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My cousin who’s in SF in IB one of the EBs in the first year couldn’t save more than ~$10k and he’s a conservative spender. Rent will go north of $1500 if you want to maintain the 20 min to work thumbrule, dining out is brutal a breakfast at Denny’s is ~$30 for one. plus SF has a ‘City’ tax so you’ll get screwed all around for a while
That sounds brutal. Did he have 10K left before he got his bonus, or after??
That Denny's figure is cap. Rest on par
hes not conservative if he couldn't save $10k in SF on an EB salary -- bullshit
I am in SF just about to finish my first year as an IB analyst. Between my signing bonus and my first year base salary, I’ve put away $30K, and that’s after taxes and before I’ve even received my bonus for the year. I honestly don’t understand how it’s possible to only save $10K after getting paid $150K (pre-tax) all in for a year.
That doesn’t sound too bad. Thanks for the info!
Would you mind providing your spending breakdown? Saving 30k sounds very unrealistic. I'm considering moving to SF from BOS. Thanks!
Honestly I don't even budget. Here's why:
Starting bonus = $15K ($10K after tax) Base salary = $85K ($60K after tax)
Total of $70K "spending power"
Rent = $1.8K per month ($21.6K per year)
So you're now looking at $48K in post-tax money after taking off your rent. Now to get to the $30K that I have saved, that meant that my Visa bill was at $1.5K per month. And that's honestly not hard to do. Here's a few tips:
Buy breakfast food at the grocery store on the weekend - I do two scrambled eggs on a bagel every morning for breakfast - it's quick, tasty, and dirt cheap
Don't buy lunch every day for $10 to $15, instead go to Trader Joes on Sunday and buy five ready made sandwiches or salads for $3 a pop - you just saved $35 to $50 a week, which is $1.8K to $2.6K in savings for the year - obviously you can go out for lunch sometimes with colleagues, but don't make this a habit
Use your firm's meal allowance at dinner - you'll be at the office past 6pm everyday anyways, this means that you never have to pay for dinner
Same with coffee, I drink the coffee from the Nespresso machine at my office - This saves $5 a day, or $25 a week, which adds up to $1.3K in savings for the year
Don't spend insane amounts of money at the bars on the weekend, this is especially easy in SF - the cover is cheap at most bars, and as long as you focus on pre-drinking with cheaper booze at home before going to the bar you should be fine
Adding onto that point, I feel like lots of bankers have this innate desire to pay for everyone's drinks - stop doing this. Obviously get one or two rounds a night for you and your friends, but don't be the one paying for every round - your friends are just free-loading off you
Don't buy excessive amounts of clothing and other materials goods - I personally look at clothing like a fixed cost that depreciates over time - buy a few nice staples up front and wear them until they're worn out, then replace them - especially in SF, there is no reason to be updating your wardrobe quarterly to match what is "in trend" as appearances here are not as highly judged as they are in, say, NY
I think for me, I don't have to budget because I have an internal thought process that just naturally says "do you need this" when I go to purchase something. I find that prevents me from making a lot of unnecessary purchases that end up costing a lot of money. I also think that I have a thought process where "every little bit saved adds up" which is true.
It genuinely shocks me how people can say that they are not able to save any money in their first year as an investment banking analyst. I understand that it is nice to have the finer things in life after living frugally in college, but come on. You're going to take home ~$100K after tax when you factor in all of your bonuses. There's no reason you should be spending $100K in a year on things.
Interested in your desire to change locations. I'm currently a student in Boston interning at a boutique. Other than Boston being very expensive and of course cold, what makes you want to relocate?
Just curious if you or anyone else don't mind answering, how much of that $30K do you put into your 401k vs Roth IRA vs investments (e.g. stock mkt) vs. savings account/cash? I know you're not a wealth mgmt expert but is there a good general baseline allocation rule of thumb for savings? Thanks.
Whoa. $150K before bonus for a first year analyst? Are you sure you're not a first year associate?
20-30k savings as an analyst. in SF rent is one of the things you want to splurge on imo. a shitty living condition is no fun. cut costs in other avenues.
I have been working at a BB in SF for 3 years as an analyst, so have a decent view on the cost. Generally, people (myself included) live with a couple buddies and end up spending about $1700 - $2500 a month on rent. If you get a solo place, expect to pay closer to $4k for a decent pad.
Food is generally expensive, but chain restaurants are still similar prices, think Chipotle, Sweetgreens, etc. Independent and upscale restaurants can quickly add up though, but there are quite a few good restaurants in the area, so don't miss out on some awesome opportunities.
I have gone out a fair amount in the city, and like others have said most bars have no or cheap cover. Some of the "clubs" do charge cover, but its usually not exorbitant unless a big name is in town. Drinks inside bars seem to be similar prices to most major cities in the country and are nowhere close to the prices you might pay in Vegas, Miami, Ibiza, etc. If you are a single guy, the city isn't the best for a variety of reasons, but definitely worse places to live.
Can you elaborate on the variety of reasons as to why it's not the best place for a single guy?
Prob cuz the lack of nightlife and girls aren't as hot (lot of sjw hippies and the like) as other major cities like NYC and LA--I live in SF
1br/1ba rent in a nicer neighborhood but still close to all the good stuff, plus parking spot (10 min bus ride to office, 15 min bike, 5 min uber) = $2750 mo. (Get a pet and make it pay rent)
Utilities (internet, gas, electric) = ~$100 mo. (Sometimes higher, depends how many times I watch Gladiator that month)
Food = $50 per week (pro tip, eat adderall not doordash)
So far a rough $2900 mo. base cost.
Salary, 1st year IB Analyst, about $85k, takes a bit more than 1 paycheck to cover the monthly costs - bank the rest. Bank the bonus.
But you can of course lower these costs by living in a studio and never leaving your deal dungeon. With the right mindset you can essentially eat/sleep/work/shit/watch Gladiator all from the same space and when you emerge in a year or two you should have a solid chunk of change.
Cheers.
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