First year student in commerce, what will my career really look like?
I am a first year commerce student at the University of Western Australia. I am studying a double degree in commerce and engineering, majoring in finance and mechanical engineering. I've developed a passion for finance over the past 2 years, and I find researching stocks and reading up on different finance related news interesting. No matter how much time I spend looking at different companies, I seem to be immune from getting bored of it. Alongside this, my grades are much stronger in the commerce side of my studies, however, all my family basically forced me to double with engineering because they don't believe finance has a future and that it is too hard to find a job in the industry.
My only concern is that the industry looks ruthless and the WLB doesn't seem to suit what I am looking for so I wanted to do some more research and ask people who have worked in the industry for their opinions on the following:
What is the outlook for the industry in terms of job opportunities and job security?
If I was to switch my degree and focus only on commerce, what sort of job opportunities am I looking at after a year or two at a BB working in IB (If I have to, I can live through a year or two of poor WLB)? The ideal exit job in my mind is a well-paying job in portfolio management such as in HF/AM with a very good WLB, which also isn't extremely competitive or hard to get into. Is this even a realistic goal? Do these jobs even exist? What are some other roles in finance or business I can exit IB to that fit those criteria?
I don't know if this helps but my aim is to be able to retire or be financially independent by 40 living a comfortable life. Is this realistic?
As I mentioned, I am rather new to everything and I am trying to gather information so if anyone could leave some useful information, I would be really appreciative!
Not too sure about the job market in Western Australia but I’ll assume it’s similar to Victoria where I’m based. I think finance in WA is a lot more geared towards mining but correct me if I’m wrong.
Let’s work this backwards: from your ultimate goal back to where you are now. If I’m being honest, if you want to retire by 40, you have to have a six figure annual salary/income at least and have a solid saving/investment plan of saving more than 50% of your annual income. If you want to have a six figure salary/income, you won’t have work life balance regardless of the career. I have a few friends who are software engineers and they can make 150-200k while working 9-5, but the technical knowledge required is so advanced that you’ll basically have to be a genius to get there. If you are, congratulations and start coding.
But if you’re not some coding savant, every other career (including engineering) will require you to work long hours for good pay. You could potentially opt for running a business instead of working for an employer, but do you know how hard running a business is? Many people underestimate it. On top of coming up with a unique product offering (which is difficult in itself), you have to sell that product through a viable operating model and managing all of that is not child’s play. You will still work long hours or have many smart and trusted people helping you - and they don’t come easy. My brother is an engineer making 100k, but lives in rural Australia in some nowhere town paying $600 per week rent because the town barely has any houses yet populated by high salaried engineers like himself, working 12-14 hour shifts a day 10 days on, 4 days off. Other engineering roles he was offered were $70k but 10 hour shifts per day, plus expected travel to sites. Not to mention an engineering registration might require 5 years of study at uni which is just wasting time.
For lack of a better option, I think finance is the “easiest” career to retire early (and I’m using the word “easy” very loosely here, it’s not easy no matter what). IB, PE, HF, etc you can get $150-200k all in pay at junior level which can go up to $300-400k at VP level after 6-9 years in the game. You can get into finance with a 3 year commerce degree, unlike engineering where some fields require you to do a Masters. Besides, engineers don’t make big salaries like finance, and the work hours are only slightly less.
Job security is volatile in any industry. If the economy tanks, everyone will suffer. At least if you’re smart with your finance bonuses (i.e. save/invest them in a diversified portfolio), you won’t starve to death in a recession. I don’t know what your number is but for me, $5m would be enough for me to set up a portfolio that can generate $100k of passive income where I can just quit my job and chill. $1m allows me to be more candid at work, $2m allows me to take unpaid time off very comfortably anytime I want, $3-4m allows me to take my career less seriously, and anything more than that is solid FU money where even if I lose my job I’d just laugh at my boss and walk out nonchalantly. Unfortunately to get there, your WLB will be close to nonexistent in your early career.
All the best. Cultivate your career wisely, don’t be sucked into an unnecessarily lavish lifestyle, save and invest appropriately, and hopefully you’d be able to retire by 40 - maybe earlier.
Thank you for the response! You are correct, I have noticed that a large amount of the firms are geared towards either mining or real estate which isn't really the area I am most fond of, but I guess I don't really have that much choice unless I want to move to Sydney.
Note: Don't live in Australia (have never been there) so take everything I say with a grain of salt.
Agree with poster above that if you're gonna aim for retirement by 40 you better have a job where you 1) make a lot of money, and 2) work a job you at least find bearable 'cause otherwise you're gonna get burned out and quit and not be able to meet criteria 1). In terms of making money, I think you can make money in both finance and engineering. Why does your family think finance doesn't have a future? Very curious what brings them to that conclusion.
