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How much money do investment bankers make excluding bonuses? In addition, if and/or when is it a good idea to hire an assistant? I know it reduces the amount of time you work, but does that mean you will have more work later or can they help you with some of your tasks?

I am looking into becoming an investment banker, but I’m still not sure what career I want to peruse. # careers #business #career #financial-planning #money #finance

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Bob’s Answer

According to several sources, an Analyst may expect to make $85K the first year, $90K the second year and $95-$100K the third year. More importantly, you may be eligible for an annual bonus that could be in the range of 75% to 100% of your base salary. In addition, in some firms you may receive a hiring bonus of $10K-$15K.
An Associate may have a base salary of $150K the first year, $180K the second year and $200K or more the third year. An Associate will likely be eligible for an annual bonus representing 100% or more of the base salary. For many firms, a large percentage of your bonus may be in stock options. .
At the same time, Katherine and Nic are correct in terms of the committment you will be expected to make. As a Director and then General Manager of a global investment unit, somewhat similar to investment banking, I traveled several hundred thousand miles/year and worked eighty hours + each week. I also worked on National holidays ( On a U.S. holiday, I would work in another country that day).The stress can be formidable.
And yes, if very successful over time as a self driven individual, you can anticipate becoming a multi-millionaire. Just be aware that the role you have chosen is extremely competitive and stressful. Your job is your life.

Bob recommends the following next steps:

Seek out information related to corporate venturing or corporate mergers and acquisitions. It can be financially lucrative but less stressful.

Bob, you are solid in your response sir! However, the journey to the top incomes and stock options is a path you want to make sure you want to take. Hiring an assistant just frees you up to do more! During my VC days, I always asked new potential hires why to do you want to get into the VC world. Most said the money, a few said this was their passion. Guess who the most successful? Del Leutbecher

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Katherine’s Answer

Hi Rukmini,

I suggest going on Glass Door to find out information about compensation. As a rough number, I would say 85K base as a first year. I also suggest checking out Wall Street Oasis, and Mergers and Inquisitions. All are very helpful websites with lots of information.

Something I would strongly caution against is if you're not fully confident you want to go into banking, don't do it. It's very time consuming and stressful, and very much a meritocratic environment, so the more time you spend in the office working, the better you will be viewed by management. There is a substantial hit you will take to work life balance. The websites I have suggested above will dive into some of these job characteristics. As a rough number, I would say anywhere from 60 hours / week on the low end to 90 hours / week on the high end are common for banking.

That all being said, if you figure out your passion is investment banking, then use the websites I've suggested as the base for starting research, and then start reaching out to contacts on LinkedIn. They can be alumni from your college or high school, friends/family. Anyone who can help you understand what the workflow and culture is like is valuable because it does differ across organizations.

Hope this helps!

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Nic’s Answer

Hi Rukmini,
I agree with Katherine. I would also add that there are many other paths in financial serivces for you to explore. Investment banking is intense in terms of the workload and commitment. If you like finance, you should also look into Corporate Finance, Commerical Banking and Asset Mangement, to name a few.

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Yumi’s Answer

With respect to hiring assistant, once you developed your career as investment bankers, the newly hired person can learn some of your responsibility (just like you did) and you can delegate what you were doing. You may be put in a position to supervise them and in that case, you will be reviewing their work.

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Richard’s Answer

My son is an investment banker, so I will answer from his experiences.

85K salary is standard across the street for first years, 95K second year, same third year as analysts, with a large step up if you get promoted to associate. Bonuses depend on the tier of the firm and range from low 25K to as much as 100% of salary at top tier firms by second year.