How do you spend your money associates ?

Moistheman's picture
Rank: Baboon | banana points 106

The typical investment banking analyst's salary spending is known to be fairly tight if you live in NYC or SF and practically save nothing, but how do the pre-MBA/post mba associates at IB/PE/HF that make 200k-400k spend their salaries ? Like do you guys actually blow everything too or live the same lifestyle whilst saving more?

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Comments (76)

Aug 15, 2018

I blow everything on my student loans needed to fund my MBA.

    • 14
Aug 15, 2018

Well that makes a lot of sense

Aug 15, 2018

A third on rent, a third on fun (me, friends, girlfriend and family) and the last third I save.

    • 1
    • 1
Aug 16, 2018

Spending it on stuff you don't have to ... wife, kid, house, MBA student loans...

    • 1
Aug 27, 2018
Synergy_or_Syzygy:

Spending it on stuff you don't have to ... wife, kid, house, MBA student loans...

maybe. If it flies, floats or f-cks...

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Aug 15, 2018

bump

Aug 27, 2018

I spend it in a vicious cycle.
I pay exorbitant rent in order to stay in a city that is a financial capital, so that I can work in finance, so that I can pay rent to live in a city that is a financial capital.
Repeat, in a cycle, until insanity or hilarity ensues.

    • 17
Aug 18, 2018

The best way to spend money is on things you cannot see.
And if it must be visible, said item should provide a visceral feeling of euphoria.

Any item bought for the pure purpose of vanity (Picasso art, Panerai watch, etc) should be illegal.

    • 1
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Funniest
Aug 20, 2018

Werent u just flexing ur Maserati like 2 weeks ago? wtf?!

    • 46
Aug 22, 2018

A Picasso painting is a great investment though...

Aug 27, 2018

That is so fucking stupid. You WANT to spend your money on tangible items and not things that you can't see such as rent or the 18 yr old tinder dates u talk about lol

What concert costs 45 cents? 50 Cent feat. Nickelback.

    • 1
Aug 27, 2018

Completely agree; tangible items (luxury homes, cars, jets, yachts, watches, clothes, sporting events, etc.) are things that you can actually constantly see, enjoy in, and pass down from generation to generation. Never understood the point of spending money on things that cannot be seen/remembered/tangibly passed down 20+ years into the future.

Sep 1, 2018

tell that to my instant pot's face, fagot

heister:

Look at all these wannabe richies hating on an expensive salad.

Aug 27, 2018

"Only 3 things in life that I need.
Money, safe sex, and whole lotta weed."

Total Devastation - Many Clouds of Smoke

Aug 22, 2018

...safe sex....sounds 'um great?

Aug 27, 2018
C.R.E. Shervin:

...safe sex....sounds 'um great?

'twas a line from a rap song, but still rings true today as it was when I was 18 and heard it first.

Aug 27, 2018

I invest it into real estate, into my own education, and into businesses that I hope will pay me cash flow later.

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Aug 19, 2018

I am not an associate but make about 350k to 400k.

Tax man takes a lot but what's left I spend probably a third. I don't know what to do with and it's just cash savings. Tips?

Aug 19, 2018

What do you do in order to make that salary?

Aug 27, 2018

Cool. That's great pay. What do you do?

Aug 19, 2018

Got my own online biz

Aug 24, 2018

cash savings? Keep some for an emergency fund but dump the rest into an index fund

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Aug 21, 2018

Is your username
A) Mo Is The Man
B) Moist He Man

I prefer B tbh

Also nowhere near being an associate

Dayman?

    • 9
Aug 15, 2018

A omg

Aug 21, 2018

Fuck that you're Moist He-Man now DAWG

Dayman?

    • 2
Aug 22, 2018

I believe will Emmerson summed it up pretty nicely.

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Most Helpful
Aug 22, 2018

You can easily save money on an analyst's salary especially today when its 85k+ starting vs. 70k back when I graduated. No reason you can't max out your 401k with just the base salary and live off the rest (plus be able to bank your entire bonus).

As an associate, monthly take home after taxes, health insurance, and maxing 401k (assuming equal contributions over the 24 pay cycles to get to ~18K) is about $6,500 in NYC.

Salary: $6,500
Less: Rent (studio @ 3,000)
Less; Utilities (100)
Less: Internet/media (Netflix, HboGo, no cable): 70
Less: Food (groceries/lunch, excl. dinners/brunch etc.): 400

Remainder: 2,930 which is quite a bit monthly for traveling, dinners, going out, dates, buying stuff or just saving

Firm pays for cell phone, 80%+ dinners are comped by work, no debt, no car payments, walking distance to work. The math up there allows me to bank 100% of the bonus and including the 401k contribution savings are well over 100k annually.

