A Friendly Conversation with a Banker

Mike: Who are you?

Banker: I’m 28 and am a vice president at a large global bank where I’m currently earning about $250,000 a year. I grew up in the South, went to public school, then a private college. I got an internship on Wall Street, and then a full-time job. That was in 2005, and many rounds of layoffs later, I’m still there.

Mike: What did you study as an undergrad?

Banker: Originally, Asian Studies, but then I added on a business program as well.

Mike: What kind of careers were you considering when you were in college?

Banker: Not many! I always thought I would run my own business. I’m very opinionated, and didn’t think I would last long working for someone else. I didn’t know what kind of business—my dad was (is) an entrepreneur. I figured I would jump on the first good idea that I ran across, fail a couple of times, and then find something that worked. When the Wall Street opportunity came up, I thought it would be a good place to learn some business skills, so I jumped at it. I was right, but I overestimated my ability to quit when I came across a good idea.

Mike: What kind of upbringing did you have? I take it that since your father is an entrepreneur, it wasn’t one where you worried about money or bills?

Banker: Correct, although my dad did run a few businesses into the ground, and he had a nightmare divorce that sucked time and money away until I was 16. Money might have been tight once or twice, but it never felt like it when I was a kid.

Mike: Did your parents talk to you about money while you were growing up?

Banker: Oh, god yes.

Mike: Haha—in what ways?

Banker: I mean, I remember teaching my dad how to look up his stock quotes on Prodigy in the early days of the Internet.

Mike: How old were you then?

Banker: I must have been about seven. My dad would teach me about stocks, compound interest, and investing.

Mike: Wow. At seven years old?

Banker: It was the beginning of the Internet bubble, so that had something to do with it. I think if stocks hadn’t been going straight up at the time, I might not have had the same level of exposure. In any case, when I would work summer jobs I would save it and invest it—even if it was only a couple of hundred dollars.

Mike: What kind of summer jobs did you have?

Banker: Well, my first summer job was sewing buttons onto men’s shirts at my dad’s dry cleaning plant. I worked for $5 per hour or something. It was hot—summer in the Deep South surrounded by steam-powered machines. I also worked in restaurants, and later got unpaid (and then paid) internships at financial services firms. I was also a camp counselor, which was maybe the best job I ever had.

Mike: Sewing buttons and working in restaurants—it sounds like your family wanted you to experience good old fashioned manual labor.

Banker: Exactly. My parents always made sure that I knew not to take anything for granted, which is good, because that helped me avoid a lot of the problems that kids run into when they end up in high-paying jobs right out of college.

Mike: What kinds of problems?

Banker: I think most people get these banking or consulting jobs, and when you start out with a base salary of $60,000 or $70,000 right out of college, you probably have more disposable income than at any other point in your life. It’s a shock. All of a sudden your bank account is filling up (unless you moved into a really expensive studio/one-bedroom apartment). So I know many people, especially in 2006-2007, who were spending everything they made, and some were spending more than they made because they were betting on higher future income.

Mike: What are they spending money on? These are 22 and 23-year-olds we’re talking about?

Banker: Yeah, so, clothes, shoes, jewelry and electronics at first, and when you had the newest everything, then it was restaurants and clubs and trips to Vegas.

Mike: You managed to avoid all of that?

Banker: Of course not. =)

Mike: Haha, what does that mean?

Banker: I mean, it doesn’t matter how responsible your upbringing was, there’s still the peer pressure to live extravagantly when you’re surrounded by it. So I would eat out at nice restaurants, and occasionally I would go to a club, but I was never comfortable with the idea of spending $400 on a bottle of vodka. Mostly, I think what helped the most was that I made a decision at the very beginning that I would live on my base salary. So when there were big bonuses, that all went straight to savings.

A lot of that was reinforced during the financial crisis—there would be senior people complaining about how they couldn’t live on a $250,000 to $400,000 base salary, and I never wanted to be in that position.

Mike: Do you think it’s part of the banking culture to spend a lot of money? I imagine if it were me, I wouldn’t want to spend very much money, but I’d also imagine I’d lose out because of it—networking and such.

Banker: There is some of that, but the vast majority of professional connections (up to a certain level) can either be taken care of with $6 beers at the local bar near the office, or with an expense account. This might just be New York.

Mike: So the big spending you’d say is mostly due to having so much disposable income for the first time, and feeling like there so much more money coming your way, so why not?

Banker: Right, also (and I think that this is something that comes across on the site) a lot of people don’t grow up with strong personal finance skills, regardless of background. Did you see the article in The New York Times about vet school this week? I feel like the best evidence that there is a huge group of people who don’t have enough personal finance skills is all the people in graduate programs who are going to find themselves in financial ruin. The return on investment for so many of the programs is negative, and the worst part is that the debt follows you forever. It’s criminal that student loans are the ONLY mainstream type of debt that can’t be cleared by bankruptcy. That was a roundabout way of making the point that you can’t bet on what your income is going to be in 10 to 20 years.

Mike: Can you walk me through your career trajectory? It’d be great to get some insight into how it all works—I’m sure there’s a clear path that you see, and income levels you expect to hit at certain points.

Banker: I’m going to send you a chart.

Mike: Amazing.

Banker: So, I keep a spreadsheet with all of my income, taxes, investment returns, spending.

Mike: You mean, an Excel spreadsheet?

