Comments on: Investment Banking Salaries Vs. McDonald’s: Hourly Pay

By: Inquisitor

Inquisitor — Tue, 19 Aug 2008 05:33:44 +0000

Yes, you can definitely get much higher paying jobs (as in $500K+) afterwards. Nothing else really compares in terms of exit opportunities, actuarial work is not even close.

Just as a point of comparison, partners at PE firms often make from a few million to tens of millions per year… and the ones at the biggest firms can make hundreds of millions in cash.

Of course, very few people get that far and it takes 20+ years to reach that. Also, there are diminishing returns to money once you get to that level.

However, if you really do like math then banking is NOT for you, it’s a joke quantitatively.

By: Jay Gould

Jay Gould — Mon, 18 Aug 2008 04:55:31 +0000

My next BIG question… What are the exit opportunities? Do you learn anything valuable that will seal up a nice deal afterwards? The actuary gig sounds much better. Even at a consulting firm where you don’t work the average 40 hrs, 60 hours or more is absolutely unheard of. My math degree might be a lot more useful in that arena. I don’t want to jinx myself, but I’m pretty sure I have a dope internship waiting just about anywhere next summer. it appears you can make beaucoup dough. Furthermore, when I spoke to one of the senior level actuaries at a major consulting firm, he said he clocks in the 200k range and since he lives in Denver, real estate is new, nice, and CHEAP compared to NYC or San Fagsisco. He has definite job security (assuming liberals don’t try to push soc. health care), and since the company is not publicly traded, the profits are distributed in bonus. He will be a principal next year which means he will be of 30 people who take most of the bounty when bonuses hit. That’s when you cash in at those places. It seems like a nice path to a risk management gig too…. The truth is, I enjoy doing math and love prob and stat. At investment banking, it seems like theres not much of a quantitative side.

What do you think of that shpeel? As in actuaries.. What do you know about them?

By: Inquisitor

Inquisitor — Mon, 18 Aug 2008 00:52:10 +0000

No I am no longer in the industry.

You “need” no degrees to move up in finance except an MBA can be helpful for senior-track positions, depending on the firm in question (some make you get it, others do not).

Analyst-Associate - 3 years. Higher levels - VP takes 3-4 years, then VP to MD could take 4-5 years or more.

Uh it’s hard to answer your question specifically but if you start at 26, have no outside interests or anything else until you’re 35 you can probably save up $2-3 million.

Not going insane: Well, there’s a reason why I left…

By: Jay Gould

Jay Gould — Sun, 17 Aug 2008 07:42:15 +0000

Inquistor:
Are you still an investment banker?
Analyst? Associate?
If you get a gig as an Analyst, do you need to do an MBA or MFin or an MFE to steadily move up?
How long does it take to go from Analyst to Associate and up to even higher levels?
How good of a peion do you have to be? What if you’re a bit cocky due to a modest upbringing?
Is I-Banking the epitomy of corporate?…as in cubicle cultures, lame employee parties, lifers??
By the time I’m thirty-five, going in to the game at 26, ceteris parabis, how much cash could I have amassed by the time I’m 35?
How the helllllllllll do you not go insane with such a psycho schedule?

Thanks. Sorry for the ridiculously large set of questions, however, it’s my life and any advice from a bard like yourself is useful in the end….

By: Inquisitor

Inquisitor — Fri, 15 Aug 2008 07:52:41 +0000

Yeah things aren’t what they used to be. There are certainly some nerdier people in the field these days.

By: Jay Gould

Jay Gould — Fri, 15 Aug 2008 07:31:20 +0000

Oh no!!! What about models n’ bottles?? You mean you have to be moderately attractive and have game to get laid? Meaning… you can’t spend $300 on a $20 bottle of Absolut and have a coked out model chic give you a few cheap lap dances in VIP and tell you she’s on the rag minutes after last call? Haha. I see something terribly wrong with all of this. First, instead of a coked out model girl with STD’s, I’d go for a fine college girl whose dad is the editor of a major ski magazine. Next, I’d have her buy ME whatever I want. It seems that Investment Banking has become a bastion for D & D fans and avid X Box players. It’s a far cry from the pimped-out, glutinous 80’s.

By: Inquisitor

Inquisitor — Tue, 29 Apr 2008 05:54:26 +0000

True, the spread has really come down lately. Believe me I’ve thought about employment at McDonald’s if I get fired anytime soon…

By: Guest

Guest — Mon, 28 Apr 2008 23:24:09 +0000

After adjusting for a few errors: i.e. in 1994, McDonald’s pay was more like $4.50, in 2001 IB Analysts were starting at considerably less, but let’s peg it at $50,000, and in 2007 IB Analysts are being re-org’d so some only receive half their base and no bonus.

After making those adjustments, the takeaway is that the spread grew tremendously up until 2007, reversed sharply in late 2007 and early 2008 and hopefully temporarily, and will likely bounce back. For instance, in 1994, burger flipper was making around 50-60% of the IB Analyst pay using the high low estimates above, in 2001 that had dropped to somewhere in the 40% handle, and by 2007 it was just 25%!! So, if you had just saved all your money and skipped that silly 4-year degree followed by an MBA, you’d be ahead (at least at the end of your Analyst program, and especially if you just got re-org’d).

By: Inquisitor

Inquisitor — Tue, 08 Apr 2008 01:07:12 +0000

$34K and $5-10K bonus? OMG. Did anyone even do finance back then?

By: haha

haha — Mon, 07 Apr 2008 23:03:23 +0000

Back in 1994, FI analysts were paid $34k and $5-10k bonus for 95 hour weeks.
So, about $8/hr, or less than a McD employee who would get overtime.