    • 10
Aug 22, 2018

85,000/12 = 7,083
Minus taxes (25%) = 5,312
Health care, 401k (Max) = 3,712
Rent (2k) = 1,712

Not to be a dick but not sure you math is adding up. 1,700 on all other expenses and trying to save is not much...

    • 1
Aug 22, 2018
Marti Kahn:

85,000/12 = 7,083
Minus taxes (25%) = 5,312
Health care, 401k (Max) = 3,712
Rent (2k) = 1,712

Not to be a dick but not sure you math is adding up. 1,700 on all other expenses and trying to save is not much...

Was more referring to all in comp for analysts. Though the 401K max is real savings (though granted not liquid) and you'll have an additional ~30K after bonus+taxes which is pretty sizable savings for a 1st year analyst

    • 1
Aug 27, 2018

@Quaneaser You can easily save money on an analyst's salary "

Yup.
Always save money.
It gives you that place of fuck you that John Goodman's character talked about in the Gambler.
That's what you want - to make sure you've got $ in the bank for when the bad times hit, and the banks slash jobs. Again. Like they ALWAYS do in a downturn.
Make sure you've got your bases covered.
Always have money in the bank.

Aug 27, 2018

Frank: You get up two and a half million dollars, any asshole in the world knows what to do:
you get a house with a 25 year roof, an indestructible Jap-economy shitbox, you put the rest into the system at three to five percent to pay your taxes and that's your base, get me?

That's your fortress of fucking solitude.
That puts you, for the rest of your life, at a level of fuck you.
Somebody wants you to do something, fuck you.
Boss pisses you off, fuck you!
Own your house.
Have a couple bucks in the bank.
Don't drink.
That's all I have to say to anybody on any social level.
Did your grandfather take risks?

Jim Bennett: Yes.

Frank: I guarantee he did it from a position of fuck you.
A wise man's life is based around fuck you.
The United States of America is based on fuck you.
You're a king? You have an army?
Greatest navy in the history of the world?
Fuck you! Blow me. We'll fuck it up ourselves.

    • 5
Aug 27, 2018

Are studios in Manhattan up to $3k / mo now?
Lord almighty.
The rent is too damn high party was right.
ffs

Aug 22, 2018

You guys are assuming/paying 25% tax rates?

Have fun in jail

    • 8
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Aug 22, 2018

I definitely chuckled at your post but real talk, you get taxed on your base which for $85/yr puts you in the 25% bracket, and if you wanna get really douche-technical only dollars $37,950 through $85,000 are taxed at that rate. after about $92,000 you jump to the 28% bracket and that's all the way through ~$191,000. your bonus is taxed differently but the math above was straight up just doing an $85,000 base.

Source: the day I jumped my base into the 28% bracket I got some real amazing bragging rights over my brother who is an engineer, and by all measures much smarter than me haha.

    • 1
Aug 19, 2018

Here I am paying a 45% tax rate. Hardly worth working.

    • 1
Aug 27, 2018

@SanityCheck You guys are assuming/paying 25% tax rates?"

What? You mean hookers and blow aren't tax deductible?
These are legit business expenses.
Hell, they should be goddamn charitable deductions.
Strippers with fake titties are the veritable cornerstone of the financial system.

    • 1
Aug 22, 2018

I'm in the camp of spend your salary (less 401(k)) and save ~80% of your after tax bonus.

Thankfully, I live in a relative low cost of living city, so the IB comp goes a long way and allows for some frivolous spending... like a fast car. I also enjoy some expensive hobbies like range / target shooting - couple hundred bucks of ammo and range fees every time I go.

    • 3
Aug 27, 2018

do you live in chi/charlotte?

Aug 22, 2018

I do not

Aug 22, 2018

Piqued my curiosity. Which car?

Aug 22, 2018

R35 GTR

    • 1
Aug 22, 2018

Most associate bases are now 125/150/175/200. You generally lose 40% to tax / 401K / benefits. If you can keep rent to 2000 (w/ roommate) to 3200 (self) - you can start ripping some FCF depending on student loans. Tbh ppl spend most extra money on add ons like drinking / eating out, 1 bedroom that costs 5000, buyin fancy stuff, etc. You shouldn't need the bonus beyond first year - even for some fancy trip. Now if you want to buy a NYC apartment - different story.

