Quit or keep stacking? (26 with ~$400K saved)
Currently an ASO1 at a MM tech group - have gotten solid experience with 5+ deals closed over the past 3 years (graduated in 2022). By the end of this year, I expect to have a little over $400K saved (incl. retirement) but am weighing my options.
I don't like banking, doing deals (so no PE), nor the general culture of this industry. The idea that even the smallest thing has to be treated like the most important, pressing deliverable on earth is getting annoying. I'd like to exit to a startup in a role focused on GTM optimization, strategy or strategic finance. With this will come a 50% paycut (~$300K to $150) which seems hard to stomach given my current savings rate. Alternatively, I could stick this out for another couple years to finish out the ASO role, and stack close to $1M by the time I'm 29.
Part of me wants to keep going just to get to the $1M mark so that by the time I'm 40, I can have $2M+ just from compounding alone. On the other hand, I feel like I've saved well enough for my current age (26) and I should use this to be more risk on and take care of other parts of my life that I've pretty much ignored over the past 3 years.
Any thoughts or words of wisdom would be appreciated.
I’d ride it out a couple more years. You’re past the ‘worst’ stages in terms of office hours. If you aren’t gunning for a career in IB you could easily take a backseat during your associate stint and clip $300-400k. This should allow you to carve out a bit more time for your personal life/hobbies.
If you have a big itch such as joining a startup or creating a company I’d probably do that on the side. With the AI craze there is a huge cash grab with a lot of startups getting a lot of money (reminds me of 2020/21) but many will crash and burn and you’ll be wishing you were in banking.
Unless you’re getting crushed (doesn’t sound like you are) or extremely burnt out, I’d probably look to stay until you can get the VP promote then look to exit to corporate at a manager level title / do something else… this should get you at $200-250k comp… but by then you may have golden handcuffs but thats a future problem.
Part of me thinks that way too, but the opportunity cost of the time I'll give up in my late 20s is haunting me. My life at the moment is the cheapest it'll ever be and I feel like I'll be giving up if I continue to stay in this job that I don't plan on doing forever anyway. I am pretty burnt out ngl and the workload comes and goes (still pulling regular 2am nights)
Regular 2 am nights is pretty tough, especially at the associate level. It might be worth considering a move to another firm if this workload isn't sustainable. Regarding social life and mental health, while I can't speak directly about depression, I've found that consistently getting around 7 hours of sleep and exercising at least three times a week can significantly help manage mental well-being.
People often glorify having more free time, but take a moment to consider your friends who aren't in IB. Yes, they might seem happier or more relaxed right now, but are they truly using their extra time more productively? Chances are, many are spending their free hours on Netflix, gaming, or similar activities, not necessarily making the most productive use of their 20s.
When you say, "I'll give up in my late 20s," carefully consider what that entails. I'm only a few years older than you, and I vividly recall missing out on dates, trips with friends, and various social activities. It was genuinely tough, but those sacrifices placed me on a career trajectory that financially positions me better than 99.9% of people. Now I'm married and working around 60-70 hours per week, with probably added stress, but mentally I'm at a much better place than when I was an analyst/jr. associate.
Another perspective to consider: if you truly don't see yourself staying at your current job long-term, why not ease off a bit? I'm not suggesting becoming "that person" known for slacking, but for your mental health and overall sanity, perhaps logging off at 12:30 am instead of pushing yourself until 2 am could be beneficial. What's the worst outcome? They fire you? If you're already planning your exit, this might not be as risky as it seems.
Ultimately, this decision is highly personal, and I wish there were an easier answer. I hope this perspective helps as you think it through.
Are people usually able to work on the side while working in IB, legally / company policy speaking?
Was super impressed at the 400k, then saw you’re counting your retirement funds lol. So what have you actually saved that you can use in an emergency?
tf kinda emergency would you need 400k for lmao
When his lambo has an engine issue
Medical emergency in the U.S. w/o insurance
Cartel ransom
$300K
Resonated strongly with this post. I’m an As3 contemplating an offer for a Corp Strategy manager. Total comp as a manager would be ~$220K MCOL.
