Case Study: High Earning Attorneys Shun High Spending Lifestyle

From time to time, strangers stop by Root of Good to say “Hey, what’s up!  I like your site!” or “Your journey to financial independence is awesome.  I’m almost there, too!”.  The latter type of comment arrived in my inbox a few weeks ago.  Except it wasn’t from a stranger.  It was Jane, an old law school classmate.

After graduating from law school ten years ago, Jane practiced as an attorney and ended up in Washington, DC married to another attorney.  Most 30-something attorneys working at big law firms in big cities are making a ton of money and spending most of it living the high life.

Jane and her husband made the conscious decision to split from the herd of their high-spending colleagues and do the bizarre.  They paid down huge law school debts, saved boatloads of money, tactically bought a home at fire sale prices, and carefully managed their expenses and investments to bring about a certain level of financial independence in their mid-30’s.

Though they won’t be retiring early immediately, their money savvy behavior will allow them to execute a “coup de career” very soon so they can get back to living life on their own terms. Immediately sensing a great story from an old friend, I asked Jane if she would be kind enough to let me share her journey with the readers here.  What follows is her mostly unedited answers to all of my questions:

1. How old are you and your husband?

I (Jane) am 34 and Sam is 35.

RoG note: names fictionalized for anonymity.

2. How long have you worked full time (post-college/law school)?

10 years although we both worked during college part-time during the school year and full-time in the summers.


3. You both went to out of state law schools, correct? How much debt did you incur and how did you manage to repay it so quickly.

We had each rung up a solid $100,000 each in debt from law school student and private loans plus about $10,000 in a car loan, too. We saved money by renting in older buildings and units (rather than fancier, newer loft-style ones) and not rushing to buy a house when the real estate market was at its peak in the Washington, DC area. We set a plan for taking each paycheck and putting 2/3 of what was leftover after paying household bills to student loans and 1/3 to savings for a down payment on a house.

Everyone told us we were crazy and that student loan debt is “good debt”.  Since we weren’t from trust funds or family money, we had a lot of fear about debt and how it would limit our financial freedom and freedom to choose the direction of our careers and free time. In the legal profession, you quickly meet people who live at or well above their significant means such that they are tied to maintaining the high level of income that law firm jobs can offer but where job security becomes increasingly precarious year after year with no realistic career options outside the high paying firms. We shared one car, lived in Virginia where state income taxes were less than in the District of Columbia, and rode the metro whenever possible. After 4 years, we had paid down substantially all of our student loan debt and saved a huge chunk of money for a down payment on a house as well as a $25,000 emergency fund that we kept in an E*TRADE (now CapitalOne360) account.


4. Where are you working these days?

One of us works at a big law firm and the other works for a small law firm in Washington, DC.


5. Do you want to share your salary history?

Our first year after law school, our combined income was around $140,000. That rose over the years to around $300,000 today. Since the legal market crashed not long after we graduated, we really got lucky to have jobs that held up through that rough period otherwise our school debt could have been a disastrous investment in our future careers. Looking back, we both now say that going to those out of state law schools where we incurred all of that debt was the biggest gamble of our lives (and probably a poorly informed decision on both of our parts)! Above all else, we were truly blessed to land the jobs we have held over the last 10 years as they gave us the vehicle to start paying off debt and amassing savings and have made our budding financial freedom and independence possible.


6. You probably face a high tax burden each year. What strategies, if any, have you used to save on taxes?

We haven’t done enough here. We are almost as debt-averse as we are 401k-averse. We always envisioned retiring way sooner than we would be able to access our 401k funds without incurring a penalty and, generally, have taken the risk that paying taxes now even at our higher tax bracket may not end up being much different to paying tax on those same funds 30 years from now when the tax rate structure may be very different. We do have one 401k employer account and also have a health savings account we put money in each year, plus we have a child, but generally we make too much money combined to take advantage of a lot of other tax benefits and we did not consult soon enough with you and your blog about how to think differently about that!


7. I understand you both plan on quitting your law firm jobs soon. Will you call it “early retirement”, “taking a break”, or “becoming a stay at home mom?”. Do you plan on telling work colleagues one thing and telling close family and friends the full story?

