Worth doing JD at Melbourne Uni? (2 Viewers)

[dste6]

Looking at the statistics from a Melb study, the churn rate of top tier law firms are 40% staff renewal every 3-5 years. I imagine IP would be significantly higher than than. Consider the chances of you making to the point where the pay figures are such, let alone making it to 10 year mark or to equity partner. I'd wager the risks involved in keeping a job in IB are not that much smaller than sensible investment over a decade.

Your point is taken though. Risks associated with investment are of course external, whereas staying in a top tier firm or IB depends primarily (i wont say solely, considering the condition of the markets) on your own ability; there much to be said for that. However, the numbers in this case don't lie. Where you have hordes of talented, driven people exiting these firms prematurely, you have to look realistically at your chances of staying. This is again a personal matter, WannaBeLaw might have nerves of steel and an iron will, reading her post however, it sounds rather like young naivity. So, I have my doubts...

If your careful not to fall into speculation while investing, I don't think the risk is manageable. My original point was not so much about risk, but efficiency in making money. My view, and this is very much my personal view, is that working 12-14 hour days for 150-200k is not an efficient way of making money. Its not a particularly good way to live your life either, but again that's a view personal to me and I understand why people would disagree.

 

[BOSnewbie]

Looking at the statistics from a Melb study, the churn rate of top tier law firms are 40% staff renewal every 3-5 years. I imagine IP would be significantly higher than than. Consider the chances of you making to the point where the pay figures are such, let alone making it to 10 year mark or to equity partner. I'd wager the risks involved in keeping a job in IB are not that much smaller than sensible investment over a decade.

Your point is taken though. Risks associated with investment are of course external, whereas staying in a top tier firm or IB depends primarily (i wont say solely, considering the condition of the markets) on your own ability; there much to be said for that. However, the numbers in this case don't lie. Where you have hordes of talented, driven people exiting these firms prematurely, you have to look realistically at your chances of staying. This is again a personal matter, WannaBeLaw might have nerves of steel and an iron will, reading her post however, it sounds rather like young naivity. So, I have my doubts...

If your careful not to fall into speculation while investing, I don't think the risk is manageable. My original point was not so much about risk, but efficiency in making money. My view, and this is very much my personal view, is that working 12-14 hour days for 150-200k is not an efficient way of making money. Its not a particularly good way to live your life either, but again that's a view personal to me and I understand why people would disagree.

The number of businesses that become wildly successful and few and far between, and you'd need to have a pretty niche market to reach that level of success anyway. Moreover, luck often plays a role - being in the right place at the right time etc. I am sure a lot of very successful entrepreneurse would not attribute their success entirely to their business acumen and creativity.

On the other hand, landing a top-tier consulting or IB job (law to a lesser extent) provides you with a healthy, steady income. Sure you might work long hours, but if you can stick it out for a few years when you're 22 and fresh out of uni, why not? Even if you left IB or consulting after say 3 years and you will have built up a substantial base of knowledge, contacts and transferable skills that would be highly regarded by most employers in any other industry.

As for your point about making money by starting your own business - well do 5 years and you'll still only be 26-28 with a healthy bank balance to use as a springboard for your business venture should you be so inclined.

Bottom line - top-tier consulting or IB is a great place to be starting a career

 

[WannaBeLaw]

Some great posts in this thread!

I don't like the idea of working for a top-tier firm. I've spoken to a couple of guys and they all more or less say they were treated like a piece of meat during those 12 hour shifts.

Then again, it does make some sense to work those long hours when you're still young.

Still, my goal would be to one day open my own business consulting clients. Can anyone give me more advice on this?

Thanks

 

[flamearrows]

Some great posts in this thread!

I don't like the idea of working for a top-tier firm. I've spoken to a couple of guys and they all more or less say they were treated like a piece of meat during those 12 hour shifts.

Then again, it does make some sense to work those long hours when you're still young.

Still, my goal would be to one day open my own business consulting clients. Can anyone give me more advice on this?

Thanks

Work in a top-tier firm until you feel your skills are up to scratch and then strike it out for yourself.

 

[WannaBeLaw]

Work in a top-tier firm until you feel your skills are up to scratch and then strike it out for yourself.

good advice.

it sucks doing the LSAT... $160 just sit a 4 hour test.

anyone know how many people will be doing it?