I’ve done banking my whole career but I’ve always known I want to do something different long term. I’m 28 with just under $700K NW (incl. retirement) and on track to make VP. The corp strat offer sounds like a dream job (40 hr/week) but the pay cut is nevertheless hard to swallow especially as I am approaching the VP years where WLB should improve and comp meaningfully increases. Struggling with either taking the manager offer or keep riding out a few bonus cycles, which would put me close to $1mm by 30…
I’d take that all day - the last thing I want to do is be a VP
This is just my advice but I’m 13 years into my career and have had similar thoughts over time. The main point is this: you have no idea how important money is until you get into your mid-30s and start to buy a home, have kids, and realize how expensive everything is. In a high cost living area like NY, SF, or LA your life and optionality will be materially worse with $300K comp vs. say $700K+ (btw I’m comparing your situation OP, obviously this is not advice for the general population). Buying a $1.5M “normal” house in those markets plus having kids and buying a car, etc. will be a dogfight for your whole life. You won’t have a ton of savings, compounding will be way slower, and you’ll effectively always need your job to keep it all going. If you live in Manhattan and need to send your kids to private school you are cooked.
My comp dramatically improved becoming a VP and beyond (~$400K associate to $750K+ as a VP and Director). Savings skyrocketed and these past 5 years of S&P growth have dramatically changed net worth. Way more optionality now in career and other life choices where if I got fired tomorrow it wouldn’t be a big deal, I’d just do something else. Why keep doing banking? I looked at how many hours I was actually working over a long period of time, not just perceived. Average was in the 55-60 range with significantly more flexibility vs. analyst and associate years. While some weeks can feel like “100 hours” in reality I hadn’t worked a week like that since COVID. In start-up land, big tech, etc. you won’t be working significantly less than that to give yourself a meaningful work life balance that justifies half pay.
Now I’m also not saying you will stay stuck at the same comp level in start-up land. Some do pick the right one and hit it big. Anecdotally though I have had some friends who did pick the “right” one only to hold on too long (Rivian for example) or get high private valuation marks but never get to secondary liquidity event before value tanked (e.g. 2021 unicorns in the 2023-2025 environment). I have one friend, same analyst class, who did the start-up route and God bless him but he has the worst picker of all time. EVs, crypto, e-commerce, etc. just jumping from failure to failure and never getting any significant equity appreciation and way less cash comp. I can name a bunch of these cases from my analyst class, I think startup is really high risk comparitvely for someone who is not a founder and effectively being the first finance guy.
What's the threshold of NW where you think your life changed? Basically at what $$$ figure you'd be comfortable getting fired and you'd just go do something else. $2M, $3M?
I think less a specific number and more like some important milestones such as paying off primary mortgage and having pretty significant passive cash flow from dividends and RE investments.
Number will always vary from person to person but the big point I want to make to OP is that it is hard to have perspective on what expenses you’ll have later in life as a 26yr old. Back then I spent like $60K a year all in and lived in a small Manhattan apartment so ya even $150K probably felt like “enough” back then even though I was making $350K as a junior associate. But then you have a family, you realize you dont want to live in a shoebox forever, you want a car, etc. and all of a sudden unless you are making real money your expenses suck up all your salary and there’s nothing left to accerlate mortgage or put into investments.
Real basic compunding math if OP takes his $400K and then takes a lower paying job that doesn’t allow him to add new principal then in 10yrs @ 7% he’s at $786K. If he takes the same $400K but can add an additional $150K a year over those 10 years and compound then he’ll have $3M and the difference will only increase over time.
Just want to be sure I understand your advice correctly. Appreciate the advice that the grass is not greener in other fields (e.g startups) and the income disparity can make a big difference in wealth and quality of life, especially as you start a family.
although for people struggling with figuring out whether IB is right for them long term, is the comp a good enough reason to stay to VP and beyond? While the NPV of a career in IB is probably better than most other fields and hours improve over time, is it a suitable career for people that don’t have the talent for revenue generation or perhaps lack interest in being a revenue generator?