My husband is leaving his firm to work as in house counsel for a company where we can have health benefits going forward.  I plan to quit my full-time law firm job to have more time at home with my son and possibly open a solo law practice on the side on a very part-time basis. We hope to have more time for family and things we enjoy now that we have paid down debt, paid off our house, and saved a substantial amount such that we don’t both need to be at full-time jobs. I may tell colleagues I’m pursuing a solo practice rather than becoming a mostly stay-at-home mom only because I feel like it is none of their business what I’m doing with my career or life! All of our friends know how careful we have been paying off debt and saving and have been joking for years now about how we will retire years before them, so they will not be surprised when I leave the firm at my own choosing just because I can. 9. What are his thoughts on your financial independence and slowing down on the career? Who’s idea was it to pursue financial independence? He is excited to change jobs and do something more predictable schedule-wise than being at a small firm and is excited for me to walk-away from my job and do something different if I want or do nothing at all. Since we were both equally debt-averse and freaked out by the amount of debt we brought to the marriage from law school, we decided years ago that we had this joint vision of paying off debt and quickly amassing savings so that we could work at Starbucks if we wanted and still be very financially secure without having to dip into any savings for years to come so that those investments just continue to grow.

I think “on our way to early retirement” or “career renaissance” are good terms to describe us right now. We are maybe a few years still from really cutting the cord. I’m sure people will be like “of course you are able to downsize your careers with your big salaries you’ve had for years!” But what is amazing is the number of people we work with who make more money than us that have no savings, have overextended themselves financially and could never think about shifting to a single income home or less.

RoG note: That last sentence is the crux of why I thought Jane and Sam’s story is so noteworthy.  Sure, they made a very good income, but they managed to save a large part of it even though most of their peers were doing the opposite.  It all comes down to choices.

8. You live in an area of the east coast where the cost of housing can be very high. You combated the high housing prices by buying a foreclosure. Give me details (how much did you save versus buying at retail prices?, did you do most of the repairs yourself? Large house, small house? How does it compare to what your friends and high-earning colleagues own?)

We saved for 4 years and when the market sank, we started looking for condos, but the condo fees (averaging $500/month if you are lucky) made us reluctant to select a condo and the space limitations made us feel like we would quickly outgrow the space. Our realtor showed us a townhouse outside the beltway that was still metro accessible by only a few blocks. We got a 4 bedroom, 3.5 bath, 1800 sq ft townhouse for $200,000 less than the former owner paid and the current market value today, only 6 years later, is over $100,000 more than what we paid in 2008 and hopefully growing. The house was in good condition and only needed carpet cleaning, painting, and elbow-grease. Some people probably consider it a starter home, but we plan on it being our long-term home or eventually renting it out (around $2800/month) as extra income if we relocate geographically someplace much cheaper.

 RoG note: we ended up in a similar sized house (same square footage with one less bathroom) but in Raleigh the price is much lower.  

9. You bought a second foreclosure recently? Do you plan on using it as a vacation home or as a rental?

We did. It was probably crazy but we had this idea of scooping up another foreclosure and fixing it up to be a weekend/vacation home and maybe future permanent home. This one has needed significantly more work and elbow-grease than our first house, but we are having fun watching YouTube videos to learn how handy we never knew we were! We got it for about $100,000 less than the former owners paid. Right now we have a $1000/month mortgage payment but we are hoping to quickly pay it off.

RoG note: I’m a big fan of DIY when possible, and youtube is also my friend.  


The Shenandoah National Park, just a couple of miles from their new house.  Photo credit: Jane
The Shenandoah National Park, just a couple of miles from their new house. Photo credit: Jane


10. Do you plan on moving to a lower cost of living area once you quit working?

Probably not. Our property taxes are around $4,500 and our house and car are paid for. Other than paying gas ($30/month), electric ($75/month), cable/internet ($160/month), and our cell phone bills ($160/month), we don’t have many other expenses besides food and clothing and we aren’t big spenders when it comes to either. We love shopping at Kmart, Big Lots, and IKEA and don’t care about name brands.

 RoG note: The biggest costs of living in a high cost of living area in the US tend to be housing costs.  Not having a mortgage makes living in the city a lot more affordable.

11. What will you do with all your free time once you quit working full time? Any big plans? Travel plans?

I doubt it. We like traveling to see family and friends in the US too much and roadtripping wherever we can. I think we view foreign and big travel plans as something we’ll do when we are in our 50s. In the interim, we have Hilton Honors credit cards that earn free hotel stays without an annual fee, so whenever we roadtrip we don’t pay for our hotel costs. Plus, with advance ticket purchases, you can get really cheap Amtrak train tickets from DC, including to NYC for $98 roundtrip. We mostly want to start enjoying family time with our son. Kids grow up so fast that we want to take advantage of this time that we won’t get back while he’s young and not feel like we are at jobs that “own” us or come before our family. We also have various hobbies like playing music, learning photography, and other things we’d love to find time for. I saw how you are learning a foreign language in your free time and that’s exactly the kind of thing we want to do with our free time.

