Investment banking salaries, which continue to be under intense scrutiny after the global financial crisis of 2008-2009, are a beacon for media and political commentary. Although investment banking gets lumped into a single category, it actually comprises many positions broken down by experience and title--and commensurately, salaries. This tiered approach to salary was designed years ago, and continues on today.

Investment Banking Levels and Salaries

Investment bankers’ tiered structure is reflective of both education level (bachelors vs. masters) and years spent in the field.

  • Analyst (the lowest tier): Usually a recent college graduate. Analysts generally work extremely long hours, often 80-120 hour work weeks! One bonus for those who love sleep is that because analysts do a lot of the “grunt work” which needs to be approved by a higher level (like the director or managing director), they often arrive at work later than the higher tiers (9:30-10:00 am is not uncommon). For these long hours, analysts are compensated higher than most of their peers in other professions. According to Glassdoor, the average first year analyst’s annual salary including bonus averages $127, with second and third year analyst salaries average around $135K. These numbers have been consistent over the past decade, although initially after the financial crisis, the range has reduced in some cases, slightly. Sign-on bonuses are also frequently offered, which can fall in the range of $5-20K. 
  • Associate (the next leg up): Usually recent MBA graduates. Associates, like analysts, work long hours, although they may be slightly less. Associates work in step with analysts, but because of their seniority position, regularly direct analysts on assignments. The average annual base salary including bonus for first year associates has in recent years been $170K and for associates with 1-3 years of experience, $200K. First year associate bonuses are reported to be in the range of 10-50% of base but can grow to be up to 300% of base for third year associates.

After the analyst and associate levels, the salaries for vice-presidents up to managing directors, particularly the variable or bonus components, are much more wide-ranging. The bonuses are often a function of personal contributions in addition to the overall profitability of the entire group or work unit. As a result, there is no real “average” compensation that is representative of a particular level. With that caveat, below is a table listing compensation data as reported over the past several years. 


Years of Experience

Average Reported Annual Total Compensation


3-6 years

$350K - 1.5M

Managing Director/ Partner

7-10 years

$500K - 20M

(Sources: Wall Street Oasis)

Although it is difficult for many people to fathom the lofty compensation packages reported for the higher ranks, one change that has happened over past years has been a transition from an all-cash bonus to one that has an equity component, which can be tied up for close to nine years. The lower ranks (analysts and associates) are typically immune to this structure. 

Bottom Line

While a career in investment banking is competitive, stressful and many times, all-consuming, it is also well rewarded from a monetary perspective.