Saving in London
How much of your total comp do you typically save in Ldn? Especially analysts
How do you split your comp across rent/leisure/etc…
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Based on the most helpful WSO content, saving as an analyst in London can be challenging due to the high cost of living. Here's a breakdown of typical expenses and savings patterns:
Rent: Rent is often the largest expense. Analysts typically spend a significant portion of their income on housing, especially if living in central areas like Zone 1 or 2. For example, a 1st-year analyst earning around £50k base (approximately £3k/month after tax) might allocate 30-40% of their net income to rent, depending on location and whether they share accommodations.
Leisure and Lifestyle: London offers a vibrant social scene, but it comes at a cost. Dining out, nightlife, and other leisure activities can quickly add up. Analysts often spend 20-30% of their income on these activities, though this varies based on personal preferences.
Savings: Savings rates vary widely. Some analysts report saving 10-20% of their total compensation, while others struggle to save due to high expenses. Bonuses can significantly boost savings if managed wisely.
Other Expenses: This includes transportation, groceries, and miscellaneous costs. These typically account for 20-30% of monthly income.
If you're aiming to save more, consider sharing accommodations, limiting discretionary spending, and leveraging your bonus for savings or investments.
Sources: London Rent / Living Arrangements 2019, https://www.wallstreetoasis.com/forum/investment-banking/investment-banking-in-the-uk-an-overview?customgpt=1, How much are you able to save as Analyst in London?, Investment Banking in London (EMEA) - Strongest Players, League Tables, Salaries, Differences..., https://www.wallstreetoasis.com/forums/compensation-differential-nyclondon?customgpt=1
Let's say
70K base + 50% bonus.
Save the entire bonus and you have roughly 16k. That is what you dump into your ISA.
Month to month depending on your expenses you can save between 500-1000. (6-12k)
And then also max out pension matching. At my firm it is 6% + 6% match, so you get 12k in your pension at a real cost to you of around 2k.
Bonuses don't usually get matched for pension contributions. The real cost to you is probably more like ~3.5k with ~10.5k going in pension (assuming you contribute 6% of bonus). Still a good deal.
I was working off 70K base for my calculations according to Claude. My contribution (70k * 0.06) = 4.2K, mandatory contribution from employer is 6% so another 4.2k and employer matches up to 6% so another 4.2k
12.6k going in. Calculations for the real cost taking into account the tax saving below.
Ah then you should've said so. What you said was 6% + 6% match. Not all employers give non-contributory allocations too.
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