Another question is whether in thinking about the EV and income, you lose sight of the opportunity cost of finding something better paying but more fulfilling and fun. Perhaps something in between being an IB MD and bouncing between failing startups is a role that is the right balance
Appreciate you’ve chosen the IB path so may not have a view - but just thought I’d share my reactions as I constantly toss and turn about what to do for the next few years (I’m quite bored in IB but the money is good - although acknowledging there is more to life outside of work as well)
Agree with the above poster about the power/importance of money.
If you are able to tough it out until you're 30 or until you hit some target portfolio value of unrestricted liquidity (not counting retirement funds) then you really should. Besides the tangible and intangible value of money; there is the added benefit of additional time in the seat. Even if you don't like the work; you'll still be learning something and accruing seniority both of which will benefit you when you decide what it is you want to do next. The perspective you have when you've passively disengaged teaches you different things about both the work and working itself. Enjoy the fabulous high that comes from being at work knowing you could give notice at any point in time and be just fine.
Speaking from a bit of experience - I got burned out in late 20s and took a year off right after turning 30. I knew I was going to throw in the towel about 6 months before I actually did and about 4 months before anyone besides me knew.
The above advice is predicated on you being able to actually hang in there. It is not worth being physically and mentally unwell.
Just wondering, what are you doing now? Presumably you felt financially secure which allowed you to quit your job after burning out (in IB?). Did you find something more fulfilling? Has your life changed much?
No, I've never been in IB. I was (and still am) in commercial banking. I was burned out more by the big bank corporate shenanigans that crushed souls (and didn't create shareholder value) rather than the business itself.
Commercial banking is great because you can downshift into a smaller bank and chase the culture from one institution to another. The lifecycle of banks will always end up as soul-crushers once they reach a certain size (unless you are an exec getting paid enough to deal with it all) so this kind of career pattern is usual and customary. So yes, I ended up in a more fulfulling environment, but without much change to the work itself. I have since pursued other banking-adjacent careers and even did private sector CFO gigs for a while, but the path to those was through banking.
Yes, I was financially secure enough to be without work for 2 years without change in lifestyle. I originally intended to take that full amount of time off (effectively burning my savings to $0) in pursuit of a once-in-a-lifetime type of experience and such. Circumstances were such that I only ended up doing one of those years and spending far less than I expected.
Overall, my life is not much different than it would have been if I hadn't quit since I rejoined the industry. I did have some unique adventures (see my early post history if curious) and I don't regret it if only because it makes the whole prospect of quitting and being unemployed far less scary.
Was in a similar position but not NYC and quit. Banking sucked ass and I had saved up enough money for my main goals. Other posters make good points about life getting a bit better and comp grows v much, but to me, life would still suck too much and I figure I can do better outside of banking anyway (or at least make more than enough and have a life worth living).
OP just remember you are not stupid and are hardworking, there will always be needs for those people so you should do well regardless.
You've got to know when to hold 'em
Know when to fold 'em
Know when to walk away
And know when to run
You never count your money
When you're sittin' at the table
There'll be time enough for countin'
When the dealin's done
My take: if you are planning to stay in NYC, hold em. If you are moving to a lower cost area, fold em.
Was going to say same thing here. I Live in non-NYC metro area, have done the math on the amount of money it would take for me to maintain lifestyle and savings and the figure is absolutely astronomical
Sort of in the same position except a few years older. Was getting crushed, didn't like the team/culture, and knew I had no aspirations to be a career banker. By the time I left banking (rage quit), I was (am) on track to hit my goal of $1M liquid/invested by 35. Doing some simple math, I concluded I've effectively secured my retirement and saw no point of continuing the IB grind.
Ngl, still fighting the urge to get back into IB to do a few more years to continue stacking cash. Although, working a non-IB / remote job has been pretty nice from a lifestyle standpoint. The drop in compensation is still hard to stomach but knew it would be even worse if I exited banking at the VP+ level.
what kind of remote job is it
Presume you’re a goal oriented person and quite driven - where did you spend your drive/energy after moving into a chiller job with a bunch saved up?
Awesome thread. I saw a couple similar ones e.g VP promotes what is your end game and VPs are you happy. I think this thread sums up the answer.
