Yes, tiny violin - did anyone else struggle first years of law partnership?

[Anonymous]

Anonymous wrote:

Anonymous wrote:What's the firm's recent financial situation? Most firms in AmLaw 100 had record years in 2020 and 2021, picture very different in 2022/23 due to significantly slowdown in deals last year. So you may have made partner at just a difficult cyclical moment, where you are dealing with all the "start up" costs of partnership but also seeing smaller payouts due to belt-tightening. It should even out longterm, but now might be a bit of a pinch point.

Firms don't always do a great job of preparing partners for the financial challenges of that shift. Do you have a good financial manager you can trust? Do you feel that you properly structuring your finances with regards to taxes? I would focus on finding a good, conservative advisor to help with tax and money management, and they will help you structure things so you can avoid cash flow issues during these initial years when the capital contribution and shifting from ordinary income to distributions can be tricky.

Thank you. We need to do this. We unfortunately bought a new home and signed on for private school for another child right before making partner, not aware how cash flow would change. Partnership was not from within but rather from government so we hadn’t saved. Just stressed about cash flow.

I haven't read all of the responses but I think the bolded was a HUGE mistake. You probably bought an expensive new house based on your salary projections just to realize afterward you weren't actually bringing home as much as you thought.

My DH is a big law partner and the first year or two we definitely did not make any major purchases since the tax bill was way higher than when he was a senior associate.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What's the firm's recent financial situation? Most firms in AmLaw 100 had record years in 2020 and 2021, picture very different in 2022/23 due to significantly slowdown in deals last year. So you may have made partner at just a difficult cyclical moment, where you are dealing with all the "start up" costs of partnership but also seeing smaller payouts due to belt-tightening. It should even out longterm, but now might be a bit of a pinch point.

Firms don't always do a great job of preparing partners for the financial challenges of that shift. Do you have a good financial manager you can trust? Do you feel that you properly structuring your finances with regards to taxes? I would focus on finding a good, conservative advisor to help with tax and money management, and they will help you structure things so you can avoid cash flow issues during these initial years when the capital contribution and shifting from ordinary income to distributions can be tricky.

Thank you. We need to do this. We unfortunately bought a new home and signed on for private school for another child right before making partner, not aware how cash flow would change. Partnership was not from within but rather from government so we hadn’t saved. Just stressed about cash flow.

I haven't read all of the responses but I think the bolded was a HUGE mistake. You probably bought an expensive new house based on your salary projections just to realize afterward you weren't actually bringing home as much as you thought.

My DH is a big law partner and the first year or two we definitely did not make any major purchases since the tax bill was way higher than when he was a senior associate.

No, it wasn’t a huge mistake. That part is fine. We bought a home based on the combined salary we had at the time. Our mortgage is not that high. We were renting previously. Our home has also gone up almost a million in value. The issue, once more, for the wives in the back, is that we are making much less per month than we were. The smug judgments aren’t helpful, really. They’re just not. Keep them coming, though, it must make you feel good.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP it sounds like you’re spending more than you earn and didn’t ask any detailed questions about compensation in your new job.

What do you want? We can surmise that the house is an expensive house in a good school district. Send one or both kids to public school for a few years. Or refinance your house. Or apply for financial aid. Whatever.

Well, if you read my actual post, I asked if anyone else struggled at first and when it changed.

Most people were coming from being highly compensated senior associates and non-equity partners and had, you know, savings before doubling down on the mansion and private school. Its not fair that people can be this stupid and still be rich.

Just stop. The vast majority of associates don’t understand that they’ll make less money as a partner than they did as an associate. That’s because law firms want everyone to fight to make partner, so they’re not exactly forthcoming with this info. Unless you have a good friend who is a law firm partner who will clue you in, the most you’re going to get is a few jokes along the line of “lol, you’re a new partner, you’re still paying them.” Not everyone understands that they mean that *literally.*

If OP came from the government to a well compensated Of Counsel position, than I could see how they would assume that they wouldn’t have to take a pay cut when they made partner.

Lawyers hate their coworkers so much that no spills the beans on the con?

Law firms are a giant MLM?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What's the firm's recent financial situation? Most firms in AmLaw 100 had record years in 2020 and 2021, picture very different in 2022/23 due to significantly slowdown in deals last year. So you may have made partner at just a difficult cyclical moment, where you are dealing with all the "start up" costs of partnership but also seeing smaller payouts due to belt-tightening. It should even out longterm, but now might be a bit of a pinch point.

