interviews and anwser some emails.

 

Hard to complain

Financially: 45, run a group, make 5-8 a year, path to 10+. Worth about 30 but that’s with a lot of unmaterialized private investments. Hope to be 50 at 50 and c75 when I retire, with enough investment upside to finish at 100+. Live pretty simply, not because I place some undue value on that, but just don’t have that expensive tastes other than vacations.

Lifestyle, I work a lot but I generally enjoy deals and don’t mind pitching. That said, a lot of work is just BSing with friends, playing golf with clients, etc. I made a conscious decision to spend a lot of my non work time with family so hobbies take a bit of a back seat but there’s time for that

I work for a firm but I’m pretty much my own boss. I make enough money for the institution that as long as I don’t break conduct roles.

Only downside is while I’ve done well enough for my family and having grown up without money, have taken care of my parents and will give my kids real wealth, haven’t left a legacy business wise. People will be writing books in my clients but not me. That’s a bit frustrating.

 

Not a bad thing that people aren’t writing about you. Press is obsessed with code of conduct breakers at the senior level. And then there’s privacy for your family. The luxury of best kept secret is understated.

 

How many hours do you work generally? Do you feel like you have had flexibility to be involved in kids life when you want to be? i.e. make soccer games/recitals/etc?

 

haven’t left a legacy business wise

I take it this is something you wrestle with a lot?

 

Last paragraph is an interesting take. I would prefer being in the shadows / not known for my success outside of my family knowing my true wealth. Have a relative with similar net worth as you. No way a layperson can tell he's worth $30M+ by just looking at his LinkedIn. Worked at many companies in executive / equity holding positions that eventually sold to strategics / sponsors.

Congratulations on your success.

 

Congrats on your success! What advice would you give on allocating money to investments, or just budgeting in general, during analyst/associate years? How did you determine which companies/funds are worthy of investing in?  

 

Bump. Is it realistic to work ~60 hrs a week regularly at the higher levels in IB? My father worked about that much in his career (not IB) and I never thought of him as being not around so I think it’s realistic to be an involved parent at ~60 hrs a week. The question is, is that realistic in banking?

 

Interesting I felt the exact opposite as my father worked ~60-70 hours a week throughout my chilldhood. I wish I saw him a lot more. Barely saw him during the week. Rarely saw him on the weekends due to errands / networking he had to do for his business. He probably could have matched his salary / possibly exceeded it in a corporate role but he wanted to be his own boss.

He was MIA during my high school years. It was around the Great Financial Crisis and he was dealing with a lot of work-related issues. By the time I graduated in the early 2010s, my parents were thriving financially (put a ton of money into the market when it hit rock bottom in 2009). They finally had free time and started to work less and relax. But at that point when my parents stopped pulling those type of hours, I was in college and living away from home.

Now my parents are near retirement working ~45 hours a weeks and have grown their passive investments. My father now can take random mornings / afternoons off without much problem but I wish I had more of that when I was younger.

 

Mine worked like 6am-6/7pm so was home for dinner every night and then maybe worked a bit on the weekends. Hoping thats somewhat feasible in banking

 

Depends on the team. Some MDs work associate hours when you include travelling, entertaining, conferences, after hour calls, etc.

 
Most Helpful

Lol, the MD poster is more likely than not trolling the shit out of you young bloods. (edit: missed the group head so seems to check out, but that's like the best of the best, for the avg md, certainly younger MDs thats probably more the exception than the rule)

I have several MD friends, they are not making anywhere near those numbers. They have no where near that net worth. They are grinding. 

1-2 (maybe more like 1.5) is a more realistic number form talking to friends. Plus much of that is tied up into deferred/stock comp that vests. 

Maybe some super rainmakers are making 6-8mm but those are more likely to be gray hairs / anomalies. 

