Side hustles + investing put me ahead pre-IB… does this materially change my career path?
Incoming IB analyst in 1 month. Over the last few years I built up a decent amount from side hustles + investing and it’s gotten to the point where I’m trying to think differently about career/life decisions.
Somehow managed to have ~500k invested in equities between brokerage and SEP / Roth IRA .
My question is: for people further along in finance, is this actually meaningful optionality, or does everyone in IB/PE/HF eventually “catch up” anyway through comp?
Basically trying to figure out whether:
1. I’m temporarily ahead for my age but it won’t matter long term
2. Or whether having capital early is legitimately a huge advantage that changes how aggressively you need to grind/stay in IB
Would especially appreciate perspectives from people 5-15 years out who have seen both paths play out.
What were your side hustles?
managing the family office
e commerce / shoes
side hustles will be tough for you. I'd probably just focus on the job going forward.
But yes investing super early will get you way ahead of the majority of people. One thing I wish I did earlier was invest sooner and more often. When you grind, most of the time you forget about what to do with your discretionary income.
But yes keep investing and invest early. Index funds are easiest, single stock is tough since you likely won't have much time to pay attention / may get conflicted out.
It’s meaningful and it’s not.
500k is not enough money to change any life decisions or allow you to take your foot off the gas.
But it still has a lot of value
Invested well, it’s a nice vacation home when you have kids at an age then can real enjoy it
Or it’s enough money to allow you to take a risk with a startup that you may not want to do otherwise because it would cause lifestyle degradation
In other words, it’s not enough to change a base case but allows you to have something nice or have additional flexibility as things go on
$500k at their age is somewhat life changing though. That's the rest of his / her life to compound.
In IB terms, to have $500k invested is like similar to earning $1mm pre-tax.
That’s a head start on the retirement fund for sure. I think you should do IB + 2-4 of an investing seat of your choosing (probably public markets given you run a family office, or a crossover fund) then see where you are. You could probably transition into running your family office full time and maybe even build something dangerous with the colleagues you gain along the way. 4-6 years of cash padding, networking and targeted skill development will put you in a fantastic spot at 30 that most would kill for. Great set of options ahead of you if you can effectively delay gratification for the equivalent of another bachelor’s degree of learning
no rush for satisfaction - haven't spent any of the money on myself really... dont need lifestyle inflation but am wanting to be in a spot asap where I can buy my hours of life back
You’re in a good spot. Like others have stated, it’s not quit doing anything sort of money but you have a great head start. You can do the math what that would become if you save a few IB bonuses with X% market return.
I’m 32 and worked only in IB since graduation. What I would do if I were you - put it in a few diversified ETF’s, keep contributing regularly and max out retirement / other tax advantaged accounts. If you do that you’re going to be way ahead at my age.
Recommend working for 2-3 years in IB and see if you enjoy it / your group. If you genuinely enjoy it and your group is not a sweatshop / you love the people, you could stay and build a significant nest egg if you pad that with associate, VP, or Director bonuses. I’m talking like retire early and work part time. I have $1.7mm now but I had essentially $0 when I started in your shoes (negative $30k if you counted student loans)
But I get staying in IB is a grind - sometimes I’m surprised I’m still in it, I def got lucky. Base case is you probably do 2-3 yrs exit to something you like more and continue to potentially pad that NW with high checks if you go to buyside and works out.
Or you do something entrepreneurial after banking. That’s the beauty is you have optionality. I’d focus on thinking about what type of life you want in the future as you work in banking next two years. Don’t need to decide right away.
Continue to save and you’re golden. Congrats on your position.
this helps thank you - definitely want to go back to doing something entrepreneurial. just unsure at what amount saved its not risky to leave a seat like this... guess ill find out soon
^ this is correct. Once you make your first million it starts to snowball like crazy. As long as you keep lifestyle creep in-check.
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