Investment banking vs Software engineering
Investment banking and software engineering pay similarly at the bottom of the ladder, and banking pulls far ahead in cash at the top. Banking asks for roughly twice the hours to do it. Software engineering pays a large part of its compensation in equity, which is missing from most published comparisons and is most of the difference at senior levels.
Comparing these two on base salary alone gets the answer wrong in both directions. Banking pay is mostly bonus, so the headline salary understates it. Technology pay is substantially equity, so the cash figure understates it more. The useful comparison is total compensation per hour worked, and on that measure they are much closer than either side likes to admit.
Side by side
| Investment banking | Software engineering | |
|---|---|---|
| Hours | Roughly 70 to 90 a week early on, and you do not control when the work arrives. | Roughly 40 to 50, with genuine variance by firm and team. On-call rotations are the main exception. |
| How pay is structured | Base plus a cash bonus that becomes most of the number above analyst level. No equity for most of the ladder. | Base plus a modest cash bonus plus equity that vests over four years. Equity is most of senior compensation. |
| How fast you can move | A fixed ladder with fixed timings. Almost nobody reaches VP faster than about five and a half years. | Level, not tenure. A strong engineer can reach senior in four years or take eight, and the pay follows the level. |
| Geography | The job is where the clients are. London, New York, Hong Kong, and you go to the office. | Far more portable, and remote work is still normal at a meaningful share of firms. |
| What ends a career | Burnout, mostly, and it is common. The exit rate after two years is the defining statistic of the job. | Layoffs, which arrive in cycles and are largely outside your control regardless of performance. |
| Bottom of the ladder (total, midpoint) | $100k (Analyst 1) | $95k (Entry) |
| Top of the ladder (total, midpoint) | $1.5m (Managing Director) | $390k (Principal) |
| What the cash leaves out | Bonus is the whole story above analyst level and it is discretionary: two people at the same level and the same firm can be a year of base apart on total. Names vary at the top. What is shown here as Director is Executive Director at JP Morgan, Morgan Stanley and Barclays, and Director at Goldman Sachs and Citi. | Equity is missing from these bands and is most of senior technology compensation. A grant vests over four years and moves with the share price, so two people on identical offers a year apart can end up far apart. Compare offers on annualised equity, never on the headline grant. Note also that Amazon runs a level behind: their SDE I is L4 where Google and Meta start at 3. |
Pay figures are midpoints of aggregated, rounded bands. Full ladders: investment banking and technology.
Which one to pick
Investment banking
Take banking if you want the highest cash compensation available to a graduate and the widest set of exits in finance, and you can take the hours for two years.
Software engineering
Take engineering if you want your compensation to track your level rather than your seniority, and you would rather have the evenings. Compare offers on annualised equity, never on the headline grant.
Other comparisons
For live application windows across every one of these, see the opportunity tracker.