 

[WannaBeLaw]

bump

 

[Omnidragon]

If you get an investment banking job straight out of uni, it pays pretty good money considering you're 21, 22 or 23. $150k for first year is probably around low. It grows quite quickly from there anyway and if you're a third year, you can more or less expect around $230k-250k, again not bad considering you're only 23, 24 or 25 (depending on when you graduated). You might not have time to do anything entrepreneurial, but here's how it works:

a) You could've invested your salary these 2-3 years and maybe have made decent returns (eg an analyst in Melbourne who bought two random $500k houses over the last 2-3 years have probably made $350-600k capital gains already and you're probably positively gearing by around $20-30k passive income by now);

b) If you get sick of the long hours, you can probably get a $150-200k job working 9-6pm, 5 days a week (but you wouldn't have been able to get this job if you hadn't done your banking stint)

c) Taking option b then opens up the option of doing something 'entrepreneurial' with your spare time after you finish work at 6pm (ie before Big 4) and on your weekends

Now here's the problem with law (if you're doing it for the money).

a) You are most DEFINITELY 23+ when you start your job (due to the almost 100% certainty you did a 5 years double degree; if you did a 6 year double degree with honours in the other course, god forbid as you're 24 and your friend who started his job when he was 22-years old after honours is making minimum $220k already...)

b) You work long hours and get paid $62-70k in your grad year and first year (ie first 2 years of your working life)

c) Due to extremely low pay you wouldn't have had the option of investing much of that $60-70k since everyone has a fixed cost of living (and lawyers tend to have more since they love going out drinking and [god forbid this word] 'networking')

d) What are your exit options if you decide to throw in the towel and do something more relaxing? A job as a court associate? Or maybe pigeon-hole yourself into in-house counsel? Probably find it even harder to afford that $500k house

e) As the long-term growth rate of most asset classes kick in and inflation drives absolute yields up, you get more and more priced out relative to those who have entered the market (ever seen that ad about how $20 less costs to your super per month can make over $50k difference by the time you're 65?)

Edit: Can't say I agree with flamearrows. In AFR last year, average salaries of tier 1 (or rather, top 3 firm) partners more between $300k-350k. Sure you could get there in 10 years, maybe even 8 if you're a once-every-4-years sort. But maybe it'd just take you 15 years (putting you at 38?)

Edit 2: Oh and dste, on re-reading, just wanted to say, success seems more dependent on endurance than ability (obviously there's a minimum threshold as far as ability goes, but you'd assume you'd have it if you got in in the first place)

 

[flamearrows]

Edit: Can't say I agree with flamearrows. In AFR last year, average salaries of tier 1 (or rather, top 3 firm) partners more between $300k-350k. Sure you could get there in 10 years, maybe even 8 if you're a once-every-4-years sort. But maybe it'd just take you 15 years (putting you at 38?)

I saw that article. That's salaried (new) partners, not equity partners. You move closer to to full-equity status each year you're there (lockstep). Rumour has it that it's about ten years to fully blown equity partner status.

Also, it would be very very difficult to get a job in banking with only a vanilla commerce degree. Your marks would be walk-on-water level - I don't know anyone who was there that didn't have at least honours in commerce/economic (4 years).

 

[Omnidragon]

Yea I know that it's salaried partner. 10 years if you're fairly good to get there, to be honest. If you're great get there in 7-8 years around 30 years old. But for some people, it's going to take 15 years to make salaried partner.

How long to equity partner? That I honestly have no idea, but let's say another 5-6 years (since the article said the highest-earning partner is around $1.5m and that was topped by Freehills, I'd assume you'd come in at $650k-$750k if you've just hit equity partner).

So let's say you took 11-12 years to hit salaried partner (1 year grad, 5 years as solicitor, 5-6 years working like a female doggy as someone's SA) and you did double degree (ie started your grad career at 23), you're around 35 years old. Problem is in the past 11-12 years you would've earned a few peanuts which would've yield you a few peanuts and allowed you to invest in a few peanuts which have probably appeciated by the measure of a few peanuts.

Anyway from 35 money it's a bit better, but still a bit to prove yourself before you hit equity partner. So how long to hit that next step of equity partnership? I don't know, but would've thought at least another 5 years, taking you to 40? If you've thought ahead of 26 already, you should probably think again since life circumstances / circumspect change so much every year and especailly once you're really working.

As for straight comm (hons) --> IB I know a few so yes there are. Of course there's not going to be many, there's not many IB grads in the first place and I'm assumming you mostly know grads in your year or a year before you?