Any other attorneys considering FIRE / early retirement / part time? Forum

[Anonymous User]

I'm 32-year-old seventh year. Currently sitting at about $1.2M. I think about FIRE, but it still seems far away -- would feel financially comfortable hanging it all up if I had $3M in 2020 dollars in the bank. ($3.15M in 2021 dollars lol). That will take maybe seven more years.

I'm in 90-95% stocks, mostly VTI/VTSAX and a few other random things.

I always find this an interesting mindset. I grew up in a quite poor household, my dad maybe made like 20k a year. In his entire working life, he will have made less than what some people have stashed away. And then still the feeling is that is isn't enough and more is needed. In this case, 4% of 1.2m is 48k for the year to live off. Maybe you won't be able to live like a prince, but you can get a 1 bedroom in any major city center for that if you really need to live there. You could also just move to a cheaper city and it would be really easy to make it all work like that. And this is all accounting for not even having a partner who can further help and disregarding the reality that you will probably still at least work part time (what are you going to do at 21 years old, sit around all day?) and make at least an extra 30k or so. I think one thing that stops someone from retiring is the constant fear of "is this enough?!" which borders on the ridiculous at times.

[nealric]

I'm 32-year-old seventh year. Currently sitting at about $1.2M. I think about FIRE, but it still seems far away -- would feel financially comfortable hanging it all up if I had $3M in 2020 dollars in the bank. ($3.15M in 2021 dollars lol). That will take maybe seven more years.

I'm in 90-95% stocks, mostly VTI/VTSAX and a few other random things.

There's this quote from a Reddit comment that I like and think it is apt in response to your comment. The quote captures how I feel about biglaw in January 2022, and it's not even 2 weeks into the new year. It probably depends on your own situation, e.g., if you have an SO with 4 kids, you'd probably want 3M to feel safe, but if you're just single, no kids, 1.2M is more than enough.

"I think the main thing . . . to focus on now is accumulating enough assets to enable you to live even a meager lifestyle without working. Once you achieve that goal you'll probably find that your mental attitude changes significantly. Work will seem easier in the sense that you don't need it nearly as much; you can now survive without working. The pressure you place on yourself will diminish significantly. What you'll probably find is that you'll keep working so you're able to fund a better lifestyle in retirement. So you'll soldier on, and then at some point the scales will tip. The bullshit at work will supersede your desire for more, and you'll say, 'Screw it... I'm outa here.' When that time arrives you'll know it."

https://www.reddit.com/r/personalfinanc ... etirement/

If you really plan on the "RE" part, only if you plan to be single for the rest of your life and are looking for more of a "Vanlife" type post-working existence. Personally, I think it would be a rather rude awakening to go from biglaw to living on $30k a year for the rest of your life. With two kids in a large city, I personally wouldn't retire on $3.1MM either.

If just getting out of biglaw, there's no real net worth you need to do that. Plenty of more chill in-house/small law/government jobs out there.

[nealric]

I'm 32-year-old seventh year. Currently sitting at about $1.2M. I think about FIRE, but it still seems far away -- would feel financially comfortable hanging it all up if I had $3M in 2020 dollars in the bank. ($3.15M in 2021 dollars lol). That will take maybe seven more years.

I'm in 90-95% stocks, mostly VTI/VTSAX and a few other random things.

I always find this an interesting mindset. I grew up in a quite poor household, my dad maybe made like 20k a year. In his entire working life, he will have made less than what some people have stashed away. And then still the feeling is that is isn't enough and more is needed. In this case, 4% of 1.2m is 48k for the year to live off. Maybe you won't be able to live like a prince, but you can get a 1 bedroom in any major city center for that if you really need to live there. You could also just move to a cheaper city and it would be really easy to make it all work like that. And this is all accounting for not even having a partner who can further help and disregarding the reality that you will probably still at least work part time (what are you going to do at 21 years old, sit around all day?) and make at least an extra 30k or so. I think one thing that stops someone from retiring is the constant fear of "is this enough?!" which borders on the ridiculous at times.

4% is a safe withdrawal rate for a 65 year old retiree. You run a decent chance of running out of money if you draw down 4% a year for 50+ years. A safe withdrawal rate that also allows for inflation "raises" is more like 3%.

It's true that one can go overboard worrying about "enough", but I've also found that having a lot more than enough comes in handy I would have never thought possible at a younger age. I've recently gone through a family crisis that required an outlay of $50k to resolve. Could I have gotten through it without spending the money? Sure, but the money allowed a family member to live out their last days as they wanted instead of inside a nursing home. And that sort of thing is cheap compared to eldercare costs.

