i keep hearing that people in finance make a lot of money, especially after spending some yeas in the industry, but is that really accurate? what sort of compensation could a person with 7-10 years of experience in finance expect?
I think it used to be the case but not so much anymore. Salaries fell massively in Banks after the financial crisis of 2008. Although compared to many fields out there, it still pays very well especially in Hedge Funds where Portfolio Managers get a percentage of their revenue and a good portfolio manager in a good hedge fund can exceed the million dollar.
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i second what @MAB said, finance compensation is not what it used to be before 2008. That being said, it’s still super high compared to other industries and very dependent on your desk especially at banks: type of asset class, coverage, type of job (sales, trading, quant, research, strcuturing), how many people you are managing if any, how much does your team make, title,… To give a few number in equities markets division, below some indic numbers of total comp in 2020:
- Executive directors: $500k - $1.5m
- Managing directors: $800k - $4m
the disparities in pay tend to be quite high as you see, but i don’t there are many industries out there where you can reach $1m without becoming a big exec
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we should’ve all went to tech instead for the stock options
For reference, I currently work in finance (which is really broad) at a top 5 bank in the US. The rotational program for finance does not pay that well - around $60-70k. It also may require you to move to that location so IMO, it may not be worth it. However, if you are interested, you should def take a look!
Average pay for interns are around $25-$30 (depending on department) for the summer for most banks. LMK if you need more info!
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thank you for your info! I heard analysts at bulge brackets banks in S&T, Research or IB start at $85k base, maybe that’s not accurate. Do you know have any idea how high the bonus can get for juniors in banking (analysts and associate)? is it capped or solely determined by HR?
@freebritney it really depends on the firm. boutiques pay hella well these days. I have a friend making 125k right out of graduation at an IB boutique in NY (guess not AS well because he pays a lot for rent too lol). it also depends on location and what their hiring surge is like. analyst bonuses are less than associates, obv but still pretty good. again, it depends on the place. from what I hear, boutiques have better bonuses than big banks (ex. Jpm, BofA, Citi, etc.)
I’m not 100% sure but HR does not usually determine bonuses… or salaries. it usually is based on the team and/or hiring managers. there is a budget somewhere. (info based on what my manager told me). all in all, IB is one of the only jobs out of college that you can still make a big buck but remember 80-100 hour workweeks are very very common so if you divide that up based on hourly, it is definitely not a lot at the cost of your health and mental sanity.
imo, sometimes money does not completely satisfy you. maybe for a while like when you sign the offer and when you are there for the first 3 months. after a while, my friend said he was drained. BUT salary is still great though (before hours, taxes, etc.) 
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To me it feels like a lot when I’m still in school but if you live in a city like nyc, with rent and city taxes and all that, you’re probably not left with as much as you’d think. At least you don’t have the time to spend your money since you’d be too busy working…
really appreciate the detailed response. I agree with you, money is definitely not everything, that’s why I have doubts about IB and leaning towards markets more, at least you work market hours. I dont know if IB bonus>S&T bonus, but at a certain point, your mental health and happiness would matter more. This goldman juniors deck was funny, but kinda scary at the same time: https://assets.bwbx.io/documents/users/iqjWHBFdfxIU/rim9z3X.NpYk/v0?fbclid=IwAR0ODL_MKntKLsziT2uEzhkC0pW6GuIUG_C-0PPz3pnA7iIqTPaMn0l8fnE
like some questions are pretty dark, and even if you only do IB for 2-3 years before you move into private equity, it would still take a toll on your life. Are consulting hours better?
from what I hear recently, consulting is no better. I have a friend at MBB who’s entire team literally quit during the pandemic. like they all left dec 2020 because the workload was too much. im talking like one team, 3-5 projects which is like 60-80 if not more hours. they currently are hiring a lot more so it could be because now, because of how bad it was at the height of covid-19 and the number of projects, many people left.
you never know. I guess no pain no gain? just gotta make sure the pain is manageable because I dont want to make a ton but spend it down the line at my therapist’s office.
FWIW, I still think S&T is a good compromise. You work your 10-12h/day, 5 days/wk, and you have your weekends to yourself. It might be a little more intense during market hours but at least after 4:30pm things wind down. I know people who start at 7am and leave at 5pm. There’s always tech if you want a more chill life.