There is an adage in financial services that until you mark yourself to market, you will never be paid fair value. In other words, the only way to get paid fairly is to leave your job.
My personal story
I had been with Merrill Lynch for 5 years. I asked for a transfer to any of the European or Asian offices. My kids were still young, and my wife at the time and I felt an international assignment would be good for my career.
Management came back and asked me to lead the Canadian structured finance effort. The pitch was I would have the whole country and assistance from my colleagues in the US. It sounded great.
2 years later, while I was enjoying my time in Toronto, Credit Suisse NY came knocking on my door. I should say a dear friend referred me for the role. Thanks, Dave (not his real name).
I entertained the knock but really was not interested in leaving. However, when I learned that Director level positions in the Credit Suisse group were paying 4x what I was making… enough said.
The difference was so great that my future boss told me, upon learning of my ML salary, that getting the 4x compensation would be a huge uphill battle because of my existing low pay. I decided to go for 3x and the quick win. The difference was a few Ferraris. Ouch!
Let’s look at the data
Have you been at your firm for more than 6 years? If you have, your tenure is longer than the average employee, way longer in some circumstances. Hm.
What does that imply about your current compensation?
Did you know that the median time spent employed at Goldman, JP Morgan, and Morgan Stanley is 3.4, 6.2, and 5.6 years respectively?
How about Big Tech? Google, Facebook, and Microsoft median times are 3.3, 1.3, and 4.2 years respectively.
Where are your allegiances?
My colleagues and I historically debated whether your allegiance should be to your firm or to your boss. I learned that it is to people, more broadly defined. The firm’s senior management changes quickly, especially if they hang with Epstein.
If you’re at Barclays, you get a free resume review!
The institution does not have feelings, emotions, or really care about anything other than making money. People, on the other hand, care about people (at least most do).
When a person who respects your work moves on, many times they will take you with them. I have friends who have built entire careers “following the leader,” the famous game from kindergarten.
What does this mean for you?
If you have been with your firm for more than 6 years, odds are you are underpaid. Period, full stop. If money is important to you, you should think about a move.
Moving comes with a higher return yet higher risk. You need to learn a new culture, power dynamics, bathroom location. However, that might be a small price to pay for the ability to keep your kids in private school or get that 2nd house.
Just think about it.
Welcome to reality. Move or stay underpaid, it’s up to you. The only way to get paid fairly is to leave your job.