The biggest trade off when working as an investment banker is the sheer atrocity of the long working hours. Lucrative as it is, investment banking requires a lot of work. This article will help you visualize the laborious week of an investment banker and decide if you are cut out for this financially rewarding yet stressful lifestyle.
1. How many hours do investment bankers work a day?
The average working hours of an investment banker is reported to be around 60 to 80 hours a week. Getting any deals done in the investment banking world requires a lot of manpower since there are actually a lot of moving pieces in mere simple financial transactions. In some cases, analysts reported their working hours reaching 100 hours a week.
However, a 100-hour work week only occurs on a particularly busy and hectic week. For the most part, you can expect to have at least 70 working hours a week; and even that is stressful enough considering the average working hours for other vocations is around 40 to 50 hours.
1.1. Morning: A late start at 9 AM
Since the New York capital markets are not open at 7 a.m and most bankers don’t leave the office until midnight, the workday starts rather late for investment bankers. Investment bankers generally get up at 8 or 9 a.m. First thing they would do is to check their emails and see if they need to call into work early and answer other important emails.
They have to be in their office promptly around 10 a.m. and check with their supervisor to see if there is any work to be done from the previous day and to verify their work schedule for the day.
On a normal day, investment bankers can spend 45 to 60 minutes on their lunch break, which is plentiful considering the long stressful day ahead. These breaks are also great opportunities for investment bankers to network and build rapport with their colleagues.
Unless there are constant deadlines, investment bankers often respect their break times. Friday nights seem to be the only time to decompress when investment bankers do their best to enjoy their precious off-work time.
1.2. Afternoon: Starts at 1 PM and ends at 6 PM
For the most part, junior analysts work on financial modeling and valuation, make changes to stock pitches or presentations then send them to associates to be reviewed. The process of adjusting according to comments and feedback from associates and VPs can go on for hours since analysts would have to wait for the senior bankers to check over the models and give back comments.
After being thoroughly reviewed, the materials are then sent back to the analysts to adjust accordingly to the comments. Once that’s done, the materials are then submitted to the managing directors for one last check up. Most of the time, managing directors are not in their office and it may take a while for them to respond and make comments for the pages.
On a slow day, analysts may take their time and have a break while they wait for the higher-ups to reply. However, on a bad day with intense live deals, they would need to work non-stop and their work may also involve joining conference calls for live M&A deals and taking notes.
1.3. Evening: Ends the workday at around 10 PM
After the dinner break, which is at around 7PM, investment bankers then continue their evening shift. The evening mainly revolves around reviewing drafts, working through pages and fixing mistakes from the day’s work. After making those final adjustments to the pages, analysts then send them to the printing office who creates prints and binds them into professional-looking booklets.
If investment bankers are working on live deals, which involves repeatedly reviewing drafts and turning comments, they may not leave their office until 11 PM, sometime even close to midnight if the work is not yet done. Investment bankers may get 4 to 5 hours of sleep in before waking up the next day and start the cycle all over again.
1.4. It gets better as you get more senior
As you move up the investment banking ladder and start to take up higher roles in your firm, the working hours tend to get better. Your first one or two years working as an analyst is always going to be the worst. As an associate, you should still expect 60 to 80 hours a week; however the workload is more manageable and you will have grown accustomed to managing your time working for an investment bank.
You will start to see significant changes once you reach the position of VP (Vice President). Even though it is not like working for a 9-5, VP’s working hours depend entirely on how much they care about their work, how active they are in bringing in deals and how efficient they are at work. However, when there are constant deadlines and meetings, VPs also have to stay up late until work gets done.
Furthermore, when you move up to a certain position such as vice president, the majority of your working hours is spent getting deals, joining dinners with clients and managing your staff. Being able to bring your work away from the office really makes the hours not as grueling as it sounds.
In fact, there have been comments about how the hours are exaggerated by investment bankers. You will be in the office for at least 70 hours a week but you won’t necessarily be working 100% of the time. There are quiet periods when investment bankers will have nothing on their hand but to wait for instructions from directors and VPs.
2. Do investment bankers work on the weekends?
Working on the weekends is considered a norm if you are an investment banker. It is not necessarily because banks require them to work on weekends, but it is mainly the sheer workload and the pressure investment bankers put onto each other. Stressful and competitive has long been the work culture for investment banks.
Within the competitive world of banking, the moment you decide to put off a task, there will be dozens of young, hungry and ambitious analysts eagerly taking charge of your work to take credit. Therefore, it does not matter that you have finished your tasks of the day if your colleagues are doing a lot more work than you are. These folks are hard-wired to work without limits and to do whatever it takes to get their promotions and advance their career. And if you are not ready to compete with them, chances are investment banking is not the field you would want to break into.
