Work / life balance is one of the biggest concerns for college students when starting a career in finance. For a college educated person in the US, there are so many different paths a person can take in their careers. Whether it’s a traditional Fortune 500 big company corporate finance, investment banking, venture capital, or a startup, the career pathways are endless in today’s day and age.
Special Offer: Get 15% Off On Wall Street Prep Courses!
Optionality Creates Problems For Young Professionals
Over the years I have found that optionality is a big factor in what causes stress amongst those early in their careers. Not many young professionals can answer the age-old question “what do you want to do when you grow up?” Some may think they know what they want to do
Think back to when your parents started work. There were not many different options to pursue for your career. Most did not job hop or switch careers as often as Gen Z’ers and Millennials do today. They would stick to a role for multiple decades and often retire in the same company or field that they started in out of college.
Today, there are tons of different options for recent graduates, especially for those who are focused on building a career in finance. We are fortunate to live in a country that gives us so many different opportunities to be successful and make a lot of money. I remember when I started my career in investment banking I had so many different options to pursue and had to do an extra year as an analyst to figure out what exactly I wanted to do.
Chances are you will not pick the perfect job for you longer term straight out of college. It may take a few jobs and setbacks into your late 20s/30s before you figure out a path that best suites you.
You Will Fail At Some Point In Life
“You will fail at some point in your life. Accept it. You will lose. You will embarrass yourself. You will suck at something. There is no doubt about it.”
-Denzel Washington
Whether it is failing a class, getting fired/laid off or burning out, I guarantee there will be a point of time in your life when things just don’t go your way. When you get that investment banking, private equity or hedge fund offer, you think you’re on top of the world and life couldn’t get any better. But trust me, once you start working long hours, missing important events with friends/family, and have no control over your time, you will start to question whether it’s worth it or not.
There will be days, weeks and months when you question WTF you are doing with your life. If you are fortunate to not be laid off, you can make the decision to quit finance after just a few years working in investment banking or private equity and pivot to something else completely that has a better work life balance.
Other times, the decision is forced onto you due to factors out of your control. You get laid off out of nowhere or burn out. Investment banking layoffs in 2023 were brutal and many were let go through no fault of their own.
So just prepare and accept that at some point in your career you will fail and have a set up. Just don’t let that deter you from continuing to move forward.
Don’t Quit and Change Careers When Times Are Tough
I had a love / hate relationship with investment banking. When I first got the internship offer to join one of the well-known investment banks, I was the happiest I have ever been. In that moment I achieved the goal I had been working towards for years.
Of course, that feeling did not last forever. I got the full-time offer after the internship and once I started working in the real world my attitude towards the job constantly changed.
If you don’t know what investment banking is like, especially at one of the “sweat shop” investment banks that I worked for, then would read what it’s like working a day in the life as an investment banker.
To summarize, it was as simple as saying there were days I loved the jobs and days I absolutely hated it. And of course, the days I hated the job were days where I had to cancel plans, work on weekends and close to some sort of work deadline.
Not many know this, but a few months into my investment banking career right out of college I started interviewing for startup roles. I wasn’t actively looking, but a few opportunities came along the way that were very close to getting me to leave investment banking early on.
Most analysts spend just two years and move on to private equity. Looking back, I am so glad I ended up doing three years as an investment banker. I spent an extra year as a banker to interview at a lot of different types of shops and really figure out what exactly I wanted to do next.
Quitting a $500K Per Year Job
I knew after a few years of investment banking that I wanted to go the public side and break into a hedge fund. After banking I got lucky and landed a job at a multi-manager hedge fund. At the time I thought it was my dream job – joined one of the largest hedge funds in the world with a path to portfolio manager longer-term.
But after a few months I knew it wasn’t for me. I was working around the clock in an investment style that was very short term and speculative in nature and I burnt out very quickly.
I would have never thought I would quit a job where I already had a direct percentage cut of the profits at 24 years old and the path to make seven figures in a few years. But I simply failed – choose a fund with the wrong investment approach and knew very quickly it wasn’t for me.
I quit a $500K per year job with nothing lined up. Looking back, I probably should have taken a few weeks off, got my shit together and planned an exit with a job lined up. But somehow if you keep chugging along, it always works out in the end.
Shortly after quitting that multi-manager role, I managed to land a job at a distressed / value-oriented fund which turned out to be exactly the right fit for me longer-term.
