By Joel Chouinard, CFP®
June 11th, 2025
If my wife and I had to do it all over again—starting fresh with that first Big Law paycheck—we’d do things a bit differently.
Back when she started in Big Law a decade ago, first-year associates weren’t pulling in $225K per year (plus bonuses) like they are today. That might sound like a lot of money, but when you factor in student loans, taxes, and lifestyle pressure, is it really?
Here are the three things I would do with my money if I were a first-year Big Law associate.
1. Build a Conscious Spending Plan
Before spending a single dollar, I'd start by building a Conscious Spending Plan. This isn't a budget in the traditional sense—it’s a strategy that helps you save your money with intention so you can spend the rest guilt-free.
Here’s how it works:
- Start with your savings goal: A good rule of thumb is to save at least 20% of your gross income. On a $225,000 salary, that’s $45,000 a year.
- Define what counts as savings: Saving money doesn’t just mean saving for retirement or for college. It could also mean saving for a down payment on a house, bulking up your emergency fund, or paying down student loans aggressively.
- Don’t forget about bonuses: If you receive a $20,000 bonus, plan to save an additional $4,000 (20%).
- Estimate your monthly spend: After savings, taxes, and payroll deductions, you’ll likely have about $10,000/month to work with.
- Cover fixed expenses first: Think of fixed expenses as things that don’t change much from month to month, such as rent, groceries, utilities, insurance, gym membership, etc.
- Then spend the rest guilt-free: Whatever’s left can go toward lifestyle choices—dining out, travel, or shopping. Because your savings and fixed expenses are covered, you can truly spend the rest guilt-free!
Note: If your guilt-free spending bucket feels tight and doesn't align with your desired lifestyle, consider adjusting fixed costs like rent, car payments, or cutting out unnecessary subscriptions.
2. Max Out a Pre-Tax 401(k)
Yes, there’s debate between pre-tax and Roth 401(k) contributions. But if I were a Big Law associate earning $225K+, I’d lean toward the pre-tax 401(k).
Why? You're likely in one of the highest tax brackets of your life. Deferring taxes now and paying them later—when you’re retired and in a lower bracket—can result in real tax savings.
Here’s a potential play:
- Contribute the max amount to your pre-tax 401(k) from now until retirement.
- In your 60s (especially between retirement and age 75, when required minimum distributions start), you can convert some of those pre-tax funds to a Roth IRA and control how much income hits your tax return.
- This strategy lets you fill lower tax brackets intentionally and grow wealth tax-free from that point forward.
It's tax arbitrage in your favor.
3. Pay Off Law School Student Loans Quickly
There’s an argument that if your loan interest rate is low, you’re better off investing the money instead of paying loans off early. That’s true on paper—but it ignores a major factor: the psychological burden of student loan debt.
Most attorneys I talk to still have anxiety around their student loans, even when they’re financially stable.
Paying off your loans early gives you options:
- Take a lower-paying job
- Invest in a business, real estate, or for your early retirement
- Enjoy your money without the cloud of debt hanging over you
If I were in your shoes, I’d max out my 401(k) and throw every extra dollar at my student loans until they’re gone. The psychological freedom is worth it.
Final Thoughts: Don’t Let Golden Handcuffs Dictate Your Life
Big Law is a huge opportunity—but it’s also where many people unintentionally lock themselves into expensive lifestyles that aren’t even aligned with their values.
Set the foundation early:
- Build a savings plan
- Automate your savings
- Crush your debt
- Spend in alignment with your values—not someone else’s
Need Help Making a Plan?
If this resonates with you and you’re ready to get clear on your financial future, book a free introductory call with me. I specialize in helping high-earning professionals like Big Law attorneys make smart, value-driven money decisions.
SharpEdge Financial LLC is a registered investment adviser registered with the State of Texas. Registration does not imply a certain level of skill or training. The views and opinions expressed are as of the date of publication and are subject to change. The content of this publication is for informational or educational purposes only. This content is not intended as individualized investment advice, or as tax, accounting, or legal advice. Although we gather information from sources that we deem to be reliable, we cannot guarantee the accuracy, timeliness, or completeness of any information prepared by any unaffiliated third-party. When specific investments or types of investments are mentioned, such mention is not intended to be a recommendation or endorsement to buy or sell the specific investment. The author of this publication may hold positions in investments or types of investments mentioned. This information should not be relied upon as the sole factor in an investment-making decision. Readers are encouraged to consult with professional financial, accounting, tax, or legal advisers to address their specific needs and circumstances.