What % pay cut are you willing to take to go from V100 to in-house? Forum

[Anonymous User]

I realize this question is personal -- highly dependent on ambition, lifestyle, and LS debt, but asking just for fun and insight.

I'm a 3rd year corp associate in major secondary market at Cravath-scale firm, so making 210k base currently. Just got an offer for an in-house counsel (non-AGC) position that pays 170k including bonuses and benefits, supposed to be strict 9 to 5:30, 4 weeks of paid vacation, etc etc. Really tempted to take it despite the 20% pay cut (before firm bonuses). Wondering if I'm being low-balled or if I'm an idiot for giving up so much future income.

[Anonymous User]

I realize this question is personal -- highly dependent on ambition, lifestyle, and LS debt, but asking just for fun and insight.

I'm a 3rd year corp associate in major secondary market at Cravath-scale firm, so making 210k base currently. Just got an offer for an in-house counsel (non-AGC) position that pays 170k including bonuses and benefits, supposed to be strict 9 to 5:30, 4 weeks of paid vacation, etc etc. Really tempted to take it despite the 20% pay cut (before firm bonuses). Wondering if I'm being low-balled or if I'm an idiot for giving up so much future income.

The latter. I would take that in a heart beat. Is 20% worth all the stress and sucky quality of life that comes with big law? Besides if you need more money, you can start a side business while working in house. You can build a house, you can conquer the world.

Point is, your time is yours. take it.

[omar.comin]

Wow, you got this gig as a 3rd year associate? Congrats! Could you PM me your market/practice area? Thanks!

[Anonymous User]

I realize this question is personal -- highly dependent on ambition, lifestyle, and LS debt, but asking just for fun and insight.

I'm a 3rd year corp associate in major secondary market at Cravath-scale firm, so making 210k base currently. Just got an offer for an in-house counsel (non-AGC) position that pays 170k including bonuses and benefits, supposed to be strict 9 to 5:30, 4 weeks of paid vacation, etc etc. Really tempted to take it despite the 20% pay cut (before firm bonuses). Wondering if I'm being low-balled or if I'm an idiot for giving up so much future income.

Hard to answer without knowing your market. If this were LA, NY, SF, I would say 170k all in is ok but not incredible. However, depending on your "major secondary market" (whatever that means lol), it might be pretty good then. Either way, congrats and enjoy your soon to be better life!

[Anonymous User]

OP here. Don't want to out myself, so I'll only say that I'm from a city that flooded badly recently and the company has to do with hydrocarbons (lol).

Only concern is that a good chunk of the 170k is comprised of a year-end bonus that they claim has been paid out every year, but which I think is still ultimately discretionary. Anyone know if an advertised in-house salary should be taken with a grain of salt if much of it is discretionary bonus? Or is it generally safe to take at face value?

I'm in securities/M&A. Got it through recruiters -- basically I've been ignoring all law firm recruiting spam and focusing only on the in-house solicitations, which are rare. I had maybe half a dozen in the last year, but one of them led to this.

[Anonymous User]

Based on various interviews I've had, 170k of hard(ish) compensation is not bad at all outside of finance for a junior in house position. If you want out of biglaw, I would jump and wouldn't look back. That money goes a long way in that particular market...

[oblig.lawl.ref]

OP here. Don't want to out myself, so I'll only say that I'm from a city that flooded badly recently and the company has to do with hydrocarbons (lol).

Only concern is that a good chunk of the 170k is comprised of a year-end bonus that they claim has been paid out every year, but which I think is still ultimately discretionary. Anyone know if an advertised in-house salary should be taken with a grain of salt if much of it is discretionary bonus? Or is it generally safe to take at face value?

I'm in securities/M&A. Got it through recruiters -- basically I've been ignoring all law firm recruiting spam and focusing only on the in-house solicitations, which are rare. I had maybe half a dozen in the last year, but one of them led to this.

Lol, interesting. For the lurkers, I think the poster you are responding to asked the right question. These days, at least in CA, $170K is an okay offer, I think, but it's not quite a thing to salavate over the way it used to be. I think in your type of market $170K is more attractive. But I do share your concern re the bonus aspect. I think it would be worth it seeing if they could switch a greater percentage of the comp from bonus to salary. I would hope that would be a reasonable ask and that you could take it from there.

[Anonymous User]

That feels low for your practice area and market. I know three corporate people that went in house as third or fourth years in the market immediately to your north and they each got base salaries that were were higher than your total comp.