Banker: Yep. Use the tools you know, right? And I use Mint.com to track my spending—that website has changed my life. It’s so great (and they do not pay me to say that!).

Mike: Haha. I track everything in my head. But it works!

Banker: Impressive!

Mike: I also don’t have as much to track as you, so I bet it’s much more helpful.

Banker: The hardest part is keeping track of cash transactions. I lose track of all those and it makes me sad that that data is gone forever.

Mike: Why are the bonuses in years one and two so high?

Banker: Because I was awesome! Just kidding. The first two years were the last two “good years” on Wall Street. The third year is 2009. And in 2010-2011, Wall Street raised everyone’s base salaries to avoid bad “bonus” headlines, which was an incredibly dumb business move. The whole point of having bonuses be a large part of overall compensation is so that you can CUT compensation when times are tough. We learned from Keynesian economics that people get upset if you cut their salaries.

Mike: So, the banks raised salaries to save face?

Banker: Yes. It’s not the first time the industry acted dumb all at the same time.

Mike: What kind of banking do you do?

Banker: I work on the institutional side of an investment bank, in a client-facing role. I’m Dealbreaker’s target audience.

Mike: What’s the end goal for the typical banker?

Banker: Managing Director, or, Partner if you’re at Goldman Sachs. The typical path is: analyst (years 1-3) → associate (years 3-5) → vice president (years 5-7+) and then there are usually one or two more intermediate titles and then you’re finally a Managing Director. I think the youngest MD I’ve known is 31.

Mike: You’re getting there!

Banker: Hah. Yeah, that’s not good! Because if you don’t make MD by your late thirties, you’re usually not going to get it at all.

Mike: But usually that’s because you’re not good at what you do?

Banker: I mean, it’s difficult to make it to MD if you’re not good at what you do. But being good isn’t enough, by any stretch. These are huge bureaucratic institutions with opaque compensation and promotion practices, usually with power concentrated at one or two key individuals. So, in order to get promoted, the most important thing you have to do is not piss off the people above you. I think this is the case in most large organizations, not just banks, and not just for-profit organizations either. Any job with layers of bureaucracy is going to be mostly politics.

Mike: And if you don’t make it to managing director, you’re stuck in purgatory forever?

Banker: Not forever—just until the next round of layoffs.

Mike: Ah, of course. What’s a typical managing director salary?

Banker: $300,000 to 400,000.

Mike: And the bonus on top of that?

Banker: It varies a great deal.

Mike: Throw a range at me.

Banker: Anywhere from $100,000 to $10 million.

Mike: !!!

Banker: There are MD’s in technology and HR who won’t ever get a large bonus. Then there are the “rainmakers” in investment banking who will generate hundreds of millions in revenue for the firm with just a few large deals. They are the highest paid people at banks, outside of the senior executives. Some of the “best” (or luckiest) traders used to make that much, too, but that’s much less common these days.

Mike: So we’re talking about a lot of money here. This means early retirement?

Banker: Depends what kind of lifestyle you have to maintain.

Mike: So what’s that for you?

Banker: Lets take a look at Mint. The goal for me is to be able to be happy with a modest enough lifestyle that when it’s time for me to have kids, I won’t be a slave to the salary.

I spent about $85,000 last year, according to Mint, which doesn’t count charitable contributions.

• ~$31,000 is rent

• $15,000 food and dining

• $10,000 travel

• ~$8,000 bills/utilities

• ~$7,000 shopping (mostly gifts)

• ~$6,500 unallocated cash

Mike: And that cash could also be for anything like food or taxi rides?

Banker: Correct.

Mike: What did you put into savings and retirement last year?

Banker: Good question! I max out my 401(k) every year. Then another $65,000 on top of that—so around $82,000.

Mike: So, that was $17,000 last year in a 401(k). And then $65,000 in a savings account? Or invested in mutual funds?

Banker: Right, the $17,000 goes into a 401(k) with investment choices limited by my employer. That account has about $150,000 in it now. Then the $65,000 goes into a brokerage account. Which is mostly invested into a dozen individual stocks and mutual funds. That’s about another $350,000 total.

Mike: Is this an account you’ve had since you were a kid? Saving money and sewing buttons?

Banker: Ha. I mean, yes, but the vast majority is what I’ve saved since college. I think I had maybe $10,000 when I left college, or something like that. I’ve also invested in a small business started by some friends, which is my largest and riskiest investment.

Mike: Oh, investing in your friends is always a big risk. Putting relationships on the line!

Banker: That is true. But, for me, as long as our incentives are aligned and it’s not so much that if I lose it all, it will ruin my life, it’s ok.

Mike: Is there anything in particular you’re saving for? Do you want you buy an apartment in the city?

Banker: God no. I mean, I would if I thought it was a good investment. But housing in New York is crazy expensive, even for someone who makes a lot of money. I don’t feel secure enough in my income to be able to commit to a mortgage payment. I think a lot of people (even rich people) who lived through the housing bust feel that way. If I moved away from New York to someplace with fewer good rental options and cheaper overall housing, I would buy a place. Or if I found a place where I knew I wanted to be for the next 10 to 20 years (and could afford it even with much less income).

Mike: I’m sure that will also depend on what kind of family you’d like to have. Are you dating?

Banker: Right! I am dating someone. It’s serious. We live together with two cats. So, yes, buying a place would be a longer discussion, but my girlfriend and I have talked about my views on buying a house. And she agrees that it doesn’t make sense in New York. If we moved away, who knows.

