NYC V5 versus Kirkland Chicago Forum

[Old Gregg]

Anyway, so long as we're on the topic, you seem extremely dismissive of creditor side work. For OP and others (and myself honestly, I know next to nothing about BK), why is that? It's an interesting perspective and I'm curious where it comes from.

I'm not dismissive. I'm just conveying my impression of the general sentiment that debtors work is more prestigious. Aside from that, I have no idea what that translates into in terms of day to day work or exit options. You could very well be right that it's more interesting.

[Anonymous User]

(They very well might. After all, these are market-determined prices. New York commands a premium because people want to live in New York. Then again, you might feel New York is "overpriced.")

Housing prices are of course market-determined, but the "people want to live in New York" point just looks at the demand side of the equation. While people certainly do want to live in NYC more than Chicago, other factors come into play also. IL has lower taxes than NY, and Chicago has no city tax. Supply is more constrained in NY because Manhattan is an Island, while Chicago has no real natural limits to its physical expansion. Supply is also artificially constrained in NYC because of housing regulations. In NYC, developers have to painstakingly preserve every turn of the century tenement building. In Chicago, developers have much more freedom to tear down old buildings and replace them with high-rise apartments. Moreover, Chicago has never had rent control, while NYC has a strong tradition of rent control. To this day, only 40% of NYC apartments are unregulated. While in NYC rent stabilization doesn't apply to housing built after 1974, the effect is cumulative. Much of the high-rise housing stock in Chicago was built between 1950 and 1975. During this same period in NYC, construction was dampened by rent controls and the city has never really made up for this deficit.

Even accounting for the higher demand in NYC, housing in NYC would still be a lot cheaper if there weren't acres and acres of low-rises and mid-rises taking up valuable and limited Manhattan real estate.

Not disagreeing but I will throw out there that you pay 11% sales tax in Chicago. NY is high also, but not applied to every purchase. I always forget about the 11% until my bill comes back being way higher than I anticipated.

Chicago's sales tax is 9.5%, with a 1% surcharge on prepared food in the downtown core. NYC's sales tax is 8.875%, with some exceptions for cheap clothes. Both have exceptions for groceries.

In practice, any difference in sales tax is going to be totally overshadowed by higher prices in NYC for food, cocktails, etc.

Also, for bankruptcy, I think K&E is credited. I don't know which practice is better, but the perception is that you go to K&E for bankruptcy work, and exit options are a lot about perception.

[thesealocust]

Anyway, so long as we're on the topic, you seem extremely dismissive of creditor side work. For OP and others (and myself honestly, I know next to nothing about BK), why is that? It's an interesting perspective and I'm curious where it comes from.

I'm not dismissive. I'm just conveying my impression of the general sentiment that debtors work is more prestigious. Aside from that, I have no idea what that translates into in terms of day to day work or exit options. You could very well be right that it's more interesting.

Oh, no - I know literally nothing about BK, creditor or debtor side; I was saying your perspective was interesting and I was curious about it, and you explained it in your prior post (thanks!)

[Anonymous User]

Second 6:32am anon here:

OP here. Am highly interested in Bankruptcy work (have a little bit of work experience in the area and it's something that I'm really drawn to). How does that change things?

Yes, this substantially changes the calculus. A widely-held belief is that Kirkland and Weil are "it" in bankruptcy. I think that probably overstates the case a little bit, but at a minimum Kirkland is a debtor-side firm and DPW is a creditor-side firm.

Debtor work is generally thought to be the more desirable of the work. The debtor is the company that actually files for bankruptcy (say, United Airlines). The creditors are the banks, the bondholders, the unions, and the shareholders. The debtor's attorneys are akin to distressed-scenario general counsel, overseeing a massive workout from start to finish.

Creditor's attorneys are, on the other hand, in a more narrow role of trying to maximize recovery on a particular claim. I suspect, however, that the case in favor of debtor's work is often overstated. The anon above makes some points that effect.

