Is investment banking worth it?

In the media investment banking is generally portrayed as a wild time. A bunch of rich assholes surrounded by money, drugs, sex and women.

Obviously I'm sure reality isn't like that. From the accounts I've read it seems to be a very competitive workforce with long hours and an education from an Ivy.

I'm a sophomore in high school, looking to get into finance in the future, can those who actually work in this field give me the truth of the job? Should I give this field a shot? Does it pay off? What should I do to prepare myself and what education path should I take?

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Comments (20)

Jun 11, 2020 - 4:17am

If you have an interest in this field, then yes - it can be rewarding, interesting, exciting even and might lead to a long and fruitful career.
If you look at a job/industry purely because of the income or prestige and have otherwise no interest in economy or finance related tasks... then no, it would not be a good idea.

What career alternatives do you have? Ever wanted to be something else? What are your interests and hobbies?

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  • Associate 2 in IB-M&A
Jun 11, 2020 - 3:37pm

My steps to break into finance starting in high school. Follow these and you'll be on a good track:

Step 1A - 1D (Sophomore / Junior High school): Get good grades, take AP courses, do well on the PSAT / SAT and have well-rounded extracurriculars.

Step 2: Get into a good college with strong alumni base. Doesn't have to be an ivy but it should have proven track record of placing students into strong finance internships.

Step 3 (Summer going into college): Try and get a finance related internship. Ideally, it would be tangential to the field of finance you're interested in. Mostly resume building at this stage but also meant to begin developing professional skills / familiarize yourself with professional environments. Can be sales-related finance role... anything.

Step 4: Go to college. Have fun but go to class, get good grades, join finance related clubs and have extracurriculars. Developing the social skills and friendships are as, if not more, important than developing the resume.

Step 5 (Freshman Year): Network with alumni and begin applying for internships. Ideally you'll want an internship that is very close to the general finance position you're pursuing. If it's IB, go work for a local IB / PE shop... there are plenty of 2-10 people shops that are looking for unpaid interns. You'll have to send lots of cold emails.

Step 6 (Sophomore Year): Repeat step 5 but get an internship directly in the field you want to pursue. If it's IB, then you'll want to start developing modeling / transaction experience in your resume. You don't have to be a pro at the end of the summer but you should be able to speak to the experience during formal recruiting during your Jr. year.

Step 7 (Junior Year): Repeat steps 5/6 but you need to lock up an internship in the field you want to pursue. Don't rely on senior year to recruit for the position you want. Be relentless and don't hesitate reaching out to professionals for 15 - 30 minute coffee chats. Network hard that Fall to secure a good internship.

Step 8: Lock in full time offer during internship and enjoy your senior year in college.

There's probably a 1-year buffer for when you begin this process but that's typically the timeline for breaking into finance at a high level. It's OK if you don't know what you want to do now and don't have any idea why people want to break into IB and PE. Explore different classes in college and talk to people in finance. Ask good questions and make the decision for yourself whether finance is the right path.

For now, don't take things so seriously and enjoy your formative high school years.

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  • Analyst 2 in IB-M&A
Jun 11, 2020 - 4:14pm

Agree with everything except maybe step 3. Not that its necessarily wrong but in theory it should be one of your most stress-free summer. You got into college/just graduated college (probably around 18) I'd probably spend my summer traveling or doing anything fun.

I don't believe anyone in my analyst class/friends in IB interned before college summer and you won't be at that much of a disadvantage to kids who have.

Will caveat though and say part-time job is different if you're working for college tuition.

Jun 11, 2020 - 4:18pm

Yeah, if you've already gotten into a top school, there is no need for a pre-college job. Travel or do an interesting project (volunteer, learn a skill, etc.) If you MUST work, start a company instead of work an internship.

Be excellent to each other, and party on, dudes.
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  • Analyst 2 in IB-M&A
Jun 11, 2020 - 11:19pm

Long hours mostly within a cubicle, low to mild intellectual stimulation depending on bank group, and above average compensation with a high ceiling. The industry is consolidating and compensation growth on a relative basis has been somewhat stagnant. The absolute best of the best firms still pay very well (nearly $200k starting all-in compensation), but many firms pay around half of that all-in. You can expect to be somewhere in the low to mid 100's. Keep in mind that this is dependent on how the bank/economy is doing. Many analysts this year at solid firms will make $80-95k including bonus, given COVID.

Overall, it is a decent career path. Decent because although investment banking is not an ideal long-term career for most in and of itself, it gives you a marketable skill set for financial analysis and opens a lot of doors to better/higher paying opportunities. Most people who work in investment banking do not intend to stay in the career for more than 2-3 years, given the reasons stated above.

Jun 12, 2020 - 10:02am

It's a good course to follow for someone who isn't particularly smart but is hard working and possesses a respectable level of neuroses about power point slide formatting

Source: someone who isn't particularly smart but is hard working and possesses a respectable level of neuroses about power point slide formatting

Jun 12, 2020 - 6:07pm

You're a sophomore in high school. just get good grades and have fun. be curious about the world. not the time to be thinking about this too in depth.

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