Mike: Does your girlfriend earn as much as you do?

Banker: Nope. She earns a more “normal” living—way above the median U.S. income for a single white woman working full-time (which was about $40,000 in 2011), but normal by New York standards.

Mike: How do you navigate money in your household? Do you mostly pay for things?

Banker: I pay more—we split most of the expenses 60/40.

Mike: So when you say you spent $31,000 on rent, that was just your share?

Banker: Yes.

Mike: You must have a nice place!

Banker: Well, now I’m checking again, and that included a broker’s fee. On a straight up rent basis my share would be around $20,000 a year. But yes, we do have a nice place in a nice neighborhood, which is a great luxury. But I pay significantly less rent than most of my work peers.

Mike: What are your work hours like?

Banker: Twelve hours most days—I get in around 8:30 a.m. and am checking my Blackberry until I go to sleep.

Mike: Do you work weekends?

Banker: I usually end up working at least a couple of weekend days per month. The first three years in the job are the most brutal. That was 6:30 a.m. to 10-11 p.m. Monday through Thursday and working pretty much every weekend. I still end up pulling a couple of all-nighters every year.

Mike: What’s your social life like?

Banker: I think its pretty normal—drinks with work people some Thursday or Friday nights, and I go out with non-work friends on the weekends, and I have normal hobbies. It’s not like I’m sitting in a dark room counting my money like Scrooge McDuck.

Mike: You do consider yourself “rich” though, yes? Especially if you continue on and become a managing director.

Banker: Yes, I do consider myself rich, even if I don’t make it to managing director. Mostly that’s not about my income, but about the nest egg I’ve been able to save. So, some stats:

• Only 5% of white males age 25-29 earned more than $100,000 in 2011

• The median net worth of a head of household under 35 years old is $12,000

Mike: Well, I’m glad you have some perspective.

Banker: There was a great article I read: “Straight White Male: The Lowest Difficulty Setting There Is”

I was very lucky growing up—financially and emotionally stable parents. Being lucky can’t be the answer though. It’s not helpful. That’s why it’s sooooo important to have as even a playing field as is possible.

Mike: And how do you think we can even the playing field?

Banker: Good public schools help. If people believe the system is fair, and you give them the tools and opportunity to learn a skill, the rest will usually work itself out. But having a fair system is crucial. There’s a book called Animal Spirits by George Akerlof and Robert Shiller that provides a great overview of the financial crisis and how it created more unfairness in our economic system.

Mike: Does this mean you’re happy to pay your taxes?

Banker: Well, no. I don’t think anyone is happy to pay their taxes. But yes, I do believe in a progressive wealth redistribution system. I think consumption taxes would work better than income taxes, and I think we need an aggressive carbon tax. So: I’m not a Republican!

Mike: So, when you first got in touch with me, you told me you were going to inherit some money.

Banker: Right, so to me, inheriting money is the most unfair way to “win” the little game we call capitalism. The idea that money (and therefore power) can be freely given to someone undeserving is the opposite of fair. I mean, winning the lottery is so much more fair, because at least that’s random. And the best way to avoid an aristocratic layer of society is to have a high (close to 100%) inheritance tax. So you can imagine my dismay when my parents recently told me that I’m probably going to inherit some money. I’m grateful that they didn’t ever tell me when I was younger. Anyway, more rich people problems, right?

Mike: It seems like your parents did a good job of trying to let you see the value of hard work, and provide you with some perspective. Can you say how much you’ll be inheriting?

Banker: I don’t know!

Mike: But you think it’s quite a bit.

Banker: Not enough to retire on. But probably a couple of years of living expenses, if I ever need it. It’s amazing what kind of breathing room having a cushion like that can bring. Putting aside the issue of inheritance—just knowing that you’ll be ok for a year or two if you lose a job…now that I have that peace of mind, I can’t imagine living paycheck to paycheck. And I know that the vast majority of people who do get laid off every year don’t have that flexibility.

Mike: That’s one less thing to worry about, for sure.

Banker: When it comes to money, I have less to worry about than 99% of the people out there, but that doesn’t mean I don’t worry about the future. If I didn’t have anything to worry about, would I work 12 hour days? Probably not. Being so close to the financial markets when everything was going to hell, I don’t think I’ll ever feel truly “safe.”

Mike: The Queen of Versailles.

Banker: Right. Another reason to live more modestly than you need to!

Mike: Is there anything we haven’t talked about that you think we should cover?

Banker: Probably. I could spend another two and half hours talking about investing.

Mike: Haha. Let’s save that conversation for another time.

 

Previously: A Friendly Chat With a Rich Person (Household Income: $360,000)

Questions? Interested in talking to us about your money? Send an email.

 

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70 Comments / Post A Comment

honey cowl (#1,510)

Where do you find all these super-nice, tax-lovin’, super-rich people, Mike? I like to maintain this image in my head that super-rich people are horrible. (jk jk, this person sounds like a nice dude)

aeroaeroaero (#1,422)

@honey cowl I definitely appreciate this guy’s candor, but honestly he seemed a touch more arrogant and a bit less likable than the others. Although maybe it’s because he’s a banker? I don’t know, this read kind of American Psycho to me.

@aeroaeroaero Really? I thought he was great.