Davis Polk is a nothing in bankruptcy

You're entitled to your opinion, but what I posted was derived from independent and objective analysis of practice area strengths, so you're really going to have to back your statement up if you want anybody ITT to take you seriously. Convincing me is irrelevant and I don't really care if we disagree, but it isn't helpful to say a firm's practice area "is nothing" without backing it up.

Playing devil's advocate, the best I could come up with is that DPW's BK group is small, but K&E's Chicago practice isn't huge either.

I don't think it's true that "Davis Polk is nothing in bankruptcy," but Weil and Kirkland are the big players here because they get most of the debtor work (which you can verify in the Chambers profiles). Kirkland's bankruptcy group in Chicago is one of the foremost groups in the country (although it and the New York group are basically one group).

Not disagreeing but I will throw out there that you pay 11% sales tax in Chicago. NY is high also, but not applied to every purchase. I always forget about the 11% until my bill comes back being way higher than I anticipated.

Your dollar gets you about 1.7 times further in Chicago than in New York. http://www.nalp.org/buying_power_index_class_of_2010. As far as I know, taxes overall are lower in Chicago or at a least a wash. The money calculus objectively favors Chicago, especially when you take into account above market pay at Kirkland.

[Snape]

You can live a very happy life at 160K in either city--that really shouldn't be a huge factor in less you are absolutely thinking they are equal outside of COL...I'm gonna say NY firm and options is better--historically it is very easy to move from V10 in NY to Chicago (even on a partner track) but much much more difficult to move Chicago to NY....

[thesealocust]

historically it is very easy to move from V10 in NY to Chicago (even on a partner track) but much much more difficult to move Chicago to NY....

Even if this is generally true, Kirkland is probably the exception to the rule. It's as good as the top firms in NYC, without reservation or caveat.

OP: Some quick googling yielded pay dirt; here are people who have worked at both firms. You could reach out to them and get some inside info?

--LinkRemoved--.

http://www.kirkland.com/sitecontent.cfm ... temID=9969

http://www.kirkland.com/sitecontent.cfm ... temID=9893

http://www.kirkland.com/sitecontent.cfm ... temID=9758

http://www.kirkland.com/sitecontent.cfm ... temID=8127

[Anonymous User]

You can live a very happy life at 160K in either city--that really shouldn't be a huge factor in less you are absolutely thinking they are equal outside of COL...I'm gonna say NY firm and options is better--historically it is very easy to move from V10 in NY to Chicago (even on a partner track) but much much more difficult to move Chicago to NY....

It's not just whether you can live comfortably on $160k in either place. It's about what you have in your bank account when you get booted out of big law when you don't make partner. As I showed above, you can easily have ~$300k more to your name after six years in K&E Chicago versus DPW NY. Since OP seems to like the two cities equally, I think it comes down to whether that pretty big difference in finances is outweighed by the perceived difference in exit options.

[Anonymous User]

Second 6:32am anon here:

You can live a very happy life at 160K in either city--that really shouldn't be a huge factor in less you are absolutely thinking they are equal outside of COL....

This is simply not correct. Pay at DPW: $160,000 + 7,500 = $167,500. Pay at Kirkland: $160,000 + 15,000 = $175,000. Then multiply that $175,000 by 1.7 = $297,000. I don't know what's a "huge factor," but $100,000+ is a significant factor in my opinion.

[thesealocust]

Second 6:32am anon here:

You can live a very happy life at 160K in either city--that really shouldn't be a huge factor in less you are absolutely thinking they are equal outside of COL....

This is simply not correct. Pay at DPW: $160,000 + 7,500 = $167,500. Pay at Kirkland: $160,000 + 15,000 = $175,000. Then multiply that $175,000 by 1.7 = $297,000. I don't know what's a "huge factor," but $100,000+ is a significant factor in my opinion.

