Where is the compensation in banking? Is it worth taking a pay cut for the long-term prospects?
I'm a little confused about compensation potential in IB. I always planned on going into the field given how much you learn and the exit ops, but as I research more into the pay I'm starting to wonder if it's worth it. As background, I'm an analyst for a long-only equity shop ($1-3B AUM) right out of college in a very low cost of living city (Midwest). I've determined pay for the average analyst here is around $150ish base and bonus of ~100-250k depending on the fund's performance. So, I figure in a low cost of living state I could make around 300k on average working roughly 50 hour weeks (at most). For reference, first year analyst right out of college I'm expecting about $100k cash comp all in (so clearly the progression is painfully slow here, but the starting number is decent).
I'm reading about what bankers working ~80 hours a week make, and I'm starting to wonder if I'm crazy to leave. My issue is that my current firm probably maxes out around $450k on the absolute best years, and I don't like my potential earnings capped around $400k.
My questions are these:
1) Is banking pay comparable to these figures (maybe not associate level, but longer term)? I've looked at the compensation reports, and it doesn't seem much better than these levels, and I know the cost of living is much higher pretty much anywhere outside of where I live.
2) Would it be a bad career choice to leave my current role to go get an MBA and try to get into Banking? I like the fact that the upside to banking seems much higher if you get into f500 management or maybe PE somewhere rather than knowing I'll get ~400k at the peak of my career in my current role. Yes, it's a nice living, but I don't want to limit myself. Although it'll probably be a pay cut when I enter, I'm thinking banking will improve my long term earnings potential... is that somewhat accurate?
I'd appreciate any thoughts. Also, I'm not going to solely make my decision on money, but I feel I should consider it before I leave a cushy job (if it, in fact, is). One more piece of background: I interned in Big4 audit, so I handled 80+ hour weeks for months at a time, so I'm not super concerned about the lifestyle change in banking. And also I saw partners at that firm make probably over $500k, so I kind of feel like I need to get at least that to make up for leaving.