Taking Early Exits Off Wall Street

By LESLIE KWOH

After five years in investment banking, Matt Wolf decided he'd had enough.

While the 35-year-old vice president enjoyed his close-knit team of colleagues at Morgan Stanley in Manhattan, he had reached a breaking point: Too many takeout-fueled late nights, too many canceled trips with his wife and too many judgmental looks at social gatherings. His pay—still generous, but lower than he had expected before the financial crisis—was no longer worth the sacrifices.

So last month, he left. With no job lined up, his only plan is to spend the next few months coasting solo on his motorcycle from New York to South America, crashing at hostels and campsites and exploring job opportunities in the emerging markets. "You want to feel good about what you're doing in the long run," says Mr. Wolf, who is now seeking a more entrepreneurial career.

After the financial crisis resulted in less prestige and money, "the equation changed."

Disruption on Wall Street, resulting in image problems for the industry, smaller bonuses and less lavish perks, are spurring other midcareer bankers to similarly reassess their careers.

After a lifetime of targeted choices—attending top-tier schools and pursuing competitive internships in hopes of winning high-paying finance jobs—some bankers are bailing out with no Plan B. Their only certainty, according to interviews The Wall Street Journal conducted with a dozen midcareer bankers, is that they no longer want to stay in banking.

"People in the industry have started to question what the grand purpose is, really," Mr. Wolf says.

Burnouts on Wall Street are nothing new, nor are early retirees who leave after stockpiling cash. But industry recruiters say it is unusual to see 30-somethings, who have spent close to a decade in finance, leaving without an exit plan.

"It's been an all-too-common story line this year," says Ross Baltic, managing partner at Mercury Partners Inc., a Manhattan recruiting firm specializing in investment banking. The middle ranks of bankers naturally thin out as workers head to private equity or hedge funds, but leaving without a destination is a new phenomenon, he says.

Lower pay is, of course, a major factor in prompting bankers to weigh the costs and benefits of the profession. Average bonuses for first-year vice presidents—generally a position with five to 10 years of experience—fell 13% in 2011, to $203,358, according to an annual survey by WallStreetComps.com.

Meanwhile, in a report earlier this month, the New York Comptroller's Office found the total average salary and bonus for securities-industry professionals in New York City rose 0.5% to $362,950 in 2011, but still fell far short of the slightly more than $400,000 from 2007, just before the worst of the financial crisis.

Bankers from Goldman Sachs, Bank of America Merrill Lynch, Morgan Stanley, Citigroup Inc., J.P. Morgan Chase & Co. and UBS AG interviewed for this article —but who declined to be named because either they are still working at the banks or fear they may one day need to return to the industry—cited brutal hours, lack of exercise, weight gain and a nonexistent social life as reasons for leaving.

"I only dated bankers, because they could at least understand my lifestyle," says one Citigroup banker who left the profession in July.

Todd Lawrence, 31, a former Citigroup senior associate in Australia specializing in mergers and acquisitions, says he quit his nearly $300,000-a-year job in December when he realized that after seven years, he would have to put in another three to five years just to advance beyond doing paperwork or proofing pitch books.

"Everyone goes into banking with wide eyes, but once you sit down at your desk, that fades pretty quickly," he says. "You're really just living skin deep. You've got nice suits and nice cars."

Now, he worries about paying his mortgage as he works pro bono for a businessman expanding a silver-production venture in Mexico. But he says he prefers taking that risk and pursuing personal fulfillment "as opposed to something that's just going to give me an income."

Earlier this year, Escape the City, an online community for corporate professionals exploring a career change, polled 75 current or recently departed finance workers. When asked if a raise would change their minds, 36% responded: "No price tag on my soul."

"It's not just a money thing; they just don't feel their values align," says Mike Howe, 28, a partner at Escape the City and a former banker himself.

Several banks contacted for this story, including Goldman Sachs, Bank of America and Citigroup, declined to comment on whether they have observed midlevel talent leaving their firms without jobs.

A person familiar with hiring trends at Morgan Stanley says voluntary turnover across all business units has fallen to the lowest levels since the financial crisis.

Christina Maslach, a University of California, Berkeley psychology professor who has researched job dissatisfaction, says a sense of fairness and values often plays a role in burnout. She likens the banking-migration trend to the dot-com bust circa 1999, when technology firms—initially proud to advertise themselves as "burnout shops"—began losing talent due to tough working conditions and poor morale.

Not everyone makes a permanent escape, with many bankers returning to the industry within a year or two of their departures.

But similar gambles have paid off. Andy Frankenberger left the industry in 2009 after 14 years as an equity-derivatives trader. "I wanted to grow more as a person," he says.

A recreational poker player, the 39-year-old began playing tournaments in 2010 and has since raked in $2.5 million in winnings.

Still, Mr. Frankenberger says he wouldn't rule out someday returning to banking or even starting his own hedge fund. "A lifetime is a long time, right?" he says.

Write to Leslie Kwoh at leslie.kwoh@wsj.com