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Private Equity Analyst Salary in the U.S.

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A career in the private equity sector is considered challenging due to the stressful and long working hours, but it is also highly rewarding. PE firms provide employees with a comfortable and stimulating environment and high compensation. 

The private equity analyst’s salary depends on experience, job role or work profile, geographic location, etc. The PE industry does not only offer competitive salaries but perks, too, like bonuses, company stock options, insurance benefits, paid vacations, etc. These things add up to make a more rewarding salary package. 

Here, we will delve deeper and learn what private equity analysts do and how much money P.E. analysts make. 

What does a Private Equity Analyst do? 

Private equity analysts work on specific tasks on teals rather than handling the process from beginning to end. They perform the following tasks: 

  • Cold calling to get new deals. 
  • Monitoring portfolio companies. 
  • Conducting due diligence on likely investments. 
  • Building an initial or simpler financial model for the company. 
  • Collecting data and performing research on the data. 
  • Researching about the competitors and their offerings. 
  • Coordinating with the legal and accounting teams. 
  • Staying updated with financial and market news 
  • Checking emails and relying on urgent messages. 
  • Updating an LBO model 
  • Making cases to determine the impact of the projections. 
  • Joining the call to discuss customer contracts, financial data, 
  • Mining and cleaning the data into a more presentable and usable format. 
  • Making drafts for meetings. 
  • Sharing the findings with the higher officials in the P.E. hierarchy. 

 

Private Equity Analyst Salary Components 

Before we arrive at the private equity salary package, it is important to understand that the income of a private equity analyst is made up of these components: 

  1. Base salary 

This is a fixed amount of money that the analyst receives every month. 

  1. Bonus 

Firms pay This variable amount to their employees according to their company performance. This component is based on investment returns and includes the following sub-categories. 

Co-investment: If the company has permitted their employees to put money and participate in some deals, they can get returns. The money they make from those deals forms a part of compensation. 

Carried interest: Though this component is mostly for higher-ranking officials, it is a share of the returns or total pool percentage of the fund. 

In most PE companies in the U.S., the combination of base salary and bonus makes for all-inclusive compensation. From Analysts to M.D.s, individuals earn massively through bonuses and carried interests. Usually, the all-in compensation remains around $300,000 on average. There are also annual raises that are discretionary and can be from $25,000 to $50,000. 

 

Private Equity Analyst Salary Overview and Roles 

The analyst makes around $80,000 to $130,000 annually. Though compensation is different worldwide, it is believed that PE firms in the U.S. pay their employees a much higher salary than in other countries. However, private equity firms pay analysts lesser salaries than investment banks. An IB analyst mostly earns a total of $130,000 to $160,000. 

When you work in the PE industry, you can count on the bonuses, which are substantially higher when you perform well. You can get high salaries, bonuses, and carried interest. However, you will receive a carry when you get to a senior position. 

The salary range is widely dependent on the factors like: 

  • Education: Professionals with a higher degree or better academic credentials are known to earn more. 
  • Private Equity Certifications: These certifications demonstrate your expertise and proficiency in your field. If you are exploring how to get into private equity, then be informed that pursuing private equity certification and obtaining educational degrees will get you into PE. Also, you will get paid more than those who don’t have the certification. 
  • Experience: The salary of an analyst also considers the number of years of work experience in the P.E. industry. The more experience you have, the higher your package will be. 
  • Region: The salary of a private equity analyst also depends on the location or region. In cities like New York, you get higher compensation, while the figures are lower in the smaller cities and outside the U.S. The PE analyst is known to make more money in the U.S. compared to Europe and Asia, where the former pays 20% less and the latter pays about 40% less. This makes the U.S. the best region for private equity professionals. 
  • P.E. Firm: Top PE companies pay more than other mid-sized private equity firms. 

| Read More: Private Equity Certificate Program 

Wrapping Up 

Considering the paycheck and other benefits, private equity is a lucrative career option. The demand for private equity professionals has been soaring yearly. PE firms around the globe continue to hire analysts. So, there are lots of opportunities for you and a lot of money to go around, too! 

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