 RoG note: In other words, I don’t think Jane and Sam will get bored easily.


Cape May Lighthouse
Cape May Lighthouse


12. What do your coworkers and friends think about your financially savvy and frugal behavior? Any funny/awkward moments?

Everyone gives me a hard time about how I won’t or VERY infrequently will pay for a cab ride home even if working late. I’ll always take the metro if I can – you can’t beat a $2.75 ride home! Some coworkers are jealous of the financial freedom we have gained with our strategy to pay off debt and save and invest as much as we can. It has taken willpower to not get caught up in our salaries and a fancy lifestyle here in DC. A dinner out for us is going to Baja Fresh or Chipotle or ordering Dominos pizza.


13. You have a young child. How do you plan on raising him to be financially responsible and frugal?

We have a 529 where we are putting $1,000/month to save for his future education. We hope we are already teaching him by osmosis that you roadtrip when you can, you ride the metro to get around, that an evening in the local park beats having our own gigantic yard, etc. He’s still only a toddler so we haven’t talked about whether we’ll give him an allowance someday or anything like that. We received a lot of hand-me-down toys and clothes when we started a family and talk with him about how his things used to be Jake’s or Braeden’s. We are trying to teach him that it’s good to reuse things and hope to have him be part of the process of handing down his (handed down) toys and things he’s outgrown to others who can use them next.

 RoG note: This approach makes a lot of sense.  Teaching by example is the best way to instill knowledge, skills, and values in impressionable little minds.  At age 8 and 9, our kids are very aware of costs, value, and making smart choices already, so I have no doubt Jane’s approach will pay off.

14. How do you plan on withdrawing from your investments and living off your savings? Do you have most of your money in a taxable brokerage account? Are you planning on spending a fixed amount of money each year?

We’ve invested our savings in Vanguard almost 50/50 between dividend earning bond and stock index funds. We hope to not start living off our savings just yet and first start living on a significantly reduced income while still saving a little, too. We hope to just keep growing our savings for another 5 years before we are at a place where we could consider just withdrawing the dividend income each month rather than reinvesting it but hope to not touch the principal or base of our savings until much later in life.


15. What kind of cars do you drive and why?

We have always bought used cars until our hybrid Prius which we bought new in December when dealers were trying to move the prior year’s inventory. We traded in our used car at that time toward the purchase and set a budget that we didn’t want to spend more than $12K out of pocket toward whatever vehicle we purchased and it needed to be one with a high miles per gallon capability. Sharing one car has been a huge savings over the years, too!

RoG note: We keep our auto costs low, too, and are thinking about dropping down to one car for the whole family once Mrs. RoG joins me in early retirement.

16. Anything else you want to mention that helped you get into the great financial spot you’re in today?

Being on the same page as a couple about the financial goals we had for ourselves and strategy for getting there – that’s the secret sauce!

RoG note: No way I can disagree with that!  That’s probably the biggest background contributor to growing wealthy at an early age.

Overall Thoughts

Right before Jane reached out to me, I saw another one of those articles that explain how big six figure earners are going broke.  Not long ago I saw another article proclaiming how difficult it is to live on $400,000 in the big city.  Or how $500,000 a year ain’t what it used to be given today’s prices for yachts, maids, nannies, and private ivy league preschool tuition. Then I hear about Jane, who fits squarely within the big earning circle.  But they are different.  They are nowhere near going broke; they are financially thriving!  Which is what every single high income household should be doing, but don’t for some reason. Jane was one of the smarter high earners and figured out that you can actually save a lot of money if your expenses remain lower than your income.  Yes, you read that correctly.  When your expenses are lower than your income, you too can save money!  Such a simple concept, yet so many high income earners don’t understand it (or at least ignore the concept to their own financial detriment). Thank you, Jane, for providing an excellent counterpoint to the too-common sensationalist “barely surviving on $500k” per year articles!


Do you know any Janes and Sams?  Or are you a Jane/Sam?  



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  1. Wow! What an amazing story and an inspiring one. One small nit to pick: who pays that much for cell phones per month when unlimited talk, text, and data for 2 from Republic Wireless would cost them less than a third of what they currently pay?

    1. CL, we live outside a small city in TN. The only wireless carrier that works out here is Verizon. For my wife’s iPhone, my S4, unlimited talk/text and 3GB of data, we pay about what Jane and her husband do per month with taxes. Not everyone has a choice of all the different providers if you don’t live in a major city.

