Thought I'd post a quick update to a post I made here a couple of years back for those that are interested.
Health warning - my original post was heavily scrutinized and flagged as fake news by many, so will let you form your own views as I'll probably not engage the trolls this time
Tier 2 BB Product Group
AN1 (starting July 2013) - 140K
AN2 - 165K
AN3 - 180K
AN3 - ASO Stub - 40K (I think..)
ASO1 (starting Jan 2017) - 330K
ASO2 - 425K
ASO3 - 475K
Tier 1 BB Product Group
VP1 - 615K (started in late 2020 - came on a guarantee)
VP2 - 645K
VP3 - 700K (50 / 50 year of project work / being staffer, wild year)
Director 1 - 735K (starting Jan 2023)
Director 2 - 810K
My personal experience has been that if you're consistently ranked in-and-around the top of your class, the pay schedule is rather predictable and you're unlikely to ever be truly "screwed over" by a team. Perhaps I've been lucky vs. others, but HSD % increases YoY (for TC) is what I'd advise anyone to expect from the VP years onwards.
Legend
Congrats on JPM
no shot these numbers are coming from MS or Citi / Euro BBs
what % of your comp is deferred? Claiming to get > “$400k” as an associate and VP leads to a large chunk not being cash
25% of discretionary comes in RSUs - vesting over 2/3 years
What is your rough net worth after all these years in IBD?
Lower than you are imaging probably.. $1.8 / 1.9M of investments and cash (all bank-compliant, so primarily ETFs and mutual funds, plus some in a managed brokerage account). Then $300-400k or stock. Have some 401K savings too but not material really
real estate?
$2.2+mm net worth at 33-34 is great, congrats to you man
How aggressive did you invest/save as an analyst, associate, VP and how as that changed over the years? Would be super insightful for younger guys to hear the lifestyle as you move up the ranks. For comparison, as a first year analyst, I managed to save 70-80k, maxing out Roth and backdoor Roth 401k while trying to invest 1k a week into s&p
This is entirely what I would expect for a top performing product guy at BB on the “MD track”
This thread has taken a totally different tone than my last post. Quite refreshing really
Congrats man, appreciate the transparency
Congrats! Very insightful, thank you for sharing. Using an inflation calculator, it’s apparent that real wages have been depressed in IB, even after the base raise of COVID times. Feel like it’s especially pronounced with your ASO figures. Helpful information for sure
100%. And I'm not sure people realize this. The glamor in this industry wore off long ago. It's a great way to position yourself for a very comfortable life without too much risk attached (long-term, clearly there are isolated good years and bad years). But even at the VP level you're not really saving that much. The true operating leverage over fixed cost (rent, lifestyle, etc.) comes when you're consistently making north of $600-700k.
If you could go back in time, would you still go down the same route or do something different? How has your work life balance and level of stress evolved over time?
What product group would you recommend to someone starting now?
"The true operating leverage over fixed cost (rent, lifestyle, etc.) comes when you're consistently making north of $600-700k."
Very well said and I'm not sure how many think this through. The net worth of someone who is making $1-1.2mm/yr is going to be many multiples of the guy making 500-600k/yr.
This seems like a good / reasonable progression. Associate and VP maybe a bit above average, but nothing wild. Where I think you've done particularly well is the past couple years as a Director in a down environment, at least better than most I know at (likely) lesser banks. Lots of zeros and offensive bonuses for the Director community in 2023.
How do you feel about MD promotion this year?
The (literal) million dollar question...
I think I have a reasonable shot at it - get all the right messages from above, and have been very deliberately building an internal network the past couple of years so I have support at the right time. Plus had very good deal flow last year.
But I've seen this play out in a whole variety of ways, so I'm not assuming it will be. But obviously will be frustrated if it doesn't.
That said, I'd wait another year. If I don't get it after 4 years though, I'm out :)
Your pay progression has been extremely similar to mine OP (I am one year behind you) and at an EB
I joined as an A1 lateral (former A2A) and my associate comp was basically exactly the same as yours at the T2 BB. There's a decent sized $75-150K premium for all the VP and Director years at the EB though which is pretty consistent with what I've heard from friends and on this forum.
