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Career Resources
From what I’ve seen on this forum people your age are worth 400-700k
Yeah I’ve seen those threads and thats partly the reason I made this post, hah. Trying to figure out if those people are outliers or if I really should be at $500k+ by now (hint, im not).
Bump
I’m a year younger than you but similar with 2.5 years of IB and two years of private credit. Not exact but I think my earnings over four years excluding first year stub is ~$875k, and my net worth is hovering right around $400k including 401k right now. I’d expect by the end of this year post-bonus and other savings with no market move to be in the low $500s.
Nice thats pretty solid, congrats. Kind of solidifies my thoughts of being about a year behind most people my age
Thanks, and congrats right back at you. Sometimes wish I spent more on traveling and just having fun not that I actively try to deprive myself, and in the grand scheme of things we’re all doing incredibly well.
Fam, you're not even a year behind people our age. You're still way up compared to the general population mate
How is your net worth that high after only a few years? Do you save half your paychecks?
I said higher up but would reiterate I probably wish I had spent more on travel/going out etc but have been in a long-term relationship (though not sharing housing) that probably cuts fun expenses. Other than that tried to contribute a fair amount to 401k and saved 90% of bonuses.
2020: contributed ~$50k to brokerage
2019: contributed ~$45k to brokerage
2018: contributed ~$40k to brokerage
2017: contributed ~$35k to brokerage
2016: contributed ~$10k to brokerage
+ roughly $50k of gains = roughly $230k
401k ~ $165k total. Maxed for three years, somewhat less for the first two, + roughly $35k of employer matches + investment gains = ~$165k
2.5 years of maxing a backdoor Roth + some gains ~$20k
How are salaries I private credit at say a sixth street type fund
From what I’ve heard definitely varies by firm and possibly even strategy within a firm, but high-level at the larger credit funds something like $125k base + call it 80-120% bonus for the associate years as an estimate. I was at one of the large ones (GSO, HPS, Ares etc) and was in this range.
The top numbers are outliers. As you noted you’ve made $1mm gross, so after taxes ~$600k in earnings.
I would say “good” would be (using 5yrs as the amount of time in the workforce even though it’s coming up on 6 right? Just being conservative):
maxing out 401k (let’s assume no match): $95k (19k x 5yrs) + $25k in appreciation (returns have been pretty good over the last 5 yrs) = $120k
Outside of that I would imagine cost of living in nyc was ~$50k a year ($2k a month in rent and another $2k in living expenses) to start and probably closer to $75k now (that is pretty conservative at $3k/mo apt and $3k/mo expenses, it could be a fair bit higher), so that leaves you about $250k. I’ll be conservative and say you invested most of that later and with appreciation are at ~$300k
So around $400k would be pretty good. If anything I guess you would probably have spent more and be around $300k (buy a nice gift or take a nice trip with a bonus, get a nicer apt and drop the roommates, etc) and I’m also assuming you didn’t put a large amount of your wealth in crypto, etc.
You’re pretty spot on with this actually haha, thats right where i’m at. And yes I guess its been 6 years but again I dont really count that first stub year as I hardly made anything beyond funding my rent / moving expenses that year. So essentially 5 full bonus cycles and i’m at exactly $400k ($150k is 401k) right now. I guess I feel like it should be a lot higher but maybe not. I def had some spendy years early on though..
We're the same age/have a similar(-ish) background and you're ~$50k ahead of me on an all-in basis. I wouldn't sweat things too much.
Put it all in ETH
I’m 26 at $270k and used to stress about this constantly (especially when I saw so many other people getting crazy gains during covid).
But it doesn’t matter how fast you get to $400k or $500k. What matters is that you position yourself to be in the carry pool or whatever your fields equivalent of that is. If you look at finance guys who are worth $30mm+ in their 40s, I highly doubt their net worth at 28 was a determining factor. I imagine there is some correlation, but it’s not as strong as you think.
Those guys with the $50mm net worth took big risks (joined a start up, left for a smaller fund and invested everything they had, started their own fund, invested in a buddies startup, whatever) or moved up the corporate ladder extremely fast. I don’t think an extra $50k in savings would have made the difference
It matters if you don't plan to be an outlier and just want to live a regular upper middle class life
oh wait I misread your comment. I see what you’re saying. Yeah, if you just want to save and live a normal life, it does matter.
But also, $400k saved at 27-28 is not upper middle class. You’re easily in the top 5% of your age group by net worth. Exclude people who inherit money, and it’s even higher.