Aug 22, 2018

Sometimes you just have to #ballsohard haha

Aug 24, 2018

I'm a first year analyst and this is pretty much what I've been told. Live on the salary as if its your only income and stash the bonus as if it doesn't exist.

Aug 27, 2018

"Live on the salary as if its your only income and stash the bonus as if it doesn't exist."

very wise.
People forget how bad 2008-2011 was.

    • 1
Aug 22, 2018

Ask my wife

    • 5
Aug 15, 2018
IntlBaller:

Ask my wife

The only way to keep her relatively sane with IBD hours.

Aug 22, 2018

Ain't that the truth. Though also makes me question why TF I'm doing this.

Aug 27, 2018

IntlBaller: "Ask my wife"

Just get her a pair a pair of flip flops and a dildo.
That way, if she doesn't like the flip flops...

Aug 27, 2018

IntlBaller: "Ask my wife"

Some money for the poolboy, some for the TV repairman.
Some for the shrink, some for the surgeon.
Gotcha.

Aug 22, 2018

Two condos and food

Aug 27, 2018

why 2 condos?
You can only sleep in 1 bed right?
Or am I missing something interesting going on here....

Aug 24, 2018

In NYC, you upgrade your apartment to one that's a normal size for a Midwest apartment and with fewer roaches.

Or, you stay in the tiny studio and save the extra money hoping that your investments will allow you to live in a place outside of Manhattan that actually has some space after you get burned out from IB.

Aug 24, 2018

I didnt read any of the comments and went straight to the comment section here to make a point -

Writing: 'The typical investment banking analyst's salary spending is known to be fairly tight if you live in NYC or SF and practically save nothing' - wtf, so whatever a starting total comp is nowadays, $100-150k leaves someone saving nothing?!?! Yeah, only if you spend all your dough on nighclubs, booze, models, and maybe drugs. Wtf people, lets get back to reality. If someone cant save a cent on that kind of salary theyre just wasting their money away on nonsense. I get that people do that but dont start a damn thread saying how you dont save money on starting IB salaries - dont think you'd have many baristas and waiters in NYC if that was the case...

    • 3
Aug 27, 2018

@Hocikto
You had me at "spend all your dough on nighclubs, booze, models, and maybe drugs"
Challenge accepted.

Aug 30, 2018

From my 3 years in IB as an analyst, I saved a little less than $250k living in Manhattan (a little bit less when you factor in the deferred taxes on 401k). My first year and a half I paid $2,900 a month in rent, which was just too much. Otherwise, I didn't travel at all, buy any fancy watches, bottle service, etc. I stayed on my parent's health insurance and cell phone plan (only child, so it would be my money eventually, right?) Frankly, I wish I had spent more of it and enjoyed life more. I have everything in cash right now since I rolled my 401k, so I need some ideas on how to deploy it. My biggest issue is figuring out what asset classes should go in my IRA vs. my taxable accounts, etc. Any advice would be appreciated.

Aug 30, 2018

works in finance. on a finance website. says most of money in cash. doesn't understand opportunity cost of not investing. ??

not trying to be mean, but kinda of surprising to me... invest in stocks

Aug 30, 2018

Hey, I've read all of the typical value investing books, MPT, etc. What I also understand is the opportunity cost of the 30%+ I'd lose if and when this market tanks. That being said, I don't disagree with you, but the opportunity cost in today's market is not exceedingly high on a month to month basis. I'm looking to structure my portfolio as efficiently as possible to manage the cycle and what costs I can control such as taxes, fees and all that. My new job gives me some insight into my sector, so when I have some time and experience I would like to build a L/S portfolio to leverage that insight (not MNPI, just the perspective of an informed industrialist). It makes sense to have some beta risk too, though.

    • 1
Aug 31, 2018

Why is an index S&P and Total Market hard to figure out?

Aug 31, 2018

It starts slowly, at first you think what do I need to change my lifestyle is fine as is. I never did not do things I wanted to do b/c of $$, but eventually little things start to piss you off and you realize that you no longer need to put up with these things anymore. Ex: I decided I no longer wanted to have roommates when I got sick of listening to my roommate and his cow of a GF have sex. Obviously did not enjoy listening to it when I made analyst $ but now that I'm making associate $ I don't have to put up with it, and I made an adjustment. Now my rent is 3X higher than before. Got sick of the guys in my office giving me crap about my old crappy car that I had paid off, now I have a nicer car and the payment that goes with it. I am totally glad I did both of these things, and I love the new apartment and car but you get the point.

Outside of rent and cars its really hard to really blow yourself up with other stuff especially when you don't travel that much b/c you are working all the time.