Every time this comes up on TLS, people get super excited about their ability to look up cost of living numbers and then do basic arithmetic.

Some cities are cheaper to live in and some are more expensive, but choosing Kirkland Chicago over Davis Polk NYC is *light years* away from the same thing as gaining $100,000.

More realistically, the Kirkland person is likely to receive a small amount more in take-home pay after taxes. The two associates will then choose where to live, and the person in Chicago is likely to get a more desirable location and/or nicer and/or more space for the same amount of money. Afterwards they'll make budgets (or not), life within their means (or on credit), save some money (or ignore it), etc.

Just like nobody in America is 8.1% unemployed, nobody has to divide their take-home pay by their cities cost of living index.

It's completely accurate to point out that Chicago's cost of living is lower and that its tax rate is lower. It's asinine to the highest degree to try and make that out to be a $100,000 difference.

[Anonymous User]

Every time this comes up on TLS, people get super excited about their ability to look up cost of living numbers and then do basic arithmetic.

Some cities are cheaper to live in and some are more expensive, but choosing Kirkland Chicago over Davis Polk NYC is *light years* away from the same thing as gaining $100,000.

More realistically, the Kirkland person is likely to receive a small amount more in take-home pay after taxes. The two associates will then choose where to live, and the person in Chicago is likely to get a more desirable location and/or nicer and/or more space for the same amount of money. Afterwards they'll make budgets (or not), life within their means (or on credit), save some money (or ignore it), etc.

Just like nobody in America is 8.1% unemployed, nobody has to divide their take-home pay by their cities cost of living index.

It's completely accurate to point out that Chicago's cost of living is lower and that its tax rate is lower. It's asinine to the highest degree to try and make that out to be a $100,000 difference.

Well it's mostly just to make a point that the COL difference is not as trivial as it seems. My math was admittedly a bit misleading because you should use an aftertax figure and because it's generally more illuminating to gross down rather than gross up.

Say both take home about $100,000 after taxes. The 1.7 figure suggests that if the NY guy spends $100,000 to live, the Chicago guy would only need to spend $61,000 to get the same standard of living. (1.00 is 41% lower than 1.70.) Does that sound more plausible?

I understand your point about 8.1% unemployment (which is an accomplishment, I think, because that's a pretty cryptic point). However, I think it's a bit of an exaggeration. I think that if you looked at a New York associate living a bare minimum, ascetic lifestyle and a Chicago associate doing the same, you'd probably find that the Chicago guy's cost of living was about 40% lower than the New York guy's.

[Anonymous User]

More realistically, the Kirkland person is likely to receive a small amount more in take-home pay after taxes. The two associates will then choose where to live, and the person in Chicago is likely to get a more desirable location and/or nicer and/or more space for the same amount of money. Afterwards they'll make budgets (or not), life within their means (or on credit), save some money (or ignore it), etc.

It's not a small amount. NYC is the most expensive city in the country, while Chicago's is just a little more expensive than average. Given that the two markets pay the same amount, that's cash in your pocket every month.

Big law, for most people, is about quickly paying down their law school debt and saving some money before being "up or outed." That $700/month you save in taxes in Chicago versus NYC is money you can use to pay down your debt faster. For $1,700/month, you can buy an apartment in Chicago closer to work, bigger, newer and cleaner, than anything you can rent in Manhattan in that price range. That's equity you have at the end of the day, and tax savings you can use to pay down your debt faster and save more.

Yes, you can reduce your standard of living in NYC to compensate for the higher CoL, but you can do that in Chicago too. If you're willing to extending your commute from "walking to work" to "spending 35 minutes on two different transit systems" you can move to Jersey City and get a crappy 1BR for $1,800/month. But in Chicago you can move to Lakeview and get that same crappy 1BR for $800/month. Plus, as long as we're talking about reducing your standard of living, why focus just on housing? Take the 1 hour you'd spend on the train in NYC instead of driving to work to cook your own food instead of going out to eat all the time.