Overall, I'd say the job is more just client mgmt with lots of travel. Your schedule is much more flexibility, you probably dont even know how to use ppt/excel anymore but its still a grind and stressful for different reasons. That said any job making that kinda money is stressful, for the most part. The job of an MD isn't anything like at the lower levels so if you enjoy client interaction, etc. its a good path. 

 

Lol, the MD poster is more likely than not trolling the shit out of you young bloods. 

I have several MD friends, they are not making anywhere near those numbers. They have no where near that net worth. They are grinding. 

1-2 (maybe more like 1.5) is a more realistic number form talking to friends. Plus much of that is tied up into deferred/stock comp that vests. 

Maybe some super rainmakers are making 6-8mm but those are more likely to be gray hairs / anomalies. 

Overall, I'd say the job is more just client mgmt with lots of travel. Your schedule is much more flexibility, you probably dont even know how to use ppt/excel anymore but its still a grind and stressful for different reasons. That said any job making that kinda money is stressful, for the most part. The job of an MD isn't anything like at the lower levels so if you enjoy client interaction, etc. its a good path. 

$2mm all-in for $25mm PnL and scales up somewhat proportionately to around $5mm for group heads at BB.  I know for a fact at my bank the mean MD bonus in 2023 was $1.4mm (got this from our group head), which is down 30%+ from a decent year.  If you have a $25mm PnL at an EB, you can easily clear $6mm

 

I generally agree with what you're saying, but how many MDs make $25mm+ in PnL individually each year? I'd wager not as many as most think on a hard dollars basis. On a soft dollar basis, sure I'd imagine a lot clear $25mm PnL and maybe this is what you mean. On a hard dollar basis, I'd imagine the PnL quickly shrinks at non EB shops where you are splitting revenues with other groups (i.e. if you're in coverage and do an M&A + acquisition financing deal, you may be splitting revenues with your bank's M&A, Sponsors, Lev Fin, DCM, etc. teams) or other MDs/Ds in your own group. 

On comp, my general understanding is that in Banking 30 - 40% of a teams revenue will be paid out as comp to the bankers. Markets roles I've generally heard 10 - 20% of revenue goes towards comp. The discrepancy comes from Banking revenue being "risk free" (or as close to it as possible assuming no sizeable BS is used), while Markets comp is penalized due to the risk taking nature and use of BS.

I've generally seen and heard that BBs and MMs target $2mm+ in revenue per head in IB, which seems to make mathematical sense to me. If a team of 5 ( one each of Analyst through MD) make $10mm on a hard dollar basis, this would allow for comp to flow in the approximate following manor:

An -$150k+

As - $300k+

VP - $500k+

D - $750k+

MD - $1mm+

Total comp for all 5 members would be $2.7mm+, which is a bit below the 30% range I mentioned above.

 

To answer your question, it’s the internet. Of course I could be lying about my comp but no particular incentive to do so on an anonymous forum.

But to answer why I’m on here, WSO has been around long enough that I used it as a resource when I was a junior banker and have posted occasionally since, often with multi year breaks. I do come on here at year end to see what the scuttlebutt is on comp and do my primary research on where the market is away from what I get from HR / management. In this case after the BofA tragedy I was pointed to some of the posts by one of my analysts. And besides everyone needs a mindless break, I also post on random forums about sports and travel interests of mine.

As far as comp goes, I never said my numbers are average (I’ve been an MD for over a decade and promoted a couple rings from entry level MD), but i don’t think they are outliers either. I’d guess I am top 10% of MDs at my firm, but certainly not top 3%. I have c10 MDs report to me and their comp ranges from 1mm a year to 4mm a year. 
 

 

MD in fixed income clearly didn't hone his attention to detail skills, missing out on the key point that you are a group head and not just your 'average MD' that he's alluding too. These aren't exactly rare numbers for group heads. Have heard numbers like that since I was in college.

 

Dude. No analyst would ever have the balls to point a group head MD to a WSO post (nor would group head MD give a shit). That’s not realistic. Idk what kind of game you’re trying to play but it’s weird. 

 

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