Though I did have two minor quibbles: many Republicans do support consumption as opposed to income taxes (because they are largely regressive) and the median income for a single person in New York city is barely higher than the national average, so earning significantly more than that is no more “normal” than in Peoria.

aeroaeroaero (#1,422)

@stuffisthings It’s possible that I’m just judgmental about bankers (sorry bankers!) and that the last one was from the wife’s perspective, and she seemed chill. But this guy with his whole “inheritance is unfair, haha, but I’ll be getting mine and it will be a lot!” shtick just sort of rubbed me the wrong way. Probably I’m just jealous!

NeenerNeener (#156)

@aeroaeroaero That’s funny, for some reason the wife one really rubbed me the wrong the way, and this one not as much (but I did have the same reaction as stuffisthings to the consumption tax bit).

honey cowl (#1,510)

@stuffisthings Dude. I was born in Peoria.

Winfield (#3,368)

@aeroaeroaero Did you sleep through American Psycho…or were you high? Either way, the only this guy has in common with Bateman is that they are bankers.

@honey cowl Well there you go. Someone making $80k a year is equally as ordinary in Peoria as in Manhattan. Statistically speaking.

aeroaeroaero (#1,422)

@Winfield Actually I read the book. It was his neat little punch list of expenses and overall judgement of people unlike him that made me think Bateman. “Oh yeah, $31,000 last year in rent. No big, really. Just my share, though. My poor (but not by middle America standards) gal pal makes up the rest. Here’s a spreadsheet of my exorbitant salary and bonus that I just had sitting around, in case anyone asked me about my career trajectory! Also, lol if you go to grad school — bad investment!”

honey cowl (#1,510)

@stuffisthings That would be cool but I am not making $80k! If only………..>!

Cavendish (#494)

Every fiber of my 33-year-old grad student in the humanities (fully funded, no loans, at least) making a $17k a year stipend self is crying right now. God, I wish my parents had encouraged me in a more traditional direction like this guy’s. I have had an interesting life, but some financial security would be lovely.

la_di_da (#1,425)

I love this series. For real. It’s really helpful in conceptualizing what wealth actually looks like. I think it would also be interesting to do a chat with a “poor person” and how they distribute things, but then I suppose that’s just the comment section. :)

Anyway, way to go rich person, you sound pretty down to earth about things. It’s nice to hear people talking about having a family one day and realizing that they’re going to have to make some major shifts in expectations.

I disagree about inheritances though. Inheritances in my family were never huge, but they definitely pushed the next generation forward. It was my father’s seed money for his company. My sister and I got through some of college on money from our grandmother. I think HUGE inheritances may provide some disincentive to work or to save for retirement, but I think you would be the same hard working person even if you knew you had money coming your way because that’s how you were raised–with independence and work ethic.

The other thing about inheritances is that you can never count on them. You never know when sickness or advanced age will knock out savings. Or at least that’s my paranoid take.

ThatJenn (#916)

@la_di_da Yeah, I don’t really get why anyone would consider an inheritance “breathing room.” I mean, I will almost certainly inherit some money (directly) when my grandfather dies. But (a) I’m hoping that that won’t be for a long time yet (statistically likely given family history and his age of 83), by which he will have hopefully used a lot of that money to live the life he wants or to pay whatever unfortunate bills may come along in that time, and (b) I hope that it doesn’t impact my savings habits at all, because I want to get to a point where I feel secure even if it never comes well before it arrives. Anyway, same goes for my parents – I mean, my mom at least will probably leave me some money, but I’m hoping that for me it is like it was for her when her mom died – my mom was in such a strong financial place by then, in her late 40s, that the money didn’t really impact her life. That’s what I want. Plus, you know, I want my family to live forever, too.

ellabella (#1,480)

What do 22 and 23 year olds living in Manhattan spend their disposable income on? To threadhack, this NYC lady making far less than $70,000 just bought the pattern and yarn to make this polka-dot cowl, and is THE MOST excited. $40 on yarn + $5 pattern plus $20 Addi Turbo needles means it will be a $65 scarf. But in cost of entertainment/hour will probably come out to around $3/hour (I’m a newish/slow knitter). Plus the final product. Definitely cheaper than the movies.

http://quinceandco.com/store/index.php?main_page=product_info&cPath=75_85&products_id=264

Sorry for the threadhack guys, I’m just super excited, and all the Billfolders should take up knitting as an affordable hobby. It looks like honey cowl is on board?

milena (#3,288)

@ellabella I like to sew as an affordable hobby. Spending $30 on materials and about 8 hours of work for a dress is cheap entertainment with nice end results to show for!

inspector_tiger (#2,651)

@ellabella me too! I love the planing aspect more than the actual sewing though, so I have a lot of unfinished “projects”… Well, but to stay on topic, I just “inherited” some great fabric which will be a new skirt in the next days to month. yay!

rorow (#1,665)

@ellabella I make a good income, but if it was into the six figures I can guarantee there would be more plays, more ballet, more fine dining and more travel in my life. I do eat out a lot and travel a fair bit because those are things I love, but I temper them with cheap(ish) hobbies like cooking, dance and Netflix.

Honestly, if I had more disposable income I would also shop more. I know I don’t need as many clothes as I want, but being able to buy a beautiful, impractical item from Marc Jacobs or Alice + Olivia without feeling really guilty would be nice.