Top Finance Careers and Work Life Balance
There is a strong correlation with how much you work and how much you make, especially early on in life. You could work 40 hours a week for the government or a corporate role with a ton of flexibility, vacations, etc. and get maxed out making just low six figures or you could slave away at one of the high paying finance careers and make mid to high six figures by your late 20s.
The choice is yours. Work life balance varies substantially amongst all the different Wall Street jobs. That said, it also depends highly on the firm you work for. There are sweatshops in every type of finance job so it really depends on the firm.
Best Work Life Balance In Finance Ranked
As obvious as this is, there is a very strong correlation with the number of hours you work and the amount of money you will get paid throughout your career. The pay varies significantly as you get older in some of these finance careers (especially careers where you can stand to make millions through carried interest in private equity/hedge funds).
The below chart shows compensation vs. hours per week for someone with just a few years of experience across all the different finance careers:
Investment Banking (50-120 Hours Per Week)
Investment banking roles are notorious for their demanding work hours, particularly during deal execution. Professionals in investment banking often work late nights and weekends to meet tight deadlines and always have to respond to demands of both your client and your managing director, regardless of how unreasonable they may be.
Lately, banks have tried to make an effort to improve the work-life balance, especially amongst analysts adding “protected weekends” or protected “Saturdays.” But at the end of the day, if you are on a live deal, you will be expected to work around the clock, especially before major deadlines like Board meetings and announcements. Expect days and nights when you question whether investment banking is really worth it.
Don’t expect to have any control over your time or be able to make really any plans. Nowadays it’s probably a bit easier to travel on occasion with remote work, but you should expect to have to cancel events every now and then.
Out of all the Finance careers, investment banking ranks the worst in terms of work-life balance. If interested, read more about life as an investment banking analyst here.
Mega Fund Private Equity (60-110 Hours Per Week)
Mega fund private equity roles are known for their demanding work hours and high-stakes deal-making. There is a reason why you get paid more at these larger funds relative to middle-market firms.
These positions often involve intense competition and long hours, especially during the execution of large-scale transactions. While it’s nice to get paid a ton after just two years of investment banking experience, the work-life balance in mega fund private equity can be challenging and most burn out after just a couple years.
Out of all the finance careers we talk about here, mega funds private equity is near the top of the list in terms of worst work life balance. There is constant deal flow and an ever-demanding need for juniors to model and put together investment committee presentations.
Middle Market Private Equity (50-90 Hours Per Week)
Middle market private equity involves investing in mid-sized companies, companies that are a bit more mature and have a stable source of revenues relative to growth equity. Compared to the mega funds, middle market private equity generally has a better work-life balance.
But just like at any other shop, when you are in a middle of a deal hours can be rough as you must meet certain deadlines. So just like in investment banking, expect hours to be a little all over the place depending on what is going on work wise, but generally much better work life balance than the larger funds.
Multi-Manager Hedge Fund (50-80 Hours Per Week)
Multi-manager hedge funds have a very different investing style than most of the single manager hedge funds. Basically, all teams run a market-neutral model where you are long the same amount of stocks as you are short, so you have little to no exposure to overall market moves.
Depending on the team, the investment horizon is typically very short, think somewhere around 1 week to 6 months. There were multiple times when my portfolio manager asked me why XYZ stock is down or up x% at a given point of time. Because of this, you need to stay on top of all the news and data for each of the stocks that you cover, which can be extremely stressful.
Every day you either made money or lost money. Depending on the firm, you have a risk limit where the team can only lose a small percentage of money before the whole team gets let go.
This makes the work life balance pretty bad as you are constantly thinking about your investments and losing sleep, especially before earnings. If you want to learn more, then read life at a multi-manager hedge fund.
Management Consulting (40-80 Hours Per Week)
Management consulting is known for its demanding nature and often requires extensive travel and long hours. Consultants work on tight deadlines, often supporting clients during critical decision-making processes. While the exposure to various industries and the exit opportunities are attractive, management consulting can be demanding at times, especially at an MBB (McKinsey, BCG, Bain).
However, compared to investment banking, the culture is much better, schedules can be a bit more predictable, and you are less likely to have to cancel plans. Also, there are weeks when you are “on the bench,” meaning basically you don’t have to work until you are assigned on a project.
I used to live with someone who worked at an MBB and when he was “on the bench” he would have weeks where if nobody called him before 10am, he knew he had the rest of the day off.
Single Manager Hedge Fund (50-70 Hours Per Week)
Single manager hedge funds can offer more flexibility and better work-life balance than larger hedge funds, but like other career paths, it really depends on the firm you join. Usually, the work day starts pretty early around 8 to 8:30 am to have time to check the news before markets open.
