Salary Range for Investment Bankers
If you are looking to become an investment banker, there are many benefits. You gain a lot of great first-hand finance experience and education and a sizable paycheck. Salaries in investment banking depend on education, experience, and position.
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Analysts
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Aspiring investment bankers with a bachelor's degree from a top-tier undergraduate business school typically start out as analysts. At large, full-service investment banks, a first-year analyst can expect to make between $60,000 dollars and $150,000 dollars per year. By their third year, analysts may make between $120,000 dollars and $300,000 dollars, with an annual bonus anywhere between 10 and 50 percent of their salaries. Bonuses can be either all in cash, all in the firm's stock, or a combination of cash and stock. The structure is largely the same at regional and boutique firms, however the pay may vary depending on the size and earnings of the firm.
Associates
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Analysts usually work for a few years at an investment bank and then are encouraged to earn an MBA. Returning analysts with MBAs--especially those with degrees from Ivy League and other top-tier universities--as well as new hires with MBAs, are usually hired as associates. First-year associates can make between $150,000 dollars and $250,000 dollars a year plus an annual bonus that can start at 10 percent of their salary. But based on the associate's experience and yearly results, the bonus could be as much as 100 percent to 300 percent of his salary. Third-year associates can expect to make as much as $250,000 dollars to $450,000 dollars a year, plus bonus.
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Vice Presidents
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Vice presidents are typically hired from the associate ranks (if they are not hired from a rival firm). Selected associates are typically those with three to six years of experience and considerable success in their area of investment banking. They may make as much as $350,000 to $1 million dollars a year plus bonus.
Directors/Principals
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Directors and principals, (usually former vice presidents) who typically have between five and ten years of investment banking experience, may make between $400,000 and $1.5 million dollars a year, plus bonus.
Managing Directors/Partners
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Managing directors and partners may make between half a million dollars and several million dollars a year including bonuses, depending on their success and the success of the firm. They usually have between seven and ten years of experience. Higher compensation typically comes from the larger, more prestigious banks.
Department Heads
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Department head pay can range from as much as $800 thousand dollars to several million dollars, including bonus, again depending on the size, profitability, and prestige of the investment bank. They usually have ten or more years of experience.
Chief Executive Officers
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Chief executive officers can make anywhere between several million dollars and upwards of $20 million dollars, including bonus, depending on the profitability of the firm.
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