Investment Banking Associate Salary
On the pecking order for investment banking positions at above analysts but below vice presidents and managing directors, associates can expect to earn a very nice income though your working hours are long. However while you can expect to work between 10% to 20% less hours than the analysts beneath you while earning in general a better income, when problems arise, deals stall, deadlines are due it is to you the VPs and MDs will come to. This article takes a look at a breakdown of what an associate salary is at each level and what factors can affect those numbers.
Associates are hired usually after getting an MBA and they have often worked previously as an analyst or have some experience elsewhere in the industry. It is a good idea to start planning your career while you are still an undergraduate if you want to head into investment banking as jobs are highly competitive in large part because of the generous salary they offer. An investment banking associate salary will have a base salary component and a bonus component. As you move up in the company to better positions the bonus component becomes a larger portion of your salary.
Associates working in key cities like of course New York can expect to have a higher wage than those who work elsewhere. Salaries can also be affected by the region you are in, the size of the firm you work for, the economic climate, and how well that firm is performing. Even if you are amazing at your job if the company as a whole is not doing well, your bonuses will be lower. To get the most you can and make those long hours worthwhile you need to perform brilliantly while the firm itself performs well too. Your job is basically to check analysts’ work, carry out the VP’s orders, talk to clients, attend pitches and meetings, do some excel work.
First and Second Year Associate Salary
The average wage for an associate in their first year is somewhere between $150,000 and $250,000. Having an MBA gives you a better understanding academically of capital markets and investment banking. You will work closely with analysts overseeing their work and managing them. Bonuses are usually 10 to 50% of your base salary. First year associates usually receive a signing on bonus of something between $10,000 to $30,000 as well as a stub bonus that is for three to six months working. Find out more about the average salary of investment bankers.
Third Year Associate Salary
At this top level of being an associate you can expect to earn something between $300,000 and $500,000 a year. You have a lot more experience with hands on knowledge, work well with the analysts rather than clashing with them, and have established good working relationships with your superiors also. When something goes wrong though it is often to you that the VP or possibly though rarely the MD will come. Bonuses can go as high as 300% of your base salary when in your third year as an associate. After three to four years as an associate you can decide whether to look to a promotion to being a Vice President or move elsewhere, though the latter is more difficult at this level. It is harder to get promoted to VP then it is to move from analyst to associate.