Runawaytwin (#2,693)

@ellabella I live in NYC and I think i may be the only New yorker who cross stitches (I cant even find supplies here). By the hour it might be the cheapest hobby on the planet. I sew clothes too but i consider that less of a hobby and more of specific projects I take on (sometimes for pay)

Admittedly I spend money drinking and on fashion and have a closet full of european (yay sample sales) clothing. ANy other disposable income is furtively squirreled away for trips (or taken by my dentist)

With more income id prob shop more and eat out/ buy a lot more higher quality foods at grocery store (i would like to live on scallops)

honey cowl (#1,510)

@ellabella YEAH I AM ON BOARD!

However. Knitting is not a cheap hobby. If you want a cheap hobby, don’t be knittin’. Or keep buying Q&Co, never get into stuff like Brooklyn Tweed, Madelinetosh, Swan’s Island … aka my drugs of choice. Especially when I was in college, whoa man, I spent way larger a percentage than I should have on yarn.

sophia_h (#3,049)

@ellabella Yeah, ditto, I’ve mostly quit knitting now because $65 to me for a scarf + entertainment is still way too much, and I got sick of using acrylic blends from the big craft stores. Look at the patterns that use 12 balls of $15 yarn for size L sweater and tell me knitting is a “cheap” hobby.

ellabella (#1,480)

@sophia_h Did you find a good replacement cheap hobby? Genuinely curious! I feel like a lot of hobbies are actually quite expensive and it can be hard to find ones that truly have little-to-no cost.

Also I will absolutely not dispute that knitting may not be a cheap hobby for you, but I would say it can be for many (Although obviously not the cheapest. Maybe that’s cross stitching, that does sound cheap!). If I would pay $50 for a sweater anyway, then I’m shelling out an extra $130 to knit my own sweater (that will almost certainly be of better quality than what you can buy for $50). If it takes me 40 hours to knit that sweater, we’re looking at $3.25/hour of knitting entertainment.

squishycat (#3,000)

@sophia_h Oh yes. At a party to which I brought my then-current project las year (a baby blanket for some friends), someone made a comment to me about “skipping the consumerism” and “saving money”, and I pretty much laughed in their face for a good five minutes. That particular project did not cost very much, because I managed to hit upon an online sale and buy a full bag at 70% off the usual per-ball price, but in general, once you get to anything bigger than gloves or a hat you are looking at spending a good chunk of money if you want yarn that’s at all nice to work with. The upside is that you do get entertainment out of it, and have complete control over the color, fiber and details, and if you’re good enough, you can fit it to you or the recipient exactly. (On the other, other hand, most people who get into fiber arts and crafts end up spending a lot of money on yarn/fiber that they don’t have a plan for at purchase, and it then sits in their stash to be lovingly looked at and stroked but goes months without being *used*. If you’re me, you buy hanks and hanks of lace yarn every time it goes on sale, and then remember that most of the people you have to knit for are dudes who really don’t want lacy stoles or delicate, airy scarves.)

sophia_h (#3,049)

@ellabella For a while I switched to very small gauge projects — socks take me forever, for example, and I had a brief period of crocheting doilies on teeny hooks with very inexpensive crochet thread before I pretty much hit the limit of how many doilies a modern woman can own (turned out to be 3). Then I crocheted a few blankets out of high quality acrylic (cost was still around $65 but took much longer) before again hitting the limit of how many blankets I could own or give away, and now I’m doing crewel work embroidery which, since I’m not great at it, takes forever and is pretty inexpensive (the sampler kit I have cost $25). The general approach has been “what will take me the longest to make?” which has actually been kind of not-fun, since I just love that moment when you’ve finished something soft and pretty and now it’s yours, and I have to instead deny myself that as long as possible to get my “money’s worth” out of a project.

I know everyone has a different budget, so I didn’t mean to say that knitting couldn’t be an economical hobby for anyone. I just used to be a lot more active on knitting blogs, Ravelry, etc, before realizing other people (particularly pattern designers) just had a lot more disposable income than I did (~$0) and making the beautiful things I saw usually involved nicer yarn than I could really afford, especially as a larger woman who at least needs the L size of anything.

ellabella (#1,480)

@sophia_h Thank you for the impetus to google image crewel work! That is beautiful and basically made my day. As a huge William Morris and Liberty Print fan, this just took things to the next level of awesome.

And another topic for another time, but the rise of Pinterest and lifestyle blogs that make it look like you can create this beautifully handcrafted DIY world on a budget when it’s actually super-expensive to buy nice or even decent craft supplies is super-interesting to me.

sophia_h (#3,049)

@ellabella I’ve just been doing this alphabet sampler so far, but I love that I’m still working with yarn. And yesss, the DIY mindset can sometimes be a cost-saving one, but sometimes is like “we bought this solid walnut and then our carpenter friend built us…” or “I used fabric I hand screen-printed in my printing studio and trimmed with vintage ribbons I found on Etsy and stuffed it with pure wool batting…”

themegnapkin (#444)

@sophia_h for affordable knitting supplies have you tried knitpicks.com? I’ve been knitting for years, and I find their quality to be wonderful. Their Stroll yarn (superwash merino blend) is a staple, and they have a cashmere blend that is lovely. I’m a big fan – I can usually get enough fingering weight for a sweater for ~$30.

honey cowl (#1,510)

@ellabella You sound new to knitting, so I’m guessing a sweater will take you more like 100 hours, so it’s even more affordable.