I think the outlook for the industry is fine? I don't think it's super lopsided demand/supply situation like software engineering (people getting hit up by multiple recruiters a week), but it's decently healthy. People are making good money. I don't see it going away (and am not sure what exactly would cause it to do so). In terms of job security, depends on what your job is/ where you work. Places like a sovereign wealth fund/ big bank would have more job security than a pod shop.
If you get through IB... I think the common exits are PE, HF, corp finance. I also know people who decided to join a startup in a more operations role. I think with that kind of background going to a HF is definitely possible, but with good WLB...? I guess it depends what your definition of good WLB is. If you're thinking 9-5... I don't think that exists lol, like the other poster said - go learn how to code if you want that 9-5. Out of everything I mentioned, corporate finance probably has the best WLB. Depending on how much money you feel you need to retire, it could help reach your retirement goals as well. "A comfortable life" is quite vague. How much income would you need coming in a year to feel you had "a comfortable life"? Take that number x25 and that's how much net worth you would need to have saved up to retire (plus a bit more if you want buffer).
If you work in finance and aren't that attached to 9-5, I think retiring by 40 is very realistic. Depending on the job/ your ability to save/invest correctly (diversify!!!), you could move that up by as much as a decade.
Thank you for your response!
In regards to what I would classify as a preferable WLB, in my head, it looks something along the lines of weekends off, home from the office by 8 or 9pm latest on average and no need to do much work once I am home. I could see myself surviving this as this is already better than my current study habits.
In regards to why my family believes there isn't much of a future in finance, from their perspective (they don't really understand any role in finance tbh), they believe most of the roles won't be difficult to automate, or enough automation is possible in the industry that it will be too difficult to get one of the remaining jobs.
Also, I have read that AM is a good alternative to IB for those who want a better WLB. Is it possible to go directly into AM as a 1st year and what is the relative difficulty of finding a job vs IB? If I were to go into AM, what sort of compensation decrease/increase can I expect in comparison to IB and are the exit opportunities worse for AM?
I think your WLB expectation is pretty reasonable for other roles in finance, not banking though (note: I've never worked in banking myself, this is just from talking to my friends who do/ reading this forum).
I think there definitely is some amount of automation in finance over time, and I would say that's a good thing. If instead of getting a poor analyst to manually visit 500 web pages and copy data, you can just write a script to automate it, why not? Then you can tell the analyst to do something else more helpful. You can see the job outlook from US Bureau of Labor Statistics here(not sure if there's any equivalent thing in Australia), by the way the one for mechanical engineers (in case you want to consider it, though it sounds like you don't) is here. And just for reference, if your top criteria for choosing careers is availability of jobs/ job growth - software engineering is where it's at.
AM is a good alternative to IB for those who want a better WLB. I agree. However, I would also say they are not fundamentally the same job. It's kind of related but not exactly... kinda like how an aerospace and construction engineer are different, but both use engineering concepts.
When you say as a 1st year... you mean a 1st year university student? From my experience it's pretty hard to find any relevant job as a first year university student, you've barely learned anything at that point. If you do find something though, all the power to you. A lot of people I knew just did summer camps or research assistantships or other random gigs. Not sure if it's just totally different in Australia.
I think compensation is going to be variable depending on where you go. I think it's fair to say some places will pay you more than IB, and others will pay you less.
A lot of people think about exit opps when they go into IB, but not so much AM from what I've seen. AM is the exit opp. I think most people I know in AM really like it and plan to do it until they retire (including me). The ones that decided not to stay in AM stopped doing finance entirely and decided to move to tech startups for strategy/ops roles, which is very different.
I am pretty sure the IB scene is generally limited to Melbourne and Sydney. UWA is Go8, so your not entirely disadvantaged.
All the IB summer analysts I know from USyd are either from the Dalyell scholar track, have at least a distinction WAM, multiple internships, or participate in many case studies with a good ranking. Generally, most have a combination of those mentioned.
If your in first year, I highly recommend you make sure you study well, look for related internships and look out for competitions that may give you an edge in your resume.
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I am not sure what you are trying to say. I was mentioning the qualities of students that I have seen in USyd that managed to get the summer analyst role in IB (which means they have a chance of conversation).
Let's suppose you are encouraging OP to look out for that particular challenge you mentioned. Even if his school typically does well in that challenge, it doesn't mean he will do well if he doesn't make an effort. Similarly, even if his school doesn't do well in other challenges, it doesn't mean he will not do well if he put in effort.
Given that, I can't find the relevance of your comment.
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