Investment Banker: Career and Salary Facts

Explore the career requirements for investment bankers. Get the facts about job duties, licensure and education requirements and salary to determine if this is the right career for you. Schools offering Finance Investments & Securities degrees can also be found in these popular choices.

What Is an Investment Banker?

Investment bankers design and coordinate financial strategies that are expected to yield a profit. The investment banking industry comprises a wide range of institutions that employ individuals in many capacities. Investments vary by organization, which usually employ an overall strategy to handle individual assets. Investment bankers represent an elite section of this field.

If you become an investment banker, you will be tasked with creating strategies to raise capital for your company. Once the strategy has been approved, you will essentially be equal parts liaison and salesman, creating interest and building enthusiasm of prospective investors. To do this well involves a high degree of attention to detail and the ability and willingness to analyze complex financial information.

The table below outlines the general requirements for a career as an investment banker.

Degree Required Bachelor's degree is most common
Education Field of Study Business, economics
Key Responsibilities Connect businesses in need of funding with investors, estimate companies' worth to prepare for IPOs, connect companies in mergers and acquisitions
Licensure Licensure typically required
Job Growth (2014-2024) 10% (for all securities, commodities and financial services sales agents)*
Median Salary (2016) $89,265**

Source: *U.S. Bureau of Labor Statistics, **Payscale.com

What Would I Do as an Investment Banker?

When commissioned by a company or individual, your first responsibility as an investment banker will be to assess the state, needs, and goals of the entity to determine possible ways to improve capital. You will likely have access to all the entity's financial information, and will use it to develop an investment strategy. Once the entity agrees to the strategy you propose, you will be entrusted to seek out potential investors, while continually assessing any loans, bonds, or stocks in the entity's profile.

What Kind of Education Do I Need?

The financial industry is an environment of very high competition, and most investment bankers have at least a bachelor's degree, often in business or economics. Coursework in these areas frequently includes business fundamentals, accounting, economics and management strategy.

Post-graduate education is not uncommon in this field. Many investment bankers go on to earn a Master of Business Administration (MBA) or an advanced degree in economics. As an aspiring investment banker, you also need well-developed mathematical, organizational and analytical skills.

Do I Need To Be Licensed?

Most investment bankers need to be registered with the Financial Industry Regulatory Authority (FINRA), which oversees the industry and grants licenses. FINRA offers various licenses that cover many jobs and responsibilities in the banking industry. You need to pass exams and demonstrate your industry knowledge and compliance with regulations. Continuing education is usually necessary to maintain your registration.

Where Might I Work?

You can expect to begin in entry-level positions within investment firms. This usually entails working as an analyst and undergoing a training period. Successful analysts are generally promoted to associate-level positions and begin to handle clients' accounts more directly. Investment bankers are directors of financial firms and represent the apex of this career path. The level of employment at which you enter the financial sector and the speed of your advancement may be influenced by any advanced education credentials you possess, as well as your personal skills.

What Kind of Working Conditions Can I Expect?

The financial industry is known for its high stress environment and demanding hours. You could face regular deadlines and competition from your peers. Because you may be working in groups with other analysts or associates, networking and social skills are an asset.

As a director in investment banking, you would meet with high-profile clients and coordinate investment strategies. You could travel frequently, and your position would demand the leadership and communication skills necessary to guide associates, as well as work with investors.

What Kind of Salary Could I Have?

According to Payscale.com, investment bankers earned a median annual salary of $89,265, as of October 2016 (www.payscale.com). The 10th to 90th percentile of earnings for investment bankers, including bonuses, profit sharing and commission, ranged from $56,277 to $218,303 in the same year. In May 2015, the U.S. Bureau of Labor Statistics (BLS) reported that the median yearly salary of securities, commodities, and financial services sales agents was $71,550 (www.bls.org). This figure could vary due to salary frequently being dependent on factors like the output of the individual and the strength of the market, as well as any bonuses you might receive.

What Are Some Related Alternative Careers?

If you would like to explore careers with similar educational requirements and job duties to those of investment bankers, you could consider a financial analyst or a financial manager. Financial analysts are hired by companies or individuals to help make investment decisions and track the behavior of stocks or bonds. Financial managers oversee the financial activity of an organization. This involves making investment decisions, producing financial reports, and creating and monitoring financial goals.

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