And, trust me, the nice yarn is totally worth it. BrooklynTweed til I die.

oiseau (#1,830)

I recently watched the documentary Inside Job which was great. In reading this interview, I cannot get past the thought that investment bankers are essentially paying themselves with funny money. This banker is a friendly and harmless-sounding guy, but the system he works for is extremely flawed, fraudulent, and corrupt.

I realized recently that I’ve always thought of careers as being of two types: The kind that pays really well but is boring and/or stressful, or the kind that’s interesting/rewarding but doesn’t pay as well. Then I had a light bulb moment that maybe some people genuinely think banking is the most interesting career available, and they’re just lucky that their interests line up with what’s highly compensated.

So friendly banker (or anyone else in a similar position who feels like sharing): Do you find your work interesting and hours manageable? Or is it boring and exhausting, but worth it for the money? Or somewhere in between- interesting enough that you don’t mind, but you wouldn’t be doing it for lower pay?

navigateher (#555)

@TheclaAndTheSeals I’d say these types of jobs can be both. For me and my husband for example finance is a passion. We’ve both known forever it’s what we want to do because to us, it’s fascinating, and because most of our friends have these types of jobs, I’d say it’s true for most of them too. We’re both number oriented and the least creative and exciting people you can possibly imagine. I have no interest in any “creative” type of jobs or anything that would be traditionally seen as “exciting” (whatever they may be). Money is definitely part of the excitement of banking jobs though. As for the hours, I couldn’t say because it depends on the person and you can end up working insane hours in other jobs too. I also know many very passionate corporate lawyers who would no doubt be doing what they do for lower pay, because some people really love that shit, and I know a couple of doctors and one dentist that only do what they do because it pays well. I don’t know if this answers your question in any way though?

@navigateher No, what you said is interesting. The Billfold is my outlet for asking questions that are too rude to ask people I actually know. Thanks for sharing your perspective.

cjm (#3,397)

@TheclaAndTheSeals I am a lawyer for insurance companies. Not “Big Law” so I don’t make $160k in Manhattan in my first year, but I do make $75k in a smaller city and could in my career get up to the 250k range.

I really like it. The hours aren’t crazy, but are more than my teacher, secretary, non-profit friends. And, you need to be available even when you aren’t at work. It is interesting and challenging and mentally rewarding. I think people shouldn’t become lawyers or bankers unless they do actually enjoy it. I think that’s why people in high-tax countries are happier. If you can make a livable amount by teaching, or non-profiting, and maybe only 2x as much banking or lawyering or doctoring, you end up with fewer unhappy bankers and more happy teachers (or whatever).

But I do feel lucky to like and be good at something that is overly compensated. (Though less lucky than this rich person since lawyering requires and additional 3 years of education i.e. loans).

@cjm I’m always curious: why does a lawyer for an insurance company need to be available off-hours? Are there emergency midnight court sessions? Or is it just that work takes so long it can’t be totally finished during the day…

No but I’m super curious. Like I finished work and was out drinking, which is why I’m commenting so much, but what does a finance person do at, say, 9pm at night? Are you guys just really slow at making spreadsheets or are deals happening whilst the financial markets (and all banks) are closed? Or what?

navigateher (#555)

@stuffisthings In here at least, time difference is a factor. For example here in Finland you only need to deal with Sweden to have to stay 2-3 hours extra, easy. Also, clients are everywhere and because they’re the ones with money they apparently don’t have to care what time it is in here? Another thing is that deals often happen on a _very_ short notice and because of the bazillion rules and regulations a simple limit increase can demand a lot of work from a lot of people on different levels.

I’m currently not in banking though but my husband is, and from what I gather, the most popular reason for 30-40 year old male bankers to stay late is to avoid going home until the kids are asleep and the wife is two glasses deep in a wine bottle.

cjm (#3,397)

@stuffisthings For me at least it is a trickle down effect. Nothing is actually that urgent. No midnight court sessions. For example, we notify an agent of something that needs to be done in 2 weeks. They don’t respond or reply until 13 days later and read their e-mail at 4:55 and replies to partner at 5:30. Partner reads their e-mail at 6:00 and then forwards to me at 6:15. Thing needs to be done and resolved by 10AM. And, though it could easily be accomplished between 8 am and 10AM, the partner wants verification that I know about it and am on top of it before they go on with their life. Sometimes we call this a “fire drill”- Everyone freak out and rush rush rush about something non-urgent.

Even if it is not that urgent, if the partner e-mails you with a question at 8pm, they want an answer. You are here for their convenience. That’s why they pay your phone bill. Some partners/ bosses are more reasonable than others of course.

Clients also need to get quick responses so they keep using us- they don’t want to wait, and they really love it when they send an e-mail at 7 and get an answer at 7:15. It makes them feel like they are your most important case. Even if it is a totally dumb non-important issue. It’s just like your doctor or plumber- you like it when they can help you after hours and on short notice. And so, they pick you again and give you more money.

Thanks for the responses all! (And those below.)

I’m happy with my 9-5 thankyouverymuch.

cmcm (#267)

It’s just… kind of unfair. When I am king of the world, nurses and teachers and social workers will be the highest paid of all professions.