You'll be fine on all in of 170k in your market (especially if you have a spouse making six figures), but I would probably try to hold out for something better.

[Anonymous User]

OP here. Don't want to out myself, so I'll only say that I'm from a city that flooded badly recently and the company has to do with hydrocarbons (lol).

Only concern is that a good chunk of the 170k is comprised of a year-end bonus that they claim has been paid out every year, but which I think is still ultimately discretionary. Anyone know if an advertised in-house salary should be taken with a grain of salt if much of it is discretionary bonus? Or is it generally safe to take at face value?

I'm in securities/M&A. Got it through recruiters -- basically I've been ignoring all law firm recruiting spam and focusing only on the in-house solicitations, which are rare. I had maybe half a dozen in the last year, but one of them led to this.

You should take it at face value. Bonus at companies is always "discretionary", technically. However, if companies didn't pay it, everyone would leave. Obviously if the oil industry tanks, you should expect a lower bonus, but typically should be close to what was promised in a normal year.

Your offer is solid. You can try to negotiate for 10% raise or something, but even if they say no, if you're ready to leave BigLaw life, don't look back. Take the offer and enjoy. You don't know when an opportunity this good will come (particularly because you're still a junior so you getting the offer in first place is not that common).

[Anonymous User]

OP here. Don't want to out myself, so I'll only say that I'm from a city that flooded badly recently and the company has to do with hydrocarbons (lol).

Only concern is that a good chunk of the 170k is comprised of a year-end bonus that they claim has been paid out every year, but which I think is still ultimately discretionary. Anyone know if an advertised in-house salary should be taken with a grain of salt if much of it is discretionary bonus? Or is it generally safe to take at face value?

I'm in securities/M&A. Got it through recruiters -- basically I've been ignoring all law firm recruiting spam and focusing only on the in-house solicitations, which are rare. I had maybe half a dozen in the last year, but one of them led to this.

I'm in-house in the same industry and city. I will say that for most companies in the industry, bonuses are all-but guaranteed. Even in 2015 and 16, when everyone thought the sky was falling, there were still bonuses in line with target bonus.

[nealric]

I realize this question is personal -- highly dependent on ambition, lifestyle, and LS debt, but asking just for fun and insight.

I'm a 3rd year corp associate in major secondary market at Cravath-scale firm, so making 210k base currently. Just got an offer for an in-house counsel (non-AGC) position that pays 170k including bonuses and benefits, supposed to be strict 9 to 5:30, 4 weeks of paid vacation, etc etc. Really tempted to take it despite the 20% pay cut (before firm bonuses). Wondering if I'm being low-balled or if I'm an idiot for giving up so much future income.

PM me if you are willing to add some more details outside of the general forum. I may be able to add some color.

[Anonymous User]

OP here. Thanks everyone for the helpful feedback. Very reassuring to know that this offer (including the large bonus component) is in line with market. Looks like taking this offer would be entirely reasonable, although it would mean having to budget now on the one hand (given the much lower base monthly paycheck), but getting to enjoy evenings and weekends on the other -- not to mention the full month of annual REAL vacation time. Even still, not an easy decision......

[JenDarby]

I agree with those that say it's in line with the market and would be a reasonable offer to take. Certainly it's not on the higher end, but I know plenty of biglaw people who have left for less, certainly as a 3rd year. Here's some additional salary anecdata from the salary data points thread in case you haven't looked:

https://docs.google.com/spreadsheets/d/ ... 0/htmlview#

[1styearlateral]

I think if you crunched the numbers to figure out your current hourly earnings in biglaw and compare them to what you'd be making per hour in house you'll be disappointed in your current rate. But only you can value your own time. There's more to life than just money; what's the point of making an extra $40k if you don't have time to spend it.

[somedude]

I think if you crunched the numbers to figure out your current hourly earnings in biglaw and compare them to what you'd be making per hour in house you'll be disappointed in your current rate. But only you can value your own time. There's more to life than just money; what's the point of making an extra $40k if you don't have time to spend it.

