NYC law partner w/ kids: "$850K gross is not enough to live on"

[Anonymous]

Anonymous wrote:

Anonymous wrote:She should have bought a small condo in Manhattan or Brooklyn before becoming partner or having kids. If she's a second year partner at a top firm (I'm a little thrown by her saying it's "Vault 50" -- I thought only law students cared about Vault rankings? Partners look at AmLaw which ranks by revenues and profits per partner), she's likely about 12 years into her legal career. What has she been doing? Especially if she's married, they could have bought a one bedroom years ago, and since it's NYC, it would have appreciated. Plus they'd have the equity. Then they'd be in the position to rent it out or sell it to move up the ladder.

She also should understand that early partnerhood can be a weirdly cash poor (very relatively) existence. Why is this a surprise to her? I never understand when young partners are surprised or frustrated by this. It's true for everyone except those with family money or other revenue streams (like rental income from the condo you bought as a fifth year associate).

And yes, the fact that they are on their third kid before sorting this out is monumentally stupid. Most NYC lawyers I know have one or two kids, max, because that's what keeps private school a manageable option and allows you to live in smaller but nicer homes, closer in. The ones a know with more kids moved to the suburbs years ago and mostly have SAHPs or family nearby.

A couple of things wrong with this.

I doubt she had the ability to buy a place --- probably student loans and the like.

I would not attack people for their choices on kids. Who knows if it was even a choice.

It’s most certainly a choice. She’s got two others, it’s not exactly a surprise.

[Anonymous]

The three kids is what really blows my mind. I am in Chicago, and the professionals that wanna live in the city routinely stop at two kids.

I wonder if it’s a case that they are having the third to finally get a much wanted boy or girl.

[Anonymous]

Anonymous wrote:

Anonymous wrote:What’s wrong with this? Maybe I don’t understand the commute times.

https://www.redfin.com/NY/Larchmont/7-Gerlach-Pl-10538/home/20111204

the Reddit OP is an entitled whiner, that’s what. she is conveniently omitting a chunk of her annual income because it’s not part of her monthly draw (boo hoo) and thinks she is entitled to a mansion. She also turns up her nose at the Brooklyn schools where she could afford to buy.

Exactly- this is what a friend refers to as "just take the win"- a house in a nice area with good schools, 10 minute walk to a train station with nonstop/1 stop trains 35 minutes into Grand Central. Sure it's 2000 square feet and not 5000, but it's still a very nice standard of living for 5 people. Now you have everything you are looking for for $12k/month including schools. And can deposit that annual profit-sharing check into your "home in the Hamptons" fund and buy that in 8 years or whatever.

[Anonymous]

Anonymous wrote:

Anonymous wrote:The whole post by the NYC lawyer makes no sense to me. She basically claims that her $850k per year translates into just $21k per month take home pay. Even with self funded retirement it should be close to $40k per month after tax. The poster is either dishonest or dumb.

She didn't say that her her take-home pay was limited to $21k per month, she said her take home draw was $21k per month. A significant portion (depending on the firm, the majority of her compensation) is made through partner distributions, which may be paid in sums throughout the year, or, in some cases, entirely in the following calendar year.

I'm not saying she's right - it's tough to sympathize with someone making close to $900k each year. But when you call someone "dishonest or dumb" without either reading carefully or understanding the compensation schedule and structure she's talking about, you out yourself as being the dumb one.

tl;dr - you're an idiot.

Well, you are just proving my point that the OP is either dumb or dishonest. According to you her take home is way more than 21k a month, most likely 40k. Why pretend she can barely make ends meet.

[Anonymous]

Anyone can be priced out of any lifestyle. But people with that much money complaining are just being clueless Asshats.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The whole post by the NYC lawyer makes no sense to me. She basically claims that her $850k per year translates into just $21k per month take home pay. Even with self funded retirement it should be close to $40k per month after tax. The poster is either dishonest or dumb.

