How to Become an Investment Banker (2024)

FAQs

How to Become an Investment Banker? ›

Becoming an investment banker involves at least four years spent earning a bachelor's degree, plus additional time spent preparing for and earning FINRA licensure. Mid-level and advanced investment bankers typically earn master's degrees, which can take an additional two years to complete.

Becoming an investment banker involves at least four years spent earning a bachelor's degree, plus additional time spent preparing for and earning FINRA licensure. Mid-level and advanced investment bankers typically earn master's degrees, which can take an additional two years to complete.

Most investment banks prefer degrees in finance, accounting, business administration, and other business disciplines. Undergraduate degree subjects are less influential in the hiring process if a candidate has a master's degree in business administration, finance, or another highly relevant subject.

Investment banking is one of Wall Street's most coveted roles. It is also one of the hardest. It is no surprise that the average day in an investment banker's life is long and stressful. Those who manage to survive the adjustment period often go on to have long and financially rewarding careers.

A college degree in finance or economics is typically the starting point for entry-level jobs at an investment bank. Accounting and business are also common educational backgrounds.

Getting Started in Investment Banking

An MBA, an advanced degree in math, or a Chartered Financial Analyst (CFA) certification can improve the prospects of a candidate. Networking informally and formally is crucial. An internship at a top firm can help someone get onto the first rung on the ladder.

Are You Too Old? This is a vague question, so the only reasonable answer is: “It depends.” You will not win an IB Analyst or Associate role if you're a 40- or 50-year-old accountant, but if you want to make more money while doing something related to finance or deals, there are options.

Age Range: Associates come from more diverse backgrounds, so 25-35 is the safest bet for the age range. It would be virtually impossible to become an IB Associate much before 25 unless you graduated university at age 18 or 20.

Many investment bankers are Type A personalities, which means they are ambitious and driven. Young bankers are inducted into a stressful lifestyle from the get-go. They are encouraged to work long hours with very little free time to fit in socializing or relaxation. Many turn to caffeine and drugs to help them cope.

How many hours do investment bankers work? ›

On average, an investment banker works for 80 hours a week. But, yes, there may be some weeks where their working hours may go around to 100 hours a week. The working hours will also differ for different positions of employees.

Key Takeaways. A bachelor's degree and or a master's degree in a related field is often required to become an investment banker. Investment bankers often start their careers as analysts and do so by earning the CFA charter. Independent investment banks often pay higher bonuses to entry-level investment bankers.

No matter what major you pursue, investment banking will require strong math and analytical skills with a firm understanding of economics and how it affects corporate finance. Also, internships during your bachelor's program can help you build working experience and enhance networking in the financial field.

How Much Sleep Do You Get in Investment Banking? Investment Bankers who average 80-hour work days will likely get around 7 hours of sleep per night assuming that they go to bed at around 2 AM and wake up around 9 AM.

Hours: Without question one of the biggest drawbacks are the hours that Investment Bankers work. It is not unusual to be expected to work through the night when deal flow is high. Working weekends is also common when deals are close to being struck.

Typically banks screen resumes based on GPA and will often remove anyone below 3.5. However, there is room for an exception here, and exceptional experience may bypass GPA requirements if one can prove competency or high value to the bank.

Pros of being an investment banker

Working in the financial industry can be a potentially lucrative career choice, and the average national salary for investment bankers is $66,493 per year . Successful investment bankers can earn both high base salaries and significant commissions.

Can you become a millionaire as an investment banker? It is possible to become a millionaire as an investment banker, but it is not easy.

The average investment banker salary in Canada is $130,592 per year or $66.97 per hour. Entry-level positions start at $129,095 per year, while most experienced workers make up to $131,860 per year.

Do investment bankers travel a lot? ›

Client Management:

Since investment banks work for customers across the world, investment bankers need to travel a lot to service their customers and maintain relationships with their firm's largest accounts.

Among the country's largest lenders, National Bank of Canada had the biggest pay-per-worker increase.

The median yearly total compensation reported at RBC for the Investment Banker role is $77,426.

Western University (Ivey) and Queen's University (Smith) are the top two schools for investment banking in Canada.

Rajat Tiwari: The Youngest Indian Ingenious of Global Investment Banking. Like the changing weather of our globe, the investment climate of the global financial world keeps evolving.

