Bschool for Lawyer --> IB or consulting?
Looking for some thoughts on this one.
I'm a current lawyer, 6 years out of school, working at a biglaw firm in litigation. The money is good enough (market paying so 300k+), but I'm not sure about future prospects here (partnership is possible but not likely). I'm also not sure I can work in this industry for the rest of my life... it can get pretty boring and monotonous.
I've considered IB or consulting as alternate career paths for a while. Was decent at finance/math in undergrad but went for the law degree instead. I'm already in at two top-15 bschools that should at least give me the opportunity to make the transition.
So the question is, am I crazy for considering giving up my current job for an entry level finance position? My goal would be to end eventually in a role that pays similarly or higher. The risk of staying is that I'm pretty specialized so if I get fired there's not a huge market for my services elsewhere. But I'm also concerned that I'm overselling the idea of IB to myself and I'll be miserable there/won't ever reach the same income level.
I don't have experience in law, so can't comment on that side. However, I think you can rest assured that if you ever transition into IB or consulting, you will be able to reach the same level of compensation (and more). Depending on the bank you work for, you will most likely be able to surpass 300k within 4 years, and from there it keeps getting higher.
Also, you should make sure that IB is really what you want. As you said it yourself, you might indeed be overselling the idea of IB. It can get extremely boring at times, and if you don't believe just spend some this on WSO's forums to learn more about what IB work actually entails (especially in the first few years, which involve countless hours spent formatting powerpoint slides, putting together analyses that will never be used, etc.). Like every job, IB has its downsides and its upsides.
I think you should educate yourself as much as possible about IB before making any rash decision. Perhaps you could contact bankers on linkedin and set up coffee meetings in order to find out more about what they do on a daily basis.
Have you considered transitioning into another domain of law? Perhaps you are simply bored with your specific practice. But what about intellectual property law? M&A law?
Appreciate the comment. I've spent years thinking about it and talking to people in the industry, but without knowing exactly which group or which bank I'd be going into it's very hard to get a realistic sense of what the day to say would be like. My best guess is that I could do the work. I would probably not like some aspects of it but would like others. That's probably about the same I feel about my current career today. I also would assume that I would be an average associate... Not the best for sure, but not a low performer either.
At this point it would be essentially impossible to change my path within the law--have tried before and just don't see a realistic path for it (I could get into it more but probably just a tangent). So really the options for me are to stay the course or take a chance on something new.
It's good to hear I can realistically expect the same level of income or higher in IB eventually. I guess I'd be most curious at the personal cost to me--would I just hate my life because I'd be working so much? I read plenty of stories here about people working 100 hrs a week day in and day out, but is that really the norm for everything in banking (working until midnight 7 days a week)? For comparison, I work hard enough here but rarely am I in the office outside of business hours and I just finish up things at home. Probably average 55-60 hours per week.
Ultimately I'll say this: I've thought about doing this for years and I definitely WANT to doit. I'm just worried about ruining what I have now for something I'll hate or isn't what I'm hoping it would be.
IB and consulting are very different paths. Most of my friends in IB have the same "sold my soul for money" philosophy that a lot of M&A attorneys have. Even the ones who were gung ho about it in business school are reconsidering. I'm aware of one suicide and one heart attack to date. So the money will catch up, but so will the problems.
Strategy consulting can be a fulfilling and passionate career that is still research driven, but that is interactive and intellectual - it's not about construct an agreement or argument, like in law, but rather figuring out the best path forward. About 30-50% of my consulting friends are burnt out on the lifestyle and hours; but an equal number or more are highly passionate about their day job. The first year is the toughest in terms of hours. After that, once you are trusted to manage more of your own work, it gets better. Most firms are 80% travel, but the general expectation is that you have light or no work on the weekends (many of my banker friends are 7 days a week).
In terms of compensation - if you're not happy, does it really matter? Take a change. IB will catch up to law if you're not partner track. Consulting to a lesser degree.
But if you're curious, MBB/T2 are paying upwards of $200k all in your first year, not counting a signing bonus. Banking is, I think, closer to $250k. 5 years out, if you're promoted in each role, you should expect ~$300k/yr as an experienced manager in consulting or $400-$500k/year as a VP in banking (if you land a good firm, which is likely from an MBA business schools">M7 with your background). Any of those salary ranges are more than liveable. We only live once; it's not work an extra million or two over 20 years to kill yourself for something you don't love when you're young.
Hours are typically 55-60/week in consulting, upwards of 70/80 for intense engagements (but, remember, they have an end date). Some firms/groups are known for being on the more intense end (McKinsey, Bain's private equity group, NYC offices, etc). But generally, 55-60 is normal. The 80% travel is the tough part, though some projects and firms even at the top end trend down to 10-30%. The hours are concentrated M-Th. Working past midnight is definitely not a general practice; most of my projects we end between 9-11 during the week. Off a project it's 6-7 most nights.
