Perhaps the most high-profile corner of the financial industry is equity analysis. Not because it’s the most exciting, most difficult, or most lucrative, but because it is easiest understood outside of the industry. Derivatives are complicated, real estate valuations at the professional level are intricate and math-intensive, and bonds are even more complex and hard to understand, so the average person on the street doesn’t give them much consideration.
But, ironically, not only is equity analysis one of the smaller parts of finance, it’s also not the most lucrative.
There are many options in finance for seven-figure job paths, and one of the least explored among the rank-and-file financial students is consulting. With the exception of McKinsey, whose high profile and high salaries have given it a legendary status among the MBA crowd, the Big Four firms are not top of mind for these students despite the lucrative and high-quality jobs that these firms provide.
This could be, perhaps, a result of history. The legacy of the Big Four firms as accounting companies looms large, and they still make a sizeable chunk of their revenue from accounting. But advisory services, which extends far beyond tax considerations to things like new investment viability and valuation, takeovers and merger opportunities, and many other things typically done by investment banks are also a large and growing part of the Big Four’s additional services.
So what is a job in the Big Four like? Talk to junior analysts/consultants in each firm, and you will get vastly different answers each time. The common thread is that these junior employees are relied upon to build sophisticated models and solutions for clients and to communicate those models and solutions effectively—in other words, the two primary skills of any financial professional, namely numerical mastery and communicational skills.
What about the pay? While it varies tremendously from location to location, Big Four jobs pay similar to finance jobs, with starting analysts in NYC earning around $80-120k base pay, similar to what you’d expect starting out at an investment bank. Bonuses can be similar, and after a few years one can move up to high-six and low-seven figure jobs. Others will end up being recruited or hired at consultant firms, ending up taking a job in the low-stress, low-risk, and also relatively lower paying corporate finance world.
There is also an international opportunity with these firms. While KPMG’s franchise model makes it harder to go from one country to another, PwC and Deloitte are well known for giving workers the opportunity to work in a foreign nation if they so desire. And with these companies’ massive global presence, opportunities to live abroad are not hard to find. Ironically, the dull reputation these firms have for their accounting history is the exact opposite of the exciting global opportunities they provide—which is quite different from Goldman Sachs or an investment bank, where moving from Hong Kong to London or even from London to New York is notoriously difficult.