Obviously, the conversation is different if you don't have any relatives who ever need support or dependents. But I wouldn't bet on that being the case forever at age 30.

[Anonymous User]

I'm 32-year-old seventh year. Currently sitting at about $1.2M. I think about FIRE, but it still seems far away -- would feel financially comfortable hanging it all up if I had $3M in 2020 dollars in the bank. ($3.15M in 2021 dollars lol). That will take maybe seven more years.

I'm in 90-95% stocks, mostly VTI/VTSAX and a few other random things.

There's this quote from a Reddit comment that I like and think it is apt in response to your comment. The quote captures how I feel about biglaw in January 2022, and it's not even 2 weeks into the new year. It probably depends on your own situation, e.g., if you have an SO with 4 kids, you'd probably want 3M to feel safe, but if you're just single, no kids, 1.2M is more than enough.

"I think the main thing . . . to focus on now is accumulating enough assets to enable you to live even a meager lifestyle without working. Once you achieve that goal you'll probably find that your mental attitude changes significantly. Work will seem easier in the sense that you don't need it nearly as much; you can now survive without working. The pressure you place on yourself will diminish significantly. What you'll probably find is that you'll keep working so you're able to fund a better lifestyle in retirement. So you'll soldier on, and then at some point the scales will tip. The bullshit at work will supersede your desire for more, and you'll say, 'Screw it... I'm outa here.' When that time arrives you'll know it."

https://www.reddit.com/r/personalfinanc ... etirement/

If you really plan on the "RE" part, only if you plan to be single for the rest of your life and are looking for more of a "Vanlife" type post-working existence. Personally, I think it would be a rather rude awakening to go from biglaw to living on $30k a year for the rest of your life. With two kids in a large city, I personally wouldn't retire on $3.1MM either.

If just getting out of biglaw, there's no real net worth you need to do that. Plenty of more chill in-house/small law/government jobs out there.

Not OP, but would it though? I'm in Biglaw and my first year I spent about USD 36k. I went on multiple weekend trips through the year and lived alone in a large one bedroom in the city center. I definitely didn't feel like I had to live below my means. I probably would have had a cheaper place if I didn't want to be so close to work, so probably could have kept it under USD 30k. I think having a partner would make things even easier: you can get a nicer place for the two of you but not one that is necessarily twice as expensive. I moved in with a partner in my second year, total rent went up by 10% compared to last year but this expense was subsequently slashed in half, plus they had an extra USD 80k in income.

Kids though? Yeah, that is the killer. Money sucking machines.

[Anonymous User]

I'm 32-year-old seventh year. Currently sitting at about $1.2M. I think about FIRE, but it still seems far away -- would feel financially comfortable hanging it all up if I had $3M in 2020 dollars in the bank. ($3.15M in 2021 dollars lol). That will take maybe seven more years.

I'm in 90-95% stocks, mostly VTI/VTSAX and a few other random things.

I always find this an interesting mindset. I grew up in a quite poor household, my dad maybe made like 20k a year. In his entire working life, he will have made less than what some people have stashed away. And then still the feeling is that is isn't enough and more is needed. In this case, 4% of 1.2m is 48k for the year to live off. Maybe you won't be able to live like a prince, but you can get a 1 bedroom in any major city center for that if you really need to live there. You could also just move to a cheaper city and it would be really easy to make it all work like that. And this is all accounting for not even having a partner who can further help and disregarding the reality that you will probably still at least work part time (what are you going to do at 21 years old, sit around all day?) and make at least an extra 30k or so. I think one thing that stops someone from retiring is the constant fear of "is this enough?!" which borders on the ridiculous at times.

4% is a safe withdrawal rate for a 65 year old retiree. You run a decent chance of running out of money if you draw down 4% a year for 50+ years. A safe withdrawal rate that also allows for inflation "raises" is more like 3%.

It's true that one can go overboard worrying about "enough", but I've also found that having a lot more than enough comes in handy I would have never thought possible at a younger age. I've recently gone through a family crisis that required an outlay of $50k to resolve. Could I have gotten through it without spending the money? Sure, but the money allowed a family member to live out their last days as they wanted instead of inside a nursing home. And that sort of thing is cheap compared to eldercare costs.

Obviously, the conversation is different if you don't have any relatives who ever need support or dependents. But I wouldn't bet on that being the case forever at age 30.