One non-crazy take is that it isn't about being able to spend it, but about being able to save a lot while young. From this perspective, the point of an extra $40k is $240k - $320k in 30 years at a 6-7% return. An "extra $40K" turns into an extra $65k the next year ($360k-$492k in 29 years, at a 6-7% return). To me the "real" trade-off calculation involves thinking more about your future self and compound interest. Not at all saying that staying in blaw is the right move in light of this---the $170K in house job is plenty good to plan for retirement, though you will have to work longer---but it can seemingly be rational to stick it out if the blaw situation isn't terrible.

[1styearlateral]

I think if you crunched the numbers to figure out your current hourly earnings in biglaw and compare them to what you'd be making per hour in house you'll be disappointed in your current rate. But only you can value your own time. There's more to life than just money; what's the point of making an extra $40k if you don't have time to spend it.

One non-crazy take is that it isn't about being able to spend it, but about being able to save a lot while young. From this perspective, the point of an extra $40k is $240k - $320k in 30 years at a 6-7% return. An "extra $40K" turns into an extra $65k the next year ($360k-$492k in 29 years, at a 6-7% return). To me the "real" trade-off calculation involves thinking more about your future self and compound interest. Not at all saying that staying in blaw is the right move in light of this---the $170K in house job is plenty good to plan for retirement, though you will have to work longer---but it can seemingly be rational to stick it out if the blaw situation isn't terrible.

I agree wholeheartedly and decided against even addressing the scenario of being able to save/invest more by staying in biglaw, but unless OP is billing 1800 hours/year, it's probably not as sustainable long-term as would working 40 hrs/week still making decent money. Plus, in house experience is sometimes mandatory (and certainly preferred) for other in house positions. This could be OP's opportunity to make it to GC or some other high-level management role, at which point $320k over 30 years will pale in comparison to the kind of income/investments OP may have available to him.

[somedude]

I think if you crunched the numbers to figure out your current hourly earnings in biglaw and compare them to what you'd be making per hour in house you'll be disappointed in your current rate. But only you can value your own time. There's more to life than just money; what's the point of making an extra $40k if you don't have time to spend it.

One non-crazy take is that it isn't about being able to spend it, but about being able to save a lot while young. From this perspective, the point of an extra $40k is $240k - $320k in 30 years at a 6-7% return. An "extra $40K" turns into an extra $65k the next year ($360k-$492k in 29 years, at a 6-7% return). To me the "real" trade-off calculation involves thinking more about your future self and compound interest. Not at all saying that staying in blaw is the right move in light of this---the $170K in house job is plenty good to plan for retirement, though you will have to work longer---but it can seemingly be rational to stick it out if the blaw situation isn't terrible.

I agree wholeheartedly and decided against even addressing the scenario of being able to save/invest more by staying in biglaw, but unless OP is billing 1800 hours/year, it's probably not as sustainable long-term as would working 40 hrs/week still making decent money. Plus, in house experience is sometimes mandatory (and certainly preferred) for other in house positions. This could be OP's opportunity to make it to GC or some other high-level management role, at which point $320k over 30 years will pale in comparison to the kind of income/investments OP may have available to him.

Helpful counterpoints.

[thexfactor]

I think if you crunched the numbers to figure out your current hourly earnings in biglaw and compare them to what you'd be making per hour in house you'll be disappointed in your current rate. But only you can value your own time. There's more to life than just money; what's the point of making an extra $40k if you don't have time to spend it.

One non-crazy take is that it isn't about being able to spend it, but about being able to save a lot while young. From this perspective, the point of an extra $40k is $240k - $320k in 30 years at a 6-7% return. An "extra $40K" turns into an extra $65k the next year ($360k-$492k in 29 years, at a 6-7% return). To me the "real" trade-off calculation involves thinking more about your future self and compound interest. Not at all saying that staying in blaw is the right move in light of this---the $170K in house job is plenty good to plan for retirement, though you will have to work longer---but it can seemingly be rational to stick it out if the blaw situation isn't terrible.

I agree wholeheartedly and decided against even addressing the scenario of being able to save/invest more by staying in biglaw, but unless OP is billing 1800 hours/year, it's probably not as sustainable long-term as would working 40 hrs/week still making decent money. Plus, in house experience is sometimes mandatory (and certainly preferred) for other in house positions. This could be OP's opportunity to make it to GC or some other high-level management role, at which point $320k over 30 years will pale in comparison to the kind of income/investments OP may have available to him.

In addition, a lot of people think that your time in your 20s and 30s is worth a lot more than time in your 50s and 60s. You can't travel around the same way as your 50s and 60s. In addition, if you would like to start a family and have meaningful relationships, it may be harder to do that in your 20s and 30s.