Just wanna have a good time and maximise comp and set up my 30s. Fine to sacrifice a bit in my 20s and cruise into 30s while still being smart with my time and not miss too much in life. Key is finding a good team that won’t burn you out
Just got back from a 10 day bender abroad. Not heaps of time e.g three weeks but enough to make awesome memories and feel good about life. Like above poster said it’s not about how much time but how you use it
Back to work now and sure it sucks but not too stressed abt it. Don’t regret my time in IB too much but obvs answer is different for everyone I’m lucky I didn’t get as sweaty of a team
I’m in similar boat. Not banking but PC. I’m 29 with $850k or so. Will plan to do PC and hopefully save $150k per year for a few more years. I think some of the input here assumed that if you’re not in banking, your savings goes to 0. But really the choice may be going from saving $10k a month (incl bonus) to $3-5k in whatever other job you take. If you play with these retirement calculators or FV calcs, the early years obviously matter a lot. From there, makes much less difference. When I played with the calcs, maintaining my current income for 3 or 4 more years gave the same FV as saving $3k a month for the next 20+ years.
So what I would not do is just settle for a job that is just slightly better WLB but a large pay cut. I’d say once you get in a good spot, totally take a step back, find something you love, and chill. Once you build up a nest egg like you and I have, as long as it’s invested and compounding, saving an extra few k a month doesn’t move the needle much (compared to the FV of your nest egg). So I’d say grind it for a few (if you want) early on and then totally chill—but don’t do this half chill half grind thing. Jump all in or all out. But take with a grain of salt cause I haven’t jumped out yet. But I am comforted by the fact that I could peace out from finance at any moment and not think twice.
I agree (and have acted similarly). What do you see as your ultimate savings goal once you leave? ~$1.5m? ($850k plus $450k in savings with growth too)
I don’t necessarily have a target number. I do like thinking of how much expenses my current portfolio could cover at 4%, so I would like to get above $2mm so that it could generate around $80k. But I won’t be afraid to leave before that or feel obligated to leave finance after that.
The reason I don’t have a set number is at this point time / gains contribute just as much as new $. So hitting $1.5mm might be a matter of grinding for X more years or waiting Y more years for more growth. When I look at retirement calculators, 90% of FV is from what’s already saved. So grinding for the marginal 10% doesn’t seem worth it. So will keep stashing money until it starts interfering with life. Then will go do maybe a start up or sports thing or just something I’m genuinely excited by
I’d really give serious thought to what you want to do long-term because spending that energy to advance in that can go a long way vs just sticking around banking.
A lot of people are advocating for sticking around and padding your net worth. While I understand the rationale, it’s a slippery slope that I’ve seen way too many bankers fall down.
The reality is that GREAT exit opportunities for bankers gets more challenging, the more senior they get.
Now if you’re a high-performing mid-level / senior-ish banker with real client connectivity and execution skills parlaying that into a sweet gig is very much possible.
However, if you’re intending to just “hang out” and clip as many checks, what are the chances you’re actually going to be running through walls to develop yourself? The reality is at some point you will likely get blown out and then the decision to pivot will be forced upon to you.
Now imagine you’re a young expensive director that spent his / her entire career in banking and is very much seen as a transactional / execution person. Is corp dev something you want to do? Are the corp dev opportunities available even attractive or dead-end roles? Is it easy is to completely pivot to a new field that requires a different skill set (it’s not)?
I can elaborate more so figure any grammar mistakes. In a bit of a rush
If you were OP would you still stick it out for 1-2 years to build wealth up until you are able to find a role you would really enjoy? Agree the worst thing would be to be stuck in mediocrity, lose your drive and be ultimately forced out. Although seems to be a middle ground in terms of squeezing as much as you can out of IB and setting yourself up financially to take on more enjoyable but likely weaker paying roles vs. leaving too early and losing that savings potential.
I am in similar situation as OP and personally feel like I am still figuring out what makes me happy and what I want in the long term. My sense is the best option today is to continue survive to the next bonus while I work this out / allow time and maturity to do its thing
As long as you’re actively investigating what interests you and networking for those opportunities then I agree that using banking to pad your net worth makes a lot of sense.