Yeah but you can parlay that into some F500 corp finance gig and then coast the rest of your career, topping out at low to mid 6 figures. Have enough for a house, two cars, college for two or three children. And retire with mid 7 figures. I would call that upper middle class.
Again, you're just misunderstanding how poor most of America is. This is easy to do when you go to private school or hang out with other professionals with college degrees. Don't mean that in a bad way - I used to think that way too before I looked at hard data. "Mid 7 figures" net worth puts you literally in the top 1% of the US.
$2.3 million puts you at 20x the median household net worth.
How Much Money Do You Need to Be Wealthy in America? - Bloomberg
$488k puts you in the top 1% of earners in the US.
https://www.bloomberg.com/news/features/2020-02-07/how-to-be-in-the-ric…
$4.4 million net worth puts you in the top 1% of the US
https://www.businessinsider.com/net-worth-to-be-in-1-percent-top-richest-wealth-2021-2#:~:text=The%20US%20has%20the%20highest,to%20crack%20into%20the%201%25.
Here is another source that puts the top 1% net worth at $11 million. Even so, 95th percentile is around $1mil. So even $1 mil is well above upper middle class. In this source, 75th percentile net worth is $400k. That's the high end of upper middle class in America... believe it or not.
United States Net Worth Brackets, Percentiles, and Top One Percent - DQYDJ
Looking at the United States as a whole is pretty irrelevant. It matters more about what the actual COL is where you reside.
Yeah of course if you want to define “upper middle class” as the 50-75th percentile of West Village residents, that’s up to you
This is the dream, spot on. You def need to retire with a couple million for a comfortable lifestyle (and in case health care costs, anything else becomes an issue). It doesn't really matter that the rest of the US is hand to mouth.
do many people start as analysts with some savings? I considered myself lucky not to have debt...
gotcha thanks
I think the "good" benchmark is 400-600k for late 20-something in Finance but there's a ton of idiosyncrasy involved here. A lot of folks who post in the net worth threads have enjoyed massive cap gains or inflate their net worth the same way they inflate their hours when asked.
To give you another data point, I just turned 27, 3rd year as assoc going to VP at a MM, did 2.5 at a tiny bank paid below street. I'm sitting around $450k across several accounts. I have not quite earned a cumulative 1m gross - closer to 900k as of this coming bonus period, thanks to my bitch pay at that tiny bank.
My idiosyncrasies:
~150k of that is cap gains, half of it realized. I am a stock picker, and a mediocre one at that. I've beaten the market over the last 12 months by being massively long commodities and metals, and a bet on potstocks that paid big. BUT if I had just plowed everything into market indices that 150k might be higher. If I had bought Tesla or DOGE or BTC or whatever sky-high risk-asset, that would be higher. I kick myself over this even though I know I shouldn't.
I lived in LCOL Texas for a couple years and saved 70% of my net salary, which was 20% higher than it is where I currently live due to taxes. All I did was work in Texas too - Spent next to no money.
I am incredibly fortunate that my parents (and grandparents on both sides) all started education savings for me when I was born so I did not graduate with student loans.
I'm 31 and at about $920K, if that helps. At your age I probably had like $600K saved.
no one will admit they have saved considerably less than you if in the same position, so I'd take replies with a pinch of salt.
That’s mostly true, as it is with all posts here (comp especially).
As an older member of this forum I’m happy to tell you I had saved a lot less 5 years into my career. I think I was around $70k (that may even be generous). I graduated with $55k of debt and didn’t have a very high paying job (didn’t do IB out of undergrad). Most people on this forum who go into banking (and definitely those that go into PE) are way ahead of the curve.
How old are you?
Don't defer consumption so much, you only have 1 life to live! What are you saving up for so much? To spend that money when your 80? No thank you
Hell yeah, brother - what’s the point of making all this goddamn money if ya can’t fucking spend it?
Haha I totally agree with this logic and thats partly why I’m a little behind to begin with. However, there is definitely a happy medium. Not sure where you’re at in your career but after all these years im starting to realize I probably won’t be a lifer in this industry so at some point I will be leaving my current role behind and the comp that comes with it. That’s made me realize the importance of having some money saved (I wish I had more) as I will likely never see anything close to my current comp level once I leave.
Guy has 400k at age 27...is concerned he is behind the curve..smh...
Out of curiosity, what is your target NW number for when you're 50 / 60?
