law firm partner salaries Forum

[mho11]

surely after a few years they could afford it but it wouldn't be pocket change

Mayyybe some bank would give someone making $1M a year a $6M mortgage (though I somewhat doubt it these days). But they would be leveraged to the hilt. When you consider the ratio of after tax income to the cost of the property that's like someone making $100k buying a $1M place.

I believe the rate of savings plays a part where the $1M maker is able to save more. OTOH the $1 mil maker may also be more prone to spend more rather than save.

[Renzo]

Taxation isn't the obstacle you think, especially at the high end.

http://www.irs.gov/pub/irs-soi/07intop400.pdf

Biglaw partners do get hit with taxes particularly hard compared with corporate executives of similar income. Biglaw partners don't get stock options (more ordinary income, less capital gains), they have to pay 100% of payroll taxes, and they usually end up paying 100% of their health insurance premiums.

Again, what exactly can't one afford with $1-3 million a year--which is increasing well over the rate of inflation--and a modest rate of savings?

In NYC, where a large percentage of biglaw partners are, quite a lot actually. For example: this is what $6 Million gets you in the Upper East Side: --LinkRemoved--. A very nice place, to be sure, but not crazy extravagant. At 2,500 sq feet, people in the midwest burbs have houses the same size that cost under $200k. Someone making $1M a year couldn't afford it.

2500 sq. ft on the UES not extravagant???? WTF is extravagant, then? Do you have to own a fucking island? How can you compare a ranch house in suburban Kansas City to a luxury building in the most lusted-after zip code in the country?

[quakeroats]

Taxation isn't the obstacle you think, especially at the high end.
In NYC, where a large percentage of biglaw partners are, quite a lot actually. For example: this is what $6 Million gets you in the Upper East Side: --LinkRemoved--. A very nice place, to be sure, but not crazy extravagant. At 2,500 sq feet, people in the midwest burbs have houses the same size that cost under $200k. Someone making $1M a year couldn't afford it.

So you're saying that not being able to buy a huge apartment in the most exclusive area of the most expensive city in the country immediately upon making over $1M a year should count as an obstacle?

[nealric]

2500 sq. ft on the UES not extravagant???? WTF is extravagant, then? Do you have to own a fucking island? How can you compare a ranch house in suburban Kansas City to a luxury building in the most lusted-after zip code in the country?

It's all relative. A 600sq ft studio in Harlem is extravagant compared to a shack in Hati. But you have to admit that the family in KC is living in the same amount of space.

My main point is that even biglaw partners aren't to the "money is no object" level of wealth. This is what your neighbors in the UES will be living in:

--LinkRemoved--

That's extravagant.

[Renzo]

2500 sq. ft on the UES not extravagant???? WTF is extravagant, then? Do you have to own a fucking island? How can you compare a ranch house in suburban Kansas City to a luxury building in the most lusted-after zip code in the country?

It's all relative. A 600sq ft studio in Harlem is extravagant compared to a shack in Hati. But you have to admit that the family in KC is living in the same amount of space.

My main point is that even biglaw partners aren't to the "money is no object" level of wealth.

It is all relative, and square footage is about the worst possible metric to equalize comparisons. If it weren't, people all over would forego swank downtown condos and instead opt for doublewide trailers in the sticks.

As for your main point, I agree, but neither are the vast majority of corporate execs, or bankers, or consultants, or any other field where people work for a living. There is no profession where "money is no object" is anything but a pipe dream/lottery chance. There are only 500 Fortune-500 CEO's, after all.

[BruceWayne]

Taxation isn't the obstacle you think, especially at the high end.

http://www.irs.gov/pub/irs-soi/07intop400.pdf

Biglaw partners do get hit with taxes particularly hard compared with corporate executives of similar income. Biglaw partners don't get stock options (more ordinary income, less capital gains), they have to pay 100% of payroll taxes, and they usually end up paying 100% of their health insurance premiums.

Again, what exactly can't one afford with $1-3 million a year--which is increasing well over the rate of inflation--and a modest rate of savings?

In NYC, where a large percentage of biglaw partners are, quite a lot actually. For example: this is what $6 Million gets you in the Upper East Side: --LinkRemoved--. A very nice place, to be sure, but not crazy extravagant. At 2,500 sq feet, people in the midwest burbs have houses the same size that cost under $200k. Someone making $1M a year couldn't afford it.

Irony at its best. In fairness, outside of NYC and parts of California, most people making that kind of salary can essentially afford whatever they want that's within reason (ie not a personal island, private jet, a professional sports franchise etc.). When you think about it, it's really quite remarkable just how expensive NYC is. You're practically paying to breath in Manhattan.

[Renzo]

Irony at its best. In fairness, outside of NYC and parts of California, most people making that kind of salary can essentially afford whatever they want that's within reason (ie not a personal island, private jet, a professional sports franchise etc.). When you think about it, it's really quite remarkable just how expensive NYC is. You're practically paying to breath in Manhattan.

Don't worry, NYC hates you too.

[nealric]

If it weren't, people all over would forego swank downtown condos and instead opt for doublewide trailers in the sticks.

