Admit it or not, most are in IBD for the money. But honestly I feel like a joker working 9-2AM on the daily while my tech / trading / HFT friends are making 300k++ working 9-5PM casually.
Is IBD like the biggest clown in high finance?
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I think about this often, but it's less about what you are making today (though good and in the 3rd deviation by age group for each level), it's more about an investment in what the "big bucks" can be once you are a Director / MD. Life get's a lot more manageable, the job more enjoyable and you can make some real money if you are good, patient and a bit lucky. Well, that's at least how I rationalize it...
There have been a ton of fun adventures on the way and it would be a bit challenging to envision myself doing something else that isn't at a comparable level of intesity.
Though it's not entirely late game/early game scenario. By the time you're MD/D, HFT peeps are long gone enjoying their retirement already, and in their last few years they're probably racking up as much as you would at MD/D level. So back to my point, I think IBD is a clown in high finance, the real money is elsewhere.
If you are in a top HF or have had the benefit of a high vol / bull market, then yes. However, on a risk adjusted basis, the comp in IB tends to be higher.
And those clowns in HFT are probably jealous of the unicorn cofounders who achieved a 8-9 figure liquidity event. Shit, those cofounder clowns are probably jealous of Bezos and Musk. You can always compare vs. some other role and say how much greener the grass is, but how many can realistically land it? People in IB are smart, but most aren't smart enough to be quants at a HFT firm. A lot probably aren't cut out to make it as SWEs either, I know I certainly wasn't. IBD gives those who are reasonably smart and willing to put up with at times a shitty lifestyle the opportunity to make substantially more money than they could make in other career paths. When you've had enough of the shit, you're then well placed to exit into a job which pays a lot more than you can get going through the standard corporate route. That's why a lot of people do IB.
Well just go to tech / trading / HFT rather than complaining on WSO homie
I am complaining cuz I can't qualify there. Why else would I be a whiny bitch here?
Why complain about things you can't control?
that's why they get paid more
You're discounting yourself more than you should. As a pretty below-average programmer at a big tech company, I can tell you from experience that anyone can land a solid SWE position with a few months of studying + leetcoding. You obviously won't succeed if you're actually dumb, but if you're smart enough to get an engineering/consulting/finance/etc job, I'd be extremely surprised if you couldn't get an offer from at least one reputable tech company so long as you practiced leetcode.
The real question in tech is: can you rise up the ranks? And this is where the grass isn't always greener. I know so many coworkers who quit after a decade at a place like Google/Netflix because they had enough money for an okay retirement, but they couldn't get past L5/L6. The guys who stayed are just resting and vesting and not looking to advance their careers. And the people who do break through the ceiling and make it past are literally about one in a hundred. Imagine being a first year associate at some bank until you're 45 years old.
Like a ton of other people in this thread are saying, stop complaining and comparing yourself to others. Be thankful for what you have because it could be a lot worse. And if you really hate it that much, just get another job.
To exit to PE.
As if PE can outearn them (?)
Easily with big carry checks. As others have mentioned, focus on yourself. There are PE and even IB professionals who make more than anyone in the professions you listed will ever see.
lol, if you're smart enough to work in HFT then no idea why you've confined yourself to banking. probably because you, like most bankers (including myself), are not. I'm also sick and tired of Jason Tatum being paid tens of millions to play basketball all day while I am forced to do comps so my analysts can have their mandatory 5 day vacations.
Well I'm not, so I'm here to bitch
Fair - it's the eternal struggle of the 'pretty smart but have ambitions of being more than pretty successful'. That's why I never went to PE. You'd need to be in the top 20% of associates in PE to move up, unless it's Apollo in which case you'd just need to be alive at that point. I'm always top bucket in banking but if PE is made up of all top bucket bankers to begin with, I'm likely falling in that bottom 80% and ending up in corp dev lmao.
I suppose it’s just the demographic that exists on this website, but I’ll bite.
It often gets lost how ridiculous of situation you’re in to make such a high compensation package out of college. I come from a small town with parents who didn’t work in finance. They didn’t really know what investment banking was until I got a job in it. I went to a large state school that places maybe 5? 10? Students a year into investment banks. Of those 5 or 10 it’s almost all within the school run accelerated investment banking path/prep that you must apply to as a first semester sophomore and have a GPA of ~3.9. Unless you’re extremely lucky or have great foresight you’ll miss that opportunity.
I don’t have a stellar GPA, but it’s above a 3.5. I’m not in the Honors program, but I’m plenty smart to succeed. In highschool I wouldn’t have gotten in to an Ivy, UVA, UNC, Duke, UMich, maybe not Vandy, but nor did I want to go to one of those schools. Most of my friends with worse, similar, or better GPAs don’t know what investment banking is, nor do they care. They’re excited about getting their job in sales, corpfin, insurance, big 4 accounting, etc.