This is a great point. People always talk about kids as the great money drain (and believe me, they are), but caring for aging family members can also put a strain on finances, and it seems like a lot of people don't consider that as fully, or just assume that someone else in their family will step in. Looking ahead, I can tell that my mother in law will need help in the not-too distant future (she's starting to have some health issues, is an absolute nightmare with money, and none of my spouse's siblings are financially reliable or particularly solvent). We've already started talking about what we would do if she needed to move in with us (which would involve moving ourselves since we live in a small apartment with 2 kids) and what that would look like for us financially. As you said, ensuring that she is as comfortable and happy as she can be in her last years is a big priority for us and it gets real expensive, real quick. That is what makes me uneasy about early retirement.

[nealric]

I'm 32-year-old seventh year. Currently sitting at about $1.2M. I think about FIRE, but it still seems far away -- would feel financially comfortable hanging it all up if I had $3M in 2020 dollars in the bank. ($3.15M in 2021 dollars lol). That will take maybe seven more years.

I'm in 90-95% stocks, mostly VTI/VTSAX and a few other random things.

There's this quote from a Reddit comment that I like and think it is apt in response to your comment. The quote captures how I feel about biglaw in January 2022, and it's not even 2 weeks into the new year. It probably depends on your own situation, e.g., if you have an SO with 4 kids, you'd probably want 3M to feel safe, but if you're just single, no kids, 1.2M is more than enough.

"I think the main thing . . . to focus on now is accumulating enough assets to enable you to live even a meager lifestyle without working. Once you achieve that goal you'll probably find that your mental attitude changes significantly. Work will seem easier in the sense that you don't need it nearly as much; you can now survive without working. The pressure you place on yourself will diminish significantly. What you'll probably find is that you'll keep working so you're able to fund a better lifestyle in retirement. So you'll soldier on, and then at some point the scales will tip. The bullshit at work will supersede your desire for more, and you'll say, 'Screw it... I'm outa here.' When that time arrives you'll know it."

https://www.reddit.com/r/personalfinanc ... etirement/

If you really plan on the "RE" part, only if you plan to be single for the rest of your life and are looking for more of a "Vanlife" type post-working existence. Personally, I think it would be a rather rude awakening to go from biglaw to living on $30k a year for the rest of your life. With two kids in a large city, I personally wouldn't retire on $3.1MM either.

If just getting out of biglaw, there's no real net worth you need to do that. Plenty of more chill in-house/small law/government jobs out there.

Not OP, but would it though? I'm in Biglaw and my first year I spent about USD 36k. I went on multiple weekend trips through the year and lived alone in a large one bedroom in the city center. I definitely didn't feel like I had to live below my means. I probably would have had a cheaper place if I didn't want to be so close to work, so probably could have kept it under USD 30k. I think having a partner would make things even easier: you can get a nicer place for the two of you but not one that is necessarily twice as expensive. I moved in with a partner in my second year, total rent went up by 10% compared to last year but this expense was subsequently slashed in half, plus they had an extra USD 80k in income.

Kids though? Yeah, that is the killer. Money sucking machines.

You might not have to live by the office, but do you really want to live in a shoebox apartment way out in the burbs for the rest of your life to make ends meet? And that doesn't give you much room in your budget for travel or hobbies for your newfound time. I'm sure it can be made to work, but it's likely going to require some lifestyle cutbacks even as a single person. The plan probably works a lot better if you are from a small town in a low cost of living area and just want to move back.

I also think there's a difference between living on a fixed income of $30k and living on $30k when you are making $200k and saving like crazy. If an unexpected expense comes up while you are earning income, the only result is your savings rate dips a bit. If you are on a fixed income, you may need to make some tough choices.

[Anonymous User]

30k as a fixed income is too tight, but I’d be comfortable with 60k, no kids, if it means I’d never have to work again, including never having to serve a boss.

60k/year at 4% withdrawal rate means 1.5M net worth, which is just a bit more from 1.2M.

[Anonymous User]

I’m at about $1.3M now ($1.5M NW but I don’t count my house equity). Hoping to hit about $1.6-$1.7M by next Feb/March, if the markets do OK.

I spend about $40-$45k/yr (majority of that fixed housing costs due to be in HCOL city). I’m mid-30s, married, no kids, we keep our finances separate. So $1.6-$1.7M should give plenty of buffer.

Very seriously considering taking an indefinite sabbatical (potentially RE) early next year. But it’ll be a very tough decision. The job is easy (in-house; I hated biglaw), it pays well (about $300k/yr - more after raises hit).

Working another year could mean another $350k saved (inclusive of growth) - a nicer house, more cushion, etc. But I also realize one-more syndrome could go on indefinitely.

[LBJ's Hair]

I’m at about $1.3M now ($1.5M NW but I don’t count my house equity). Hoping to hit about $1.6-$1.7M by next Feb/March, if the markets do OK.

