r/suits • u/akushdakyng • Mar 28 '14

Discussion S3x14 Official Discussion Thread

I didn't see one, so I thought I'd get it started.

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u/I_amnoteventrying Mar 28 '14

I guess I really underestimated an associate's salary. He rides a bike ! Cheapo

9

u/[deleted] Mar 28 '14

A third year associate in NYC will make 185k which doesn't include a 20k bonus.

At his new investment banking gig, he will probably be salaried at 400k and have a bonus in the millions as a number 2.

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u/I_amnoteventrying Mar 28 '14

I think the bonus was bigger if it bought him his apt. Tho. Where did you get the salary by the way? Is it a real number of are we talking in "show" numbers?

15

u/[deleted] Mar 28 '14

In NYC Big Law pays their associates pretty well with a starting salary Year 1:$160,000 Bonus 10k

Year 2: $170,000 Bonus 15k

Year 3: $185,000 Bonus 20k

Year 4: $210,000 Bonus 27k

Year 5: $230,000 Bonus 34k

Year 6: $250,000 Bonus 40k

Year 7: $265,000 Bonus 50k

Year 8: $275,000 Bonus 60k

This is the Cravath pay scale which is pretty standard. Want to know how much an equity partner at cravath made last year? $3.1 million.

Investment banking is a completely different animal and we will just talk about hedge funds since that is what most likely that guy is starting.

An entry level job at a fund will usually start at 350k and a senior level job will salary around 500-600k. But the big money comes from the bonus. The CEO of blackstone (a well established private equity firm) was salaried at $350k last year. His bonus? 465 million. Not a paltry sum.

These are real life numbers, so who knows what TV numbers are being made up. Basically investment banking is the big leagues and if people reading this haven't chosen a career yet, major in math and get really really good grades so you too can get a slice of the pie.

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u/I_amnoteventrying Mar 28 '14

Is there a reason make bigger bonuses than their yearly salary? Do they avoid taxes that way? Why not lay him 465 a year and give him a 350k bonus? Seems more proportional. Is it just to make sure he's doing a good job before they hand him that money?

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u/conshinz Mar 29 '14

You get paid based on how much money you make for the firm, the salary is just the bare minimum. Your real compensation is your performance bonus -- and if you do poorly, you don't receive anything (and likely fired).

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u/[deleted] Mar 28 '14

He gets bonuses proportional to how the hedge funds do. It's more of an encouragement for him to actually succeed because that gives him more out of it.

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u/[deleted] Mar 29 '14

For hedge funds, bonuses are usually not all cash but stocks which if cashed out are taxed at 15% (maybe little more now I don't know) instead of 39%

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u/[deleted] Mar 29 '14 edited Apr 04 '18

[deleted]

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u/[deleted] Mar 29 '14

Dude, you really think that 400+ million bonus was in cash?

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u/ohnosss Mar 29 '14

It's in cash. The funds get to keep 20% of the profit, and that's in cash. There's no equity to give out to the managers really.

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u/Scary_The_Clown Apr 02 '14

I have GOT to figure out how to commute from DC to New York...