The position I am in to go to a very large population center and live in the wealthiest, youngest part, max out my 401k, IRA, put together a small emergency fund, and have enough to put a down payment on a house is so utterly ridiculous at 23 it’s hard to comprehend. It’s like I skipped about 10-15 years of financial adult life. I’m not rich, but I have insane upward potential in life financially speaking. I have an opportunity to take risks, and I am now gaining skills at a rapid pace while also building a network of people smarter than I who will probably do great things.
I think this gets lost on this website because the demographic is largely prestige-consumed individuals who went to prep schools, then to Ivys and other prestigious schools who had parents in finance. The alternative is so much worse it’s almost incomprehensible.
Thanks for the write-up. I am 100% aware of this. I know my position is already much much more ideal than most adults my age. Guess I am just salty for the amount of hard work I put in to be in this situation, right next door prop trading ppl are making much more a killing without having to actually sell their soul.
There’s more people in IB than prop trading. Take solace in that
Hard work is hard. I'm not saying to be satisfied as there is always more to gain in life. Take this with a grain of salt, but the real winners out there who lead the life you want are risk-takers who would take an opportunity like ours and propel themselves into something with potential for more exponential gains and intellecutal stimulus than successful traders.
is this site's demographic really prep school kids? I'd assume more non-targets because at the end of the day WSO is used for guides and getting information from other users. But I agree on the prestige-consumed individuals who especially want to prove to their parents, friends, etc that they have made it.
I’m inclined to think so. Every day I see a new thread comparing offers from a zillion of the “top” investment banks and people complaining about the job. I think it’s only this way, because many of these people come from ridiculously privileged backgrounds who have an insanely skewed view of opportunity and who have never worked a shitty job for limited pay before. Who knows though, just the way I see it.
I second this notion.
If you can last 2 years as an analyst in IB, and are halfway decent, you’re going to make close to half a million bucks in just 2 years.
Assuming you’re somewhat diligent and save a decent amount, this alone can build you a solid financial foundation for the rest of your life. Easily worth it.
Completely agree with this or even if you go out to Corpfin/corpdev you can probably clear 200k. Either way, by late 20's/early 30's you will have amassed (if saving is done right) to retire comfortably early and live the dream life.
Stop comparing yourself to your peers fam. Focus on paving your own path.
Thanks, I will eventually swallow the red pill and do just that.
Maybe im just the jerk some people accuse me of being because I come from a wealthy family so I have " had life easy". But is no one just grateful that they can make that type of money? I know nearly all my friends around my hometown who are just struggling to get by would take the job in a heartbeat but they are not qualified. Just seems pretty ungrateful to complain about the slightly higher comp in certain areas related to WLB balance and earning like 6 times the regular persons pay.
Also over most of our probably 35 years remaining before retirement its not all going to stay perfectly the same in regards to which one pays more and WLB and all.
I came from a privileged background too, not ultra super rich, but pretty dang comfortable. Honestly, another 100k/200k wont change lifestyle one bit, it's just having a greater dong to swing around and sense of achievement..
It'll work out in the end. You're putting up hellish hours now, but you'll see exponential career/comp growth soon enough — your friends in tech/HFT won't. If you keep comparing yourself to others, you'll always find something to be bitter about.
And for what it's worth, my college friends now at Google/Amazon are still working 45-60 hour weeks. Sure, they work a lot less than I do, but it's not as much of a cakewalk as people like to suggest. If I'm in the office past 6, I might as well get paid top-dollar and have solid exit opps by staying in this industry.
Hours at those big tech companies depend a lot on team and manager. But yeah, there's no free lunch anywhere.
Hey glimmer of hope, thanks mate
Not sure why people still discuss this. Does anyone really do IB to stay in banking? Maybe I'm privileged, but I thought everyone had the implicit understanding that you pay your dues for 2 years in IB so you can exit to PE (fingers crossed). I imagine if you'd know this if you were an incoming.
I really don't understand when people say this. My peers who have moved to PE are pulling same compensation! (albeit some with more forgiving hours). If you're talking about the carry at senior level yadayadayada then it's still longer down the road uh, and it's not going to be astronomical amount
You’re correct in that the transition from IB to PE doesn’t always result in an immediate increase in all-in comp, but most see a gain in earnings rather quickly. I’d also suggest doing your homework on the last part of your comment. If you’re looking to eventually break into PE, it’s critical that you have a thorough understanding of the industry in all aspects of the business, career trajectories included. You’re still young, so you have plenty of time to figure this out, but it’s very clear when candidates obsess over technicals and put minimal effort into learning about the informal components of the job.
