Learn why money never sleeps with a summer job on Wall Street.
Note: This article was submitted by one of our Guest Authors. However, they asked us to withold their name as they are currently employed with one of the companies mentioned in this article.Let us call them Bill and Jane
Undergrads looking to explore the world of high finance flock to Wall Street for summer internships. Post-grad, a job on “The Street” is more lucrative than ever, as firms have raised salaries and lowered time limits for promotions in an attempt to stave off the exodus of talented workers to Internet startups. The improving benefits mean that the competition for Wall Street jobs is fierce. The key to obtaining one is getting a foot in the door early.
The road to a high-powered job starts with internships. Just don’t be disappointed if the closest you get to learning to trade like the big boys is connecting their phone calls. But you never know. You could end up doing some cool stuff, too.
“I was interested in working on Wall Street my whole life. I started investing when I was thirteen. Last summer when I needed an internship and I was unable to get a job on my own, one of my dad’s friends who is a trader on Wall Street, he got me a job working on the New York Stock Exchange,” says Bill of the University of Pennsylvania’s Wharton School of Business. “Sometimes I’d help answer the phone, take orders from customers, or update them on their orders or when they want to look at a certain stock trading on the floor. I served as a communications link between the broker I worked for and the client. I had to write up reports which wasn’t very complicated.”
Family connections help when it comes to finding jobs on Wall Street, especially with the smaller independent brokers. The most popular way to find an internship at Wharton is through the career services department, which supplied 36% of interns with jobs. The second most popular was through a friend or family member, with 29% of Wharton juniors obtaining internships this way. Since so many students are interested in interning with Manhattan firms, the more people one knows and the more experience one has, the better.
No matter what an intern’s credentials, there is always the possibility of poor treatment by superiors. The Wharton grad told a story about one of the “practical jokes” that was played on him as a naive intern.
“They told me to go get a box of uptakes. You know an uptake is pretty much a stock trading higher than it did on the last trade. I was going all over the city. They gave me an address that didn’t work. The fourth guy I went to was going to send me to the World Trade center to go somewhere else. As I was leaving he said, ‘Hey kid, come back.’ And they told me that there is no such thing as a box of uptakes. I guess everyone there knows that trick.”
Additionally, students searching for an internship must make a decision about whether pay is important. For some reason, unpaid internships generally tend to assign more responsibility to the student while paid internships are often more mundane. However, living in New York is expensive, and if students have to pay for a room and meals close to the city, an unpaid internship can drain your pocketbook awfully fast. Paid internships vary by the company. Bill made $400/month at an independent broker. Interns at the big investment banks like Goldman Sachs will pull in around $800/month. Accounting interns averaged pay of $2,757 per month, while finance interns made an average of $2,513 and sales/trading interns made an average of $1,871. That may seem like a lot, but the money will go fast if you have to pay your living expenses for the summer.
“I worked for CIBC Oppenheimer, for an investment manager. I did not get paid which turned out to be a good thing because he had about three or four other interns who he did pay and all they did was stuff envelopes all day,” University of Pennsylvania School of Arts and Sciences junior Jane said. “I was redesigning existing presentations, researching stocks and bonds, trying to find undervalued companies, going to meet with managers of mutual funds.”
Besides pay, interns must also determine how much they are willing to spend on living arrangements and must plan ahead, as finding housing in Manhattan can be difficult. The average cost of a shared student apartment is $400-700 per month, plus utilities. However, prices vary greatly depending on location and housing type. Often you can save ten to twenty percent on housing by living outside of Manhattan and taking public transportation to work. The New School in Manhattan has an excellent guide for students trying to decide where to live in New York.
“I lived in a shithole named ‘the Hooker Hotel’ by a friend of mine who had lived there the summer before,” Jane said. “It was $900 a month for the worst apartment ever. It was really hot and sweaty. But I was never there. I went out every night and whooped it up, got drunk with friends. It was the best summer I’ve had so far.”
Image courtest: Dennisflood