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Neff

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Stories of extreme frugality in biglaw

Post by Neff » Fri Mar 29, 2019 12:19 pm

What is the most anyone has been able to save in, say, 2-6 years of biglaw (assuming standard Cravath base and bonuses)? Has anyone actually retired (for good — from all work) before the end of the 8/9 year partnership track?

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Re: Stories of extreme frugality in biglaw

Post by Anonymous User » Fri Mar 29, 2019 12:53 pm

I know someone who saved a million in cash between cash savings and 401k.

It involved having roommates for 7-8 years, getting market or above-market bonuses (for good performance), and being single (no kids, no dependents). For the most part this person was pretty frugal, though they sometimes splurged on travel (not often).

Also, not in NYC but another major east coast market.

This person left biglaw after 7-8 yrs, but is still in the legal industry.

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Re: Stories of extreme frugality in biglaw

Post by Anonymous User » Fri Mar 29, 2019 3:51 pm

Single, NYC, no student loans/debt. 18.5 months into big law so far. My networth went from 35k on day 1 of the job to 268k as of today. I got a windfall of 30k along the way from something else but the rest is straight up big law cash and moderate market gains (about ~10.5k attributable to the market). According to mint, I only spend about $2400/month and this included a few international trips since I started.

RaceJudicata

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Re: Stories of extreme frugality in biglaw

Post by RaceJudicata » Fri Mar 29, 2019 4:40 pm

Anonymous User wrote:Single, NYC, no student loans/debt. 18.5 months into big law so far. My networth went from 35k on day 1 of the job to 268k as of today. I got a windfall of 30k along the way from something else but the rest is straight up big law cash and moderate market gains (about ~10.5k attributable to the market). According to mint, I only spend about $2400/month and this included a few international trips since I started.
Where on earth do you live spending only $2400 a month TOTAL?

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Re: Stories of extreme frugality in biglaw

Post by Anonymous User » Fri Mar 29, 2019 4:57 pm

RaceJudicata wrote:
Anonymous User wrote:Single, NYC, no student loans/debt. 18.5 months into big law so far. My networth went from 35k on day 1 of the job to 268k as of today. I got a windfall of 30k along the way from something else but the rest is straight up big law cash and moderate market gains (about ~10.5k attributable to the market). According to mint, I only spend about $2400/month and this included a few international trips since I started.
Where on earth do you live spending only $2400 a month TOTAL?
Brooklyn. Rent is only 2800 for a nice new 3 BR in bushwick, so with utilities my split is about $1050 a month.

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mvp99

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Re: Stories of extreme frugality in biglaw

Post by mvp99 » Fri Mar 29, 2019 5:05 pm

To hell with frugality Yolo you might die tomorrow


Moddsss please de-anon. Mvp99
Last edited by QContinuum on Sat Mar 30, 2019 1:09 am, edited 1 time in total.
Reason: De-anoned at poster's request.

2013

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Re: Stories of extreme frugality in biglaw

Post by 2013 » Fri Mar 29, 2019 5:10 pm

Anonymous User wrote:Single, NYC, no student loans/debt. 18.5 months into big law so far. My networth went from 35k on day 1 of the job to 268k as of today. I got a windfall of 30k along the way from something else but the rest is straight up big law cash and moderate market gains (about ~10.5k attributable to the market). According to mint, I only spend about $2400/month and this included a few international trips since I started.
So you’ve saved a little over $200k from biglaw in 18.5 months. That’s very impressive.

Slightly shocking, tbh though. In 19 months, you would’ve made 205k + 150k = $355k. After taxes, and the $44,500 (2400 x 18.5), were you somehow avoiding taxes?

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Re: Stories of extreme frugality in biglaw

Post by objctnyrhnr » Fri Mar 29, 2019 5:17 pm

This is a good thread. Carry on.

JustHawkin

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Re: Stories of extreme frugality in biglaw

Post by JustHawkin » Fri Mar 29, 2019 5:21 pm

2013 wrote:
Anonymous User wrote:Single, NYC, no student loans/debt. 18.5 months into big law so far. My networth went from 35k on day 1 of the job to 268k as of today. I got a windfall of 30k along the way from something else but the rest is straight up big law cash and moderate market gains (about ~10.5k attributable to the market). According to mint, I only spend about $2400/month and this included a few international trips since I started.
So you’ve saved a little over $200k from biglaw in 18.5 months. That’s very impressive.

Slightly shocking, tbh though. In 19 months, you would’ve made 205k + 150k = $355k. After taxes, and the $44,500 (2400 x 18.5), were you somehow avoiding taxes?
Got out of crypto before the burst, maybe?

