What's it really like to be a 20-something in an investment bank in the 13th year of the 21st century?
If you read the Times, it's a sorry existence fraught with uncertainty and overwork. "Promotions are much harder to come by," Georgie, a 28 year-old banking junior told the paper. "They can easily work us as hard as they want because they know there are 100 other people champing at the bit for our jobs....“We all talk about this MD in our office, now 40, who got made MD at 28 almost in hushed, reverent tones, as though it were a fable of a time long ago. No one gets made MD at 28 anymore."
Well, guess what? It's not that bad. As a junior in banking, you will have money. You will have a life. The only downside is that you will probably end up living in a bubble with a lot of other people in the industry until you're 30 - at least.
"You're never short of money - unless you're spending way too much," says Paul, a City-based rates trader in his early 30s, speaking anonymously. "I've never known anyone in trading to be short of money. You have to remember that base salaries have gone up here."
Afzal, an analyst who's just joined a leading bank in Canary Wharf says being a junior banker is a bit like being a university student - just with more spending power. "Most of us are living together in rented apartments worth around £500k," he says. "They tend to be furnished, with built in dishwashers and microwaves and we can actually afford a cleaner."
Flat shares are the norm, especially when analysts didn't grow up in the UK and don't know London (most don't). "You meet people on the one month training programme right at the start and then you usually move in with them," Afzal says. "A few of us live in the Isle of Dogs, although there are some who are blowing money on living the life right next to the office, or saving it by living way out somewhere in zone four. The bank gives you a small bit of money to set you up, which helps."
Even after five or more years in banking, a lot of young bankers live in shared housing. This is partly because houses in London are so unaffordable and partly because they're often in a state of uncertainty about their futures.
"I was sharing with my mate in his late 20s even when he was making £750k a year," boasts Paul. "He didn't want to buy anywhere - he always thought he was going to quit his job in a year or two and go to South America."
"Everyone I know was living in shared houses even when they were 28 or 29," says James, a capital markets banker at a boutique firm in London. "That's just how it is now - you live with your peers in the industry."
What does the banking-youth do at weekends? Afzal says there are analyst parties. These events might be in other analysts' flats. - "Or we get together and go out to restaurants. There's not so much clubbing - it's more mature socializing. We're not like students who go out to get drunk and off their faces."
Sometimes young bankers get a little carried away. Paul says he got into debt in his first year because he was expecting his bonus in February and only found out at the last minute that it was paid in July: "I ended up with a big overdraft." There are also stories of a Credit Suisse analyst who splurged on renting a flat off Sloane Square, and then lost her job.
Back office bankers - stuck in shared banker housing for a lot longer
The crunch point for today's young bankers comes when they want to move out of shared banker-housing into their own places. This can be hard - especially for people who aren't in the highest paying jobs in the front office.
"After five years, most people in the front office are earning more than £100k," says Muzaffar Khan, a former trader and hedge fund strategist, who coaches young bankers in the City. "They can easily save up for a deposit. The real problem comes for people in the back office - they're only earning £50k which sounds a lot when you compare it to the average pay in the UK, but there's a very significant expenditure associated with working in the City and that makes it very hard to save.
"If you work in the back office, the culture in the City is that you are expected to go out after work for drinks," adds Khan. "These people finish work at 6pm and there's a big push for them to be social. They have to dress well. They have much higher daily expenses that someone working as a teacher in Brixton, for example."
Nonetheless, back office bankers usually earn six figures after they've been working for a decade and can then save for housing deposits, says Khan. He adds that most new entrants to banking are fine with this state of affairs - it's the bankers in their late 20s who are struggling to adjust to the new reality. They went into the industry before the crash, expecting to earn a lot of money fast only to find themselves still living in flat shares at 28.
"There's a definite sense of malaise," says James. "The hierarchy in big banks is very fixed and people aren't getting paid as they'd expected. You still have title inflation to keep people happy, but banks have started to realize that they're already paying huge base salaries and they're not willing to keep increasing pay year-on-year like they did in the past."
*Names in this article have been changed.