Who makes more $$?

Graduate School Business School - MBA
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<p>I find that hard to believe. It’s not that I don’t think that trial lawyers can’t make a lot of money, because they surely can. But to say that they can outearn investment bankers? Sure, they can outearn the average banker, but the best ones? I think that’s a bit strong. Even the very best trial lawyer winning his most lucrative case would find it difficult to match the $1 billion that George Soros made in a a few short weeks in a speculative currency attack on the British pound. </p>

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<p>This is also true, but it also is important to point out that most lawyers won’t make it to become partners of major law firms or be otherwise high-rollers, for, like you said, most of them aren’t cut out for it. Suffice it to say that the attrition level to make it to the top in either profession is high.</p>

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<p>Sakky:</p>

<p>a) I never stated the trial lawyers outearn ibankers, I was simply correcting a misconception–ie the HIGHEST paid lawyers out there are not corporate lawyers, but they are trial lawyers (e.g. people like John Edwards or Joe Jamail, who I believe is a billionaire).</p>

<p>b) George Soros is NOT an investment banker, let this be clear. The man runs hedge funds, and thus at the end of the day is a trader. Soros’s fortune was made not because he worked on somebody else’s IPO or M&A transactions, it was made because he risked a sizable portion of his own capital along with that of his lucky investors and he can read markets like very very few can. In fact, chances are, the highest paid people in investment banks are not even bankers at all, but they are traders. The joke is that the bankers fly first class, while the top traders fly in their own Gulfstreams.</p>

<p>c) I have no idea about the attrition levels of lawyers vs. bankers, but I suspect it’s harder to make it to the top in ibanking–it’s more grueling, longer hours, more people trying to break into the field, etc. If you have the info, I’d love to see the ratios between senior and junior level people for both law and ibanking. </p>

<p>Practicing law seems to be for those who are more risk averse than those who go into finance. As a former investment banker (who now works in hedge funds), I can tell you that many people out there have the wrong idea. The average person who goes into investment banking will not clear a million a year from investment banking, he just will not get that to that high of a position in the field, plain and simple. It’s not as easy as some people think it is.</p>

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<p>Yes, it is true that the top guys are not bankers, they are traders. But the fact is, investment bankers often times become traders. You have to ask how is it that those top trading/speculator/hedge-fund guys get those kinds of jobs, and the answer often times is through Ibanking (or at least, it’s more likely than through law). I think in this thread, we are talking about investment banking in the general sense of financier-type jobs, not strictly Ibanking per se. Ibanking can lead you to those types of high-flying financier jobs, at least, more so than law can. I think the real point is that the Ibanking career path can is more likely to potentially get you to a point in your career where you will make more money than law will, regardless of whether that point is still in banking, or whether it’s somewhere else. As I’m sure you know, Ibanking is often times not a career destination, but rather a career waypoint. You go into Ibanking not because you want to stay there, but because it will help you get to where you really want to be. In that sense, you could say that this is akin to people getting law degrees not because they want to practice law but because they ultimately aim to become politicians. </p>

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<p>So would I. However, I think we can both agree that making partner in a bigtime law firm, or otherwise making it big in law is no walk in the park by any stretch of the imagination. </p>

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<p>I have never said that it is easy to make a million annually in IB. My point is that it’s also not easy to make a million annually in law. What I also see is that the chances to make truly ridiculously huge sums of money, while still small in both cases, is more likely in IB (or, more generally speaking, a ‘financier’ career) than in law. Which gets back to a point that I’ve been making - if all you care about is money, don’t go to law. Go to IB.</p>

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<p>Investment banking is not exclusive to M&A. In almost every BB firm trading falls under the umbrella of investment banking (so do many other areas). So in a sense, George Soros was engaged in a type of investment banking.</p>

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<p>Soros was a broker who managed money. They had to switch because a law made it so that even if your managed accounts made money you couldnt take cash for performance only on commissions. Thats why Soros, Rogers started Quantum. Thats a hedge fund. </p>

<p>Middle men dont have years when they make over 1 billion or even over 500 million. Ibankers are middle men. They rarely put there neck in line and actually take big risks. Risks are taken by people on the prop desks or the funds betting their capital. Ibankers look for commission. They look for returns.</p>

