Big Law Salaries: Starting Salary for Lawyers in Their First Year & Beyond
“How much will I actually make as a lawyer right out of law school?”
I wondered the same thing when I first started thinking about law school.
Because law school is expensive AF.
Given a 6-figure investment in a degree, one of law school’s most powerful value propositions is an increased earning potential from your current J-O-B.
Buuut that’s not always the case.
The big answer is…it depends.
I know, I know. The most frustrating answer ever.
But it’s true.
There are several need-to-know factors that go into how much you can expect to make as a lawyer out of law school. 👇
If you’re ready to dive into the juiciness, buckle up and let’s get to it!
Or…
You can check it out real-human-style in my YouTube video all about “how much do lawyers make?”
What determines the starting salary for lawyers?
What you can expect as your first-year lawyer salary depends on four main factors:the type of law you practice, the legal sector you choose, the size of the organization, and your geographic location. Let’s talk about it.
1. The Type of Law.
The type of law that you decide to practice when you first start out will likely be the number one factor in your starting salary.
Why?
Legal practice areas that serve businesses can necessarily charge higher rates (and therefore pay their associates more) than legal practice areas that serve individuals.
There are hundreds of legal practice areas, but to start to give you an idea of legal niches that cater to businesses vs. individuals…
If we’re talking legal niches that serve businesses, we’re looking at things like mergers and acquisitions, IP litigation, capital markets, antitrust litigation, and privacy law.
If we’re talking legal niches that serve individuals, we’re looking at legal practice areas like family law, criminal law, immigration law, wills and estates, and personal injury.
2. The Legal Sector You Choose.
The “legal sector” you work in will also make a huge impact on your starting salary.
The easiest way to think about this is working in the private sector vs. the public sector.
When we talk about working in the “private sector,” we’re first and foremost talking about working in a law firm. Most of us are familiar with the idea of a law firm – that is, a company of lawyers, managed by lawyers, doing only legal work. This is also where the vast majority of us will get our first job out of law school. Because there are a *lot* of law firms.
Law firms come in all different sizes – generally referred to (very creatively) as small law firms, mid-sized law firms, and big law firms. The size of the law firm (i.e. how many lawyers work in that law firm) will have a direct impact on the salary that the law firm pays its associates. More on this later.
The other “private sector” place to work as a lawyer is as an employee of a corporation – i.e. in the legal department of that particular corporation as “in-house counsel.” Corporations with in-house legal departments also vary in size (which will impact the salary they are able to offer their in-house lawyers).
Something to keep in mind is that very few corporations (practically none) hire law students straight out of law school because they generally prefer that you have 3-5 years of corporate experience before making the jump to an “in-house counsel” role. That being said, “going in-house” is a popular lateral move for lawyers later in their career.
When we talk about working in the “public sector” we’re generally talking about working for a government agency (at the local, state, or federal level), a nonprofit organization, or academia. As you can imagine, since the public sector is not profit-driven, starting salaries are generally much lower. For example, if you work for a judge, a legal aid society, or a university, there is generally less capital with which to fund all of their employees (including the lawyers).
3. The Size of the Organization.
As we mentioned above, legal organizations in both the private sector and the public sector come in different sizes – which will have an impact on the budget they have available to pay their first-year lawyer salaries.
Let’s take a look at both ends of the spectrum to give you an idea of the range of sizes of the different types of legal organizations out there.
Law Firms
Big law. Large national and international law firms made up of 500 to 1,500+ lawyers (generally referred to as “big law”) pay the highest starting salaries on the market. See below.
Solo practitioners. On the other end of the spectrum are law firms that are “one man” or “one-woman” shops, in which the lawyer himself or herself is the only employee. This means that the lawyer’s salary will depend on the business that he or she brings through the door.
Corporations
Working as an “in-house” lawyer at a corporation, your salary will depend in large part (no pun intended) on the size of the company. In huge, multinational corporations (like Microsoft, Pepsico, or Avon) with hundreds of lawyers working in their legal department, you will generally have a higher starting salary than at smaller companies that may have only one in-house lawyer on their team.
Non-Profits
Same thing with nonprofits. Although nonprofits as a general rule have limited budgets to hire employees, the larger nonprofits that exist at the national level (like the ACLU) are able to offer a higher starting salary than a local nonprofit with more limited funding might be able to afford.
