Accounting Partner vs Law Partner
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considering that this is a finance based forum I doubt you will have any luck. Sorry, but I would try another forum. What I guess would be true is that Law would be better compensation but more work. Accounting would be less compensation less work. Again considering that this is a finance forum I would try other forums for Law/Accounting. I wish you the best, and I hope you crush it and get what you want !
More comp for law. More hours for law but each are rough. Partner chances about the same. slightly more stability in accounting
No idea in terms of law, but I have worked Big 4 audit and I wasn't impressed with the partners there. Pay is absolute garbage, even if you do become partner you might not get equity for a few years. You're still working tough hours, especially during busy season. At my office (in a major city) partners weren't as big picture as I thought or would have hoped. They are still reviewing audit files, going through these minute details, asking questions and saying we need to do follow up testing on petty expenses. When your charge out rate is $1000/hour, you shouldn't be spending time worrying about a $7K legal expense of some insurance branch.
The upside is summer is so slow that you'd get a great work/life balance. I wouldn't even see some partners for most of the summer - I can only assume they are out golfing/drinking/spending time with family. It's also a really secure position, so once you're in you're set for life. Exit ops are great as well as you'd be going to be CFO or VP of Finance at a company.
Overall it's not a bad gig, but to be honest if I was offered audit partner tomorrow I probably wouldn't take it.
Oh yeah? If you were offered a partner position tomorrow, as a first year analyst, you wouldn't take it?
Lol'd
Not a chance. Like I said - I've been there and I've seen it.
This. 100%. Just a few things to add here. Accounting is a dying industry, especially in audit where the value you bring to clients is a diminishing proposition and can nearly be automated (and is moving in that direction for the forseeable future).
At all levels the work is ridiculous commensurate to the reward in Big 4 accounting and I wouldn't approach that arena of with a 10 foot pole. In contrast, if you go into the BIg 4, go to Deloitte and go into Consulting, specifically S&O / Strategy.
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On Law, you have another problem. Everyone and their grandma is a lawyer these days and the general US market is flooded with attorneys. If you are headed in this direction go to only the top 10 law schools in the country or be prepared to face chronic unemployment and a considerable student debt.
You will also work long hours but if you manage to land a decent gig the pay is great. The path to partner is also similar to audit in that law is a commodity industry for many of the general things you would need lawyers for (e.g., incorporation, shareholders agreemnts etc.). Some specific areas like IP law, M&A are still good bets. The best place to be in law is actually in-house counsel, so target that.
Some truth here -- some of it is a bit off. I had multiple partners who were very open with me about the process, comp, etc. 1. Pay isn't necessarily garbage -- but like any sales role, pay is tied to the size/type of clients you bring in, TO SOME DEGREE. EX: If you get SEC partner tracked vs. private client, your pay is a fair bit higher. There is also not as much emphasis on sales at some point, as you have required partner rotation. If you are the right kind of partner in the right industry you will just roll from SEC client to SEC client and the pay is pretty good. One partner left his tax return up on his computer when he had given it to me to do some stuff for him (clearly not caring that it was there) - he was pulling in 875, granted he was 50 something and a few years from retirement. 2. The hours suck. Most partners during busy season (at least toward filing deadlines) are there with the team until midnight. If you happen to have off-cycle clients, it means you can be doing those hours during weird times of the year. All said, work life balance isn't great. 3. Depending on the firm, the reason comp is lower in the first few years is that you have downside protection (and you are paying off your buy-in). PwC for instance starts partners around 300 (if I recall) but you are not responsible for any downside the first three years if the firm loses money. 4. Billing rates in Big 4 are complete bullshit. Yes, partners "bill" at $1k an hour, but its nothing but an internal metric. Each job is based on pre-negotiated fee with budgeted hours. As you go over the budget, it starts eating into the partners returns. Their hours are simply a balance between how much profit they can squeeze out of the job, and how many they need to bill to show the SEC that they proper oversaw the job. 5. Firms pay a percentage of your last years salary once you hit the forced retirement age... yeah. That guy making 875 will get a very high percentage of that for life. 6. Major downside is there is no guarantee you will make partner, and the typical track is something like 12-15 years.
