Investment banking requires a bachelor's degree, internship experience, and often an MBA or professional certification to reach senior roles
Investment banking is not a single job title—it is a career path that starts with entry-level analyst roles and moves through associate, vice president, and managing director positions. The typical route is a four-year degree in finance, economics, accounting, or business, followed by an internship during college or a full-time analyst role after graduation. Most people who reach managing director level have completed an MBA between their analyst and associate years, though this is not required to start.
The work itself involves helping companies raise money, advising on mergers and acquisitions, and trading securities. The hours are long—60 to 80 hours per week is standard for analysts—and the pay structure combines a base salary with a bonus that can be larger than the base. Entry-level analyst salaries range widely by firm and location, but New York and London firms typically pay more than regional offices.
Key Takeaways
- A bachelor's degree in finance, economics, or accounting is the standard entry point; investment banks hire most analysts directly from college.
- Internships during your junior and senior years of college are the most common path to a full-time analyst offer, and many banks only hire from their intern pools.
- An MBA is not required to start but is often expected before moving from analyst to associate, typically completed at a top-tier program.
- Professional certifications like the CFA (Chartered Financial Analyst) can strengthen your profile but are usually pursued after you have a job in the industry.
- Networking and referrals matter more than applications—most hires come through connections made at recruiting events, university career fairs, or employee referrals.
What degree you need to start as an analyst
Investment banks hire most entry-level analysts from four-year bachelor's programs. The most common majors are finance, economics, accounting, and business administration. Some banks also hire from mathematics, physics, and engineering programs, especially for quantitative roles that involve building models and analyzing data.
Your GPA matters more at the analyst level than it does later in your career. Most large banks have a minimum GPA threshold—often 3.5 or higher—and will screen out applications that fall below it. This is less about the actual quality of your work and more about the volume of applications they receive; GPA is a fast filter.
The school you attend also affects your chances. Investment banks recruit heavily from a small set of universities: Ivy League schools, Stanford, MIT, University of Chicago, Northwestern, and a handful of state schools with strong business programs. This does not mean you cannot get hired from another school, but you will face more competition and may need stronger connections or internship experience to stand out.
Internships are how most people get hired
An internship during your junior or senior year is the most direct path to a full-time analyst offer. Most large investment banks run formal summer internship programs that last 10 to 12 weeks. During that time, you work on real projects—building financial models, analyzing deals, preparing presentations—and are evaluated by senior staff. If you perform well, you receive an offer for a full-time analyst role starting after graduation.
The internship application process typically opens in the fall for the following summer. You submit a resume, cover letter, and sometimes a short application form. If your resume passes the initial screen, you may be invited to a phone interview or a group interview on campus. Interviews focus on your understanding of finance, your ability to work through a problem, and your motivation for the role.
If you do not land an internship, you can still be hired as an analyst after graduation, but it is harder. Some banks have a separate hiring track for non-interns, and you will compete with interns who already know the firm's systems and have relationships with the team. Starting as an analyst without prior internship experience is possible but less common at the largest firms.
The analyst role: what you do and how long you stay
An analyst typically works in one of several divisions: investment banking (mergers and acquisitions, capital raising), sales and trading (buying and selling securities), or research (writing reports on companies and industries). The work is highly technical and involves building spreadsheet models, analyzing financial statements, and preparing materials for client meetings or pitches.
Most analysts stay in the role for two to three years. Some leave for business school, others move to a different firm or industry, and some are promoted to associate within the same bank. Promotion to associate is not automatic; it depends on performance, the firm's hiring needs, and sometimes your willingness to pursue an MBA.
The hours are demanding. You may work late into the evening or through the night during deal cycles, and weekends are not always free. The pay compensates for this: a first-year analyst at a large New York or London bank might earn a base salary of $100,000 to $150,000 plus a bonus that ranges from $50,000 to $200,000 or more, depending on the firm and market conditions. Regional firms and smaller banks pay less.
Getting an MBA between analyst and associate
Many people pursue an MBA after two to three years as an analyst. This is often called the "analyst-to-MBA-to-associate" track. You leave your job, attend business school full-time for two years, and then return to investment banking as an associate at a higher level and salary.
The MBA is not strictly required—some people move from analyst to associate without one—but it is common enough that not having one can slow your advancement. Top-tier MBA programs (Harvard, Stanford, Wharton, Chicago Booth, Columbia) are preferred by large banks, though graduates from other strong programs also get hired.
The MBA also serves as a reset button. If you worked at a smaller bank as an analyst, an MBA from a top program can help you move to a larger, more prestigious firm. If you want to switch divisions—from research to investment banking, for example—an MBA is a natural transition point.
Professional certifications and their role
The CFA (Chartered Financial Analyst) certification is the most recognized credential in finance and investment banking. It requires passing three exams and having relevant work experience. Most people start studying for the CFA after they have a job in the industry, often while working as an analyst or associate.
The CFA is not required to work in investment banking, but it strengthens your profile, especially if you move into roles that involve research, portfolio management, or client-facing advisory work. Some firms encourage or subsidize CFA study for their employees.
Other certifications like the FRM (Financial Risk Manager) or CAIA (Chartered Alternative Investment Analyst) are less common in investment banking but may be useful if you specialize in risk management or alternative investments.
Networking and recruiting events
Most investment banking hires come through networking, not online applications. Recruiting events—held at universities, professional conferences, and through alumni networks—are where banks meet candidates and candidates learn about opportunities. If you attend one of these events and make a good impression, you may be invited to interview even if your resume would not have passed an automated screen.
Alumni connections are powerful. If you went to the same school as someone at the bank, mention it in your cover letter or reach out directly. Many banks have alumni networks that facilitate introductions. Employee referrals also carry weight; if someone inside the bank refers you, your application gets priority review.
Cold applications to job postings are the slowest route. Thousands of people apply for each posted role, and most applications are filtered out by resume screeners or junior staff before a senior person sees them. If you do apply online, customize your resume and cover letter for the specific role and firm, and try to find a way to get a referral or attend a recruiting event.
Frequently Asked Questions
Do I need to study finance in college to become an investment banker?
No, but it helps. Banks hire from many majors, including engineering, mathematics, and physics. What matters more is that you understand financial concepts, can build models, and perform well in interviews. If you majored in something else, you may need stronger internship experience or connections to compete with finance majors.
Can I get into investment banking without an internship?
Yes, but it is harder. Some banks hire analysts who did not intern at their firm, and smaller or regional banks are more open to non-interns. You will face more competition and may need a strong referral or to start at a smaller firm and move to a larger one later.
How long does it take to become a managing director?
Typically 15 to 20 years. The path is analyst (2–3 years), associate (3–4 years), vice president (3–5 years), senior vice president (3–5 years), and managing director. Some people move faster or slower depending on performance, firm size, and market conditions.
What if I did not go to an Ivy League school?
You can still become an investment banker, but you may need to work harder to get noticed. Strong internship experience, a high GPA, and networking can overcome a less prestigious school. Starting at a smaller bank or regional office and moving to a larger firm later is also a common path.
Is the CFA required before I can work in investment banking?
No. Most analysts do not have a CFA when they start. You can pursue it while working, and many people study for it after they have been in the industry for a few years. Some firms encourage it; others do not require it at all.