What Private Bankers Do
Private bankers are essentially financial advisors for high net worth individuals who typically work in large banks, wealth management firms, and investment banks. They meet with their clients to discuss their financial goals, and then help the clients choose the right vehicles to help them get where they need to be. Because the career covers so much territory, private bankers also routinely work with other financial professionals to develop comprehensive strategies for the people they serve. Once a strategy is devised, the private banker then executes the strategy and manages the portfolio, making adjustments as needed to ensure the client’s assets are growing well.
It’s common for a private banker to handle all of a client’s finances, from basic cash management and deposits, all the way through tax planning, retirement preparation, trusts, insurance, and annuities. They may even oversee credit and lending issues should the need arise. This is also what sets the career path apart from traditional wealth management, which focuses on growing wealth, although many consider them to be within the same realm. Because the various job duties can be quite demanding, most private bankers only assist a small group of clients at once, though some larger firms also split up the duties between private bankers and relationship managers, and have the private bankers focus solely on managing portfolios.
Who would enjoy a career in Private Banking?
A career in private banking is ideal for someone who enjoys finance and also likes to work more with people. The career generally offers a comfortable salary, benefits, and work/ life balance than other finance areas such as investment banking, so it’s a good choice for those who want a career in finance, but don’t want their job to dominate their lives. Organizational skills, teamwork, effective communication, computer knowledge, and leadership qualities are also beneficial.
Who mightn't like the career?
Those who get into private banking need to have a deep understanding of accounting and investments, so it’s not a good career path for those who aren’t truly committed to their educations, as well as continuing education after graduation. Although the career does typically provide solid salaries, they aren’t quite as lofty as what other finance professionals might see, so someone more motivated by salary would likely be happier in investments or trading.
Most people don’t become private bankers directly after graduation, although it is possible with the right knowledge and a degree related to finance. Instead, it’s quite common to transition into private banking after working in retail banking, investments, or trading.
Licenses are required to work in the field, and will vary by jurisdiction, as well as by job duties. For example, those who handle insurance may need a special license to do so, as may those who work with variable aunties. Having certifications related to the job requirements is also beneficial, though it often takes years to qualify.
Once it’s established that an interviewee has the required skills to work as a private banker, questions often surround interpersonal skills, salesmanship, and customer service. It’s also helpful to be familiar with the different investment vehicles the firm focuses on, as interviewers often walk the interviewee through a role playing exercise in which they must help a client choose the ideal packages for their needs.
- Common Interview Questions for Private Bankers
- What interviewers really want to know in private banking interviews
Moving into Private Banking from another career
Many financial and insurance careers work as excellent gateways into a career in private banking, but those outside the industry will have difficulty entering the field without advancing their education. For more information, see “The Top 3 Methods of Breaking Into Private Banking.”
Role: Although some firms offer a linear pattern of progression akin to what other finance jobs provide, which include starting as an analyst and moving into an associate role after gaining experience, many simply refer to professionals as “private bankers” from their first day on the job forward. While those just starting out typically work under the direction of a senior private banker to start, they perform all the same duties. This includes talking with clients about their needs and goals, proposing solutions, and executing the strategy.
It’s worth noting that certain firms offer vice president and director roles after this, but it’s somewhat uncommon for people to transition into the roles from private banking. Instead, a move to another department, such as wealth management, is more common.
Private bankers do not usually travel for work, though they may sometimes meet with clients outside the office.
Private Banker: According to data from PayScale, salaries average USD $70,000 in the United States, £56,000 in the United Kingdom, CAD$72,000 in Canada, and AU$112,000 in Australia. Top-performing private bankers who retain the title for an extended period of time can earn double the base salaries listed here.
Bonuses, profit sharing, and commission are all routinely part of a private banker’s salary. Combined, they can reach six figures, even before reaching executive levels.
Why Private Bankers move on
When people move on from private banking, it’s often because they’ve reached a ceiling with income or the firm’s career ladder. If they have developed a strong client base, it’s also common for private bankers to be approached by investment banks and wealth management firms for alternate positions.
While burnout isn’t quite as strong in private banking as it is in other finance careers, those at some of the larger firms may be expected to put in 80-hour weeks at the lower levels. If they get stuck in the position, they often move to a new firm or leave finance altogether. However, the large salaries for top performers, and the knowledge gained while in the position, can prime a person well for entrepreneurship and business leadership roles.
For more information, see “What Do Private Bankers Do After Leaving the Industry” and “Former private banker: Making money is the easy part.”