The short version here is: Yes, investment banking hours, especially in your first year or two, are always bad (think: 70-80 hours in the office per week). But junior bankers also tend to exaggerate their hours, often by not subtracting downtime or breaks during the day.

The work includes three primary tasks: presentations, analysis, and administrative. After two years of working for the investment bank, top performing analysts are often offered the chance to stay for a third year, and the most successful analysts can be promoted after three years to investment banking associate.

How Many Hours Do Investment Bankers Actually Work? Investment banking is not a normal 9-to-5 job — investment bankers can work anywhere from 60 to over 100 hours per week, depending on the company and the deals at hand.

A Day in the Life of a Investment Banker. Investment bankers advise their clients on high level issues of financial organization. They manage the issuance of bonds, recommend and execute strategies for taking over and merging with other companies, and handle selling a company's stock to the public.

No matter how old you are, the best time to start investing was a while ago. But it's never too late to do something. Just make sure the decisions you make are the right ones for your age—your investment approach should age with you.

What is the dropout rate for investment bankers? ›

Working as a junior M&A banker in a big investment bank can make you very good money, but it may well be at the expense of both your health and your social life. A new study suggests that 44% of junior M&A and corporate finance bankers who join banks out of university leave the industry within three years.

Investment banker, investment broker and financial services professional are some of the highest-paying positions in the finance industry. These roles typically require a bachelor's degree in a related field, such as finance or business, and may require additional certifications or licensing.

The least stressful job in the finance sector is "Accounting." It requires you to build a routine that you can follow daily. It does not require much effort if you have the skill. An accountant is never on the counter and does not have to deal with clients face to face.

You need to put in at least 90 hours every week in Canadian investment banks.

At 60 hours, you can have one full free day off and generally only have to do some light work on the other day. You might not get to choose exactly when that time is, but in general, this is survivable. You'll see from the schedule that most people get into work around 10am in banking.

As long as investment banks remain gatekeepers to the market for companies (and capital markets), they will be able to extract high fees, and use those high fees to pay high salaries and bonuses.

The CPA certification is typically viewed as more difficult than the CFA because it covers a broader set of topics. The CPA exam broadly focuses on all aspects of accounting while the CFA exam solely focuses on finance. In the end, the difficulty of either exam depends largely on your knowledge and experience.

An MBA degree can help you transition from investment banking into highly desirable roles in private equity and hedge fund management. If you plan to work at one of the top investment banking firms, an MBA may be your only way in. Banks sometimes offer tuition assistance for employees who want to pursue an MBA.

Investment banking offers the opportunity to become an expert at building large, complex financial models at the earliest stage of your career. While bankers aren't necessarily great investors, they do spend a lot of time on valuation work, and this can be an excellent way to start your career.

Believe it or not, mastery of advanced math skills is not necessary to have a career in finance. With today's technology, all math-related tasks can be done by computers and calculators. That said, there are some basic math skills that would certainly make you a better candidate in the finance industry.

Do investment bankers need to know coding? ›

According to the Financial Times (pay wall), the banking giant is putting all its new investment bankers and managers through code school. They are expected to learn and become proficient in using coding language Python. The bank has so far trained around a third of its analysts and staff.

Investment banks regularly take on undergraduate and graduate interns and provide them with training and mentorship. Interns typically perform the same kinds of duties that analysts and associates perform, including gathering data, working with financial models, and interacting with clients.

Executives in investment banking can make upward of $300,000-$500,000 per year. Investment banking can also lead to other high-paying careers in finance, such as private equity and wealth management.

The investment banking lifestyle is fast paced and very demanding. On any given day, investment bankers are busy from dusk til dawn with meetings, projects, and presentations. They usually eat all three meals at work and don't go home until late at night.

You would surely earn enough, but it is hard to discover time to spend it. Life as an investment banker will be hectic, but investment banking is the right choice for those who wish to live through dedication, competition, risks, and perform well.

The answer is a resounding yes. Introverts typically prefer quiet solitude to noisy crowds. Financial advisors study financial trends, so they can make great investment recommendations to their clients. They spend as much time on research as they do on prospecting, and meeting with, clients.

To become an investment banker, you need a minimum of a bachelor's degree. Common majors are finance, business, economics, and accounting.

Grades below those levels don't necessarily mean that banks will reject you right away, but they do make it harder to win interviews through the normal process. But there are limits to that statement; for example, if you have below a 3.0 GPA in the U.S., then banks may reject you just based on that.

