Average New York IBanker's 1st Year Income after tax?
Done some research on the topic but would like to lay it out more clearly/ get clearer insight. How much would a 1st year IBanker at a BB in NY receive after taxes?
Assuming $70,000 base and $40,000 bonus (correct me if I'm wrong on the bonus)
What I gather: -Federal Tax: 35% bracket -NY State 7.7% -NYC 4%
Seems like after-tax and assuming $18k/yr housing ($1500/mo. x 12), I'd be left over with roughly $50k in the bank?
1) Are these assumptions correct? Should I adjust any numbers and what will that come out to? 2) Not to dodge the IRS but is there a way to NOT get destroyed by taxes? I.e. start a company and write-off certain expenses...?
Any insight/clarification would be greatly appreciated.
This is all assuming that you receive your bonus in cash? Are bonuses for analysts handed out entirely in cash? At one point in time (i.e. not over 3 years)?
Doesn't seem much different of what my friends are making here in Montreal (except for that 40k bonus). However, the housing and life in general are much cheaper here.
I think bonus should be closer to $60k. And that the bonus is a lump sum later in the year so your actual cash flow will be based on the $70k base salary.
I'd prep mentally for it to be more along 30-40k after all the talks of cutting pay
Another reason that I'm doing consulting in a lower COL city then haha. Can't imagine the kick in the nuts that working 100hr weeks for $110k all-in in NYC is. That translates to ~$60k where I'll be working after adjusting for COL.
^
Federal won't be 35%, because 35% is the marginal rate for high earners. The effective tax rate would likely be somewhere in the 10-15% range pre-bonus (standard deductions, HoH status), with the bonus taxed at around 25%. That's the good news. But the bad news is that you also have to consider payroll taxes, which is ~7%.
Take-home should be around 4.2k/month (from the salary), and you should get a decent refund due to your std deduction.
Are you planning on rooming with someone? If not $1500/mo is way low balling your rent expense.
Tax tactics you should consider: - 401(k)/IRA - tax free retirement savings - Wage works - tax free transportation
Also, you're effective federal tax rate will be well below 35% once you get benefit of retirement savings, standardized deduction, etc.
Live like you get salary only and then all bonus goes straight to bank/bottles/models.
This. And I really don't think it'd be that hard anyways to live off 70k in NYC. Also, maybe depending on where you live, but 1500k/month for rent seems more than enough.
This is pretty accurate, just fill in the boxes appropriately...
http://www.paycheckcity.com/calculator/netpay/us/arizona/calculator.html
Regards
$40k is an extremely low bonus, but I guess if the markets don't pick up that's what you could reasonably expect.
$40k for 1st yr IBD at a BB is low in this environment?
SO...basically...there's no way around getting taxed to death
Well in this environment, very reasonable (GS's stub bonus was $20k in January for average performers without any higher "top bucket"). Historically though, a middle bucket bonus for a full year's worth of work hasn't been $40k at BB's since before 2006.
US taxes are so low its a joke.... I'm paying close to 60% here in the UK.
Can you explain? All the online tax calculators show an effective rate of approx. 40% inlcuding national insurance. Are there additional taxes for living in London?
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