Isn't PE comp now lower than IB?
on any risk-adjusted basis, banking significantly outperforms PE comp. Yes, successful partners in PE will make multiples of an BB IB banker but it's a tough road to get there. and PE might have slightly better hours on average for juniors but is mentally more challenging with less downtime doing menial stuff.
IB is essentially a job for people that want to make good money but would prefer to grind out high hours than take on seemingly riskier/uncertain paths. for some people this is worth it, for me it wasnt and i left
Just what I need to hear to sit my ass down after thinking that I have made it breaking in IB. The grind continues...
lmao are you just replying to yourself?
SWE and Market Makers make ton (esp. in prop trading firms like Jane Street, etc), but their attrition rate is very high due to it being very very competitive (for prop trading) / very boring and repetitive (for SWE).
In a risk adjusted sense, IB is one of the best careers to have because it literally guarantees one million dollars if you save correctly and put down few years on grinding work.
IB also gives options to PE and even more lucrative industry like HF, where the comp ceiling is your capability and frankly higher ceiling than SWE in the long run.
Either way, IB is literally the best platform to start if you want to do some kind of "business-y" things in the future. Opens so many doors.
Thank you for the insights mate. Though for prop trading the attrition rate not very relevant as even if they can last 2-3 years, they will out earn IBDs people spending 6 years anyway (+ longer hours), but yea we chose this as we want business-y things anyway. Bless you brother.
But people who get pushed out of HFT have a much more difficult time landing on their feet again than someone in IB because their skills are much more niche in nature, and it’s very easy to quantify why they were pushed out (PnL) so even lesser tier firms don’t want to touch them with a ten foot pole.
NPV of IB much higher than prop -you can get cut within 6 months if you don't kill it on a desk. As others have said, on a risk adjusted basis & taking a long term view, starting in IB can 100% allow you to create a decent amount of long term wealth - certainly more than quant/prop if play you cards right
What these prop kids can make in 1 year, even if they cut, already can beat what you will be making in 3 years with 3x the working hours. This is where I get abit salty. They can get axed in 1 year but they've already made a killing.
Thats not correct - if you get cut after a year bonus payout (ie significant part of their comp) isn't paid out the same (if at all) compared to if you have a stellar year. Some years you might take home a 0 bonus (base at these places maxes out at around $200K at junior levels) so your argument only works if you're the best of the best AND you kill it every year continuously - I'd argue much easier to be mid-top bucket AN vs top trader at Optiver/JS/2S year on year. Getting axed in BB is much less likely compared these places where you literally live and die by your pnl ie its much easier to identify who's not pulling their weight on a desk compared to an AN in a team. Furthermore, the point about NPV still stands IMO
IB is for suckers. The higher up the chain you are, the bigger sucker you are.
I guess so
1. You’re probably not in banking.
2. You don’t have same-aged friends in tech / trading / hft making 300k a year.
3. You don’t have friends to begin with.
Is that you
Hahaha yes bro come give me a kiss
at what HFT firm can you make 300k 9-5? Sure maybe less hours but i highly doubt it's only 8 hours per day only (especially if your friends are in their 20's).
5-7 years into the business valuation profession, you're a Senior Manager making $250K+ a year, working no more than 50 hours a week.
To be fair, $250k with 5-7 years of experience is miserable
Miserable?? bro the average 27-30 year old is not making anywhere close to over 250k what fucking planet do you live on.
The average work experience for most MBA programs is approximately 5 years. When candidates graduate from their MBA programs, 2 years later, the average starting salary, even at top programs, is less than $200K. So no, $250K/year isn't "miserable." There's still upside from there too.
You’re lost
Wait till the free money policies fade away and the tech companies start seeing a cash squeeze, IB will probably be the only high paying job available in abundance
totally agree that this is an underrated point - credit has never been cheaper than it has in the last 10 years which has helped inflate tech salaries to great amounts. what we're seeing is a big shift in that paradigm which may come out of left field for those 20-35 y/os that have never really had to deal with inflation and high rates (at least in professional life).
Exactly, makes no sense that companies that barely have EBITDA pay their employees $200-$300K.
coming back to this when you called it.
I see IB as my "training years" and also as platform to network with funds or succesful bankers/entrepreneurs/investors and learn from them. My ultimate goal is to have my own company in the future. In my opinion, there are tons of wonderful ideas that could lead to successful businesses, but most of them usually lack the proper execution or capital. On the opposite side, I've seen terrible ideas that have obtained millions in funding, just because the founders worked in IB (and some of them later went to PE/VC) and know PEs/VCs and people who would invest in them.
