Average Salary: $99,940
Expected Lifetime Earnings: $4,172,000
It's Wall Street money. That concept implies a few odd things.
This is one of those rare times where you really hope they're not talking about giving you literal pie. (Source)
For one thing, bonuses drive everything. That is, most people on Wall Street work for relatively small base salaries.
A director at an investment bank might make only $350,000 (though the average is around $100,000) a year as a base salary—hey, we said relative—but in a good year, that director might have sold five mergers and managed two IPOs. Collectively, those deals will have put a billion dollars of investment money into the bank's proprietary hedge funds. Shouldn't the director get a piece of that pie?
And note that the more senior you get, the more volatile the spread becomes between salary and bonus; a second year analyst might see a bonus of 100% or even 200% of his base; but it won't be 20,000%. Not yet, anyway.Think about these numbers on a per-hour basis—an average orthodontist works forty-five hours a week and makes maybe $200,000.
An average investment banker in a modest group at an average bank might make $500,000, but they live in Manhattan (usually) where costs of living are crazy high (ever had a $26 hamburger in Omaha?); taxes are huge (half your pay goes back to Uncle Sam); and they work around twice the amount of hours as the orthodontist.
Still, we somehow doubt people with six- or seven-digit portfolios are crying themselves to sleep at night. The pay may not be as great as it sounds at first, but it's still much, much better than your average American's.