I spend about $40-$45k/yr (majority of that fixed housing costs due to be in HCOL city). I’m mid-30s, married, no kids, we keep our finances separate. So $1.6-$1.7M should give plenty of buffer.

Very seriously considering taking an indefinite sabbatical (potentially RE) early next year. But it’ll be a very tough decision. The job is easy (in-house; I hated biglaw), it pays well (about $300k/yr - more after raises hit).

Working another year could mean another $350k saved (inclusive of growth) - a nicer house, more cushion, etc. But I also realize one-more syndrome could go on indefinitely.

if your job is actually "easy" you should do mediocre work and make them pry this from your cold dead hands...

[Anonymous User]

Serious question - how did you accumulate that much wealth at 30? Did you go to law school exceptionally early?

Anon here. I went straight through, but I caught a number of lucky breaks as well. Biggest is no debt from law school, thanks to a wealthy grandparent. I live in a low COL city with low taxes and have been making a NY big firm salary with bonus every year. I bought a house early on and it has made huge gains - about 10% each year (I counted that in the $600k even though it's obviously not "cash"). Oh, I also switched firms once and got a nice signing bonus. And thankfully, no major unplanned expenses have come up yet.

In terms of budgeting, I'm most certainly frugal but it's natural for me and I never feel like I'm missing out. I don't really travel much. I haven't been out of the country in years. I took very liberal use of the firm transportation/dinner perks before I left the big firm. Sometimes for weeks on end I wouldn't need to buy groceries.

All of my investments are in index funds with low expense ratios. Obviously the market gains from the last few years in particular have been helpful.
I just checked and I've up~$35k at the moment from that.

I graduated at law school at 25 with about $200k in debt, am now 31 and have a $500kish net worth (will jump to around $600k when the bonus check hits later this month). I also haven't lived particularly frugally or anything, and am in NYC.

[Anonymous User]

I’ve been part time since I was a 4th year associate. Reduced earnings mean less savings, but for me at least the correspondingly reduced workload has extended longevity and given me time to enjoy hobbies that I’m not going to be able to do when I’m older. I also took a sabbatical and realized during that time that I’d get bored without some intellectual stimulation, so I don’t feel like I’m giving up that much by continuing to work a little.

Around 425k net worth as a senior associate, graduated with $215k of debt.

[Anonymous User]

I'm the 32-year-old seventh year with $1.2M (a touch higher after today's stock performance ). I agree with a lot of the comments discussing my post -- for one thing, yes, work is now a little easier knowing that if I quit or were fired tomorrow, I could technically survive. But also, yes, it would be hard to just live on $48k or whatever (and I agree a 4% rule over such a long time frame might be risky -- would prefer 3.5%) for the rest of my life. Money, at some level, is important if you want to be able to buy nice experiences and live it up a bit, which I do. I'm also single and gay, but haven't ruled out kids. If I ever wanted those; they could be expensive.

I picked $3M in 2020 dollars because at $105k/year on a 3.5% rule, I felt like that would allow me plenty of cushion to feel really free doing whatever I wanted for the rest of my life. I spend about $75k-$80k/year in a HCOL now. It would be nice to feel like that number could go up if it needed to. And as some others have commented, it also would be nice to be able to feel like I could absorb a $50k emergency hit if life happens, as it probably one day will. But we'll see what happens -- staying or going from the firm is an every-year decision for me; no guarantees I make it quite that long.

[Anonymous User]

I’ve been part time since I was a 4th year associate. Reduced earnings mean less savings, but for me at least the correspondingly reduced workload has extended longevity and given me time to enjoy hobbies that I’m not going to be able to do when I’m older. I also took a sabbatical and realized during that time that I’d get bored without some intellectual stimulation, so I don’t feel like I’m giving up that much by continuing to work a little.

Around 425k net worth as a senior associate, graduated with $215k of debt.

How did you manage to go part time? I've never heard of this arrangement.

[Sad248]

I think everyone has to decide for themselves what a good time to 'retire' is and also what that actually means. I've seen people here who are happy to retire on $30k a year and others who cannot imagine anything less than $80k a year. Those are pretty large differences. So it's all about the lifestyle you want. Some people need parties, events, concerts, vacations, etc. Others are fine with staying in 6 days a week and cooking every day. Some want kids, some do not. Some have a partner who is bringing in a solid amount, others are single or have a partner who is financial dead weight. Some want to live in Manhattan when they retire, and others want to retire in the south of Spain. Some plan to actually retire, others plan to get a part time job and make some extra bucks, and others want to pursue a fulltime (money-making or not) passion for which they need more capital to start up (like a business or a car collection). These are all factors which could mean you could retire at figures under a million or would need over $3m.