Recently, Goldman Sachs and JP Morgans have both enforced “protected weekends” to encourage their employees to drop their work on weekends, unless they are working on live deals. These policies have brought about some positive results, however the work culture in investment banking is yet to be improved. Since weekends are off the list, many investment bankers are finding ways to squeeze in more hours on their weekdays, which leads to an even more exhausting and competitive work environmen
3. Are the Long Working Hours Worth It?
Working crazy hours to meet unrealistic deadlines is considered a regular thing in banking. To most people, investment banking working hours are absurd and represent the relentless, tireless attempt to accumulate more money that we may not even need. The investment banking world is also very selective of their employees and those who aspire to become their staff must possess certain finance skills and enough grit to be able to handle the stressful day to day work of an investment banker.
3.1. Yes, if you are passionate and want to move up
If you are interested in the investment banking sector and want to contribute to the financial world, a 60 hours work week should not be too unbearable. The long hours of work you put in will not only be financially rewarding but also help you gain precious experience and expertise, which is absolutely crucial if you want to move up in the investment banking ladder. If your goal is to work for a hedge fund or private equity, you would still have to spend your first few years working for an investment bank.
3.2. No, if you are just in it for the money and break down under stress
If your sole reason for pursuing investment banking and working 60 hours a week is financial gain, it is most likely not worth it. For most people, having to work 60 to 80 hours a week is an immediate deal breaker to them when choosing a career path. The lack of work-life balance is a major issue for those who work in investment banking.
Without any real interest or passion for the finance world, you will probably buckle under the stress and the volume of investment banking workload. There are a lot of investment bankers who after a few years working start to find exit opportunities to have a better and more sustainable working environment.
The most important thing you should do is to figure out what your personal and professional goals are. If you aim to have a job which pays and still manage to maintain your personal life, then 60 weekly hours of stressful work is not going to be the best fit for you.
4. How to Cope with Long Working Hours as an Investment Banker
There is actually not much you can do about the fact that it is crazy hard working as an investment banker because of the investment banking culture, work and business model issues. Banks have tried to improve the hours over time with “protected weekends” and other mandatory time off, but the results have been mixed. Since even though you are not in office, you will be on call 24/7, and you’ll have to respond to urgent requests and emails all the time, making it difficult to have a life or plan regular activities.
4.1. Don’t expect work-life balance as an analyst
The long working hours are out of the question if you are planning to break into investment banking. Therefore, for your first few years as an investment banker, it is better to accept that your only focus should be on your work. Whether you start out as an analyst or an associate, you are required to make a substantial trade off devoting the majority of your time to work.
And it is also good to know that the hard work you put in now will definitely benefit your investment banking career in the future. The sooner you come to accept that fact, the better mood you will have while working those long hard hours.
4.2. Have dedicated break times
Short 10 to 15 minutes dedicated break times during your workday can seem insignificant but they prove to be helpful in calming down your mind and avoiding any nervous breakdown. The built-up stress of working all day long can be dangerous and unsustainable for most people. As a matter of fact, working non-stop for a long period of time can lead to decreased efficiency and mistakes which is common when you have to be dealing constantly with numbers and data as an analyst.
You should have at least one 10 to 15 minutes break every 2 hours of work. You may spend your breaks doing anything that helps relieve stress, such as catching up with news and sports, getting a cup of coffee, playing video games,… Taking shifts to run errands, get food, etc., during the day would also alleviate some of the monotony.
4.3. Set time limit for each day’s work
Setting a hard stop for your day’s work is crucial to stop yourself from chasing constant deadlines. No matter how hard you work on those deadlines, there will always be more to come and you need to do this in a more sustainable way. For example, setting the limit at 12 PM so no matter how many deadlines you have, you will be able to get at least 4 to 5 hours of sleep each night. Rather than overworking and risking not only your health but also your efficiency at work, proper sleep and rest periods will benefit you substantially in the long run.
5. Final words
In conclusion, it cannot be denied that working hours in investment banks are quite “brutal” sometimes, especially when you’re involved in live deals. However, it is one of the highest paid jobs right out of college for finance aspirants. Most bankers sacrifice their personal lives in the first 2-3 years to acquire skills and knowledge essential to transition to better and more prestigious careers in private equity and hedge fund later, where the hours can be less intense and the work gets more interesting. But without experience in banking in 2 to 3 years, breaking into associate levels in PE and HF is nearly impossible. So, why not investment banking?