<p>Oh most of the best hedge fund guys arent flow traders (aka do other peoples orders). These guys work in prop. trading desks at the ibanks which are more or less in house hedge funds. Such as Lampert who made 1 bill last year at his fund.</p>

<p>It is true a lot of guys go into ibanking to later move onto other career paths.</p>

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<p>Mahras2: You get the credited response.</p>

<p>UC Benz said: “So in a sense, George Soros was engaged in a type of investment banking.”</p>

<p>I don’t know what experience you have in the industry if any, but you’d be laughed out of the room if you ever said that on an interview. </p>

<p>Sakky:</p>

<p>I now understand what you meant, and I for the most part agree with the notion that if money is your prime goal, take “IB” as you define it over law. However, I’d disagree with your lumping of banking and trading under one label. </p>

<p>If anything, I’d say law and banking are more similar to each other than they are to what George Soros & co. do. At the end of the day, lawyers and ibankers are both functionaries as Mahras noted, they don’t pull the trigger, they are not the true capitalists. While it’s very correct to note that many bankers become traders with hedge funds, have careers in private equity, etc. (though the reverse almost never happens), make no mistake about it, these are apples and oranges, and do not fall under the same umbrella. Sure, you can say they both involve finance just like doing your taxes does, but they are different jobs that require VERY different skill sets. </p>

<p>Btw, not all bankers will be able to transition over into hedge funds, vc, and pe, the demand amongst ex ibankers for these positions far exceeds supply, trust me I know. Just like some don’t have what it takes to become a MD at Goldman, some just don’t have it takes to work at a hedge fund, which I can tell you is a far different environment than doing M&A at a BB. Furthermore, trading is becoming MUCH more specialized, a trader at a BB does not just trade bonds anymore, they trade a very specific instrument. With increased specialization, I see trading becoming even more of a separate career path from ibanking which will probably make it harder for bankers to transition into these types of jobs. Though of course for those with the talent, anything is possible despite their background, that’s one of the best things about trading the markets, it’s an ENORMOUS meritocracy, much more so than either law or banking.</p>

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<p>“is one required to work on saturday as a consultant? a lawyer?”</p>

<p>for consulting, it depends on the firm you’re working for, but most like to give you the weekends off (your clients will probably be available only during the weekdays anyway). thus you log in the 60-70 hours in 5 days. </p>

<p>for law, it can depend on you. you’re required to bill a certain number of hours, but many can’t finish billing all their hours on the weekdays so they might have to work weekends. their 60-70 hours may be spread over 6 days instead. of course, if you have trouble filling your billing requirements, you might need even more than 60-70 hours. (most firms require around 40 billable hours a week… billable means hours that clients pay for… you usually need to work around 60-70 hours to reach 40 actual billable hours).</p>

<p>on another note, since many here are ambitious, but some actually want a life, an alternative route would be climbing the corporate ladder via in-house management work. that is, say for example, work as an accountant or whatever in a company, start at around $40k, but work your way up. many non-executive managers (a few steps up from entry level) make around $70k-$80k already, and senior managers (1 step above manager) make around $90k-$100k, but they only work maybe a little over 40 hours and they actually have a life. you’re not going to be super rich but perhaps you can live a nice upper middle class lifestyle.</p>

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<p>I certainly don’t consider Soros an investment banker. I was just saying in a certain sense he could be considered one.</p>

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<p>Does anyone here have info on the culture of a consulting firm? Is it the same environment as an I-bank? Of course it depends on the firm, but generally, do people find it more “enjoyable” to work in a MC firm than i-bank? By culture, I basically mean how well co-workers get along, team environment, whether or not the partners are *******s or more lenient, work ethic in general, etc.</p>

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<p>what I’ve been told by friends at big 3 consulting firms, especially bainies, is that the culture is based around mutual respect and people are very nice to each other and are willing to help each other out. You normally work in teams and what ends up happening is that your team for your 10 month project (lengths vary) becomes kind of like your family. You’re on the road 4 days a week for an extended period of time and you spend so much time with these people that you become quite close. You work hard but you also play hard…you go out clubbing, etc. with your team. Also the partners are generally *******s, from what I hear, some of the managers can definitely be slave drivers. In the end though there is always rivalry as you compete againsts your friends for promotions and since MC is an up-or-out business it really can get pretty intense. In general, though, I’d say the culture is much more enjoyable than at a ibank.</p>

