Entry-Level Investment Bankers: Long Hours, High Rewards

Investment bankers are known for working notoriously long hours, with the typical work week ranging from 60 to 80 hours. However, it is not uncommon for bankers to work upwards of 100 hours per week, especially during high-intensity periods or when working on multiple live deals. The demanding schedule of an investment banker is often filled with tasks such as financial modelling, presentation building, due diligence, and market research. While the long hours may be daunting, investment banking offers lucrative compensation, with entry-level employees working around 40 hours per week and earning an average annual compensation of $170,000.

Average working week

The average working week for an entry-level investment banker is around 40-50 hours per week. However, this can vary depending on the company and the specific role. Some sources suggest that entry-level investment bankers can expect to work up to 60-80 hours per week, with the occasional high-intensity week pushing them to 100+ hours.

The long hours in investment banking are often attributed to the competitive nature of the industry, the need to be responsive to client demands, and the culture of "paying your dues". While it is not common to consistently work 100-hour weeks, it is not uncommon for investment bankers to work late nights and weekends, especially when there is a live deal in progress.

The workweek typically includes attending meetings, conducting financial modelling and analysis, creating presentations, and responding to client requests at any time of the day. While there may be some downtime or waiting periods during the long hours, investment bankers are expected to be available and adaptable to meet the needs of their clients.

The demanding nature of the job can make it challenging for investment bankers to maintain a healthy work-life balance. However, as one progresses to more senior positions, the hours tend to become more manageable, with each level reducing the weekly workload by a few hours.

Working hours by role

The number of hours worked per week varies depending on the role. Here is a breakdown of the expected working hours for different positions in investment banking:

Analyst

Analysts typically work between 60 and 80+ hours per week. They often have a packed schedule with tasks such as financial modelling, presentation building, due diligence, and market research. While it is uncommon, analysts may occasionally work over 100 hours per week when working on multiple live deals or international projects.

Associate

Associates can expect to work slightly less than analysts, with a range of 55 to 80 hours per week.

Vice President (VP)

Vice Presidents usually work between 55 and 70 hours per week.

Managing Director (MD)

Managing Directors tend to work the fewest hours among these roles, with an average of 50 to 60 hours per week. However, it is important to note that the hours can vary depending on the company and specific team.

It is worth mentioning that the hours worked may not be consistent throughout the week. There may be quieter periods during the day or week where bankers are waiting for guidance or updates from senior staff. Additionally, bankers may need to be available outside of typical working hours to respond to client requests or address urgent issues. This availability and unpredictability are significant factors contributing to the long hours associated with investment banking.

Reasons for long hours

Investment bankers are notorious for working long hours, with a typical work week ranging from 60 to 80 hours. Occasionally, bankers may experience high-intensity work weeks, pushing them beyond 100 hours. Here are several reasons why entry-level investment bankers often find themselves working long hours:

Huge Client Demands

Investment banks cater to major clients with significant financial stakes, and these clients expect prompt service and quick results. When a company pays substantial fees to a bank, they expect to receive top-notch service at any time of the day. As a result, investment bankers must be available around the clock to address client needs, which contributes to their long work hours.

Unpredictable Work Demands

The nature of investment banking deals, particularly M&A transactions, involves a significant amount of unpredictability. While much of the work happens at the beginning and end of a deal, random events, requests, and problems can arise at any time. For example, a buyer may make a last-minute acquisition offer, or a client may miss their earnings forecast, requiring a revamp of financial models. These unexpected demands can extend the work hours for investment bankers as they scramble to address these issues.

Division of Labour Challenges

Investment banking deals often require client-specific knowledge, making it challenging to divide the labour evenly among team members. One person usually needs to "own" each aspect of a deal to ensure accountability and prevent inconsistencies. This can result in a heavy workload for individual bankers, especially junior analysts, who may be tasked with handling multiple projects simultaneously.

Cultural Factors

The culture of investment banking plays a significant role in the long work hours. Senior bankers, having endured long hours themselves, often view these grueling schedules as a rite of passage for newcomers. Additionally, there may be a tendency to introduce extra work or last-minute requests, not because they are necessary but because of a desire for extra analysis or a desire to impress clients. This cultural expectation of long hours, often referred to as "paying your dues," contributes to the demanding work environment for entry-level investment bankers.

Work from Home Challenges

The shift to working from home during the pandemic has also impacted the work hours of investment bankers. With "Zoom time" and "24/7 availability," bankers are expected to respond to messages and work requests immediately, blurring the boundaries between work and personal time. Additionally, working remotely has reduced opportunities for socializing and changing environments, making it more challenging to tolerate long hours without the usual office interactions and breaks.

Work-life balance

The demanding schedule leaves little time for a personal life. Investment bankers frequently work on weekends, and they are expected to be available 24/7 to respond to client requests. This unpredictability makes it challenging to plan personal activities and maintain a healthy work-life balance.

The long hours are driven by several factors. Investment banking is a highly competitive industry, and banks strive to meet client demands promptly. The unpredictable nature of the work, with last-minute requests and changes, also contributes to the long hours. Additionally, cultural factors play a role, as senior bankers often believe that new analysts should "pay their dues" and endure similar rituals.

To cope with the demanding hours, it is crucial to be passionate about the work. It is also important to use downtime purposefully, such as spending time with friends or engaging in hobbies. Seeking professional help to develop healthy coping mechanisms is also beneficial.

While the long hours can be challenging, they are not permanent. As investment bankers gain seniority and move up the ladder, the hours tend to decrease. Additionally, the knowledge gained during the early years can open up exciting exit opportunities, such as transitioning to private equity or hedge fund management.

Is it worth it?

The long hours worked by investment bankers are well-documented. A typical week for an entry-level investment banker involves 60-80 hours of work, with some weeks exceeding this range, especially if there is a ""live deal" in the works. However, it is worth noting that some bankers exaggerate their hours, failing to subtract downtime or breaks. Additionally, the long hours are often a result of cultural expectations and the desire to impress clients.

So, is it worth it? This question is highly subjective and depends on individual priorities and circumstances. From a financial perspective, the high salary and career advancement opportunities make the long hours worthwhile for some people. On the other hand, the physical and mental toll of working such long hours can be detrimental to one's health and personal life.

Those considering a career in investment banking should carefully weigh the pros and cons before making a decision. The financial rewards and career prospects can be enticing, but it is crucial to recognise the potential impact on one's well-being and work-life balance. It is also important to remember that the long hours may not be sustainable in the long term, and many investment bankers move on to other opportunities after gaining valuable experience.

Ultimately, the decision to pursue a career in investment banking depends on personal values and priorities. For some, the financial rewards and career growth may outweigh the demanding hours. However, it is essential to be aware of the potential challenges and sacrifices involved.

Frequently asked questions