I've never really thought about it like that. To me time/flexibility > money. Target NWs are kinda arbitrary numbers. I'm at the point where I could walk away from my job and have enough to continue to live my life in its current form - I'm basically there (not not working ever again, just not having to really grind and make a lot if I choose not to). Anything more is just owning a bigger house than I already own or staying at fancier hotels - which don't get me wrong is nice, but not a necessity. Stuff is really just stuff. I'll do my job until its no longer fun and then pivot, or at least have that option. No golden handcuffs for here.
To tie back to the original poster, 400k at 27 is on an extremely solid path and he/she shouldn't too worried as that is a great achievement at a young age.
Since you asked, what about yourself?
At ~300k NW today in my mid-20s (don't want to get more specific than this), with slate of new investment opps (private & public) that have recently come across my plate I should comfortably reach 1ml by 30 which is my target. I'm sure there are guys who will do way better but for me I want to a) build sustainably for the LT (slower & steadier is ok, esp working 50-60hrs per week vs. 70-80) and b) enjoy my 20s (travel / golf / great restaurants / etc)
Assuming you enjoy what you do and will keep at it, your NW is about to exponentially go higher so never get this question unless its one of those WSO 2+2+2+2+2 folks who wants to just change their career path at anytime. When you hit early 30s then should be more of a concern, but years 1-5 you could be 80% behind others and end up at the same place.
Fair comment, and I agree. As I mentioned to the other user above, for me I’m realizing my tenure in this career may come to an end soon so thats why im starting to think of these things. Tbh id be shocked if im still in my current seat when I turn 30. Ive had enough of this shit lol. I’ve got 1 more bonus cycle in me, maybe 2 max but thats it.
What's next on the horizon for you?
If I am not at least a millionaire by that age, I’d be incredibly disappointed
I'm 30 and sitting at $400K. Did 2 years in consulting, 2 years in PE, 1 year at a startup and 2 years in business school (full ride scholarship). Gross wage income from those jobs probably around $750K (this includes bonuses and in case you're wondering, startup equity worth 0).
Have been able to save as much as $400K due to a combo of parental support/inheritance (probably ~$100K over the years), side income (probably another ~$100K cumulatively) and from investing. Generated $70K in investment income in 2020 alone.
Feel pretty comfortable where I'm at especially after taking 2 years off from the workforce. The median net worth across all US families is only $120K.
I know this isn't the purpose of this thread, but curious: when you applied for business school, were your recommenders from the PE fund or the startup?
One of each.
You're miles ahead of people who did business school
This is true
Probably a dumb question, but do people usually pay for bschool out-of-pocket or draw a loan?
loans usually
6 years in IB and I just started saving in August 2020. I maxed out my 401k but spent every other dollar on vacations/dating/general fun in NYC. I now have a girlfriend with a more conservative lifestyle which I have started adjusting to. While I kick myself sometimes thinking about where I would be financially if I saved more (currently at ~$175k), the friends I made along the way and all the experiences I had to maximize my youth make settling down much easier. I think if you don't have fun now you'll be the 40 yo at PHD buying bottle service and cheating on your wife because you never lived it up as a young single man, just my $0.02.
I spent a massive amount of money going out in NYC. In one month I think I went out 30 days in a row. It was insane. Amazing.
I'm two years older than you OP but on my 28th bday I had earned $1.05M in wages as well (from IB). I had just over $500K saved up (started with -30K of debt), mostly through good savings (I think capital gains was only about ~$50K or so then) and living in a lower COL city for a few years before moving back to NYC.
To illustrate how dramatically things can accelerate once you have a good capital base, I've nearly tripled my savings in the last two years in part through aggressive investment (e.g. finally investing my cash on the sidelines near the bottom of the COVID trough) and strong 2nd/3rd year Associate bonuses. YMMV but the advice about later years dwarfing earlier years is certainly true (though I appreciate in your post that you are looking to exit, which I fully understand and have at times considered)
adding a data point, earned roughly the same in wages and have about the same saved at $500k+. started with nada out of college
Thesis: Where your net worth stands at this very moment is irrelevant in the grand scheme of things.
Reasoning: At 28, my net worth was negative, I was unemployed, and living in my parents basement. Graduated from an "okay" state university and my girlfriend since high school had just broken up with me.