While hedge fund professionals in general may face demanding hours and market pressure, single manager funds tend to have smaller teams and a more manageable workload. However, the nature of the industry and the need to stay on top of market trends can still result in long hours during crucial periods, especially during earnings season where you have to be on top of all the companies you follow when they report results.
But like I said before, hours are entirely dependent on the firm. Places like Melvin Capital when they were still around were sweat shops and had analyst working six days a week for 70+ hours. That said, usually hours are more consistent with less volatility compared to investment banking/private equity, so much easier to plan your schedule.
Growth Equity (40-60 Hours Per Week)
Growth equity roles typically involve investing in more mature companies with proven track records. This sector usually has a work-life balance that is a little worse than early-stage venture capital, as junior employees have a ton of deal sourcing responsibilities and must meet a quota in terms of cold call outreaches.
That said, while there can be times where you have to work a ton (usually during the deal execution phase), growth equity employees generally have more stable and manageable work hours than most high finance fields.
Venture Capital (40-60 Hours Per Week)
Venture capital (VC) offers a relatively flexible work environment and greater autonomy compared to many other finance jobs. VC professionals often have the opportunity to set their own schedules, work remotely, and also do something entrepreneurial on the side. The workload can be demanding during due diligence or deal execution phases, but work-life balance is very good overall.
Part of the reason is there is not much due diligence when it comes to VC investing. Most of the time it is a founder with an idea or a group of individuals with a proof of concept. No cash flow, no numbers – all you can do is analyze the founders’ background and the total addressable market of the idea. Plus, most VC investments are tech focused, so it’s an industry that is a bit more laid back than traditional finance.
It’s an investing style where you need to hit a home run every ~10 investments or so and where you don’t mind if half of your investments end up going to zero.
Sales and Trading (40-60 Hours Per Week)
Sales and trading roles within investment banks can have a pretty good work-life balance. While markets can be volatile and demand quick decision-making, these roles often adhere to more predictable schedules compared to investment banking or private equity. Although there may be occasional late nights or early mornings, sales and trading professionals usually have weekends and evenings free and operate during market hours.
Days are likely to start earlier, but once the market closes the work load slows down significantly.
Corporate Finance / Banking (40-60 Hours Per Week)
Corporate banking and corporate finance roles are typically found within large financial institutions or corporations. Corporate banking roles involve providing financial services to corporate clients, such as loan structuring, treasury, trade, cash management, etc. Corporate finance is a bit difference in that you work in the finance department of a large corporation, where you basically help the company with any matters regarding investments, capital structure, funding, maximizing profits, etc.
While the workload and work-life balance can vary across different organizations, these roles generally offer better work-life balance compared to investment banking or private equity. Out of all the other finance careers discussed above, corporate banking provides a much better work life balance, but pay is significantly lower than investment banking or buyside roles.
Why You Should Work Hard In Your 20s
The 20s are the best time in your life to get ahead of the crowd and set a good foundation for the rest of your life. Most in their 20s are single, unmarried with no kids and no real commitments – it’s the best time to work as hard as possible to build a finance career and prepare yourself for the future.
If you play your cards right in finance, you will start making somewhere between $400K-$1MM a year by your late 20s and have a top 1% net worth.
If you want to be better than average, then you must make a sacrifice at some point in your life. Better to make that sacrifice in your 20s when you have nothing to lose and when nobody depends on you. Most waste their time working 40 hours a week in a job with no medium to long term goal to get ahead of others while going out getting drunk every weekend.
Try to figure out what you want to do 5 to 10 years out and work backwards on how to get there. If you are young fresh out of college or in your 20s, don’t worry too much about work life balance – go after the career that best sets you up with what you want to do longer term, regardless of the hours. Overtime, the hours will get much better as you get more senior. The sooner you figure out what you want to do the better as it’ll take some time for you to reach that end goal.
Great advice here. One thing I wanted to note was the importance of determining your path and strategy early. Most investment bank summer internships take place after junior or even sophmore year. That means applying the fall beforehand, which is very early for most students. These internships, though hard to land at the top firms, are far and away the most direct way to launch a trading or investment banking career. If you don’t get one of these internships and a subsequent return offer, it can be very hard to break in.
One side effect of this timing is a continuing lack of diversity. If you grow up in Greenwich, CT and mom works at Goldman, you’re much more likely to know this well-worn path.