Big / Middle Market law: 1. Much more focus on hours, as you are truly generating revenue based on what you bill (unlike big 4). 2. Most firms are partner track in 7 years (assuming you are not the of-counsel route). Most firms even guarantee it in writing when you sign your employment agreement. 3. Comp is significantly better at all stages--granted you had a 3 year opportunity cost for additional school. That said, depending on your market, starting salaries are anywhere from about $85 (before bonus, profit share, etc.) in small markets, $110 to $115 in middle market, and the big boys are starting you out at $150-165. 4. Work-life is very firm dependent, As much as I hated the big 4, outside of busy season there is a decent bit of flexibility at lower levels--I worked at home most fridays during the summer once I was senior, I had 5 weeks of vacation, benefits (except comp) were pretty good. Big law is attrocious. You do not own your life until you make partner, because unless you are billing, you are not making the firm money. And billing requirements are STRINGENT. 6 minute intervals, can't bill for research (granted you just call it by another name), etc. Hours at middle market firms can be more reasonable, but your required hours (to get your bonus) are usually fairly high. 5. Partner comp is very firm specific. Big law: those guys are easily clearing a mil. But you have the potential to find a boutique working in a niche with 10 partners that is doing the same with better work life balance. So it really depends.
Happy to answer other specifics. My wife is in law (as was my father) and I am a CPA who left and is now working at a boutique investment management firm.
Very good post. I don't have any expertise on accounting, but I have a ton of lawyer friends who all went to T14 law schools (most of them top 10) and work in biglaw. A couple of notes on some of your points: entry level at biglaw is now $180k. Cravath raised it this year and almost every other firm has followed suit. Second, the path to partner at biglaw is longer than 7 years. Fifteen years ago 7 was an accurate number, but the dual pressures of an oversupply of lawyers and automation have caused biglaw firms to lengthen that number and introduce things like non-equity partners. Eight to nine years is a more accurate figure for partner at a top firm, and it is absolutely not given in writing to entry level associates. As for work-life, it is firm dependent even in biglaw. I've had friends who worked 100+ hours a week regularly and others who clock in at ~70. It depends on your practice, the firm, and how they staff. Some firms have a model where associates are in a "pool" and can be staffed on any partner's work. Others have associates assigned to a partner and they can only be staffed on that partner's engagements. In the latter case, if your partner isn't that busy you are not as busy.
What kind of goober thinks $250k+ in compensation "garbage."
Let's be honest here, the majority of the people on this board will NEVER see that level of comp. Sure you might be in a field that offers comp in excess of that figure, but the odds of reaching that level are very slim. And for those that hit the $250k mark, (1) you are pretty special and (2) you are probably not butt-hurt about that you didn't hit six figures.
My advice would be go into the field where you, given your skill set and background, can excel.
The finance guy from a non-target background (assuming he breaks in) probably is going to struggle making MD at a known IB. I would think this would be similar for law partners.
On the other hand, there are plenty of audit partners with non-target backgrounds.
note: $250k is a super conservative figure. I knew a few "big-10" (if that exists) senior managers with comp around $175k in a non-major market. No idea why they shared their comp with me.
note to the note: I have never done audit
This has been said before in other threads, but being a law or accounting partner has really nothing to do with a 9-5, job security, being promoted, or even your ability. It's all. About. Sales. You become a partner by bringing in revenue--that's it. Your work-life balance is whatever it takes to bring in enough revenue to justify your partnership in the firm. You become a partner because you produce x amount of revenue for the firm; therefore, it's worth it to the other partners to give you a greater piece of the action in order to prevent you from taking your relationships and the resulting revenue with you to another firm.
Your hours are your hours--whatever it takes to bring in revenue and manage your staff.
Can't rec this enough - I'm blessed to have two parents who are successful attorneys but man they still work all the damn time and one of them runs their own practice while the other is a senior partner doing Big Law. The money can be dope, but the hours will suck and it's a constant struggle to maintain a healthy work-life balance. Even if you can pull it off and graduate from a top 10 law program, you will essentially be slave labor for the next 6-7 years pulling all nighters as you'll need to be billing non-stop to justify your salary. I've always been told though that if you want to be successful in law, it all boils down to having the fundamental ability to sell yourself. It really is a matter of your worth being almost entirely determined by how strong your relationships with your clients are - especially when you consider how oversaturated the legal field is becoming.
Agree with everything that was said except that accounting is a dying industry. Accounting/audit will always be needed. Yes, there'll be more automation in the field but that will apply more to basic tasks. The bulk of the work will still require human eyes.
The dying industry sentiment is directly corellated with big 4 revenues in audit that is shrinking from year to year and buckling to client demand. (i.e., you've been my auditor for 10 years, why does it keep costing more to do this work?)
Up until recently, I would have agreed that it was a necessary evil that required human eyes. But that number can be cut in half, or quarter or 1/10th (whatever it may be) using future looking technology like block-chain and other distributed ledger systems that can give you more precise level of materiality and accuracy.
Down the road when this becomes widely adopted I think the first industry it will target will be areas like accounting, retail banking etc.
The demand for traditional legal services is also declining as technology improves, it's not just accounting. Also, making partner in both of these fields is a grueling, uncertain path. I don't know exactly how bad it is in accounting, but your odds of making partner now as a first year law associate at a big law firm are like 10%. If you're at a big law firm these days it's also very likely you went to a top 10 or top 5 school, so it's not for a lack of pedigree or ability.