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2013

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Re: Stories of extreme frugality in biglaw

Post by 2013 » Fri Mar 29, 2019 6:43 pm

JustHawkin wrote:
2013 wrote:
Anonymous User wrote:Single, NYC, no student loans/debt. 18.5 months into big law so far. My networth went from 35k on day 1 of the job to 268k as of today. I got a windfall of 30k along the way from something else but the rest is straight up big law cash and moderate market gains (about ~10.5k attributable to the market). According to mint, I only spend about $2400/month and this included a few international trips since I started.
So you’ve saved a little over $200k from biglaw in 18.5 months. That’s very impressive.

Slightly shocking, tbh though. In 19 months, you would’ve made 205k + 150k = $355k. After taxes, and the $44,500 (2400 x 18.5), were you somehow avoiding taxes?
Got out of crypto before the burst, maybe?
They said all but 30k was from biglaw (so 35k from before + 30k other still leaves 200k+)

abiglawyer

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Re: Stories of extreme frugality in biglaw

Post by abiglawyer » Fri Mar 29, 2019 6:49 pm

This smells like parental assistance ("pulled myself up by the apron strings")

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Re: Stories of extreme frugality in biglaw

Post by dabigchina » Fri Mar 29, 2019 6:51 pm

abiglawyer wrote:This smells like parental assistance ("pulled myself up by the apron strings")
Either that, or he works at wachtell and makes way above market.

Either way, that's like 11k saved per month. a first year's entire paycheck isn't even going to be 11k per month after withholding.

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Re: Stories of extreme frugality in biglaw

Post by BrainsyK » Fri Mar 29, 2019 6:55 pm

2013 wrote:They said all but 30k was from biglaw (so 35k from before + 30k other still leaves 200k+)
abiglawyer wrote:This smells like parental assistance ("pulled myself up by the apron strings")
I'll join in on the wild speculation and say the $200k savings OP is at a Cravath+ but not quite Wachtell-level firm.

EDIT: Damn it. Scooped.

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BaileyJohnson

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Re: Stories of extreme frugality in biglaw

Post by BaileyJohnson » Fri Mar 29, 2019 6:58 pm

Including my loan payments, my plan is to save around 50k as a first year (also including my bonus).

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Re: Stories of extreme frugality in biglaw

Post by gaddockteeg » Fri Mar 29, 2019 7:03 pm

Anonymous User wrote:Single, NYC, no student loans/debt. 18.5 months into big law so far. My networth went from 35k on day 1 of the job to 268k as of today. I got a windfall of 30k along the way from something else but the rest is straight up big law cash and moderate market gains (about ~10.5k attributable to the market). According to mint, I only spend about $2400/month and this included a few international trips since I started.
I've got you beat. I did 30 months in BigLaw as a junior associate in DC. I saved somehting like 300k cash but this was back when starting salaries were only 160k.

My living expenses were like less than 1k/month including rent/food/travel/fun. How?

I had a live-in GF (now wife) who I split all expenses with. We lived in a 2BR apartment. When my/our roommate moved out, instead of finding another associate, I airbnb-d that room. His share of the rent was like 1.2k and apartment was 2.7k/month. Airbnb income from that room alone was like 2.5 to 3.5k depending on the season (less busy in winter, really busy in spring and summer). So we basically lived there for free.

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Re: Stories of extreme frugality in biglaw

Post by Anonymous User » Fri Mar 29, 2019 10:46 pm

Original anon that everyone is speculating about:

You forgot to account for the 10.5k in market appreciation -- that plus the 35k in prelaw savings and 30k windfall = about 75k not attributable to brute saving, so let's say I saved up about 190k in the 18.5 months. Did you count the summer 5k bonus in the income numbers? I also got a 10k above market bonus for end of 2018, so not quite wachtell level. and definitely no cyrpto lol.

ETA: I just checked my investment spreadsheet and the market appreciation is slightly higher than the 10.5k i initially rounded - $11,891 to be exact.

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Re: Stories of extreme frugality in biglaw

Post by Anonymous User » Fri Mar 29, 2019 10:58 pm

dabigchina wrote:
abiglawyer wrote:This smells like parental assistance ("pulled myself up by the apron strings")
Either that, or he works at wachtell and makes way above market.

Either way, that's like 11k saved per month. a first year's entire paycheck isn't even going to be 11k per month after withholding.
As far as taxes go, I believe I only took 2 exemptions for withholding purposes. I obviously max out my 401k each year and my transit benefit though to minimize pre-income tax.