While money is important, it is very often hard to discount the human element and how much relationships matters. Of course you could be superhuman and just not sleep

[Anonymous User]

I think if you crunched the numbers to figure out your current hourly earnings in biglaw and compare them to what you'd be making per hour in house you'll be disappointed in your current rate. But only you can value your own time. There's more to life than just money; what's the point of making an extra $40k if you don't have time to spend it.

One non-crazy take is that it isn't about being able to spend it, but about being able to save a lot while young. From this perspective, the point of an extra $40k is $240k - $320k in 30 years at a 6-7% return. An "extra $40K" turns into an extra $65k the next year ($360k-$492k in 29 years, at a 6-7% return). To me the "real" trade-off calculation involves thinking more about your future self and compound interest. Not at all saying that staying in blaw is the right move in light of this---the $170K in house job is plenty good to plan for retirement, though you will have to work longer---but it can seemingly be rational to stick it out if the blaw situation isn't terrible.

I agree wholeheartedly and decided against even addressing the scenario of being able to save/invest more by staying in biglaw, but unless OP is billing 1800 hours/year, it's probably not as sustainable long-term as would working 40 hrs/week still making decent money. Plus, in house experience is sometimes mandatory (and certainly preferred) for other in house positions. This could be OP's opportunity to make it to GC or some other high-level management role, at which point $320k over 30 years will pale in comparison to the kind of income/investments OP may have available to him.

In addition, a lot of people think that your time in your 20s and 30s is worth a lot more than time in your 50s and 60s. You can't travel around the same way as your 50s and 60s. In addition, if you would like to start a family and have meaningful relationships, it may be harder to do that in your 20s and 30s.

While money is important, it is very often hard to discount the human element and how much relationships matters. Of course you could be superhuman and just not sleep

Fair points. In OP's situation, I would take the in-house gig (or similar) now or try to get the exact same job in 2 to 3 years, and it would personally be a tough call. I don't really see it as a "your 20s/30s or your 60s" decision...it's a 2-3 year decision that is potentially worth half a million or more (1st year lateral's points about climbing in-house ladder to the side)...I think reasonable minds can differ on that question.

[Anonymous User]

I'm a 2nd year litigator looking to leave the private sector altogether (decided I'm into the PI/govt) thing. I'm also fortunate to only have a net -30k value (my loans were only 70k, so I spent my first year focusing on building a rainy day fund).

So with that said, I'd be fine taking a 300% cut -- low sixties is enough for my lifestyle (and still max 401k). I'm also a boheme and like my personal time.

I also understand that if I gutted out 8 years of big law and stuck to a strict FI/RE diet, I could stop work entirely by the time I'm 40.

Ultimately, though, the decision (mentally, speaking -- still haven't left) came down to the fact that I wish to pursue public interest and that private sector is a mismatch for me.

Know Thyself.

[Anonymous User]

Anon from above -- just saw the "in-house" comment, haha.

[Anonymous User]

Based on these replies it seems like people are a lot more bullish about in house jobs and salaries now than they were even a year ago. Is a 20% pay cut the new normal?

I would almost certainly take this job and I'm a rising 3rd year in NYC, so I would jump immediately if I were in a lower cost of living place like Houston. 170k is great for those hours.

[1styearlateral]

Based on these replies it seems like people are a lot more bullish about in house jobs and salaries now than they were even a year ago. Is a 20% pay cut the new normal?

I would almost certainly take this job and I'm a rising 3rd year in NYC, so I would jump immediately if I were in a lower cost of living place like Houston. 170k is great for those hours.

Especially if you know your salary could only go up.

[Anonymous User]

OP here. Extremely difficult decision, but I ended up turning down this offer. I know it's a solid offer overall, but just feels like I'm leaving firm life too soon, since in 2-4 years AGC roles may be attainable. Sucks to be getting back on the hamster wheel again, but delayed gratification's a bitch...

[smokeylarue]

OP here. Extremely difficult decision, but I ended up turning down this offer. I know it's a solid offer overall, but just feels like I'm leaving firm life too soon, since in 2-4 years AGC roles may be attainable. Sucks to be getting back on the hamster wheel again, but delayed gratification's a bitch...

Turning down 170k in Texas and a chance to leave BigLaw after 3 years? I don't think offers like this come around that often, but best of luck OP.