Government
When we think of the size of a governmental agency, it’s helpful to think of them in terms of the government they serve – at the local, state, or federal level. Generally speaking, federal government agencies will have a larger budget for hiring than state government agencies than local (e.g. city or county) agencies. So when we’re talking starting salaries, the federal Securities and Exchange Commission (SEC) will be able to offer a higher starting salary than your local district attorney’s office.
Academia
And finally we reach academia. Long story short, if you're working as a professor, student services director, or admissions officer at a large and/or nationally-recognized law school or university, you're likely going to make more money starting out than you would working at a smaller or less-well-known law school, university, or community college.
4. The Geographic Location.
This one's easy. Larger legal markets, such as New York, San Francisco, Chicago, and D.C. offer their lawyers a higher starting salary. Smaller legal markets, such as Tallahassee, Phoenix, or Cleveland offer their lawyers a lower starting salary.
BUT… here's the catch.
When you’re choosing the city where you want to live and work after law school, it’s not just about how much money you make. It’s also about how much it costs to live there.
What your starting salary can buy you (aka, how far your money can go) makes a huuuge difference in the type of lifestyle you can afford with that salary. If you want to know what are the best cities for new lawyers, check out my YouTube video here.
Aaand my favorite tool that connects the dots between a new lawyer starting salary and the “buying power” of that salary by city is the NALP Buying Power Index. It is truly fascinating. And in proper clickbait fashion…the results will surprise you.
What is the average salary for a new lawyer in the U.S.?
Let’s get into the nitty gritty numbers.
The mean starting salary for law students graduating in the Class of 2022 (the most recent NALP data available) is $116,398.
While this number sounds exciting, this salary number doesn’t tell the whole story.
The reason is that starting salaries for new lawyers are skewed because of the “bimodal” nature of the job market.
On the far end of the spectrum, the highest starting salaries of $210,000 (coming from “big law” jobs that encompass only 20% of new lawyer paychecks) – create a sense of a higher starting salary than most new law school graduates experience.
The reality is that over 50% of law school graduates can expect to make $50,000 to $90,000 starting out.
Since the “promise” of a more powerful earning potential is one of the biggest reasons we pursue a legal degree in the first place, it’s important to know these numbers so that you can make an informed decision about whether the cost of law school justifies the salary growth potential when you graduate.
What I made as a first-year lawyer when I graduated law school. / How much did I make as a law school graduate?
My first job out of law school was as a federal judicial clerk (aka, working in the government sector), making $65,000 per year.
Although this starting salary was on the lower end of the spectrum, having a federal judicial clerkship on your resume is a shiny gold star that a lot of big law firms will pay big money for in order to recruit you into their associate ranks.
As a result, when my federal judicial clerkship ended a year later and I joined a big law firm, I was paid a $50,000 judicial clerkship bonus (a bonus which can now fetch up to $150,000 for a federal district court or federal appellate court clerkship…and up to $400,000 for a U.S. Supreme Court clerkship).
I was also credited a year towards partner track, meaning that I came into the law firm as a second-year associate (making a second-year associate salary) – which at the time was $175,000. Now that would be upwards of $235,000.
At the time I knew that I was incredibly fortunate to be in the position I was in, getting the jobs I was getting, and getting paid what I was getting paid.
I not only got to do the work I wanted to do, it also gave me the chance to save money and invest money in order to make an exit plan when I was ready (but why I left my job in big law is a story for another time).
What is the starting salary for lawyers in Big Law now?
Because big law firms pay the highest starting salaries on the market, this is a question I get asked a lot.
As of today, the median first-year associate starting salary is $200,000 – not including the signing bonus, which can be another $15,000.
Yep, you heard that right.
This number has gone up in recent years, and will likely continue to grow as big law firms compete for “top talent” (aka, law students graduating from the highest-ranked law schools and/or graduating with the highest grades in the class).
Now, even though $200,000 is more money than most of us have ever been paid to do anything in our lifetime, some people say that it’s not a lot of money when you factor in the number of hours that you’ll be working as a first-year associate in big law. If you’re interested in more on that discussion, check out my YouTube video about “how much do lawyers work?” here.
Personally, I think $200,000 as a starting salary is a ton of money. And when I started out as a first-year associate in big law, the money I was paid was truly life-changing.