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Re: Stories of extreme frugality in biglaw

Post by BrainsyK » Fri Mar 29, 2019 11:53 pm

BrainsyK wrote:I'll join in on the wild speculation and say the $200k savings OP is at a Cravath+ but not quite Wachtell-level firm.

EDIT: Damn it. Scooped.
Anonymous User wrote:I also got a 10k above market bonus for end of 2018, so not quite wachtell level. and definitely no cyrpto lol.
I'm claiming victory in this pointless contest.

2013

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Re: Stories of extreme frugality in biglaw

Post by 2013 » Fri Mar 29, 2019 11:54 pm

Anonymous User wrote:Original anon that everyone is speculating about:

You forgot to account for the 10.5k in market appreciation -- that plus the 35k in prelaw savings and 30k windfall = about 75k not attributable to brute saving, so let's say I saved up about 190k in the 18.5 months. Did you count the summer 5k bonus in the income numbers? I also got a 10k above market bonus for end of 2018, so not quite wachtell level. and definitely no cyrpto lol.

ETA: I just checked my investment spreadsheet and the market appreciation is slightly higher than the 10.5k i initially rounded - $11,891 to be exact.
The numbers still don’t add up for me (having 225k (190 + 45 in living expenses - 10k in appreciation) post-tax even with the “extra” 15k). But it’s not my bank account or assets. It’s great that you were able to save that much, though.

Just doing a basic income calculator search, a first year would only take home around 135-140k first year (including bonus and 401k).

It’s just mind blowing is all.

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Re: Stories of extreme frugality in biglaw

Post by Anonymous User » Sat Mar 30, 2019 12:27 am

I work with a 1st year who has saved $7,500/month so far in his 6 months in biglaw. He talks a lot about it actually. Single and no loans to pay. Takes home 10k-ish in his jurisdiction and describes it like this: 1k to rent/utilities (with two roommates), 1k to "stuff" like food, shampoo, Christmas cards, etc.; a few hundred to health insurance or other expenses (travel exclusively by bike or mass transit). $1.5k of that $7.5k goes to his 401(k) and I think the rest goes right into his Vanguard account.

He brings his lunch every day and gets the firm to pay for Seamless dinners a lot more than he probably should (no one cares). There are other little ways it's noticeable, like on the rare occasion he does go to a restaurant or a bar, or when we're discussing pop culture that costs money, like movies (or even things on Netflix, which he doesn't pay for - his entertainment source is an Internet connection with no paid subscriptions). And his commute is a lot longer than mine, which would drive me crazy, but he claims not to mind it and listens to a ton of podcasts.

It just strikes me as exhausting that he thinks about money so much when he doesn't need to. There are plenty of things to think about in biglaw and I consider one of the perks the fact that I never have to think twice about getting whatever I want for lunch or dinner, or getting tickets for a show for date night without having to check my balance first or even think about it.

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Re: Stories of extreme frugality in biglaw

Post by Anonymous User » Sat Mar 30, 2019 8:27 am

Net worth went from -$250,000 to +$250,000 in about 5 years. It is pretty much the best I've heard of personally among friends. I wouldn't say i'm extremely frugal either. Just don't buy shit, paid down debt very fast, and tried to save as much as possible. Other than eat out a few times a month and 2-3 trips a year (none of which cost more than a few thousand) I don't really spend on anything substantial.

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Re: Stories of extreme frugality in biglaw

Post by Anonymous User » Sat Mar 30, 2019 10:11 am

Anonymous User wrote:I work with a 1st year who has saved $7,500/month so far in his 6 months in biglaw. He talks a lot about it actually. Single and no loans to pay. Takes home 10k-ish in his jurisdiction and describes it like this: 1k to rent/utilities (with two roommates), 1k to "stuff" like food, shampoo, Christmas cards, etc.; a few hundred to health insurance or other expenses (travel exclusively by bike or mass transit). $1.5k of that $7.5k goes to his 401(k) and I think the rest goes right into his Vanguard account.

He brings his lunch every day and gets the firm to pay for Seamless dinners a lot more than he probably should (no one cares). There are other little ways it's noticeable, like on the rare occasion he does go to a restaurant or a bar, or when we're discussing pop culture that costs money, like movies (or even things on Netflix, which he doesn't pay for - his entertainment source is an Internet connection with no paid subscriptions). And his commute is a lot longer than mine, which would drive me crazy, but he claims not to mind it and listens to a ton of podcasts.

