Quote: (01-21-2012 02:33 PM)[email protected] Wrote:
G- what would you recommend if you wanted to join the top .5% Ivy League MBA and work on Wallstreet/Banking Industry to leverage other people's money?
I'm not G obviously, but thought I'd offer at least a little perspective on this. Granted, you should take it with a grain of salt (I'm much younger than G, HH, and the other experts here), but perhaps I could still be helpful.
In my estimation, finance is the most heavily trafficked road to the .5%. That's where the money is. The biggest key to making big money in our world is moving/managing other people's money. You can get into the 1% as a lawyer, engineer or doctor, but its much more difficult to break the top .5% in those professions than it is in finance.
The complete path to wealth via finance is as follows (you may want to skip to step 4):
Preliminary: Before you start, you'll want to make sure you go to a very good secondary school, preferably an elite prep school (though a top public
like this can do just fine). This will help to make the steps you take later a bit easier, as I'll explain in step 3.
1. Get into any Ivy, Stanford, Duke,
NESCAC or MIT for undergrad.
Why these schools? Because they're the ones Wall Street most heavily recruits from. Any given year will see a trickle of guys from places like Colgate and maybe Bucknell, but you've got a better chance if you aim up a little more.
2. While there, work your ass off. You'll want at least a 3.7 to give yourself a good shot at a bulge-bracket bank or even a sniff of private equity/hedge fund work (ex: Bridgewater Associates).
You can enhance your chances in a couple of other ways:
A. Play a sport. These industries love athletes, and athletes are over-represented in the finance world. They like to hire one another.
B. Join one of the elite fraternities on campus. This will depend on how frat-centric your campus is (ex: fraternity life at my school is dominant, while at some NESCACs there are no greek organizations), but if frats are there, it'd be wise to sign up and join the wealthiest ones. Lots of connections to be made there via the children of top finance professionals (who, at least on my campus, are downright ubiquitous).
Majoring in a hard science/engineering/math discipline and doing well there gives you a leg up, as Menace noted. This is a very difficult undergraduate path to take, however.
That being said, if you go to the right school (read: Ivy, Stanford, Amherst, Williams, and a couple of others), you can be a history major and still get a good gig so long as your GPA is top notch (again, 3.7-3.8+) and you've taken at least a couple of econ courses. In fact, I know personally of religion majors who have made successful strides into finance/business upon graduation from these schools. At my school, econ is a common de-facto major for those who are thinking about finance.
The more elite the undergrad you attend, the more mileage you get out of a non-science/math/engineering degree and, obviously, the more connected and well networked you are, the more leeway you get gradewise for good jobs.
3. Intern during your summers as an upperclassman (or potentially as a sophomore), hopefully with a top bank (Goldman or the next best) or top consulting firm. This obviously requires that you have the grades to snag an internship by your sophomore/junior years-if you're one of those kids who came into your elite undergrad and struggled for a semester or two grade-wise before starting to do well, you may be a leg or two behind.
Remember how I said in the preliminary step that you'll want to go to an elite secondary school? This is where the 1% gain a huge advantage. Their children go to elite private schools (or, in some cases, a handful of VERY good public schools), which prepare you EXTREMELY well for schoolwork at Ivies/Stanford/NESCAC/etc (while also giving them better networking/connection opportunities). This means that they're not only more likely to get into said colleges than anyone else, but once they get there, they're the ones who will be most likely to get the good grades right off the bat and lock up the top internships (with their connections/wealth only making things more certain).
Most middle class, average-public school (read: not elite publics like Greenwich High School or New Trier) educated kids have to make a longer adjustment to the school work. Whereas his preppier peer might pull a 3.5 his freshman first semester, the less privileged kid might be lucky to get a 3.0. He could be getting 3.5+ regularly by his sophomore year, but his more privileged peer is still going to have a big leg up for sophomore/junior year internships gradewise, and thus a leg up for job offers after graduation.
The game is a little rigged this way.
4. After graduation, build work experience, hopefully leveraging your internship experiences into a finance gig. Work for 2-3 years at least. Any elite bank, top consulting firm (think McKinsey, Bain or BCG) or (if you can get it) hedge fund/private equity gig is fine for this, and will look good on your resume.
5. Apply to an elite MBA program. Look
here for ideas-shoot as high as you can. Obviously, go as high up the ladder as you can-it does not need to be an Ivy. UChicago, to use an example, is better than Yale Business.
6. After graduation, leverage your MBA into a higher-paying gig in finance/consulting than what you had right after graduation. Some firms are known to even aid their employees in finding and paying for business schools, on the condition that they return after graduation to work for them for a set number of years. Either way, once you do this, you can focus on climbing up the ladder and shooting for managing director/vice president/partner/etc, while also looking for profitable laterals/exit ops.
The investment banking path will typically have much higher compensation levels involved than consulting, as Menace noted, but you can leverage consulting experience into great exit ops that pay well (ex: executive at a Fortune 500, Venture Capital, Hedge Funds, private Equity, etc). A lot of high-paying employers like consultants.
Once you hit the MD/VP level at a good investment bank (a process that'll usually take 8-10 years at least), you'll be looking at potentially a
seven figure annual paycheck, and a very solid shot at moving up toward the higher end of the 1% by the time you hit your late 40's/50's, with a salary that could hit 8-fgures. You can make
even more as a senior guy at a good hedge fund, or (if you're really on your game and have managed to build a good enough rep/skillset) as a fund manager.
The Caveat: This will vary from year to year as economic fortunes (and, by extension, the amount of money moving through the system) ebb and flow.
Also, as Menace noted, none of this is easy.
7 (Epilogue): Marry attractive wife (who is probably daughter of a fellow 1% type financier/lawyer/doctor herself). Have 2-3 children (one is too few, four+ is often considered too expensive). Pick an elite part of the country to live in (ex: pretty much
any of these), send your kids to an elite private school (or a top public if you live near one), make sure you've been donating to your undergrad (and to whatever sports team you played on if you were on one), and get your kids into said undergrad (or onto said team).
Then the cycle repeats itself.