Firms don't always do a great job of preparing partners for the financial challenges of that shift. Do you have a good financial manager you can trust? Do you feel that you properly structuring your finances with regards to taxes? I would focus on finding a good, conservative advisor to help with tax and money management, and they will help you structure things so you can avoid cash flow issues during these initial years when the capital contribution and shifting from ordinary income to distributions can be tricky.

Thank you. We need to do this. We unfortunately bought a new home and signed on for private school for another child right before making partner, not aware how cash flow would change. Partnership was not from within but rather from government so we hadn’t saved. Just stressed about cash flow.

I haven't read all of the responses but I think the bolded was a HUGE mistake. You probably bought an expensive new house based on your salary projections just to realize afterward you weren't actually bringing home as much as you thought.

My DH is a big law partner and the first year or two we definitely did not make any major purchases since the tax bill was way higher than when he was a senior associate.

No, it wasn’t a huge mistake. That part is fine. We bought a home based on the combined salary we had at the time. Our mortgage is not that high. We were renting previously. Our home has also gone up almost a million in value. The issue, once more, for the wives in the back, is that we are making much less per month than we were. The smug judgments aren’t helpful, really. They’re just not. Keep them coming, though, it must make you feel good.

Assuming you are OP, you are the one who made the post, so, sorry that traders believed you?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What's the firm's recent financial situation? Most firms in AmLaw 100 had record years in 2020 and 2021, picture very different in 2022/23 due to significantly slowdown in deals last year. So you may have made partner at just a difficult cyclical moment, where you are dealing with all the "start up" costs of partnership but also seeing smaller payouts due to belt-tightening. It should even out longterm, but now might be a bit of a pinch point.

Firms don't always do a great job of preparing partners for the financial challenges of that shift. Do you have a good financial manager you can trust? Do you feel that you properly structuring your finances with regards to taxes? I would focus on finding a good, conservative advisor to help with tax and money management, and they will help you structure things so you can avoid cash flow issues during these initial years when the capital contribution and shifting from ordinary income to distributions can be tricky.

Thank you. We need to do this. We unfortunately bought a new home and signed on for private school for another child right before making partner, not aware how cash flow would change. Partnership was not from within but rather from government so we hadn’t saved. Just stressed about cash flow.

I haven't read all of the responses but I think the bolded was a HUGE mistake. You probably bought an expensive new house based on your salary projections just to realize afterward you weren't actually bringing home as much as you thought.

My DH is a big law partner and the first year or two we definitely did not make any major purchases since the tax bill was way higher than when he was a senior associate.

No, it wasn’t a huge mistake. That part is fine. We bought a home based on the combined salary we had at the time. Our mortgage is not that high. We were renting previously. Our home has also gone up almost a million in value. The issue, once more, for the wives in the back, is that we are making much less per month than we were. The smug judgments aren’t helpful, really. They’re just not. Keep them coming, though, it must make you feel good.

That was knowable information, if only someone had bothered to ask a few questions.

[Anonymous]

You responded to a lot of posts but I feel like you haven't responded to the ones that suggested a line of credit or somehow otherwise financing the capital contributions. That seems like a pretty straightforward way to resolve this.

[Anonymous]

Anonymous wrote:You responded to a lot of posts but I feel like you haven't responded to the ones that suggested a line of credit or somehow otherwise financing the capital contributions. That seems like a pretty straightforward way to resolve this.

No, it is; thank you. We will do so.
We will likely take a HELOC because we got very lucky in that the home we bought has increased hugely.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What's the firm's recent financial situation? Most firms in AmLaw 100 had record years in 2020 and 2021, picture very different in 2022/23 due to significantly slowdown in deals last year. So you may have made partner at just a difficult cyclical moment, where you are dealing with all the "start up" costs of partnership but also seeing smaller payouts due to belt-tightening. It should even out longterm, but now might be a bit of a pinch point.

Firms don't always do a great job of preparing partners for the financial challenges of that shift. Do you have a good financial manager you can trust? Do you feel that you properly structuring your finances with regards to taxes? I would focus on finding a good, conservative advisor to help with tax and money management, and they will help you structure things so you can avoid cash flow issues during these initial years when the capital contribution and shifting from ordinary income to distributions can be tricky.

Thank you. We need to do this. We unfortunately bought a new home and signed on for private school for another child right before making partner, not aware how cash flow would change. Partnership was not from within but rather from government so we hadn’t saved. Just stressed about cash flow.

I haven't read all of the responses but I think the bolded was a HUGE mistake. You probably bought an expensive new house based on your salary projections just to realize afterward you weren't actually bringing home as much as you thought.

My DH is a big law partner and the first year or two we definitely did not make any major purchases since the tax bill was way higher than when he was a senior associate.