Hence, for me IB provides 1) a solid training in executing projects, in other words, in "getting things done", usually with high pressure and long hours. There's a huge difference between having ideas and taking action, and the latter is usually the crucial aspect behind the success of many companies. And 2) Exposure to people with capital.
Hey we have the exact same aspiration. Ofc coming to IB I also hope to achieve the two things you mentioned, but recently starting to have doubt if 1) ppt/excel is at all training your project execution skills 2) as junior I don't get to talk with those people as much. Keen to hear what your experience has been (?)
Nice to read that we share this entrepreneurial mindset.
I get your project execution point. For me it's about getting things done in which I had no prior knowledge at all. In the first transaction I was staffed on, I did not know a single thing about the company or the sector, yet I had to deliver some slides for my associate summarizing the industry. This forced me to investigate further, call some friends from uni who coincidentally worked in this company's sector, and reading some articles, so that my slides were not just a bunch of numbers and graphs, but rather made sense and delivered an idea. I could say the same for the Excel skills. The tight deadlines turned me into an "expert" in Excel (for IB at least) in no time, and I don't consider myself as somebody who was naturally good at Excel
In addition. I was lucky that my associate and VP allow me to work on other aspects of the deals rather than just PPT/Excel: calls with legal and economic advisors, coordinate and attend some meetings, and attend on-site visits. I believe this "full ownership" approach depends on the team and it's more common in boutiques (where I currently work) than in BBs (I interned at a BB and felt that the roles were way more structured). That being said, it can be way more stressful but It makes it up for me.
As for the exposure, as an Analyst my exposure is limited too, but as I mentioned, my team allows me to attend some meetings and you always have some IB events (these data rooms events, etc).Moreover, IB gives you an edge when recruiting for PEs/VCs, and this is where you make connections with the people with capital.
Honestly I think that if you are doing this only for the money and "the potential big payout once you make it to MD", the payout does not match the cost. For one, what are the chances that you really make it/stick around till becoming am MD? Two, one thing no money can buy is the youth and the energy that comes with it. Working 16h a day from your 20s and due to that not really going out, socializing, partying, traveling, dating, doing sports, etc. is completely fine, but just make sure that you are in peace with this. If it hits you that you "never lived a life" in your mid 30s or 40s, it will be an unpleasant experience...
If you are working in this role for the prestige, excitement and mental satisfaction that comes with it, I think these are much stronger reasons.
The big payout for me if is someday I'll be daring enough and successful enough to start my own business.
Right now, the pay for me is just to make sure that I don't lose out in dick measuring contests against peers of my age / my friends
Be grateful that you even do IBD considering that you don't need to have any talent nor IQ to do PPT and Excel. If you've had any talent you wouldn't be in finance and instead would be getting those 300.000+ by doing something more creative and unique.
But but but....
This point it what drives me crazy mentally. Like, most people in IB say “oh I’m too dumb to code,” but probably every one of those people could. Even then, as someone who can code, I’m just wondering if I should pivot to tech from IB post-SA. Don’t have a huge preference either way in terms of work content as far as I’ve gathered, and obv lifestyle difference is huge. This is certainly a subjective, individualistic conundrum, but what would your thoughts be there?
Because I'm wanting to take complex challenges greater than what I am able to take on now!
We all came here because it was ambitious. Working at a major or elite bank that has such powerful influence over the world economic system- or at least a big hand in it- seemed dope. Just be here for the deal experience.
Study it. Study the people around you. Know them.
Study the people above you. And where they leave to.
And if this doesn’t seem to be yhe most ambitious and prestigious gig out there- then become what is necessary to obtain what is.
But how can I have the confidence to live through my 30s knowing that my friends are earning 3x more than me at 1/3 the hours !?
There's a job that pays 2.5 mil for 20 hours/week? Send me the application portal ASAP
Only job I can think of that does this is tech.
Do you want to be in tech? Writing code? And not necessarily the environment or people of want to be around. Banking is cut throat. But you’ll be making much more than them if you stick to it - should they not make their own startup and become $xxx,xxx,xxx airs
Hi. I want to get into investment banking. Any advice on what to learn and know to better equip me into the work environment as well as nailing the interview by appearing to having a better understanding of the industry.
i entered investment banking because i wanted to work at the goldman sachs
lol, kid
If you're willing to sacrifice comp for WLB then go apply for big tech jobs and stop complaining. It makes no sense to me when privileged new grads bitch and moan about workload when they're about to join the top 0.01% of earners globally. You kids have no clue do you? If you were born just 2 thousand miles east, you'd be living on 50 bucks a month kicking rocks for fun. You regret banking? There are hundreds of thousands of other jobs readily available to you that might not pay as much, but still allow you to continue living a comfortable life. Seriously. Shut the hell up. I'm sick of seeing these out of touch, moronic posts.
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