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

Forum Index » Money and Finances

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

Subject:

Emoticons





More smilies

Text Color: Font: Close Marks

[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]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.  [/quote]

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.[/quote]

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.[/quote]

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.[/quote]

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. [/quote]

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.  
[/quote]

I think you don’t get it. She gets much more than $21k a month, annualized. She wants to pretend a huge chunk of income doesn’t exist just because it’s not part of her monthly draw. [/quote]

Options

	Disable HTML in this message
	Disable BB Code in this message
	Disable smilies in this message

Review message

Search Recent Topics Hottest Topics