The issue I’ve seen with a number of disinterested bankers (friends, ex-colleagues) is that they get stuck on the perpetual hamster wheel of “just one more bonus check” without actively planning for the future then they wake up one day wondering where the time went and they feel stuck / hit a wall.
One of the worst things is being a director-level banker who hates the industry but didn’t prioritize how to exit. You’re now expensive, likely have a ton of deferred and are potentially without real client connectivity (because you didn’t really “care”) and pigeonholed as a “transaction guy.”
In my opinion, if you truly don’t see yourself doing banking long-term, try to get out no later than your VP years.
Keep in mind the more senior you get the less structured finding opportunities are. We’ve all been accustomed to go to the right schools, then the right banks / buy-side shops - all designed in a very structured way for us. These are the first moments when you have to figure shit out for yourself.
If I were op, I’d stick around until VP1 but I would know exactly where my exit is coming from and plan early and thoughtfully.
come to ir
How’s your comp and WLB? Are you in nyc?
I am logo design expert
I'm in a similar position to you (a year or so ahead and a bit more saved). Ask yourself who you were before you started this job and whether it changed you. Is there someone you'd like to be without banking tying you down? Would you be happier? Would you do something else with your life? The challenge with deciding now that you'd prefer money over your time (and life) is that the decision will only become more difficult: you'll only get paid more, and you'll only be tied more and more to the job. If you look to your VPs and MDs and see that they have lives you admire, then you can work towards that. But if you don't, then you'll just face the same decision again every year and it'll be more difficult to turn away. Golden handcuffs in themselves aren't a problem. It's your life, and if you're comfortable trading your time and happiness for money, then that's a valid decision. But if you can anchor to something outside of the job and decide you want to turn back to that, then it might be worth giving up banking.
It's also helpful to try to remember your attitude to money before investment banking. Did you use to think that a few thousand dollars was a lot of money? Or did you always think you'd need hundreds of thousands (maybe even millions) to be happy? When you get used to large amounts of money (and are surrounded by people who are similarly in that mindset), it's hard to remember that you may have once been excited about far less. If so, that can help you contextualize how much you've saved now and what it would mean for your life if you left.
Esse magni nihil adipisci esse tempora esse ex voluptatem. Est molestias sapiente id minima sapiente. Dicta fugit nesciunt voluptatum sapiente.
Vel libero illum consectetur quod molestiae assumenda. Incidunt ea incidunt impedit et quia dolorum. Et vel ipsum blanditiis et. Explicabo aut est placeat quidem et nam vitae. Quia consequuntur enim est et distinctio neque.
Minus vero rerum velit perferendis numquam. Vero distinctio enim provident. Ipsum impedit eveniet eos odio. Maxime eum vel neque. Voluptatem minima impedit qui a ex. Reiciendis repudiandae sed quaerat nostrum quae saepe distinctio.
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...
Nihil deleniti dolorum quaerat perspiciatis vero qui. Ad quas suscipit ut in et. Est reprehenderit harum tenetur ipsum sit cupiditate. Tempora non excepturi molestiae atque et non. Laudantium mollitia beatae possimus. Numquam beatae harum quas eum error ex.
Fugiat est perspiciatis dolorum aperiam ut molestiae molestiae. Aut consequatur nam quo repellat expedita totam eaque. Quae consequatur cum magnam laudantium. Qui ut sunt quis labore. Nisi beatae consequuntur aut quis porro. Non eos quia qui consequatur soluta rem.
Modi atque nihil nisi fugit. Nihil repellendus est odio recusandae quo numquam consequatur. Dolores inventore quam esse similique velit aut asperiores. Laudantium autem ut vel distinctio.
Ut animi explicabo enim quasi nesciunt rerum et. Ut aliquid voluptate voluptatibus aliquam inventore. Itaque autem quis at rerum esse accusantium eius est. Corrupti quidem non omnis non sit sequi modi natus. Est non cupiditate ut.
Et impedit est vero tenetur est id voluptates. Et consequatur doloribus doloribus consequuntur. Tenetur suscipit sit et. Deserunt consequuntur nihil ut ut quibusdam sapiente.