Money Goals for Exiting Big Law
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Anonymous
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I plan to leave Big law in a couple of years. My loans are pretty much paid off, I max out retirement, and own a home with a 575k mortgage. I have two young kids and employ a nanny. I'm not sure what my next job will be but I will most likely take a pay cut. I currently make around $250-275 with bonus annually. My husband makes about the same (not a lawyer). We plan to send our kids to public school but will likely move in a couple or of years. Our current home will likely sell for between 1 and 1.2m.
I'd love to hear financial goals of others who left big law or a similarly lucrative job. Or just give me your advice on what my goals should be. |
Anonymous
| Your goal should be to get out asap |
Anonymous
| If you aren't donating to charity, start doing so. Most here will tell you not to because they're greedy parasites. Don't be a greedy parasite. |
Anonymous
| I think that you first need to think about what exactly your long term plans are after you depart big law. And then come up with a plan which includes how long you want to stick it out in big law. Only you can determine what will make you happy in the future, not some materialistic hags on here. It sounds like your husband makes a great salary so you have a lot of options. I'm sure people on here will come out of the woodwork soon and tell you that you are barely middle class and need to keep your big law job that is eating away at your soul! Maybe if you post more about your future plans, then people could give better advice. |
Anonymous
Saving for college and paying down mortgage are good ways to increase you and your DH's options in the future. I would also add a separate retirement account - maxing out 401k will not yield enough in retirement for a couple who are used to spending as much as you have to spend. This would be a regular account that you and your DH deem to be for retirement- you can afford to be a little riskier in your investments here. |
Anonymous
| Don't get weak and leave BigLaw. You will regret it for the rest of your life and its a terrible example to your kids- to quite. You will also be making a lot more shortly. |
Anonymous
The lesson she'll teach her children if she leaves BigLaw is that BigMoney should not be your #1 goal in life, and that your happiness and fulfillment are more important. Example example for her kids. |
Anonymous
....meant excellent example. |
Anonymous
Lol |
Anonymous
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I didn't have any financial goals when I left. I started in '09 when they were doing all of the deferrals and pulling offers so I had no idea how long I would be able to stay before I was laid off or managed out. This motivated me to pay off my loans ASAP and I think I paid them off in the first 1.5 years. At that point I was making more money than I knew what to do with and my bank account quickly grew into the six figures and I think I had about $150K or so when I left at the three year mark. I got a great offer that I didn't expect to get so quickly but I took it because I was really unhappy in biglaw and I wanted a normal job where I could schedule dates with my spouse and be home for dinner.
You didn't say how much you have in savings or what your typical monthly spend is. I think the latter point is the more important one. |
Anonymous
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Start trying to live on 1 salary and bank to other. It will give you a lot of financial flexibility for the future.
If you can't bank all of it right now, see what you can do to start putting an additional 20% to savings (plus bonus and all salary adjustments) and crank it up by 5% every 3 months. Financial flexibility provides you many options - only you can decide what those are for your family. |
Anonymous
| Live on just your DHs salary. You should be able to do it with a mortgage of $575k. |
Anonymous
| I say - think about investible assets that are NOT 401k/retirement; paying down the mortgage; or saving for college. Keep doing those things of course. But keep in mind that there will never be an easier time to save than in biglaw (unless you end up in house at a hedge fund etc. but most don't). I think too many people focus way too much on paying off student loans and paying down mortgages asap while in biglaw - when those student loan interest rates/mortgage rates are less than the return on the market. Sure you should pay things down faster than required BUT you should withhold some of that prepayment money and invest it -- it'll be the biglaw bonus nest egg that will keep on giving. Personally I wouldn't want to walk out of there with NO bonuses in hand bc all of them went to my student loan provider and mortgage provider. Housing values are fickle and even if they aren't, they're illiquid and the best laid plans for moving sometimes fall through - better to have liquid investments. |
Anonymous
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Thanks-this is helpful. A few more facts about our situation: husband recently moved to $250K but he is in sales/marketing and has had some job losses in the not too distant past. So his income is not super stable (though has steadily climbed over the past 10 years). We have a full-time nanny and pay for my son's half-day pre school (would estimate that we spend about $5K a month on nanny plus school; most of it for nanny obviously). I have about $50K in liquid savings and another $20K in municipal bonds. I'm not sure how much we have in retirement right now. My husband has not had a 401K option at his prior job or at his new job (he is trying to get them to open one). I am at a firm so obvs. no match for my 401K contributions.
My husband's parents contribute the max amount to college savings for each of our kids every year so our financial advisor told us not to worry about making college contributions. I've been at my firm for 5 years this fall and have been fine here. However, I want a more meaningful career and more regular work hours. My splurges are living in a city, childcare, and travel (though nothing super crazy; our travel budget is probably about $10-12K per year for a winter vacation and a summer vacation and lots of weekend trips). I am very lucky to be in the situation I am in, but I want to take advantage of it and plan for the future and am thankful for your advice. |
Anonymous
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Well...what are your long term goals professionally? You guys are clearly set up very well financially right now and DH seems to make a good salary, so you have some flexibility. What kind of law do you practice? If corporate, an in-house gig could be very appealing. If litigation, one of the less stressful government units of DOJ or a smaller firm.
I am an 09 grad and recently left big law. I now work at a mid/small-size (60 person) firm. My salary went from 250K to around 170K. I don't miss it for a second! I work generally 8-5ish, barely work on the weekends, etc. I am a litigator so of course if something comes up it can be the same crazy hours as my big law gig, but life is just so much more pleasant and less stressful. Like your DH, mine makes around 300K so it was a no brainer for us. We have a toddler and are hoping to have another child sometime in the next year or so. |