Banking hours can definitely trend to 100 hrs/week at the top firms, and work past midnight is considered the norm - usually because you are in the office but underutilized during the day, and then when senior folks wrap up their review cycles they ship them to the team at night - a constant frustration in banking. In consulting, all of those hours tend to be productive, so the days are more engaging and go by quickly.
This is a consultant's perspective, but I'm attempting to be well rounded - the banking perspectives are all well validated by my friends in the industry (I went to Booth, so there are many).
Unlike law, most people leave consulting and banking - something else to consider. Corporate roles pay commensurately your first year out of your industry but the growth rate is lower. But again, I wouldn't over leverage on pay - focus on what you actually want to and how you want to make your impact on the world. It will be enough money.
One of my friends was an M&A lawyer before school. She's now at McKinsey. Similar hours for her (she was at an intense firm), maybe a little less. $300k paycut or more. She loves her new job and has no regrets.
EDIT: I missed that you've already been accepted to two t15 schools. Which? Any opportunity to apply at the MBA business schools">M7 (or did you already swing and miss)? Banking is pretty much 90+% and the consulting hire rate is 50-70% at the MBA business schools">M7 schools; those figures are lower at the rest of the T15. You also need to figure out what your backup plan is and if you're comfortable with that career - corporates right out of bschool are typically in the $110-$150k range all in. All told, it might still be worth it if you're unhappy in law, but something to consider.
Given that MBB just recently increased compensation packages for post-MBA consultants, do you think it's fair to say that an experienced manager in consulting (3-4 years post-MBA) could potentially earn more than just $300k/yr? I know banking earns more than consulting in general. I just want to gauge how significant that pay gap is.
Again, thank you for your insightful and detailed response.
P.S. an ex-lawyer recently got admitted to a MBA business schools">M7.
My estimates include the recent upward salary shift. A fair estimate is ~30-50% additional comp for banking over consulting at every level. But please - really - don't make your whole decision on comp. Talk to a lot of folks who did post-MBA banking and consulting before you decide which to recruit for. Most people are not lifers in either industry, so the range of exits you would consider also plays a big role.
Also - post-MBA role is usually 3 years at up or out firms. So good performers make engagement manager/project leader after 3 years, in the start of year 4. Top performers tend to make it after 2 years, for the start of year 3. Rarely someone might make it after 1.5 years, and those folks tend to have been consultants before school. So years 3/4-6/7 tend to be your manager years. You can stretch to 4 years at EM in many firms before the "out" catches up again.
I wanted to say thank you very much for your detailed response. It's really helpful to hear from someone with your perspective.
Your comments on banking are consistent with others I've talked to who took that path. In law, I really don't think I've ever worked a 100 hour week. It's hard to say how I'd really feel about it until I'm there, but as someone who's obviously a bit older than most I'm that position I'm pretty concerned that I'd burn or faster. The biggest benefit I see is that it's a bit easier to land that position as a career switcher. But with the benefit of the last week to think about it I'm growing more and more sure that it isn't for me.
Your comments on consulting are encouraging. The uses I'd being "on" most of the day is what I'm looking for--sitting around at my firm being bored only to have to work all night to catch up is a side of incredible frustration for me. I'd really like to be in a position to interact with people more frequently and engage in more problem solving--all things that sound right in consulting.
To give you some more background on me, I've looked to make the switch before. First I tried to move directly into consulting without the MBA. I've gone through the interview process at both McKinsey and BCG in multiple years and have had final rounds at each, but wasn't quite polished enough to snag an offer. Unfortunately I need to the MBA and practice with other students to get me whether I need to be. To that end, this also isn't the first year I've tried for business school. I struck out at MBA business schools">M7 more than once, so this cycle I went for some of the lower ranked schools. I received scholarship offers at both. I know that their placement rates are lower, but I'm ok with that. I feel strongly that I'll be a top performer at either school and very competitive for an MBB gig. My biggest concern is actually that they'll pass on my application since I've applied to each multiple times, but my hope is that the MBA will get me in the door again and the additional decide I'd get from MBA would be enough.
Ultimately, your comments on living once and being happy are really important to me. I've managed to work my way through biglaw for a while and it's gotten better, but there's a reason I've been looking to leave for a long time. The work is just not fulfilling in a way I want it to be and I don't see a path towards a corporate job that would be better. Still, the uses of giving up 300k for a... Let's say 25% chance at MBB is somewhat scary. If I struck out with that, I honestly don't know if I'd be happy with the other corporate jobs I could land. Not because I'd the money so much, but maybe more because I'm just not sure where that path leads and whether the work would be any better.
All of that leads me towards a gut feeling like I should stick with what I know and keep the legal job. I'm not miserable here, and I don't work insane hours... Just frequently get bored and wonder if there's more out there.
i don't think they'd pass given you've applied before - you can always bid your way onto the list if you don't get an interview. also these firms interview 50+ kids at MBA business schools">M7 schools, literally everyone who wants an interview gets one. would figure you wouldn't have too much of a struggle despite being t15 (might be diff for MBB, would ask people at consulting club for schools you're admitted at about # of offers/# people who interviewed for each role)
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