No, it wasn’t a huge mistake. That part is fine. We bought a home based on the combined salary we had at the time. Our mortgage is not that high. We were renting previously. Our home has also gone up almost a million in value. The issue, once more, for the wives in the back, is that we are making much less per month than we were. The smug judgments aren’t helpful, really. They’re just not. Keep them coming, though, it must make you feel good.

PP here - thats was fine when you were making what you were making at the time. But now you aren't bringing in as much and can't afford your house/lifestyle. I am just saying making a large purchase like a home during your first year of partnership isn't the smartest decision. Obviously that ship has sailed. But for others who are in a similar position I would highly suggest not doing a large purchase during your first year until you know how your taxes/contributions, etc shake out.

Best of luck to you - a HELOC seems like the best option.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What's the firm's recent financial situation? Most firms in AmLaw 100 had record years in 2020 and 2021, picture very different in 2022/23 due to significantly slowdown in deals last year. So you may have made partner at just a difficult cyclical moment, where you are dealing with all the "start up" costs of partnership but also seeing smaller payouts due to belt-tightening. It should even out longterm, but now might be a bit of a pinch point.

Firms don't always do a great job of preparing partners for the financial challenges of that shift. Do you have a good financial manager you can trust? Do you feel that you properly structuring your finances with regards to taxes? I would focus on finding a good, conservative advisor to help with tax and money management, and they will help you structure things so you can avoid cash flow issues during these initial years when the capital contribution and shifting from ordinary income to distributions can be tricky.

Thank you. We need to do this. We unfortunately bought a new home and signed on for private school for another child right before making partner, not aware how cash flow would change. Partnership was not from within but rather from government so we hadn’t saved. Just stressed about cash flow.

I haven't read all of the responses but I think the bolded was a HUGE mistake. You probably bought an expensive new house based on your salary projections just to realize afterward you weren't actually bringing home as much as you thought.

My DH is a big law partner and the first year or two we definitely did not make any major purchases since the tax bill was way higher than when he was a senior associate.

No, it wasn’t a huge mistake. That part is fine. We bought a home based on the combined salary we had at the time. Our mortgage is not that high. We were renting previously. Our home has also gone up almost a million in value. The issue, once more, for the wives in the back, is that we are making much less per month than we were. The smug judgments aren’t helpful, really. They’re just not. Keep them coming, though, it must make you feel good.

First time I’m posting on this thread but OP sounds obnoxious, entitled and unlikeable. Why are so many law partners like that?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What's the firm's recent financial situation? Most firms in AmLaw 100 had record years in 2020 and 2021, picture very different in 2022/23 due to significantly slowdown in deals last year. So you may have made partner at just a difficult cyclical moment, where you are dealing with all the "start up" costs of partnership but also seeing smaller payouts due to belt-tightening. It should even out longterm, but now might be a bit of a pinch point.

Firms don't always do a great job of preparing partners for the financial challenges of that shift. Do you have a good financial manager you can trust? Do you feel that you properly structuring your finances with regards to taxes? I would focus on finding a good, conservative advisor to help with tax and money management, and they will help you structure things so you can avoid cash flow issues during these initial years when the capital contribution and shifting from ordinary income to distributions can be tricky.

Thank you. We need to do this. We unfortunately bought a new home and signed on for private school for another child right before making partner, not aware how cash flow would change. Partnership was not from within but rather from government so we hadn’t saved. Just stressed about cash flow.

I haven't read all of the responses but I think the bolded was a HUGE mistake. You probably bought an expensive new house based on your salary projections just to realize afterward you weren't actually bringing home as much as you thought.

My DH is a big law partner and the first year or two we definitely did not make any major purchases since the tax bill was way higher than when he was a senior associate.

No, it wasn’t a huge mistake. That part is fine. We bought a home based on the combined salary we had at the time. Our mortgage is not that high. We were renting previously. Our home has also gone up almost a million in value. The issue, once more, for the wives in the back, is that we are making much less per month than we were. The smug judgments aren’t helpful, really. They’re just not. Keep them coming, though, it must make you feel good.

First time I’m posting on this thread but OP sounds obnoxious, entitled and unlikeable. Why are so many law partners like that?

Is this your first time learning to read as well? OP is not a law firm partner. OP is the spouse of a recent law firm partner who spouse came over to a firm from the government.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What's the firm's recent financial situation? Most firms in AmLaw 100 had record years in 2020 and 2021, picture very different in 2022/23 due to significantly slowdown in deals last year. So you may have made partner at just a difficult cyclical moment, where you are dealing with all the "start up" costs of partnership but also seeing smaller payouts due to belt-tightening. It should even out longterm, but now might be a bit of a pinch point.