[Sackboy]

I’ve been part time since I was a 4th year associate. Reduced earnings mean less savings, but for me at least the correspondingly reduced workload has extended longevity and given me time to enjoy hobbies that I’m not going to be able to do when I’m older. I also took a sabbatical and realized during that time that I’d get bored without some intellectual stimulation, so I don’t feel like I’m giving up that much by continuing to work a little.

Around 425k net worth as a senior associate, graduated with $215k of debt.

How did you manage to go part time? I've never heard of this arrangement.

This is an incredibly common arrangement in the past 3 or so years all the way into the V10. YMMV on if it's actually a "part-time" gig. Generally, you operate on a "reduced hours" approach with 2,000 as a base. So, if you choose 1,600 hours (which is probably a regular person's full-time job), you make 80%.

[Anonymous User]

My firm has partners on a part time basis making $1.5m+

Unclear how part time it truly is, though.

[Anonymous User]

I think everyone has to decide for themselves what a good time to 'retire' is and also what that actually means. I've seen people here who are happy to retire on $30k a year and others who cannot imagine anything less than $80k a year. Those are pretty large differences. So it's all about the lifestyle you want. Some people need parties, events, concerts, vacations, etc. Others are fine with staying in 6 days a week and cooking every day. Some want kids, some do not. Some have a partner who is bringing in a solid amount, others are single or have a partner who is financial dead weight. Some want to live in Manhattan when they retire, and others want to retire in the south of Spain. Some plan to actually retire, others plan to get a part time job and make some extra bucks, and others want to pursue a fulltime (money-making or not) passion for which they need more capital to start up (like a business or a car collection). These are all factors which could mean you could retire at figures under a million or would need over $3m.

My expenses in the last 10 years have never gone over 30k/year, so I'd be comfortable retiring and never think about money again with a 4% withdrawal rate of 60k/year (there is sufficient wiggle room for the nest egg to automatically compound itself). It's hard to "RE" if you live an inflated lifestyle--it's part of the golden handcuffed. "RE" is not for everyone, and some's definition of "enough" is much less than others'.

[Anonymous User]

I’m at about $1.3M now ($1.5M NW but I don’t count my house equity). Hoping to hit about $1.6-$1.7M by next Feb/March, if the markets do OK.

I spend about $40-$45k/yr (majority of that fixed housing costs due to be in HCOL city). I’m mid-30s, married, no kids, we keep our finances separate. So $1.6-$1.7M should give plenty of buffer.

Very seriously considering taking an indefinite sabbatical (potentially RE) early next year. But it’ll be a very tough decision. The job is easy (in-house; I hated biglaw), it pays well (about $300k/yr - more after raises hit).

Working another year could mean another $350k saved (inclusive of growth) - a nicer house, more cushion, etc. But I also realize one-more syndrome could go on indefinitely.

if your job is actually "easy" you should do mediocre work and make them pry this from your cold dead hands...

Don’t want to burn relationships. I’m in a small specialized legal field. Plus they’ve been good to me.

And the work is easy enough (60% just telling outside counsel what to do and reviewing their work), so no real need to try and do less. I’ll leave when I’m ready, or maybe drop down to 4 days a week next year (instead of quitting) for an even cushier job.

[Anonymous User]

I’ve been part time since I was a 4th year associate. Reduced earnings mean less savings, but for me at least the correspondingly reduced workload has extended longevity and given me time to enjoy hobbies that I’m not going to be able to do when I’m older. I also took a sabbatical and realized during that time that I’d get bored without some intellectual stimulation, so I don’t feel like I’m giving up that much by continuing to work a little.

Around 425k net worth as a senior associate, graduated with $215k of debt.

How did you manage to go part time? I've never heard of this arrangement.

This is an incredibly common arrangement in the past 3 or so years all the way into the V10. YMMV on if it's actually a "part-time" gig. Generally, you operate on a "reduced hours" approach with 2,000 as a base. So, if you choose 1,600 hours (which is probably a regular person's full-time job), you make 80%.

I'm the quoted OP. It's definitely become more common, and it comes in at least a few flavors. One is as Sackboy describes, where "market" associate comp and hours are essentially prorated. By far the most common. Another is bespoke negotiation (i.e., salaried off any normal scale); relatively common as you get more senior (e.g., counsel). Another is to essentially become a contract employee who's paid hourly. I've seen only a few people with this arrangement.

Getting any of the arrangements is like pretty much anything else in biglaw - be an important part of getting things done and hard to replace. And stick up for yourself; nobody is going to spontaneously offer you anything besides the standard burnout track.