For some people, living in a 1BR in Jersey is just as good from a quality of life perspective as living in a 1BR in downtown Chicago. The standard of living compromises are offset by how much they desire to live in NYC. But the OP seems indifferent to NYC versus Chicago. In his case, the only sensible comparison is one in which standard of living is held constant. The salary he receives, minus taxes, minus the amount of money required to achieve that standard of living is the money he has available to pay down his loans, and that number is much bigger in Chicago.

[Anonymous User]

DPW. Easy choice.

[Anonymous User]

DPW. Easy choice.

Say constructive things or go away.

[BruceWayne]

If someone is really interested in bankruptcy I don't see how this is even a discussion. Kirkland and Weil are peerless for bankruptcy law. Perhaps more important is the fact that you can do debtor's work. Essentially no other firms give you that option. If you do bankruptcy work for Kirkland Ellis Chicago for a few years, when you get up or outed every bankruptcy practice in the country will find you attractive. That's extremely important because you will get up or outed at either of these firms. Vault 5 is really kind of meaningless in this sort of context (someone is interested in a particular practice and there is a firm that is very strong in that area that is ranked lower overall in vault). Add in how much more money you will have in your pocket, and the massive increase in QOL due to you being able to afford luxury housing, great restaurants, a nice car etc. (all of which would be a big financial strain in NYC--especially the luxury housing) and it's an easy decision. I would kill to work Kirkland bankruptcy Chicago...

[Snape]

Some very bad advice/logic/and use of the anon feature here....if you are going to use terrible logic/math/experiences at least have the guts to do so w/o anon--otherwise your points are irrelevant, pointless, and gutless.

I agree that COL in Chicago vs. NY for lawyers is much different than any badly created COL calculator. Also, nobody is getting a decent 1bedroom in lake view for 800---thats just idiotic. You have to remember COL in Chicago goes very far west, very far south, and to areas basically in Gary where living costs next to nothing--much different than the outskirts of NY...much much different in fact.

Here is really what you are looking at (not forgetting that even $5 shorts in Chicago has 10.9% sales tax while all clothes in NY under 100 are 0%--huge difference!). You can live in a nice high rise in gold coast/river east/downtown, whatever in Chicago for about 2100. You can live in a great place in Brooklyn for about the same (sometimes less) or Manhattan for about 3500. So there is no doubt rent is different (you are also paying to live in the safest big city in the US compared to the highest murder rate in the US for big cities). Otherwise, tax in NYC is crappy and tax in Chicago is equally crappy.

NY exit options from a V10 kill Kirkland Chicago--no doubt about it--you can also easily move as 5th year from V10 in NYC with a decent reputation to many Chicago firms.

Good Luck but don't ever think there is a big difference in COL from the 2 cities...that idea is mostly for people who argue "why Chicago."

[Old Gregg]

Some very bad advice/logic/and use of the anon feature here....if you are going to use terrible logic/math/experiences at least have the guts to do so w/o anon--otherwise your points are irrelevant, pointless, and gutless.

I agree that COL in Chicago vs. NY for lawyers is much different than any badly created COL calculator. Also, nobody is getting a decent 1bedroom in lake view for 800---thats just idiotic. You have to remember COL in Chicago goes very far west, very far south, and to areas basically in Gary where living costs next to nothing--much different than the outskirts of NY...much much different in fact.

Here is really what you are looking at (not forgetting that even $5 shorts in Chicago has 10.9% sales tax while all clothes in NY under 100 are 0%--huge difference!). You can live in a nice high rise in gold coast/river east/downtown, whatever in Chicago for about 2100. You can live in a great place in Brooklyn for about the same (sometimes less) or Manhattan for about 3500. So there is no doubt rent is different (you are also paying to live in the safest big city in the US compared to the highest murder rate in the US for big cities). Otherwise, tax in NYC is crappy and tax in Chicago is equally crappy.