Once you get to Director at my firm the pay jumps seen historically tend to stall out until you are trending towards MD and bringing in actual revenue.
What was your comp level this year as a D1? Did you clip 7 figures or close?
Not quite, basically was similar to OP’s D2 year
I'm not sure why there was so much initial backlash to this thread—what's being described aligns closely with my own experience.
I'm at a T2 BB in a coverage role, the same rank as OP, and have stayed at my firm because I enjoy my coverage area and have a clear MD path based on discussions with seniors.
My D1 salary was roughly 50k lower (just a bad year for me/the group), but had a good year this year and ended up with a TC of ~900k this year since I was able to bring in some smaller fees without an MD above me. VP salaries for me were roughly ~30k lower for VP2 and 3, but can see how yours would be higher given firm differences. VP1 for you was much higher than me, but could just be the guarantee.
Are you looking to stay within IB? Have been thinking about jumping ship to a client once a junior MD or maybe even now. Not sure if I can become a true rainmaker in IB and the corporate finance world as a senior director/VP seems like a better WLB move with still relatively good pay.
Edit: Reading through the thread, I wanted to offer a different perspective on the COL piece. I grew up super poor, so for me, IBD has been life-changing in terms of financial security and quality of life. Yes, junior comp has lagged in real terms, but MD pay, especially for rainmakers at EBs, has actually increased. For the average MD, comp is likely flat or slightly below inflation, but top performers are making more than ever. At the end of the day, the biggest win for me is knowing that if I have kids, they’ll grow up comfortably and never have to worry about things like paying for college. That alone makes this career path worth it.
Del
Adding mine for another data point. My analyst years were similar to OP, associate and VP so far were slightly below but not far off. Every year they’ve basically hit my min number where I wouldn’t leave lol also BB and mix of MM
Aso1: $300k
Aso2: $400k
Aso3: $500k
VP1: $530k
VP2: $610k
Currently VP3
that VP2 number is for 2024?
Yes
Many thanks to you guys for these datapoints, much helpful
Could you please share how your workload changed over these years (avg hours if you have a rough idea)?
I’ve done mine before but if helpful to get a sense for longer term (and I acknowledge I’m on the successful end of things but equally there’s a long tail on the upside beyond me). I’m a group head at an old economy team and one of the independent investment banks.
The message here is not everything is linear and those D years where comp was flat / down may seem stagnant but I was building my client book out post financial crisis.
Analyst 1 - 100
Analyst 2 - 110
Analyst 3 - 130
Associate 1 - 250
Associate 2 - 375
Associate 3 - 525
VP1 - 700
VP2 - 800
VP3 - 800
D1 - 700
D2 - 625
D3 - 700
D4 - 860
MD1 - 1.5
MD2 - 1.7
MD3 - 1.8
MD4 - 3.0
I’ve averaged 5 as a group head for the past six years
SB - very impressive and congrats on your career success so far. As someone interested in a long term career in ib how would you think about building a book of business? Is it wise to move to a BB at the director level to build busines/connections and then lateral to an EB once an established MD? Did you start at a BB before heading to your current shop or have you always been at the independent banks? Any insight is appreciated!
What would you say the tail on the upside is pulling in?
lol...ur financial crisis numbers are still higher than what top performers get paid as VPs / directors at places like bofa...teetering on the edge of global financial apocalypse and they still paid out more
These numbers are all great, and thank you for the transparency. Correct me if I’m wrong, but these posters must represent top performers thriving in banking at the “right” time aka 10-20 years ago. Below are my comp numbers as an above average (not top) associate at a BB. Believe this is why the post received so much backlash initially, and hopefully these numbers provide some perspective around how it can go wrong for someone at a lower paying BB who isn’t a tippy top performer:
ASO1: 260k (2022)
ASO2: 285k (2023)
ASO3: 335k (2024)
Maybe I’m being underpaid even relative to BBs in today's environment. But if the numbers in this post are true it truly does seem like IB pay, particularly for juniors, has eroded significantly over the years.
Super helpful, when you say Aso1 was this after 3 full analyst years or includes stub year?
I started as a post-MBA associate. ASO1 year represented my pay for my first full calendar year. I received a $45k stub bonus for what it’s worth.
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