A lot of people out in the burbs have no interest whatsoever in living in Manhattan. People can and do forgo swank downtown condos for a house with a yard.

Irony at its best.

Not really. The number of biglaw partners making $1M+ is tiny outside of NYC. A lot of the NYC partners making that kind of money wouldn't be making it outside of NYC. That's the issue- biglaw is centered around high COL cities. You don't make $1M in biglaw living in St. Louis.

[Grond]

Let's use John Edwards as an example. From his bio it appears during his law career that he was always part of a law firm. He was a plaintiff lawyer who managed to win several million dollars. Based on the amount he won it appears he earned a large percentage of the winnings that went to him rather than the firm. I don't quite understand how the earnings works out when in trial law and how much goes to the lawyer vs the firm.

Back to my previous post, please. Does anyone have an answer?

The phrase in the industry is "eat what you kill". The guy who brings in the case gets most of the cash. Most PI firms have one (maybe two or three) lawyers that are bringing in the cases and keeping most of the money. As always, it varies considerably from firm to firm.

Edit: Joe Jamail, for example. Texaco v. Pennzoil. Rumor has it Jamail's fee was 335 million, with each associate at the firm getting 1 million.

[Renzo]

If it weren't, people all over would forego swank downtown condos and instead opt for doublewide trailers in the sticks.

A lot of people out in the burbs have no interest whatsoever in living in Manhattan. People can and do forgo swank downtown condos for a house with a yard.

RIght, but what I'm saying is that it's the yard, the quiet, the schools, the lack of minorities, etc., that draws people to the 'burbs--not square footage alone. People don't generally move into dilapidated neighborhoods for bigger houses, for example.

I'm just trying to say that rather than comparing real estate based on the metric of "LOL at tiny NYC apartments," maybe market price is a better measure of the general desirability of real estate. After all, a given person with a given budget for a house can either buy a tiny city condo, or a big suburban house based on personal preferences, and all of everyone's aggregate preferences give us a market price

[nealric]

After all, a given person with a given budget for a house can either buy a tiny city condo, or a big suburban house based on personal preferences, and all of everyone's aggregate preferences give us a market price

But in NYC the market is skewed. A partner who works 60-70 hour weeks in midtown can't really choose a big suburban house. There isn't enough time in the day for them to spend 3 hours commuting. NYC has a disproportionate number of high-income people who need to live in a very small geographic area in order to make that income.

[RVP11]

Being a (big firm) lawyer is a great way to live a nice, comfortable, upper-middle class lifestyle. But your chances of getting filthy rich from legal practice are very slim.

Equity partners at NLJ250 firms make anywhere from $300k to $5m. Most V100 partners in New York make well north of $1m, while most BigLaw partners outside of NY/DC/CA/Chicago will never make more than $1m.

[rayiner]

Taxation isn't the obstacle you think, especially at the high end.

http://www.irs.gov/pub/irs-soi/07intop400.pdf

Biglaw partners do get hit with taxes particularly hard compared with corporate executives of similar income. Biglaw partners don't get stock options (more ordinary income, less capital gains), they have to pay 100% of payroll taxes, and they usually end up paying 100% of their health insurance premiums.

Again, what exactly can't one afford with $1-3 million a year--which is increasing well over the rate of inflation--and a modest rate of savings?

In NYC, where a large percentage of biglaw partners are, quite a lot actually. For example: this is what $6 Million gets you in the Upper East Side: --LinkRemoved--. A very nice place, to be sure, but not crazy extravagant. At 2,500 sq feet, people in the midwest burbs have houses the same size that cost under $200k. Someone making $1M a year couldn't afford it.

NYC is shit, pure shit.

This is what $2.7m buys you in Chicago: http://www.condo.com/PropertyDetails.aspx?ID=7598595

A thousand more square feet, less than half the price, and right next to a big fucking lake.

--ImageRemoved--

--ImageRemoved--

Kirkland, Sidley, etc, pay NYC lockstep to associates and have $1.5m+ PPP.

Hell if you're a lowly associate you can afford this:

--ImageRemoved--

Yes, your view includes both the John Hancock building and the big fucking lake. For $525k. Big. fucking. lake.

[ResolutePear]

After all, a given person with a given budget for a house can either buy a tiny city condo, or a big suburban house based on personal preferences, and all of everyone's aggregate preferences give us a market price

But in NYC the market is skewed. A partner who works 60-70 hour weeks in midtown can't really choose a big suburban house. There isn't enough time in the day for them to spend 3 hours commuting. NYC has a disproportionate number of high-income people who need to live in a very small geographic area in order to make that income.

Pft. I'm the big baller millionaire.

I have a personal helicopter to and from my suburban mansion in CT.

[ResolutePear]

A thousand more square feet, less than half the price, and right next to a big fucking lake.

And 3000 miles away from your job in NYC.

