Time Is on My Side?

In 1964 a 21-year old Mick Jagger appeared on the Ed Sullivan Show and famously sang “time is on my side, yes it is.”  I wonder if he still sings that song at Rolling Stones concerts.

What does an old Rolling Stones song have to do with retirement planning for attorneys?  It’s simple: there’s a tendency to believe that time is and always will be on our side.  None of us likes to think about the reality that, as Steve Miller Band put it, “time keeps on slipping, slipping, slipping into the future.”

Time waits for no one. For law firm partners this has very practical implications related to saving for “life after law.”  In professional service firms it’s all about attracting and retaining top talent.  To do that, firms have to make room for their professionals to advance their careers.  For law firm partners, this often means they only have so many years to occupy their senior partner seat before ceding that role to the next generation.  Some firms have mandatory retirement while others have a more nuanced approach.  Either way, lawyers have a finite number of years to make hay while the sun shines.

So what should lawyers do about this?  It depends on where they are in the Lawyer’s LifecycleTM.

Over the coming months I’ll be writing a series of blogs describing the steps lawyers should take to prepare for life after law, based on where they are in their career…from associate to equity partner.

Today, we’ll focus on equity partners.

Step 1: Nail down your spending – Do you know how much you spend per month?  When you’re earning well over seven figures it’s easy to get lax about tracking your spending.  The danger is that your income stream is not a bottomless well.  There is a point when that income spigot, while running at full psi now, will be turned off.  At that point, you’ll need your investments and retirement income to fund your lifestyle.  I’ve yet to hear any client say “when I retire I’m looking forward to cutting my lifestyle by 20%.”  No one does that.  So, figuring out your current spending today is critical to future planning.

Step 2: Figure out your number – How much do you need in retirement savings to live the lifestyle you enjoy today for the next 30-40 years?  If you don’t know, find out.  Retirement projections help you determine the required savings you’ll need to maintain your current standard of living until age 90 or 95.  Next, determine how many more years you plan to work at your current income level.  Finally, figure out how much you need to be saving each year to hit “your number” by the time you retire.

 Step 3: Save all you can now – Changes to pension regulations over the last decade have created some opportunities to accelerate retirement savings in your later working years.  For example, an increasing number of law firms have adopted Cash Balance pension plans to go along with their 401(k) or Profit Sharing plans.   Contribution limits for Cash Balance plans are age-dependent and can potentially enable senior partners to save upwards of $200,000 annually on a pre-tax basis.  This can be a powerful tool to help senior partners “catch up” on their retirement savings if they haven’t been a diligent saver for many years.

Being a highly successful law firm partner creates tremendous earning potential.  The key is maximizing these years of high income by saving all you can to set yourself up well for the decades that follow.


Justin Peacock, MBA, CFP® is an Owner and Wealth Manager at BDF.  In addition, he leads BDF’s Attorney Practice Group.  This group is dedicated to providing financial planning and investment management services specifically tailored to addressing the distinct needs of lawyers.  As practice group leader, Justin is responsible for the overall vision and strategy of the practice group and for developing customized solutions for BDF’s attorney clients.  Justin graduated magna cum laude from Illinois State University with a B.S. in Mass Communication and earned his MBA from Northwestern University’s J.L. Kellogg School of Business.