She didn't say that her her take-home pay was limited to $21k per month, she said her take home draw was $21k per month. A significant portion (depending on the firm, the majority of her compensation) is made through partner distributions, which may be paid in sums throughout the year, or, in some cases, entirely in the following calendar year.

I'm not saying she's right - it's tough to sympathize with someone making close to $900k each year. But when you call someone "dishonest or dumb" without either reading carefully or understanding the compensation schedule and structure she's talking about, you out yourself as being the dumb one.

tl;dr - you're an idiot.

Does she or does she not have a much bigger annual take home income than $21k/month would suggest?

Likely but impossible to know. Every firm does it differently. My husband prefers a large draw and a smaller payout vs the opposite. Once he has proven his ability to earn a certain amount several years in a row, they allow a large draw.

[Anonymous]

Shouldn't she be using that profit share to save for a home?

[Anonymous]

New Yorker here. NYC is expensive, breaking news at 11

[Anonymous]

In NYC, I get it. I live in a MCOL place in flyover country and feel similarly with a $330 income. Three kids.

The thing is, you get NOTHING in America and everything feels like price gauging. Between student loans, saving for college for kids (which is exorbitantly priced), retirement, insurance premiums etc - even big salaries don’t go that far. We pay a lot in taxes but what are we really getting? We all know there’s no real safety net.

[Anonymous]

Anonymous wrote:

Anonymous wrote:She should have bought a small condo in Manhattan or Brooklyn before becoming partner or having kids. If she's a second year partner at a top firm (I'm a little thrown by her saying it's "Vault 50" -- I thought only law students cared about Vault rankings? Partners look at AmLaw which ranks by revenues and profits per partner), she's likely about 12 years into her legal career. What has she been doing? Especially if she's married, they could have bought a one bedroom years ago, and since it's NYC, it would have appreciated. Plus they'd have the equity. Then they'd be in the position to rent it out or sell it to move up the ladder.

She also should understand that early partnerhood can be a weirdly cash poor (very relatively) existence. Why is this a surprise to her? I never understand when young partners are surprised or frustrated by this. It's true for everyone except those with family money or other revenue streams (like rental income from the condo you bought as a fifth year associate).

And yes, the fact that they are on their third kid before sorting this out is monumentally stupid. Most NYC lawyers I know have one or two kids, max, because that's what keeps private school a manageable option and allows you to live in smaller but nicer homes, closer in. The ones a know with more kids moved to the suburbs years ago and mostly have SAHPs or family nearby.

A couple of things wrong with this.

I doubt she had the ability to buy a place --- probably student loans and the like.

I would not attack people for their choices on kids. Who knows if it was even a choice.

it's not "attacking people" for their choices on kids. 99.9% of the time, kids are preventable if you don't want them/cannot afford it/not ready for it. Unless you are wealthy, most in NYC do not have more than 1-2 kids, because it means $$$$ for private schools and more space in your condo/apartment/etc. So for a Lawyer working as a partner in a major NYC law firm, I'd hope they would know how to avoid getting pregnant until they can figure out housing/etc with extra kids.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The whole post by the NYC lawyer makes no sense to me. She basically claims that her $850k per year translates into just $21k per month take home pay. Even with self funded retirement it should be close to $40k per month after tax. The poster is either dishonest or dumb.

She didn't say that her her take-home pay was limited to $21k per month, she said her take home draw was $21k per month. A significant portion (depending on the firm, the majority of her compensation) is made through partner distributions, which may be paid in sums throughout the year, or, in some cases, entirely in the following calendar year.

I'm not saying she's right - it's tough to sympathize with someone making close to $900k each year. But when you call someone "dishonest or dumb" without either reading carefully or understanding the compensation schedule and structure she's talking about, you out yourself as being the dumb one.

tl;dr - you're an idiot.