Yep! For some reason every year recruiting for investment bank internships and private equity associate programs starts earlier and earlier.
Back when I was a banker, it was an all boys club – probably a couple girls in an analyst class of 30. Nowadays, believe it’s become a bit more diverse, but agreed all the rich/ivy-league kids continue to dominate across Wall Street.
Greetings.
This comment will be quite lengthy, so if you’re notified of it and interact I want to say in advance I sincerely appreciate your time. My name is Abel. I am a college student in the first semester of my sophomore year pursuing a BA in Finance. I’d like to supply a bit of background before presenting a series of questions. I’m a first-generation American, a child of two working-class immigrants, and a first-generation college student. My older brother graduated with his BA in Finance recently, and due to adherence to the principle you spoke on in your writing, namely, knowing what he wanted to do early on in his academic career and which path he decided to pursue (and then executing on the necessary inputs), received an offer straight out of an internship at a top global REPE firm. His credentials coming out of university were stellar and he holds a beefier track record than most of his peers displaying his competencies in the field. An early graduate, summer analyst position at a prestigious REPE firm, VP of the RE club at his university, and an active member in several national undergraduate REPE analyst competitions (in which he placed among the top competitors each time), he doesn’t have a difficult time coming across as talent worth investing into. I, on the other hand, have had a less polished start in my academic career, changing majors early on as well as not performing desirably in my first semester of college resulting in possessing a lower-than-average GPA (3.0) currently (I’m intent on redeeming it through extensive study and focused, organized work). Starting college, I had no idea what I was going to pursue and began studying Computer Science as a means to get better-versed in a business I was running and working towards a tech career potentially, but I didn’t have an understanding of how the academic system is to be approached and leveraged to reap a desirable career and become an elite competitor in the talent pool. Becoming top talent wasn’t even on my mind then, as I was just trying to find my footing with no real idea where to start. If only I knew then what I knew now. Yet still, I’ve grown as an individual exponentially in the last few months as the result of personal experiences and engaging in rationalizing and first principles thinking and my understanding is in a much more equipped place than I was even half a year prior. Thus, I’ve undergone much thought about the coming days and months and how I should approach the work I undertake, with a focus on identifying the desired end outcome, so I can begin the ruthless execution of the required inputs to get there. I’d like to receive some information from you, a qualified expert, to help guide me in the decision-making process, as upon observing my brother in his newfound role, assessing the benefits and drawbacks, and limitations on other areas he faces due to the nature of PE work, I believe it would be best if I get an honest idea of what to expect and what I need to be doing to have a fighter’s chance at achieving my goals in the realm of Finance.
I’m no stranger to hard, focused, detail-oriented work, as I started and ran a business throughout my senior year of high school and freshman year of university that saw me handling client relationships, preparing pitches for investors, managing workloads, and handling finances, with the purpose of seeing growth, and succeeded in seeing that endeavor become a stable source of income I’ve now automated. I bring this up not only to highlight some of the skills my current lackluster (3.0) GPA might not communicate but to leave a runway that transitions into my first goal in a Finance career. I’d like to work in a field that sees me bringing value by utilizing focused work, and perhaps leveraging my personability and presentation skills, as well as my analytical inclinations and executive-mindedness. However, work-life balance is important to me, not so I can enjoy a nice afternoon session of mountain biking, but because I have the desire to pursue other endeavors that build me as an individual, not just as an analyst or manager, and although I’m not expecting to see extensively loose schedules in the world of Finance, finding something that revolves around a consistent schedule of about 40-60 hours a week (normally) is something I have an interest in seeing through.
Given the prior context, how would you advise me to move forward in my pursuit of a financial career? Which careers will I tend to have a more probable chance of securing employment in, due to either less stringent GPA requirements or more suitable roles per the skills I’ve developed via the past experiences I’ve mentioned? How would you recommend I go about developing a network efficiently, especially seeing as I only have about some two years and change left before I’m to walk across the stage and complete my undergraduate studies?
If you are willing and able to communicate with me privately, I would immensely appreciate the opportunity and I’m able to connect over email or your preferred means of communication. Once again, thank you in advance for your time, and all the valuable information available on your website.
Sincerely,
AA
Appreciate the long post, but unfortunately I don’t have the time to talk one on one. I would continue working on your business, scale that on the side, and get a career in tech, sales (if you are personable) or a corporate 500 finance/corporate dev group. Once you scale that business, work on it full time. If you want a work life balance, traditional finance/investment banking/PE isn’t for you.