Survival: How to Maintain a Financial Career When the Market Turns

Roy Cohen has seen several cycles. As Vice President of Wall Street, he was there because of the 1987 market crash. He was there for the LTCM and the Asian crisis. He was a career coach at Goldman Sachs in New York City during 2008. If you want to survive what may or may not come in the fourth quarter of 2022, Cohen is well positioned to offer advice.

His key to survival? Prepare the ground. “If it’s the end of the year and you’re just thinking about how to keep your job and how to get a promotion, you have good luck,” Cohen says. “You need to build your reputation and network over time.”

If banks do cuts after Labor Day as Ken Moelis predicted, Cohen suggests acting now to identify factors that might put a target on your back. Don’t go to HR for those, he says: They won’t be forthright. Go to colleagues and managers, to the people who work with you and for you. “You need to go there with this message,” Cohen says, “I really love what I do, I am committed to success and want to stay in this position.” Do you have any recommendations on what I can do to improve?”

As we noted earlier, senior professionals in the banking sector do not hesitate when it comes to expanding on their own achievements. Historically, Goldman Sachs managing directors have had no problem describing themselves using superlatives. If others refer to themselves as “exceptional,” do you want to be known simply as “good”? Lay the foundation now.

Another adjustment that needs to be made beforehand is related to personal spending. One financial advisor, who has spent a decade working as a trader in US and European investment banks, said it’s critical to control your personal expenses. “The biggest mistake people make in banking is assuming that their income will grow exponentially,” he tells us. “They started earning £100,000, it rose to £1 million within ten years, and they increased their personal spending accordingly. Then they found themselves in a very difficult position when their role became redundant.”

Don’t get used to exorbitant spending. “Once you get used to business class travel and stay in five-star hotels, it becomes very difficult to move into the lower market,” the merchant says. “You get stuck in high spending habits and don’t save or invest enough for the future.”

If you have savings, you will have a wider range of career options when the market turns. When Shehzad Yunus worked as a portfolio trader for Morgan Stanley, he saved as much as he could. “I wasn’t a huge spender at all,” Yunus said. While his classmates flock to private schools and big houses, Yunus said he lives modestly and pays off his debts: “I saved because I wasn’t sure when I would get an income next time.” These savings enabled him to leave Morgan Stanley and create Muzz, an Islamic dating site backed by Y Combinator, which he aspires to turn into a unicorn.

Maintaining your financial services job may mean taking wise steps into thriving careers at that point in the cycle (for example, from trading to digital markets to trading again). If you are moving for unforeseen financial reasons, you will be less able to identify roles that provide you with continuity of both earnings and potential. “If you don’t have savings and your fixed costs are very high, you will need to accept the first thing that comes your way,” says the former trader. “I am only now able to become a financial advisor because I am financially free,” he says. “For me, that’s the passion, and it’s beneficial, but I also have investments that exceed my costs of living.”

This is the true measure of career success, he says: “You want to be able to do what you want to do, when you want to do it.” Planning is required.

Photo by Tim King on Unsplash

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