G@twitter (#3,402)

@cmcm But then all the nursing and teaching jobs would be filled by greedy assholes!

megsy (#1,565)

This is why I can’t find a job that satisfies me. I love finance but I’m also fairly creative and get bored easily. I tried accounting (good money but huge snoozefest), worked for a pseudo-government organization (decent money, also huge snoozefest) and then joined the military (crappy money, had potential but I got sick).

Now I’m in a snoozefest of a college program that thank god someone else is paying for because otherwise I would have quit by now.

I’ve been in a quarterlife crisis for 6 years!

TARDIStime (#1,633)

@megsy learn finance and become a financial advisor/manage investment protfolios!

Deal with new people every day: check!
Decent money: check!
Use creativity to recommend tailored financial solutions for different people in individual circumstances: check!

Your background in accounting is a pretty good start and you use creativity all the time when giving financial advice. What are you studying right now?

megsy (#1,565)

@TARDIStime geographic information systems. I needed a program that was military ish so they would pay for it even while I’m being released. I don’t owe them anything and I liked the first semester but I’m getting pretty bored of it now!

DON (#706)

Can anyone confirm “12 hour days” means – he drinks, eats, and schmoozes away from his wife for 12 hours a day? I think that is what people who work “12 hour days” mean when they say that. Otherwise, if anyone works actual 12 hour days, please explain to me how you can possibly stay productive for that amount of time. Thanks!

DON (#706)

@DON I mean, if I have a couch in my office, do naps count as working???

DON (#706)

@DON P.S. This should not discount the usefulness of Banker’s chart. A+ for that chart.

goldenhandcuffs (#2,286)

@DON I am a lawyer, and regularly work 12 hour days. I go to the gym in the morning, am at my desk by 9, and work till 9pm or later. 3 meals a day at my desk. I’m not complaining, because I don’t usually work weekends and have never pulled an all nighter (I also do enjoy my work) but 12 – 14 hour days are not uncommon.

TARDIStime (#1,633)

@DON
“Can you walk me through your career trajectory?”
“I’m going to send you a chart.”
I gigglesnorted!

honey cowl (#1,510)

@DON Yeahhhh I feel like I struggle to remain functional in hours 6.5-9 of my normal workday. See: it’s 4:25, look where I’m internetting.

MissMushkila (#1,044)

@honey cowl I usually work one or two 12-hour days a week (I’m currently teaching 5 different high school subject areas, only one of which is my area of expertise). Luckily, because I teach so many different subject areas, when my brain gets sick of Spanish I start working on grading/prepping Health or US History…

I could not do it every day.

My boyfriend DOES work 12 hour days on the regular. He is a grad student in med chem. He does take 30-40 minute meals though, and sometimes goes for extended coffee breaks with other grad students.

I feel like between the two of us this is entirely unsustainable. And then I get skerred that I am just lazy. So I’m glad other people are like “12 hours how the hell…?”

To be fair, in time use studies where they make people journal their time hour for hour (vs. recollections) very few people regularly work actual “12 hour days,” let alone the “80 hour weeks” commonly represented as what financiers do.

cmcm (#267)

@honey cowl I don’t even try very hard at my job, but after 7 hours I am like OH MY GOD I AM EXHAUSTED (I should note I also always get 8 hours of sleep). I think there must be something wrong with me.

themegnapkin (#444)

@DON I am coming off of a series of 65-85 hour weeks (I bill my time, so I keep pretty careful track. Also, attorneys typically have to work about 10 hours for every 8 hours billed, because not everything is billable – you don’t bill for conversations with your co-workers. So, 65 hours billed = about 75-80 hours in the office). It is exhausting, and only sustainable in the short term.

themegnapkin (#444)

@DON I would also add, a standard workday for me is about 11 hours. It’s easier to do when most of the people around you are doing the same thing. My 9-5 is typically spent in dealing with people – answering phone calls, writing emails, etc. From 5 until whenever I go home, when I’m less likely to be interrupted, I get my “real” work done – writing briefs, or doing anything else that requires concentration. On the rare occasion when I am able to leave work at 5 or 6, I feel like I’ve only worked a half day.

ellabella (#1,480)

@themegnapkin When do you read the awl network? :)

@DON I sometimes work a job that is 12 hour shifts and 7 day weeks, and my boyfriend often works 12 hour retail shifts. That includes lunch and coffee breaks (for me, my boyfriend doesn’t really get breaks), but not eating dinner or breakfast. If it’s not thinking-type work it’s not too hard to do 12 hour days, but you definitely don’t do much outside of work. It’s pretty much just eat-work-sleep-eat-work-sleep.

themegnapkin (#444)

@ellabella After 6 weeks of this schedule, I’m pooped! Seriously, it takes a huge toll. I’m exhausted, I’m getting sick, and my efficiency is at about 50%. So, that’s how I get to comment now!

DON (#706)

@themegnapkin I think your 50% efficiency statement sums it up. I’d rather be 100% productive for 6 hours everyday than 50% for 12. But I guess it comes down to culture and perceived work ethic… Law culture apparently blows.

themegnapkin (#444)

@DON That’s fair. But to be clear, I’m at 50% now because I’ve been working exceptionally hard (for me, anyway – a few 18-hour days, several all-nighters, and most weekends) for about 6 weeks. Eleven-hour workdays come at a cost, but it’s not as bad as 50% efficiency.
But the rate of return does drop radically for hours worked in excess of 40/week: http://www.salon.com/2012/03/14/bring_back_the_40_hour_work_week/

smartastic (#3,056)

@DON I am a graphic designer who makes a fraction of what this dude makes and I not infrequently work 12 hour days. I wish it involved more drinking and less actual work but it does not.