Pick the field you'll like, because the odds are you'll have an upper-middle class lifestyle, not some baller partner life.
i think it is way too early to think about this. stop trying to plan 10 years ahead. 10 years ago (before i know about WSO and IBD), my goal is to become a CFO. does it work out? no. but i found IBD > PE > Happiness path. but then does that shit works out as most people on WSO thinks (Ivy > BB IBD > Ivy MBA > TPG/KKR > Happiness). nope it doesn't work out that way for me. i got to IBD VP post graduate school. but trust me it was definitely not "Ivy > BB IBD Analyst 2 years > Ivy MBA > BB IBD Associate/VP".
what i am trying to say is that get the best grade possible NOW. if possible transfer to the best possible school you can NOW. perhaps in your 3rd year, applied for the best possible summer internship. secured full time from that internship. then work 2 years to see how u like and review your options again.
net net, i never try to plan more than 2 years ahead because shit changes all the time. it is not productive to plan that far ahead. too many variables. hopefully this helps.
i am planning to launch my own PE fund or a global PE fund as a senior adviser in 2018 Jan. but it was definitely not the (Ivy > BB IBD > Ivy MBA > TPG/KKR > Happiness) track. happy to help, if u have any questions.
http://goingconcern.com/post/whos-auditorproud
Don't skip the comments section.
I have talked with a couple dozen former attorneys and worked with a handful as well; and only one of them genuinely enjoyed practicing law. A good friend works at a non-Big 4 accounting firm and he said the partners' lives are terrible. Hours are horrendous, and pay almost certainly isn't as good as Big 4. Maybe Big 4 partner hours aren't as bad?
Either way, it's good that you are thinking ahead, but don't make your scope too narrow too soon. If you enjoy accounting, think about sticking it out. Sit down with a couple attorneys (even a couple that work in finance/accounting) and pick their brains a bit. If you get your hours to sit for the CPA exams, a JD/CPA could make a solid combination.
Be wary of what you said, "Put the type of work aside and what I will enjoy more..." It may seem easy to say, "who cares if I enjoy it, I'm making bank, bro!" But when you are stuck at your desk for 40, 50, 60, 70+ hours a week and working weekends, enjoying what you do becomes a bigger factor.
Harvey Halstein brings up a good point, too. When I was in grad school I thought I wanted to go Asset Management and work towards a portfolio manager position, or go corporate finance and work towards CFO. Now, 3 years later, I'm planning on making a 180 and completely switching my career path. Times change and your interests may too.
You're thinking ahead, thinking about continuing your education, that's good. You clearly have a decent head on your shoulders. Don't get tunnel vision on one or two career paths. Pursue accounting, get a feel for if law school is a good fit, but don't get tunnel vision. You may have a career waiting for you that you never expected.
This.
Lets be clear on the real choice you are currently facing here: Going into a Big4 gig immediately post undergrad to have a shot at partner, or shelling out $100k plus 3 years of lost earnings to have a shot at a Biglaw job to then have a shot at partner. I'm not clear on the path to Big4 partner, but as a law student feel it is my duty to warn the youth.
First, are your grades and LSAT good enough to get into a top program? Even in the T14, Biglaw is not guaranteed. Kids strike out at OCI from Harvard and Columbia. Realistically, about half to to maaaybe three quarters of the kids at Georgetown will land Biglaw. You may think you have what it takes to end up in the top of the class, but so does every other kid matriculating.
Once you do manage to land your biglaw gig, spend your summer evaluating your classmates, all 100 of them (I'm considering you said "mid to upper tier" whatever that means, and applying it to about V50 and up--if you don't already know what that is you're probably already at a disadvantage). One of you will make partner (maybe- sometimes they only make one out of every two classes). Do you have what it takes to beat out every single one of them? Because this is no longer an objective evaluation of your skills as a lawyer; this is a subjective, political game in which you will compete against people as good or better than you. And you don't get to stay in the game as long as you feel like it. They will begin pushing people out at around the 1 year mark..you'll get called into a partners office, they'll tell you how much they've appreciated you, would love to help you land somewhere else, you can stay on the website and payroll for 3 more months yadda yadda.
The average tenure of a biglaw associate is about 2-3 years. The 10% number someone quoted above is way too high. The highest out of the top 200 law firms is 16% (but those are typically the "lower" tier firms who don't even pay market), and most top tier firms hover closer to 1-3%. http://abovethelaw.com/2015/08/which-biglaw-firms-promote-the-most-and-…
Anyway, this is probably the forum you're looking for: http://www.top-law-schools.com/forums/index.php
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