[RVP11]

Taxation isn't the obstacle you think, especially at the high end.

http://www.irs.gov/pub/irs-soi/07intop400.pdf

Biglaw partners do get hit with taxes particularly hard compared with corporate executives of similar income. Biglaw partners don't get stock options (more ordinary income, less capital gains), they have to pay 100% of payroll taxes, and they usually end up paying 100% of their health insurance premiums.

Again, what exactly can't one afford with $1-3 million a year--which is increasing well over the rate of inflation--and a modest rate of savings?

In NYC, where a large percentage of biglaw partners are, quite a lot actually. For example: this is what $6 Million gets you in the Upper East Side: --LinkRemoved--. A very nice place, to be sure, but not crazy extravagant. At 2,500 sq feet, people in the midwest burbs have houses the same size that cost under $200k. Someone making $1M a year couldn't afford it.

NYC is shit, pure shit.

This is what $2.7m buys you in Chicago: http://www.condo.com/PropertyDetails.aspx?ID=7598595

A thousand more square feet, less than half the price, and right next to a big fucking lake.

--ImageRemoved--

--ImageRemoved--

Kirkland, Sidley, etc, pay NYC lockstep to associates and have $1.5m+ PPP.

Hell if you're a lowly associate you can afford this:

--ImageRemoved--

Yes, your view includes both the John Hancock building and the big fucking lake. For $525k. Big. fucking. lake.

Gawd I wish I had Chicago ties.

[rayiner]

A thousand more square feet, less than half the price, and right next to a big fucking lake.

And 3000 miles away from your job in NYC.

Nah. Just a mile and a half from your $2.5m PPP job at Kirkland.

[ResolutePear]

A thousand more square feet, less than half the price, and right next to a big fucking lake.

And 3000 miles away from your job in NYC.

Nah. Just a mile and a half from your $2.5m PPP job at Kirkland.

If we're talking hypotheticals here..

I want Eric Schmidt's job. I'd love to yell at my secretary: "RELEASE THE GOATS!" while pocking 300k for each word, with a 50k bonus for the emphasis.

(For those who do not know: Eric Schmidt is Google's CEO.)

[Renzo]

After all, a given person with a given budget for a house can either buy a tiny city condo, or a big suburban house based on personal preferences, and all of everyone's aggregate preferences give us a market price

But in NYC the market is skewed. A partner who works 60-70 hour weeks in midtown can't really choose a big suburban house. There isn't enough time in the day for them to spend 3 hours commuting. NYC has a disproportionate number of high-income people who need to live in a very small geographic area in order to make that income.

True, commutes everywhere (not just NYC) screw this up a little, but not that bad. The vast majority of Biglaw partners I've spoken to commute from either upstate, CT, or NJ.

[nealric]

Gawd I wish I had Chicago ties.

Try Houston. This could be yours for 5.5 Million:

[ResolutePear]

^^ Yeah, but it's in Texas.

[cortnf]

^^ Yeah, but it's in Texas.

[nealric]

^^ Yeah, but it's in Texas.

You have to admit that it's pretty crazy compared to the more expensive place in NYC.

[BruceWayne]

If it weren't, people all over would forego swank downtown condos and instead opt for doublewide trailers in the sticks.

A lot of people out in the burbs have no interest whatsoever in living in Manhattan. People can and do forgo swank downtown condos for a house with a yard.

Irony at its best.

Not really. The number of biglaw partners making $1M+ is tiny outside of NYC. A lot of the NYC partners making that kind of money wouldn't be making it outside of NYC. That's the issue- biglaw is centered around high COL cities. You don't make $1M in biglaw living in St. Louis.

That's not what I meant by irony. I meant it's ironic that the city where most posters want to end up and make six figures+ is a city where making six figures plus isn't really a big deal. In addition, this notion that there are very few partners outside of NYC making big bucks is a prominent myth perpetuated on TLS. In many of the large metro areas in the US you can find law firm partners who make large sums of money. There are plenty of them in DC, Chicago, LA, Atlanta, Dallas, Houston, Miami etc. Living in Chicago or Atlanta as a law firm partner gives you a much, much higher standard of living than doing so in NYC.

[nealric]

That's not what I meant by irony. I meant it's ironic that the city where most posters want to end up and make six figures+ is a city where making six figures plus isn't really a big deal. In addition, this notion that there are very few partners outside of NYC making big bucks is a prominent myth perpetuated on TLS. In many of the large metro areas in the US you can find law firm partners who make large sums of money. There are plenty of them in DC, Chicago, LA, Atlanta, Dallas, Houston, Miami etc. Living in Chicago or Atlanta as a law firm partner gives you a much, much higher standard of living than doing so in NYC.

I didn't get that notion from TLS. Sure, you can find biglaw partners making big bucks everywhere, but they are far fewer outside of NYC. I know quite a few of non-NYC biglaw partners, and most of them aren't making $1M a year. Moreover, there are far fewer biglaw partners at any salary level outside of NYC. I can't find it offhand, but a month or two ago ATL posted a map of how many biglaw attorneys there were in each city. NYC dominated by a huge margin.

Besides, I'm not making a normative judgement about what city people should live in for overall happiness. I'm just making a factual judgment about where there is the highest likelihood of making that salary.