Firms don't always do a great job of preparing partners for the financial challenges of that shift. Do you have a good financial manager you can trust? Do you feel that you properly structuring your finances with regards to taxes? I would focus on finding a good, conservative advisor to help with tax and money management, and they will help you structure things so you can avoid cash flow issues during these initial years when the capital contribution and shifting from ordinary income to distributions can be tricky.

Thank you. We need to do this. We unfortunately bought a new home and signed on for private school for another child right before making partner, not aware how cash flow would change. Partnership was not from within but rather from government so we hadn’t saved. Just stressed about cash flow.

I haven't read all of the responses but I think the bolded was a HUGE mistake. You probably bought an expensive new house based on your salary projections just to realize afterward you weren't actually bringing home as much as you thought.

My DH is a big law partner and the first year or two we definitely did not make any major purchases since the tax bill was way higher than when he was a senior associate.

No, it wasn’t a huge mistake. That part is fine. We bought a home based on the combined salary we had at the time. Our mortgage is not that high. We were renting previously. Our home has also gone up almost a million in value. The issue, once more, for the wives in the back, is that we are making much less per month than we were. The smug judgments aren’t helpful, really. They’re just not. Keep them coming, though, it must make you feel good.

First time I’m posting on this thread but OP sounds obnoxious, entitled and unlikeable. Why are so many law partners like that?

Is this your first time learning to read as well? OP is not a law firm partner. OP is the spouse of a recent law firm partner who spouse came over to a firm from the government.

Yep. And all she saw was dollar signs and started spending willy nilly before actually bothering to see how it was all going to work.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Your tax withholding sounds really high for that income. I bet it is incorrect.

Seems about right to me - maybe a little high. OP likely has to pay taxes in 15+ jurisdictions, plus UK and other countries.

For which she gets tax credits.

As a retired big law equity partner, I find so many posts about the financial hardships of being an equity partner in big law to be laughable. So many of them are untrue.

There is no truer statement than this: the only thing worse than being an equity partner in a big law firm is being in a big law firm and not being an equity partner.

I make a lot more than OP as a NE partner, and as a result I’m not so sure about that.

[Anonymous]

Big law wife here: it’s a bit of a shock when you pay estimated tax for this year and taxes for last year on April 15. I cried. We had the money but still I thought partner was more money.

[Anonymous]

Also private school: yes it’s a lot but in our case it paid off for our DC.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What's the firm's recent financial situation? Most firms in AmLaw 100 had record years in 2020 and 2021, picture very different in 2022/23 due to significantly slowdown in deals last year. So you may have made partner at just a difficult cyclical moment, where you are dealing with all the "start up" costs of partnership but also seeing smaller payouts due to belt-tightening. It should even out longterm, but now might be a bit of a pinch point.

Firms don't always do a great job of preparing partners for the financial challenges of that shift. Do you have a good financial manager you can trust? Do you feel that you properly structuring your finances with regards to taxes? I would focus on finding a good, conservative advisor to help with tax and money management, and they will help you structure things so you can avoid cash flow issues during these initial years when the capital contribution and shifting from ordinary income to distributions can be tricky.

Thank you. We need to do this. We unfortunately bought a new home and signed on for private school for another child right before making partner, not aware how cash flow would change. Partnership was not from within but rather from government so we hadn’t saved. Just stressed about cash flow.

I haven't read all of the responses but I think the bolded was a HUGE mistake. You probably bought an expensive new house based on your salary projections just to realize afterward you weren't actually bringing home as much as you thought.

My DH is a big law partner and the first year or two we definitely did not make any major purchases since the tax bill was way higher than when he was a senior associate.

No, it wasn’t a huge mistake. That part is fine. We bought a home based on the combined salary we had at the time. Our mortgage is not that high. We were renting previously. Our home has also gone up almost a million in value. The issue, once more, for the wives in the back, is that we are making much less per month than we were. The smug judgments aren’t helpful, really. They’re just not. Keep them coming, though, it must make you feel good.

First time I’m posting on this thread but OP sounds obnoxious, entitled and unlikeable. Why are so many law partners like that?

Is this your first time learning to read as well? OP is not a law firm partner. OP is the spouse of a recent law firm partner who spouse came over to a firm from the government.

Yep. And all she saw was dollar signs and started spending willy nilly before actually bothering to see how it was all going to work.

And her husband had no say in what house he lived in or where he sends his kids to school? He somehow is with it enough to make partner but not capable of these decisions?