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<p>when i went to the mckinsey website, it lists universities that they recruit from and pennstate university was included…contrary to what was stated on this board…a lot of people said if you want an entry level job in a consulting firm with just an undergrad, you NEED to go to a top tier school because firms recruit “SOLELY” from there…so whats the real story?</p>

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<p>they don’t solely recruit from top schools but if you look at their analyst classes each year probably more than 80% went to a top 15 school. </p>

<p>you should get some of the vault guides…like the one for consulting and the one for the top 50 firms. They give good insight. For example:</p>

<p>from the McKinsey guide: “McKinsey says that over the past two years, successful analysts have joined the firm from nearly 300 schools worldwide. As you might expect, McKinsey recruits at top colleges across the country, but hires MOST of its new analysts from Ivy League, Stanford and MIT, as well as from top European schools.”</p>

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<p>I don’t know any investment bankers who became traders. I know some who went into some specialized areas relating to trading, in sort of an interface role with the trading floor and investment banking. And I know one or two who transitioned into particular specialized, complex areas on the trading floor. But not any who became straight traders.</p>

<p>These two groups are somewhat different personality types. They wouldn’t hang out together.</p>

<p>I can’t say it never happens, but I never saw it.</p>

<p>I’ve been out of the 'biz, in NYC at least, for a while now though.</p>

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<p>Having worked for major consulting firms, I can tell you, for a number of reasons, they do recruit at a wider variety of schools than you would think. There are many jobs to be filled that are not actual consultant position that require college grads. The issue is following who gets hired for the actual consulting jobs. </p>

<p>In consulting, it’s the pull from clients, which is to have consultants who went to top schools. It’s way easier to get a client smiling about a young associate straight out of Harvard than most schools. In the end, unless the skill set is unusual, the hires will be top school graduates.</p>

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<p>ok so basically a harvard under grad doesnt have a leg up on a pennstate undergrad if they are both pursuing entry level jobs at a consulting firm right?</p>

<p>does it matter what undergrad school i attended if me and someone from harvard get the same entry level job in a consulting firm before we both pursue MBAS from top schools?..</p>

<p>hope my questions are clear enough…</p>

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<p>he/she means that the person graduated from a top UG…if you both end up at a top MBA program then ug wont matter but going to a top ug opens up more opportunities initially for better jobs which leads to better experience which makes it easier to get into the top MBA programs…</p>

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<p>oo ok…so a student who graduates from a top UG will initially have the better entry level jobs in consulting firms…but would the harvard UG’s job be a significantly “better/bigger” job than a state schools UG if they work in the same consulting firm at entry level jobs?..wont basically ANY entry level job in consulting firms be great work experience for aspiring consultants?</p>

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<p>Carl, when talking about major consulting firms, we are talking major business organizations. There are consultants and support staff. There are mis people, accountants, human resources professionals and myriad other staff. To get a job as an actual consultant, you probably need to go to a top school. You will meet many people from many colleges who work for consulting firms, but only a few are the consultants.</p>

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<p>exactly…so if few people get the actual consulting jobs, wouldnt a lot of the undergrads in top tier schools end up in the same boat as those from state schools in terms of how big/good the job is?..and i want to make it clear that i KNOW its not easy to just jump right into consulting…which is why i want to pursue an MBA…but i would love to have a job in a consulting firm and use that as my work experience when i apply for an MBA…</p>

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<p>Carl, Smeal is actually recruited by a lot of companies, if that’s the school at PSU you’re going into. It’s a good business program that will most likely get you the work experience you need, whether it is actual consulting or not at a consulting firm. Then market yourself better with an MBA from a top school, and maybe you can get the actual consulting job. Maybe a PSU guy won’t get the same position as a Harvard guy. But I’ve still heard of many from Smeal who got jobs in i-banks as actual investment bankers and not some other department. If it’s work experience you’re going for after undergrad PSU, I would say you shouldn’t worry too much. You seem like you have the incentive, which is a great start. Then what you should do is work on your college GPA, seek out an internship, etc.</p>