This is totally great. Two fascinating things:

1. I’m surprised at his take on NYC real estate. It’s not unreasonable to think of it as inflated, but I am pretty sure there is plenty of room for increasing value.

2. He’s young. It’s really easy to imagine the career path to MD from VP. He sounds incredibly level-headed and easy going and team-oriented, so that’s totally a possibility for him. But the vast majority of great, smart people don’t make it along that path. I would love love love for you to revisit this interview with him every year, as he changes.

themegnapkin (#444)

@TheclaAndTheSeals I’m in BigLaw, and I find it largely satisfying. After nearly 8 years, I’m in a position where I’m working with some of the smartest and most dynamic people I’ve ever met. I’m a litigator, which means I usually consider myself to be a writer – I get to spend long stretches of time working through problems and figuring out how to present them to the court. It is not creative in terms of, I don’t get to choose *what* to write about – my cases are largely in my narrow specialty, and I can’t just decide to write about something not relevant to that specialty. But I think that is a narrow definition of creativity – I *do* get to pick what facts to emphasize and what arguments it makes sense to present in order to best represent my clients, and I get to write them persuasively and in a way so that the judge doesn’t get bored. I have produced some writing that I am very proud of.
The downsides are, I still have to perform menial and repetitive tasks, I’ve developed an anal attention to detail, I sometimes have to write about uninteresting things, and I work long hours.

sisu (#3,401)

This guy sounds nice, but: investment banking? Really?
http://techcrunch.com/2011/03/26/friends-don%E2%80%99t-let-friends-get-into-finance/
There are so many industries that are dying to have smart, driven people, and it makes me sad to see these people go into investment banking. Has the cultural moment of railing against the “great vampire squid wrapped around the face of humanity” passed? There are ways to work in finance that aren’t destructive — what if this guy turned his (apparently considerable) skills to microfinance, or working at the IMF, or becoming CFO of a startup that’s going to change the world?

I know some people will argue that investment banking has its use – I did my undergrad in econ, I know the BS arguments — but in the current under-regulated system, I see it as mostly a destructive force in the global economy, equivalent to working for, say, Monsanto or big oil.

Obviously most people don’t have the luxury of holding out for a job that’ll “change the world”. But you, friendly banker: a guy with plenty of savings, a good head on his shoulders, a (presumably) very rich social network, and a good track record at a top investment bank: you have the world at your feet. Are you really just going to trample on it?

oiseau (#1,830)

@sisu Thank you! I was finding it bizarre that no one brought this up earlier except for me.

I have no aversion to this guy on a personal level but investment banking is a corrupted and dishonest industry on a massive scale!

rabbitrabbit (#3,404)

Agree with those directly above; I’m astounded at how benign all of the comments here are. Are we supposed to be impressed that this guy doesn’t come off as a total jerk? Very few people under 30 deserve this kind of money. Although personally, I’m not sure anyone “deserves” more than a fair wage. The fact that he seems pretty nice is sort of irrelevant to the larger issue at play – namely that it’s disgusting and immoral how much money he’s making, at a bank that was likely bailed out by U.S. taxpayers with low-interest loans. It doesn’t seem like this banker has spent much time interrogating the value of his work beyond the financial, though at least he can admit that the financial sector’s backwards incentives (i.e. raising salaries and cutting bonuses during austere times) are problematic. There are so many great articles out this week (some linked to by this site) evidencing that the financial industry profits at the expense of virtually every other industry/everyone else. In this environment, I don’t see how the writer can be blase about his big banking job, like it’s just somthing he stumbled into thanks to path dependency and can’t be blamed for.

aeroaeroaero (#1,422)

@rabbitrabbit YES

largess (#3,405)

Wow, this was so helpful, I really love this series.
Can you do one for someone in the entertainment business? I am a set decorator and for the past two years finally starting to see the light at the end of the tunnel having been basically born into debt. I see myself entering the middle class and its somewhat alarming. I wonder if there are others like me (female/33/white/married/$133k last year)

honey cowl (#1,510)

@largess Hate to break it to you, girlfriend, but I’m not entirely sure you’re “entering” the middle class if you made $133k last year, even if that includes your husband/wife’s income. I make nearly $100k less than you & data shows that I’m pretty middle-class.

inspector_tiger (#2,651)

I’d like to volunteer for dumb question of the day: Why do bankers get boni?

my theory is that banks give out boni related to their performance that year, but then they gave out boni in 2008/09 when they had to be bailed out with tax money, so that can’t be it…

In the Interview our friendly banker stated that it’s psychological, as a bonus is easy to cut because it’s not technically salary. But then in that “how to tell your wife your bonus is small”-post someone said they calculate their expected bonus into their salary, ’cause otherwise they wouldn’t earn enough for their work/hours.

I’m very confused about that, so please Billfolders – enlighten me!

megadith (#273)

@inspector_tiger here’s how my husband’s bonus works:
1. The board of directors at his bank set a target for how much his group should make this year.
2. They work like fiends, eventually reaching the target.
3. The board increases the target.
4. They work even harder.
5. In the first quarter of the next year they take 10% of whatever they made past the target and their managing director divvies it up however he feels like.

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