Average Salary

On average, an investment banker’s salary ranges between $70,000 up to well over $200,000. This wide range of salary levels is highly dependent upon several factors, such as education level, geographic location, and earned commissions.

Education Level

It is a well-known fact that college graduates earn more money than non-graduates. Additionally, masters-degree holders earn more money than bachelor-degree holders. Within this industry, it is common to have an education requirement of a master’s degree to ensure that the candidates have the highest attainable education level, and are more competent about the banking world.

Location

All cities across the country have either a high or low cost of living. In a city with a high cost of living, the minimum wage and overall salary levels are higher due to the expensive living conditions. Consequently, cities with a more affordable cost of living earn a smaller salary.

Also, the size of the firm has a lot to do with salary. With a larger firm, there are more clients who are constantly trading, buying, and selling stock. Therefore, there are more opportunities for investment bankers to take on clients and handle a large number of assets.

Commissions and Bonuses

Salary is only a minimum of what an investment banker can earn. They earn most of their money through commissions and bonuses that are given to them when they have done exemplary work. Commissions are earned whenever they conduct business with a client, and when they have a lot of clients, their pool of commissions becomes large. These commissions and bonuses can range anywhere from $10,000 to upwards of $50,000, depending on the account and the investment firm.

Job Description

Investment bankers are in charge of negotiating trades, raising capital, and advising financial strategies for companies. This is all accomplished by selling and trading securities, either between companies or their own firm. They are employed by investment banks, and they work very hectic workweeks with atypical hours that change on a day-to-day basis.

Getting into the Industry

Breaking into the investment banking industry is not an easy task. It’s all about networking, meeting the right people, and oftentimes working your way from the bottom up.

Education

Having a bachelor’s degree is one of the most important things that you can do to help yourself in this business. Having a major in subjects such as finance, accounting, economics, or even math will help your education within this industry. Going to college isn’t just about education, it is also about networking and being able to meet the right people to get you into the investment banking industry. Most firms have long-standing relationships with major universities and will recruit straight from the university.

While a student, you should try to get an internship at an investment bank, which will open many doors for you and help you to create a networking list and build relationships within the banking world.

Also, while having a bachelor’s degree is excellent, a lot of employers are beginning to make having a master’s degree a requirement to be considered for the job. Having a master’s degree shows competence and an increased knowledge of the banking world.

Entry-Level Position

It is often difficult to enter right into an investment banker position, therefore getting a position as a financial analyst is a great way to build relationships within a company and gain experience within the industry. An analyst is an entry level position and advice individuals on matters dealing with money and investments.

While it is difficult to get a position as an investment banker, it is still quite possible to achieve if you have the right work ethic and build a network of relationships within the industry. Going to college is mandatory in this field, not just for education purposes, but also for networking opportunities.

Job Responsibilities

An investment banker is responsible for the exchange of securities between large companies. This means that when one company wants to invest in another company, they go to investment bankers so a negotiation can be discussed and created. Stocks, bonds, or other assets are all types of investments that can be exchanged and negotiated.

These bankers also raise capital for their own firm, as well as large companies and governments. This is accomplished by trading, buying and selling stock or bonds. They are also called upon to advice certain strategic moves that involve a lot of money, such as buying or selling the business.

Working Conditions

They are employed by investment firms, which are banks that cannot be accessed by the public. The firm is essentially the middle-man between clients, and it buys and sells the different types of securities. If a security cannot be sold due to under-subscription, then the bank holds onto it. If there is an instance of over-subscription, then the bank has an opportunity to earn a large profit by re-selling the security at an inflated rate.

These bankers spend most of their days in an office setting, but they sometimes must travel to meet with their clients, especially when they are called upon for advisory. Their hours are quite hectic and are not typically a 9-5. Oftentimes, they will have to work at the convenience of their clients, which varies from day-to-day. Their work hours can total up to 100 hours a week, depending on how much work needs to be done.