As of writing this post, just turned 33 with a net worth slightly over $2 million. Went to work for a "boutique" IB. No signing bonus, not even a salary, so the firm partners couldn't be too picky with my credentials (or lack thereof). My only compensation was 33.3% of the success fees, the rest went to the top of the house for providing "support". I did have the option for a "draw", basically an advance of up to $150,000 per year. Didn't really care for it because I was living at home. But it was BECAUSE I was living at home that I could afford to give this a career path a shot. I'm practically my own boss at this point.
About $750,000 of my net worth is "luck". Bought a good amount of various stocks during COVID. No crypto unfortunately. Also bought a house and an investment property, which are worth significantly more based on current market conditions.
I could've been worth more, but I paid off my parents' mortgage and give them about $5,000 per month. More on occasions like birthdays, holidays, and events. My other spending habits aren't wise either. I don't go out too much, but prior to COVID, I did belong to a car club that cost about $30,000 per year. And there was a period of time that I was obsessed with bespoke clothes. Still single and no kids, for those wondering.
Conclusion: Long story short, my new goal is $10 million by 40, married by 35, and kids soon thereafter. But I want to live a fulfilling life to get there, not a boring one. If I hit my goal, then great. If I'm broke and single at 40, it won't be the first time! Where your net worth stands at this very moment is irrelevant in the grand scheme of things.
How much did you make off success fees in your first year?
Had no "earned" income for the first 9 months or so. For the 12 months after that, I made about $425,000 (give or take 5%).
Also my income isn't considered "wages", so no tax withholding. Nice because I can invest the cash until tax time. Generally my tax rate is lower, and I have a slew of write-offs (healthcare, car depreciation, meals/entertainment, cell/internet, anything business/self-employment related).
But the lifestyle isn't for everyone. No production? No pay!
This is very interesting. How did you get involved with the boutique? Is this common? I've never heard of this before (also non-target state school alum). Congrats on your current net worth and I truly wish you the best/hope you attain your next goal. WAGMI
Its basically a sales job. Like I said above, not for everyone. But it does get easier over time, once you have some momentum going.
Found the firm I work for by doing a Google search. Did some research on Linkedin and cold called one of the partners. He said he was willing to meet and wanted to some "young blood" on the team. Once we met, we hit it off quickly. Almost didn't take the job due to a no salary. But I also liked the idea of making more for the work I do, not being micromanaged, and mentorship from two guys who worked on Wall Street in the 80's and early 90s. They treat me fairly and with respect, and in return, I make all of us a lot of money. They've also given me full access to their rolodexes, so I can reach out "warmly" to potential buyers and sellers, huge reason why PE MDs will take my call or respond to my e-mails.
Working on lean team with the decision-makers can be pretty neat. A couple years ago, we were thinking about launching our own PE fund. But it didn't make sense and was too risky because couldn't remain an "advisor" to clients. Optics would seem like a conflict of interest. And no track record and a cut-throat fundraising environment? Forget about it!
Personally, I think valuations have become too expensive. But as an advisor, that's good news for me and my firm. Not so much if we were looking to buy ourselves though.
also 28 - i think i'll crack a million this year or the next.
first 3 years of my career i was in corpdev at a late stage startup - made sub 100k, got some options which may or may not worth something some day (still hoping).
left to my current company (PE backed company -> public company) and comp has gone from low 100's to 300's over the last 3 years. god bless RSU's.
cash is 800-900k, 400k RSU's (at grant value).
the biggest difference is probably LCOL/MCOL plus lower tax rates though. i maxed 401k every year, investments were mostly various indices with a few tech picks.
It helps living at home and being single. Keeps the expenses down and can throw more into investments.
I'm near your age but have had significantly less that that in earnings but have a net-worth around $250k.
Was probably similar around your age. 32 now at prob $1.3-$1.5 if I counted it all up.
Would prob be double that if I didn't spend like an idiot but have had a fun life so far...
Wow, that high even with spending a lot? Were you in LCOL spot by chance?
I've got 15k in my early 20s hoping for ~70k by 30
Net worth > income
For people with mid six figures in their late 20s, how secure do you feel financially? I feel like I see pretty consistently on here about how lifestyle creep, golden handcuffs, etc keeps upping your standards without feeling free, but that amount at that age seems like that should compound very well over the next 20-25 years. Very privileged to be in a position where some dumb lucky trades have me graduating and entering IB with a high five figure net worth and even that feels very comfortable at my age so far knowing how long it has to grow (in proper safe investments) now.
$500k is peanuts in a HCOL city like SF or NY
If you figure by the time you want to retire you are going to need at least $5MM, I don't feel secure at all.
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