How do I train for investment banking? (2024)

How do I train for investment banking?

Investment bankers start by earning a bachelor's degree, usually in a field like business administration, finance or statistics. A bachelor's degree typically takes four years of full-time study. Students can also pursue an internship or gain work experience while completing the degree.

Most commonly, investment bankers obtain either a master's of finance or an MBA with a specialization in finance. An advanced degree can also make you more competitive when applying for jobs in investment banking and raise your earning potential. Costs vary by the type of program you attend.

Internships provide a path for students and recent graduates to land full-time employment in many professions, including investment banking. An internship gives you an opportunity to try out your desired field, gain exposure to the culture, get work experience, and impress potential employers.

Investment Banking Training Programs

New analysts hired into in the Investment Banking Division (IBD) of most investment banks are placed in an investment banking training program to give them the skills they need to succeed in the job. These programs typically start in the summer and last about 6 weeks.

Is it hard to get a job in investment banking? Yes! Investment banking is one of the most competitive industries to get a job in. While every situation is different, and clearly there can be outliers, there are a couple common paths into investment banking.

Becoming an investment banker requires several years of higher education in addition to licensure. It also requires strong mathematical and analytical capabilities, which may be challenging for some people. In addition to a bachelor's degree, investment bankers may need a master's in finance or an M.B.A.

The demand for coveted positions in investment banks consistently exceeds the available supply, making it a highly selective field. Statistics indicate that acceptance rates for top investment banks, such as JP Morgan and Goldman Sachs, typically range between a mere 3% to 5%.

But if you're 30, graduated from university at 22, and have 8 years of full-time experience, along with a mid-level position at a large company, it will be more difficult. It's still possible, but the success probability is much lower.

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.

What exactly do investment bankers do?

Investment bankers help their corporate clients secure funds in the capital markets, act as financial advisors, and occasionally help companies navigate mergers and acquisitions. Investment banker positions vary from entry-level to high-level executive.

The field of investment banking has many people who want to be highly successful, and your peers are likely to work just as hard as you. The job requires intelligence and analytical capabilities, and colleagues and clients may need to perform at a high level to maintain their competitiveness.

If you're considering a career transition to investment banking, there are specific skills and qualifications you'll need to succeed. A strong background in finance, accounting, or economics is essential, as is a solid understanding of financial markets and securities.

Yes, GPA matters! Bulge bracket banks and almost all other investment banks will look at your GPA when applying for a job and you should include it in your resume. Typically banks screen resumes based on GPA and will often remove anyone below 3.5.

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. 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.

Investment bankers work notoriously long hours, with the typical work week filling in 60-80 hours per week, and the occasional high-intensity work week that can push a banker to 100+ hours.

Investment banking is very well paid, but sign-on bonuses and a healthy pay packet come at a price. To survive as an investment banker, you need to have a high stress threshold. You also need to be willing to say goodbye to your social life for a few years.

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.

Ways to make a lot of money in this world

Sure, anybody can make a good living being a doctor or a lawyer or an investment banker where you can make ~$200-500K per year a few years after you finish with your studies, but you hit a ceiling very quickly unless you start your own practice (aka start your own business).

Can investment bankers make 500K?

I happen to know some 28+ year old investment bankers that would be very happy making $500k/year.

On average, a first-year investment banker makes a 5-digit salary, in the range of $70,000 – $90,000, while a 7-digit salary is considered above average and is difficult to achieve for most people in their careers.

Investment bankers make money through the fees charged to their clients. As discussed above, this includes underwriting fees for arranging the sale of securities and advisory fees for providing strategic guidance.

Age Range: It's nearly impossible to reach this level before your early 30's, so we'll say 35-50 for the range. Few MDs continue working until the official retirement age (65-70); it's a stressful, high-pressure job, and past a certain net worth, it's just not worth it.