Do You Want Money, Or Your Freedom?

I’ll admit, the question is simplistic and vague, and doesn’t take into account that money and freedom are not mutually exclusive.

So here is a more specific question dealing with the theme:  Over the next ten years, would you trade every weekend and all evenings of your “free” time to work, in order to put yourself in a position to earn $750,000+ per year?

This is the question that Investment Banking analysts and associates, directly out of college and grad school, face when selecting this career path.

The decision is clear if you are naturally suited for the work, possessing complementary attributes:  highly analytical, intellectually curious, rigorously focused on details, and a determined problem solver.

Additionally, your choice becomes much easier if you are not solely motivated by the promise of big money, but are also very interested in this line of work.  (Blog Post: Two Questions That Lead To Life Satisfaction)

But for the sake of this post, let’s assume you do not have the natural strengths and passion for the work, but you are given the opportunity to take the job.   (Blog Post: Does Money Make You Happy?)

Would you take it?

You would have to work 80-100 hours per week, almost every weekend, at the discretion of the Managing Director.  On Friday afternoons, you would often be approached with the question, “do you have work capacity this weekend”?  The nature of the work is rigorous, detailed and scrutinized in a precise surgical manner.

The job initially consumes your life.  Want to take the family to the park on a weekend day?  Feasible, but not likely, and only with the company smart phone at the ready.

Enjoy weekday dinners at home? Doubtful.  Most dinners are consumed at the desk.

Plan a romantic weekend with your special person?  Possible, but not likely, and it may have to be cancelled on Friday at 5PM if the MD has a new opportunity.

Maybe you can spend the pile of money you have saved to take a couple of weeks off to explore the world?  Possible, but be prepared to get the evil eye for taking time off…

What about taking the beautiful spring day off to enjoy some rounds of golf, or an afternoon picnic?  Forgetaboutit.

Do you value quality of life, complete with time to nurture relationships, attend family events, and participate in extra-curricular activities?

You would certainly earn good money over the ten years, but is it worth it?

Most people who have never done this type of high demand job respond with a resounding “yes!” to the unique opportunity to obtain financial security, and they know that many others work hard for far less financial rewards, anyway.  That is a valid point…

The upside is that you would learn a tremendous amount about corporate finance and strategic transactions.  Clearly, this job is one of the best learning opportunities for young college graduates interested in business careers.

The downside is that the adventurous years of your life, often unconstrained by financial and family responsibilities, would be severely limited.

Additionally, it is very easy to end up on the treadmill of rising expenses, in order to keep up with the growing income.  The big house, multiple cars, club memberships, private schools, for example, make it extremely difficult to leave later for “normal pay”.

The dirty little secret is that most high income earners are equally, if not more reliant than “the average Joe” on this year’s income and bonus “to make ends meet”.  In fact, as crazy as this sounds, it may be more difficult for the high income earner to voluntarily leave her job, than the median inome earner.  It’s a long drop down.

Interestingly, most people in these types of high tempo/high burnout jobs never stick around for ten years.

Just 3% of investment banking analysts in the class of 2014 in the U.S. surveyed by recruitment firm Odyssey Search Partners said that they view a career in banking as a long-term option.  

For example, in my 1998 Associate class of newly minted MBAs, guess how many of the original 28 are still with the bank, nineteen years later?

Two, and one is me.

Guess how many of us are still in Investment Banking at this same institution?

Zero.

For the small percentage that do survive ten years, they face a new dilemma:  How do you walk away from the “golden handcuffs” in year 11?

What would you do next to keep the balls in the air?  High income replacement jobs are not found in the local paper’s help wanted ads section.

I joined the Investment Banking business in 1998, right out of B-school.  Over the five years in the job, I worked 80-100 hours per week, and almost every weekend, doing something I did not love.  It was misery!

It was always surprising, and a bit depressing, to see our senior bankers in the office at 11 PM, or on the weekend with us (the worker bees).  It was easy to think, “Shouldn’t they have something a bit more fun to do with their successful lives?”

Do I regret the experience? Not at all.

Did I learn a lot from it? Yep.

Would I do it again? Nope.

Why?  Because it didn’t match my strengths and interests.

However, for those that match well with the necessary attributes and all-consuming lifestyle, it is an amazing profession.

My best advice to the young go-getters who may be momentarily persuaded by the money?

Spend a significant amount of time (now), identifying the natural path that will challenge, motivate and fulfill you, absent of the monetary carrot.  Gain a true understanding of the daily life of every career field of interest, including candid conversations with people currently doing the job.

If the ideal career is in an extremely demanding job like Investment Banking, then say “yes!” and go all in.

If not, don’t be mesmerized by the Benjamins.  After all, you may not have time to spend em’….

One thought on “Do You Want Money, Or Your Freedom?

  1. So true, Frank. I love this post and preach this advice to my children. Do something you are passionate about, and don’t think about the money.

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