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Should I Stay or Should I Go?

'Tis that time of the year again when City Banks and Financial institutions debate the financial worth of their employees; their impact on the bottom line and their appropriate compensation for the previous year. To the average worker, these sums can looked outrageous and shocking; for example in 2008, J. P. Morgan Chase & Company doled out over 7 billion dollars in bonuses, with an elite 10 employees warranting a million each.  Even with bonuses down a whopping 14% in 2012, many high level executives in the banking arena stand to gain large bonuses this year, as in every year.

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Debates have been active for some time now about managing, changing the structure of and limiting these bonuses. In Europe, there are some limitations to maximum size and most have to have shareholder approvals; but so far the United States has not followed suit.

To be perfectly fair, the expenses a banker or financial analyst has to maintain to uphold this type of lifestyle and career is in direct proportion to salaries and bonuses. That average worker previously mentioned would not be able to afford the housing, memberships, clothing, business trips and cost of living that is required of a City banker. This cost is in the neighbourhood of $100,000, while the average take home pay is $363,000. Not much different than the ratios of the middle class.

A moral dilemma creeps into play also at this time of year; many financial employees have to weigh the pros and cons of continuing their banking careers or moving on to other goals in life. Rarely, do those moving on ever equal the monetary level of their City employment, but at different stages in life, that may or may not be the deciding factor.

It has been determined that the month following the bonus season usually shows around 10% of those who received compensation leave. On the other hand, many who had poor financial gains with little promise that the next year will be any better, stay.  The reasoning? Not many options.   For the successful person, who has reached a pinnacle of their career and now wants and desires a change there are interesting if not as profitable, options:

  • Retirement
  • Spend more time with family (coaching, child-rearing, vacations)
  • Write a book
  • Start a new business
  • Go into politics
  • Get involved with Fund-raising
  • Lecture
  • Travel

It may be the perfect time to become more focused, more strategic and more aware of the fact that a comfortable annual salary may be more important that pre-tax compensation.

RELATED:Which City Pays its Bankers the Best?


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