It just strikes me as exhausting that he thinks about money so much when he doesn't need to. There are plenty of things to think about in biglaw and I consider one of the perks the fact that I never have to think twice about getting whatever I want for lunch or dinner, or getting tickets for a show for date night without having to check my balance first or even think about it.
18month big law anon OP here. I think this post illustrates rule #1 of FIRE minded people - never talk about money with people in real life (who are not into FIRE themselves) because it will generally be met with skepticism, ridicule, contempt, jealousy etc. Imagine you're at work and don't have much savings and your asshole co-worker says she's saved a million in her 401k, while you're still making lease payments on the new luxury car you got -- you're not going to feel good.

That being said, I do agree with this poster that there is a certain balance that needs to be met. I often see a lot of posts in r/FIRE from people who are like "I missed out on my 30s and ate ramen everyday and now i have cancer" (maybe an exaggeration of title, but you know what I mean). I think money and how to spend it is an inherently personal thing and you should use money for things that bring YOU joy and are worth spending on while also saving responsibly for the future. For me, material things and my apartment (where I barely spend much time) don't really bring joy. I like spending my money on getting together with friends and travel instead. I take all 4 weeks of vacation for international trips and get together with friends on weekends, so don't think I am really depriving myself, even if I use an iphone 6 instead of getting the newest iphone.

In my personal experience, big law has actually made me MORE frugal. What do I mean? I billed 2000+ hours last year, which meant that I took a car home and had seamless on the majority of my weekday nights, and had to go home often and log in too. Back when I worked a more traditional office job, I had tons of time after getting off by 630pm to hang with friends and eat out for dinner or grab drinks every night. I find I'm saving more money simply because I don't have the time to spend it because of the nature of big law. This is not a plus and I would rather have free time but it is what it is until I quit big law. Which by the way, saving all this money instead of blowing it on rent or other things I don't care about will let me do whenever I want.

ETA: I should say that I quit drinking alcohol for health reasons so that's been saving me thousands/year.

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Re: Stories of extreme frugality in biglaw

Post by Anonymous User » Sat Mar 30, 2019 11:22 am

I'm not extremely frugal, but in 6 and a half years of big law I've saved about $400,000 (cash, investments, 401(k)), and paid off $140,000 in student loans. Slightly below market pay (usually $10k behind), no significant bonuses to speak of (never more than $10,000, and that was only once...), no windfalls or family money. Obviously if I was working for firms that didn't cheap out on bonuses and lag on salary, I could be much further ahead at this point. I think coast FIRE is pretty do-able by the end of the associate track for folks who are committed and who hit their bonuses (and who don't have a ton of student loan debt), but if you miss out on bonuses or end up at a firm that compresses midlevel salaries, then you're going to have to be more committed to cutting expenses (and even then, if you miss a $80,000 bonus, that's a big set back).

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Re: Stories of extreme frugality in biglaw

Post by Neff » Sat Mar 30, 2019 11:47 am

Really cool to hear these stories. Kudos to all of my mega-savers. I find the fact that this biglaw profession allows a freshly minted graduate to earn close to $2 million gross during the course of an 8-9 year partnership track pretty staggering. And not to mention the hypothetical Susman associate in Texas living with his parents (if this is you please come forward to claim your platinum prize). Few jobs in few societies on this planet allow someone to attain this kind of financial freedom so quickly.

Hearing about what others are doing motivates me even more to not succumb to materialistic bullshit. I was pretty anti-consumerist to begin with (quasi-socialist), and strange as it may seem the stresses of working in biglaw has made me even more so.

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Re: Stories of extreme frugality in biglaw

Post by Anonymous User » Sat Mar 30, 2019 12:16 pm

18 month anon here:

Yep, it’s great to see others in big law who are saving a lot especially since I have no one to talk to about this in real life and it seems my coworkers are spending like $3800 for a 1br to be close to the office etc. People who went from negative net worth above are really inspiring.

To be honest though, I still feel like quitting big law at least once every week. The golden cuffs are so real though because I tell my self that if I can stay for another 2 years I can hit half a million (if the market doesn’t crash in between). As they say, “the first million is the hardest.”

Ive considered the Texas thing given how many recruiters email about it every day. I calculated I would’ve saved about 18k in taxes for 2018 had I been in TX (and even more going forward as my income rises) but I don’t think it’s worth a move just for financial reasons. My rent is already pretty low now so it would have to be a move for QoL which honestly does seem like it would be way better there, except all my friends and family are here. Hence, stuck in nyc.

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