NY exit options from a V10 kill Kirkland Chicago--no doubt about it--you can also easily move as 5th year from V10 in NYC with a decent reputation to many Chicago firms.

Good Luck but don't ever think there is a big difference in COL from the 2 cities...that idea is mostly for people who argue "why Chicago."

I can say this non-anonymously: no doubt one of the most moronic posts here. And I fuckin hate Chicago fwiw.

[Anonymous User]

OP here. In response to Snape: I have lived in Brooklyn, Manhattan, and Chicago. I know biglaw attorneys who live in Manhattan, Queens, Brooklyn, the Bronx, Connecticut, Jersey City, and various parts of Chicagoland. I think your characterization of the COL difference is way off. (Although I would not be sad to be proven wrong.)

[IAFG]

I fuckin hate Chicago

diaf

[Tropical]

Snape is wrong, but the COL is not even close to 100K. Those calculators assume that Rent is a certain percentage of your budget (a large one). Because rent in Manhattan is twice as expensive at Chicago, it nearly doubles the cost of living. But as an associate with debt, you aren't going to spend a huge percentage of your income on housing. You'll spend a lot less than than average. Just because 40K in Chicago is like 70K in NYC, doesn't mean 160K is 280K in NYC.

You can't compare living in the goldcoast with a large 1-bed (even then 2000 is high for Chicago) with living in a small place in Brooklyn. Goldcoast, Rivernorth, Streeterver is the Manhattan of Chicago. It's nice, and it's just as safe as MFH. And it's probably 1.5-2K a month cheaper. If you want to live in a tiny shithole in Manhattan, you can go lowever, but you can live in a tinyshit hole in River North for 1000 a month. I actually live in Gold Coast for 850 (with free heat), but it's a shoebox (read Manhattan sized). If you really wanted to save money, you can get a 1000 dollar 1 bed in Lakeview, Chicago. That's more comparable to Brookyln or Jersey.

The rest of the COL differences are a lot smaller.

I'd say 20K-25K is probably a good estimate on how much more MFH rent will cost you. More like 15K if you out of MFH. When you factor in personal expenses, food, and other stuff it's probably more like 30-35K total difference.

All for a city that smells like garbage. I don't get it.

[IAFG]

Here is really what you are looking at (not forgetting that even $5 shorts in Chicago has 10.9% sales tax while all clothes in NY under 100 are 0%--huge difference!).

Someone else already explained that this isn't the rate anymore.

[IAFG]

The living situation in NY isn't just expensive, it's also kinda gross. I had a 1BR in Streeterville for $1200/mo. 1000 sq ft, well-maintained elevator midrise. My BIL has a 900 sq ft three bedroom in a (frankly icky) walk-up in Murray Hill and pays more for his share of the rent than I did for my whole apt.

Unless you really hate Chicago or really love NY, I don't get why anyone would choose to deal with NY living conditions for the same salary.

[Anonymous User]

I agree that COL in Chicago vs. NY for lawyers is much different than any badly created COL calculator. Also, nobody is getting a decent 1bedroom in lake view for 800---thats just idiotic.

My friend is living in a nice 1BR in Boystown for around $900. There are a ton on Trulia in the $700-$1000 range.

Here is really what you are looking at (not forgetting that even $5 shorts in Chicago has 10.9% sales tax while all clothes in NY under 100 are 0%--huge difference!).

Chicago's sales tax is 9.5%. Also, do the math. How much money do you spend that qualifies for that exception? $500 a month would be a big number, and it'd save you all of $50/month.

You can live in a nice high rise in gold coast/river east/downtown, whatever in Chicago for about 2100.

I live in a nice high rise in Near North side for $1500. There are a ton of apartments like that for that price. $2100 is the top of the market, in a new building. Look on Trulia.