What is the most popular degree for investment banking? ›

Most investment banks prefer degrees in finance, accounting, business administration, and other business disciplines. Undergraduate degree subjects are less influential in the hiring process if a candidate has a master's degree in business administration, finance, or another highly relevant subject.

It is a high risk, high reward career that demands a high degree of commitment, and a herculean ability to juggle your work-life balance.

Investment banking is extremely competitive with way more applicants than available positions each year. You will often be up against students from Ivy League universities, with a high GPAs and multiple internships under their belts.

There's addition, subtraction, multiplication, and division… and occasionally built-in Excel functions like IRR, Mean, and Median. You never use calculus or differential equations or even geometry / trigonometry. Just arithmetic and sometimes algebra.

Many investment bankers are Type A personalities, which means they are ambitious and driven. Young bankers are inducted into a stressful lifestyle from the get-go. They are encouraged to work long hours with very little free time to fit in socializing or relaxation. Many turn to caffeine and drugs to help them cope.

What Are the Big 4 Investment Banks? The big four are JPMorgan, Goldman Sachs, Citigroup, and Morgan Stanley. Some other global giants are treading right on their heels, including Deutsche Bank, Barclays, Credit Suisse, and UBS.

What are Investment Banking Hours? On average, an investment banker works for 80 hours a week. But, yes, there may be some weeks where their working hours may go around to 100 hours a week. The working hours will also differ for different positions of employees.

Investment Banking Managing Director Salary + Bonus: Base salaries are in the mid-six-figure range, with total compensation in the high six figures to low seven figures. An MD doing decently should earn between $1 and $3 million per year, and sometimes a low multiple of that (as of 2022).

How much does it cost to study investment banking in Canada? ›

MBA applicants can choose Banking Investment among other specialisations. Graduates of this course can take up jobs as investment bankers, private equity professionals, consultants, etc. The tuition fee is around 42,000 CAD per year.

Investment Banking is a highly prestigious profession in the field of finance and whoever works in this sector is known to lead a luxurious life making it a hot career choice for many people. So yes, if you work hard and do your job right, there's no way you cannot become a millionaire.

The average salary in Toronto is $62,050, which is 14% higher than the Canadian average salary of $54,450. A person making $40,000 a year in Toronto makes 35.5% less than the average working person in Toronto and will take home about $32,284.

RBC PL07 Software Engineer Salary | $84K-$148K+ | Levels.

The average salary for Investment Banking Analyst is CA$92,932 per year in the Toronto, ON, Canada. The average additional cash compensation for a Investment Banking Analyst in the Toronto, ON, Canada is CA$59,750, with a range from CA$25,787 - CA$1,38,444.

It is possible to become a millionaire as an investment banker, but it is not easy. Investment bankers typically earn salaries in the $200,000 to $700,000 range, with bonuses that can bring their total income up to several million dollars per year.

You can do the degree course in finance, accounting, math, banking-related courses, etc. Let us make it clear that you can become an investment banker without getting the CFA Charter. However, with the CFA Charter, you will be able to explore and discover several new opportunities and also get a higher salary.

An MBA degree is not a requirement for entering the investment banking field; however, you may have an easier time securing a job with this advanced degree.

Unfortunately, most investment banking analysts get fired for disciplinary reasons with cause – most commonly, and this is actually pretty sad, cheating on their expenses.

Do investment bankers work a lot of hours? ›

How Many Hours Do Investment Bankers Actually Work? Investment banking is not a normal 9-to-5 job — investment bankers can work anywhere from 60 to over 100 hours per week, depending on the company and the deals at hand.

The CFA charter is one of the most respected designations in finance and is widely considered to be the gold standard in the field of investment analysis. To become a charter holder, candidates must pass three difficult exams, have a bachelors degree, and have at least four years of relevant professional experience.

It's also expensive: there's a one-time enrollment fee along with exam and registration fees, plus the cost of books and study programs, and the income you're likely to lose while pursuing the credential. All in, you will spend anywhere from $2,500 to $8,500 and roughly two to four to years complete the CFA program.

Western University (Ivey) and Queen's University (Smith) are the top two schools for investment banking in Canada.

Investment banking deals are done in small teams of 4-6 bankers who usually work with one analyst, one associate, one vice president, possibly a director, and the lead managing director on the deal.