I have lots of thoughts on the big law salaries for first-year lawyers, but to give you a sense of what I made (and spent) as a federal judicial clerk vs. a big law associate, I get into alll the juicy numbers in my YouTube video “first jobs out of law school” here.
Why is the Big Law salary scale so high?
Above the Law points us to two reasons.
First, law firms are able to bill out young associates at high rates, for doing low level tasks. Tasks like document or contract reviewing can take long hours, and they bill high for it.
Second, big law firms can afford to compete with one another to get the best students from the best schools. That competition raises starting salaries and bonuses every single year.
How do you even manage a Big Law salary?
Like most people, I had never seen that kind of money in my life. Neither had a lot of my classmates.
I saw fellow recent grads buying houses, nice cars, luxury gym memberships, the newest gadgets, and (if they were smart) paying off some student loans.
Instead of buying the house and car, I decided to buy a life in Manhattan, New York.
I bought the experience of living in a $2300 studio apartment near Times Square, and eating the equivalent amount of bacon-egg-and-cheese bagels, wood fired pizza, cannolis, and chocolate cake.
And it was incredible.
I had a sense of freedom that comes with that kind of money, living in a city I wouldn't have even visited before law school. I could go out to bars and restaurants with friends without worrying about the bill coming at the end.
Despite all the fun, something kept telling me… this is all temporary.
How could anyone have problems making that much money? (she asked sarcastically)
That being said, one of the things I saw over and over was that the lawyers working in big law was that they were “cash poor.” Meaning, the had the money spent long before they ever made it. How? Lifestyle creep. More to the point? The curse of the golden handcuffs. That is, creating a high-cost lifestyle that leaves you feeling like you can’t leave your high-paying job because you need the 6-figure salary to fund your lifestyle expenses. Essentially, trapped. Not free. You get it.
The Curse of the Golden Handcuffs
I realized that I wanted to have not just freedom to spend… but freedom to leave. If or when I wanted to.
Seeing my classmates go into debt because of their lifestyles and big purchases, I knew just how badly golden handcuffs could rub.
It's not really freedom if you depend on a high-paying job to keep up with debt. It's not freedom if you can't leave.
I saw friends become miserable, tired, and no longer being fulfilled by the job. But they had to stay to support their lifestyle.
Breaking the Handcuffs
In my opinion, there are only two ways to prevent that predicament.
First, pretend that you don't have the money. It's just not yours. Put it away, in savings or investing, donate it, just get it out of your checking account.
You have to shape your decisions around that false lack- where to live, how to spend, where to send your kids to school.
It's tough. It's tempting. But if you want to stay in Big Law with free hands, it's essential.
Or second, leave.
Which is so, so hard. When the handcuffs are on, there's always another level, bonus, or raise coming your way.
Even if you have an exit strategy.
“I'll walk away at $300,000”
“I'll walk away at $500,000”
“I'll walk away at partner”
“I'll walk away at senior equity partner”
You have to prioritize what means the most to you in life. If that's spending time at home, or traveling, or if it's pursuing some other passion, some other dream.
The longer you stay, the harder it is to leave.
Why did I leave Big Law?
It took me 5 years to wean myself off Big Law money.
But it was absolutely worth it.
I went on to make $0 (yep… zero) as a pro-bono attorney, working cases I truly care about while getting my post grad degree.
I now pour all of my energy into teaching new law students how to strategically get the 1L grades to start a career on their own terms, and new lawyers how to harness their secret sauce to become rockstars at their law firm.
I found that leaving was the right decision for me. I had the time of my life, experienced what I wanted to, and then I successfully moved on.
Everyone has different stories, commitments, and needs. Some people stay due to financial commitments, some eventually leave.
As you're getting ready to go into one of the many sectors in law, consider your life in big-picture terms.
What do you prioritize most?
Are you able to go into Big Law or corporate law without getting stuck?
What kind of freedom are you looking for?
The answers are different for everyone.
You just have to find yours.
If you’re interested in how much I made (and spent) as a lawyer working in both the private sector (in big law) and the public sector (as a judicial clerk), check out this video where I break down my salary and expenses for each job.
If you’re curious about what I realllly think about making a big law salary, definitely dive into this YouTube video here where I give you all my thoughts.