PP here- I understand the distinction, now that it's explained. But I am not a partner at a law firm, and didn't understand the distinction between the original stated "$21k/month draw" and "$21k/month take home pay", because it wasn't further explained in the original post. I think it's pretty reasonable for someone not in that world to read "$21k draw" and think that means "$21k/month take home pay". I don't think many people understand the nuances of how law firm partnership finances works, unless they are in that world, and it's a pretty big leap to think an average person would be able to distinguish between "draw" and "take home pay" that clearly.

As stated above, for many law firm partners more than half of their comp comes much later. So maybe starting in August for the prior year. At my old firm the payment say for 2024 would start in August 2025 and continue to February 2026. All you get in the meantime is your monthly draw. From your draw is medical (which is the employer and the employee payments so aboyt 4k a month; 401k; other retirement; interest on capital loan; buy in. So 21k draw could be 11k.

For the PP that said you do not have to put retirement in -- that is dumb. But in any event at many firms a portion is not a choice. You are required to contribute to the defined benefit plan -- no opt out.

Once you have been a partner for a while you do have that extra money coming in from August to February. But that amount can vary widely. At the same level at my firm (same number of shares) I have collected as little as 150k in those payments and as much as 700k. Also your shares can be cut so the next year could be less and the draw less (could go up as well).

No one should cry for biglaw partners. But it is hard to plan for and in bad years is a mess. It works out in the end by the journey can be rough. Part of what you get all the money for.

so the OP is dumb or what? In short order she will have much more than $21k/month to spend. she has a short-term cash flow issue yet she wants to whine about being poor.

well is sounds like she needs to budget for $21K/month to spend, and plan extras out of the "other payouts" that could be $0 or could be $$$$. A smart person would assume the $21K and use the rest for vacations, and use it the next year, not before you receive it.

[Anonymous]

Anonymous wrote:The three kids is what really blows my mind. I am in Chicago, and the professionals that wanna live in the city routinely stop at two kids.

I wonder if it’s a case that they are having the third to finally get a much wanted boy or girl.

Well then she is a lawyer, apparently a good one, so you have to plan for that and make decisions. Choosing to have a 3rd means housing gets much more expensive/it's really challenging to live in only a 2 bedroom anymore.

I always tell people considering a 3rd (after two boys or two girls) to be very certain the reason they are having a 3rd is because they actually want a 3rd, not because they want the other sex finally. Because of the 10+ friends I know with 3 (where the first two are the same sex), only 1 got the opposite.

[Anonymous]

In NYC, the third child is the ultimate luxury. That is some serious FU money to manage that - another bedroom, another tuition. The third child in Manhattan or Brooklyn is the biggest display of wealth there is. Not sure why this poster is rolling with 3 children in NYC if they can't cover the expenses. It's not like it's a surprise.

[Anonymous]

Anonymous wrote:

Anonymous wrote:The three kids is what really blows my mind. I am in Chicago, and the professionals that wanna live in the city routinely stop at two kids.

I wonder if it’s a case that they are having the third to finally get a much wanted boy or girl.

Well then she is a lawyer, apparently a good one, so you have to plan for that and make decisions. Choosing to have a 3rd means housing gets much more expensive/it's really challenging to live in only a 2 bedroom anymore.

I always tell people considering a 3rd (after two boys or two girls) to be very certain the reason they are having a 3rd is because they actually want a 3rd, not because they want the other sex finally. Because of the 10+ friends I know with 3 (where the first two are the same sex), only 1 got the opposite.

Oh, I completely agree. I just do not understand having a third kid in a major American city unless you’re willing to make concessions like living in the suburbs and/or going to public schools.

Only the truly wealthy get to have three or more kids in the city, have a nice five bedroom home, top-of-the-line private schools, etc.

[Anonymous]

Ok her “draw” is 21 / month but she gets huge lump sums throughout the year. Couldn’t she budget those lump sums out to make her monthly take home closer to 30k ish? If you “make” 850 a year - regardless of how it is paid out - it’s up to you to financially plan how to spread that out. Are we saying people in sales / living off sales commissions aren’t able to own homes?