So you’re now making decent money, it’s time to make that work in your favor and maintain your sanity! Below are the do’s and don’ts. “Player” or “non-Player” this is still your guide to success:
Socializing
Do Go Out On Weekends: Yes you should go out on weekends, in fact, 2+ times a week is perfectly fine, the trick here is don’t go to bottle service and don’t go out to super high end clubs (unless you got the connects). Major cities have multiple other options that will be just as fun and if you’re a regular you’ll start getting drinks for free if you spend your time getting to know the people who work at the place you like, hint show up early before the workers are exhausted. The total cost of hardcore clubs and other super high end places is incredibly high because you lose more money, get less opportunities to expand your fun social network and are likely hyping up the night because you’re going to an exclusive place. The biggest flaw is actually the network, much more than the money, because you want to start the following cycle outside of work:
- Go to place that fits your personality get to know workers and tip well the first few times while being friendly/fun. The bartenders randomly charge you less or nothing at all. Exchange phone numbers and more branches now open to gain access to larger groups that lead to knowing promoters/bouncers. You now have free entry to super nice clubs if needed. This leads to being more out going and finding more places that fit your personality… Basically you’re starting a snow ball effect to maintain your sanity and maintain a steady flow of invites throughout the day. At this point going out will unlikely cost you more than $50 a night.
Don’t Go Out With People Who Have High Expectations: Inside andoutside of finance, there are many people who believe “This is going to be an awesome night it is going to be epic!” as soon as this comes out slowly back away as the person has little experience going out and has high expectations, as with many other things in life, Happiness = Results/Expectations. Sounds counter intuitive because this person seems to be energetic and happy but really deep down the person is nervous and shy, the best people to go out with have a laid back attitude to the whole process and view the act of simply going out as fun and naturally tend to get into fun situations and meet other extroverted people.
Living
Do Live Close to Work: This is absolutely key to long-term success. The difference between 4.5 hours of sleep and 3.5 is enormous. Roughing it at work on 4.5 hours is a cake walk compared to 3 hours, so absolutely do not live with a commute of 30+ minutes.
Don’t Get a Finance Roommate: The best personal advise for a young hire is… Get a roommate who does not work in finance. There is very little upside to getting a roommate within finance, your conversations will inevitably circle stocks, money/bonuses, XYZ person at work and other things that you’re not going to want to talk about outside of work. Having a roommate brings down your total cost by roughly $400 regardless of location and you now have a direct contact to the world outside of Wall Street.
Note: live alone if the snowball effect is already established.
Saving
Do Save Consistently: It is very easy to spend money when you have it and it’s also easy to get trapped into “the world is ending” vibe, when you’re working with many type A personalities and both of these are terrible in the long-term. Let’s look at the math for your average Wall Street Employee who lasts around 5 years on the Street and has around $1,500 to spend per month on fun/saving (note the number is relatively low as few people ever make it to VP or above so saving more than $1,500 is tough in the major cities EG: London, NYC, SF).
- Spends Money: This person will spend around $1,200 a month over 5 years, or $72000 at an 8% opportunity cost this means you are missing out on ~$750,000 in 30 years
- Saves Decent: This person as mentioned above at 2 nights a week is spending about $500 a month, $30,000, using the same logic at an 8% opportunity cost, you’re missing out on $300,000 in 30 years.
- Super Saver: Take a very extreme case and say they spend only $100 on fun expenses for 5 years, $6,000, using the same logic again at 8% this person lost out on just $60,000 in 30 years
- The End Game: So here’s the difference when all 3 hit that old age with the same 8% rate:
- Spends Money: Saves just $300 monthly and you’re left with a $180,000
- Saves Decent: Saves $1,000 monthly and you’re left with $600,000
- Super Saver: Saves 1,400 monthly and you’re left with $845,000
The takeaway is that someone with $600K versus $845K can likely afford a similar life style but someone with $200,000 cannot, remember when you exit the Street you’re now entirely location independent. For the super savers who will inevitably gripe over this difference until the sun goes down, good luck with all that stress from penny pinching!
Don’t Blow Your Bonus: This is something you should remember, psychologically a strong one time gain makes you do some crazy things, in fact Black Friday is built on this with a one time drop in price spurring spending that wouldn’t normally occur. The best thing to do is plan for a small dinner or event with very few people on bonus day that does not include going out and avoid spending the money for about a month. In this time period you’ll likely remember how volatile the job is and how people rarely remain in finance forever. Now you can allocate appropriately.
Health
Do Stay in Shape: This is probably one of the harder ones, healthy people can gain 20+lbs, have brain aneurisms, break out in hives and more from poor health. While you don’t need to exercise every day or eat like a runway super model, it makes sense to be aware of the changes long hours and stress will have on your body. We suggest eating healthy lunches daily and make that a set rule since dinners and travel are certainly unhealthy especially with meetings, company events and other commitments. A second good rule to have would be 6 hours of sleep don’t work out, if you’ll be getting 7+ it makes sense to at least do a 30 minute workout.
Don’t Drink Without Cause: This is usually where people really pack on weight and send themselves down the cycle of unhealthiness. Drinks with a client and to go out for fun is okay, but avoid drinking for the sake of “relaxing”.
Conclusion: While this seems like a lot of guidelines/rules of thumb it really boils down to one word, balance. Either of these extreme choices should be avoided and the suggestions above should help maximize your lifeline on the Street.