You can live in a great place in Brooklyn for about the same (sometimes less) or Manhattan for about 3500. So there is no doubt rent is different (you are also paying to live in the safest big city in the US compared to the highest murder rate in the US for big cities).

$2100 is about right for a 1BR high-rise in Brooklyn, but the Brooklyn to DPW in midtown east is a 30 minute train commute. That's a bit further than the Boystown to K&E in River North commute. You're comparing apples and oranges. If you're willing to commute half an hour, compare Lake View to Brooklyn. Otherwise, compare Near North to Manhattan. Either way, you're looking at an $800-$1500/month advantage to Chicago.

Chicago has nowhere near the highest murder rate in the US for big cities. It's not even in the top 5. Moreover, if you look at violent crime overall, instead of just murders, Chicago is only moderately more dangerous than NYC. LA is actually quite a bit safer than both. http://latimesblogs.latimes.com/lanow/2 ... ities.html

Otherwise, tax in NYC is crappy and tax in Chicago is equally crappy.

No, it's not. At $160k, NYC is $700 a month more in state and city taxes. Illinois, even with the recent hikes, has among the lowest income taxes of any big state, comparable to Utah. Chicago sales tax is high, but its property taxes are reasonable and it has no income tax.

$700/month is not nothing, that's a substantial chunk of money. If you've got $200k in loans, and put that money towards your loan payment, after six years you're down to $32k in debt versus $98k. You pay off your loans three years earlier and pay $27k less in total interest.

Good Luck but don't ever think there is a big difference in COL from the 2 cities...that idea is mostly for people who argue "why Chicago."

Sorry you can't do math bro. But I'm actually about to move to NYC to start at a V5 next month, and I've thoroughly researched my options. Maintaining the same standard of living, commute time, etc, I could have saved close to $2,000 a month in Chicago versus NYC just between taxes and housing. That's cash money I could have put towards paying down the ungodly amount of debt I incurred for my JD.

Look, I'm willing to entertain the idea that NYC is worth the money for some people. But OP here has expressed neutrality as between Chicago and NYC. And to overlook large financial savings for the claim that NYC V10 > K&E Chicago in terms of exit options is, in addition to being absolutely filthy Skadden/Latham/Weil trolling, completely unsubstantiated.

[goodolgil]

People are underestimating Brooklyn rents here. In the areas of Brooklyn where most Biglawyers tend to live (Brooklyn Heights, Boerum Hill, Cobble Hill, Carroll Gardens, Park Slope off the Q or 2/3, etc...) the rents are HIGHER than lots of areas in Manhattan.

Yes, you can find a room in Brooklyn in a safe area for cheap. But forget about living in a luxury 1BR in Cobble Hill for anywhere near comparable downtown Chicago rates.

[Flips88]

You can live in a nice high rise in gold coast/river east/downtown, whatever in Chicago for about 2100.

I live a perfectly fine high rise 1BR in streeterville for roughly $1500. There are certainly 1BRs for $2100 in the area, but they are way above average price. Finding a nice 1BR for $1400-1700 is super easy.

[Anonymous User]

People are underestimating Brooklyn rents here. In the areas of Brooklyn where most Biglawyers tend to live (Brooklyn Heights, Boerum Hill, Cobble Hill, Carroll Gardens, Park Slope off the Q or 2/3, etc...) the rents are HIGHER than lots of areas in Manhattan.

Yes, you can find a room in Brooklyn in a safe area for cheap. But forget about living in a luxury 1BR in Cobble Hill for anywhere near comparable downtown Chicago rates.

OP here. I think this is right. My last job was near GCT. Generally speaking, places in Brooklyn within 35 minutes of GCT were not cheap. Even convenient parts of Fort Greene are getting expensive. I know couples in BoCoCa who are living in not-spectacular apartments in the 1000-1100 sq ft range paying ridiculous amounts of money in rent.

Anyway, I feel like this thread has really gotten off track. I don't need to debate COL differences. I feel like I have a really good sense of living in both cities.