an intriguing thought: bonuses for consultants better than IB
i'm debating whether i want to return to IB or try consulting, and an interesting thought just occurred to me. you could work for a top consulting firm for 2 years, have them pay for business school, then return to consulting for your promised 2 years and do whatever. That's 6 years, you'd be 28 - 30, done with b-school and presumably have some strong options.
compare that to banking (assuming a similar b-school time frame). take 2 years of bonus after taxes and you're left with maybe $90K. assuming you haven't already blown the money on a car you don't have time to drive, 2 years at a top business school will eat up just about all of that. granted, when you're done with b-school you don't have a 2 year commitment to deal with, but as i understand it top 3 conulstancies are one of the most sought after employers for b-school grads anyway. in the end, you've worked about double the hours of your consulting brethren through your early 20s and don't really have much more to show for it.
your thoughts?
most people don't go straight from two year analyst stint to b-school. include in pe/hf numbers and it's a different ball game.
How hard is it to get into consulting after undergrad as compared to IB?
This part doesn't make sense. Just because top 3 consultancies are one of the most sought after employers doesn't mean a person wants to do that after grad school. As Wizard mentioned, most people do banking for the exit opportunities into PE/HF, which you don't have (to the same extent) after consulting (even postMBA)
Also, if an analyst wants to move forward in IB, they don't need to get an MBA, while a consultant does. The reason most analysts would want to get MBAs is if they go into PE as a pre-MBA, and are required to get that degree to move into the partner track. And at that point, comparing PE and Consulting is a whole different ballgame.
It's pretty rare for a consultant to return to B-school after 2 years, and (correct me if I'm wrong) most consultancies require at least a 3-4 year commitment after B-school in order for them to pay for it. Also, it's not guaranteed that they'll pay - you have to be a top performer in a very competitive environment. At least this is my experience - the firm was purposefully a little vague about the details of B-school reimbursement. However, there is a strong case to be made that you come out on top money-wise if you go the consulting route - especially if the market cools down and banking bonuses return to the levels of a few years ago. I'm not sure that they will anytime soon, though.
Consultants can come ahead money-wise with this route. The business school tuition payment is actually tax-free, and there are large signing bonuses involved. Most consultancies want you back for two years minimum after B-school.
But this does not change the fact that if you want to make as much money as you can, you should go into banking.
some people would rather work more hours then spend their weeks advising POS companies in biloxi, Mississippi
1.)Banks also pay for your MBA tuition these days, whether or not you were with them/in banking before, so that throws out the advantage straightaway. Here in Uk the banks pay the fees as pre tax which means you get 60% of it, while consultants pay it as post tax and you get full amount. 2.)The commitment time is usually one year at the bank, not sure if it's 2/3/4 years at consulting. 3.)It is necessary for a consultant to return to B school. Which is why you see so many McKinsey consultants in Bschools. That's not the case with banking ( at least in UK, in US its slightly different but still the 2 year pre-mba time limit is religiously followed at top consulting firms in US as well) 4.)Top of the line MBA program:(class of 2006)(USD approx.) First year consultant's post MBA Base Salary: 120,000 Sign on Bonus: 20,000 Year end Bonus: 26,000
First year associate salary in banking Base Salary: 110,000 Sign on Bonus: 32,000 Year end Bonus: 38,000
Now 3-4 years down the line option 2 will be twice option 1.
5.) Top employers on MBA campuses are PE (which don't come to campus..). then its i-banks. The only places where consulting is a top option is where the banks typically don't recruit from. E.g Tepper from CMU. You can get McKinsey there but not goldman/MS/ML for that matter. At my school we had 200 apps for a bank like lehman(M&A only, not S&T apps), while only 70 for a top consulting company.
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