      1. Good point. I have a feeling these guys use their phones a lot for business and have to have reliable service and call quality wherever they end up. I think they go off the beaten path for vacation often enough that something like Verizon (or another major carrier) might be the best choice. I know where my grandparents and other extended family live at the edge of the Appalachian mountains in NC, my sprint and virgin mobile phones couldn’t get service whereas those with Verizon had plenty of bars.

  2. You know what’s even more amazing? That stories like these are the exception rather than the norm. Pulling in 300K or more as a family should put you on a fast track to FI yet so many other high earners “struggle”. Sad really.

    1. Yeah, it’s pretty amazing that there aren’t a ton of 40-something multimillionaires that followed the same path as this couple. I think these other folks are under the impression that the high salaries will be there forever, so what’s the point of saving anything when they can always just make more money.

  3. Wow! That’s such an inspiring story. I can see why it’s easy to go into a high spending lifestyle at that income. I see it in my company. I really hope people can afford their super nice cars and houses because otherwise it must suck to see all the money go away every month. I’m pretty frugal, but even so, I think my friends are equally or even more frugal because their income is lower than ours at the moment. It helps to hang out with people who enjoy seeing a movie at home rather than going out to super fancy dinners.

    1. We have been lucky to have friends and family that aren’t big spenders in general. Board games, pizza, cheap wine/beer makes for a great dinner party and fun evening for us.

  4. It’s nice to see an example of a high earner that doesn’t act like the typical high earner. People can get jealous of the higher income of professionals, but the savings rate is still a bigger driver than the income.

    Great story. I hope we can get an update sometime of the DIY house project.

    1. Right. Many attorneys in their shoes spend all they make and then some. There are plenty of government employees and lower paid professionals out there that make a lot less money but manage to save a significant proportion. Do that year after year and you can create some big wealth after a decade or two. It’s not what you make but what you save.

  5. We live in the Netherlands and earn $130k pretax together. That’s nowhere near $300k/year, but for us too, keeping expenses low will propel us towards early retirement in probably something like 7 years or so. It really can be done!

  6. I totally aspire to be like this! We have similarly high earning potential but are stymied by the high housing costs (SF Bay area). Our housing costs >50% of our monthly budget. Fortunately 1/2 of that is going towards principal and hopefully-equity in the home. I hope to someday move to a LCOL area though.

    1. These two attorneys live in Washington DC, so also faced pretty high housing costs. Although nowhere near SF Bay area prices I would guess.

      In a way, they were lucky that the housing market crashed in the late 2000’s and they were able to swoop up an inexpensive foreclosure. Although they seem to make their own luck and would likely have continued to rent somewhere affordable if they couldn’t buy an affordable place.

  7. Though this couple worked hard to gain big salaries post-law school, I think the story still demonstrates that financial success and reaching life goals reduces, for most people most of the time, to choices and commitment. If some people are happy devoting huge numbers of hours to paid employment all their lives and need to consume madly to feel satisfied, more power to ’em! I’m like Jane & Sam–I don’t need stuff and status; I value time, freedom of choice, and the ability to pursue what interests me.

  8. What an awesome interview. I can certainly identify with much of their philosophy. We similarly bought our home in the city (of Cambridge, MA) at the bottom of the market and have since fixed it up and been very pleased to see the value increase. We also plan to turn it into a rental property eventually. I think Jane is 100% correct about the importance of being on the same page as your partner. That is absolutely our secret sauce too and is the #1 factor in our financial success. I just don’t think it’s possible any other way. Thank you so much for sharing your story!

  9. ” When your expenses are lower than your income, you too can save money! Such a simple concept, yet so many high income earners don’t understand it (or at least ignore the concept to their own financial detriment).”

    But I DON’T WANT more people to save and invest money like I did. It’s these spenders that have been keeping my stock funds growing by buying the latest cars, iPads / phones, fashion, cable / internet / phone pkgs, dinners out, etc. Let them spend, spend, spend!

    Is it wrong for me to feel this way? 🙂

    1. Ha ha, no, you can feel that way. 🙂

      The truth is that there are so few people actually saving a lot of money that we don’t have to worry. And if everyone suddenly became financially responsible, the upside would be no more bankruptcies or defaults on loans, virtually zero need for social programs, and I bet we would all be happier, too.

  10. We don’t quite have Jane’s income, but we’re definitely the Jane and Sam of our respective workplaces. At my job, the parking lot is full of BMWs and Audis and I roll up on my hybrid (bike!). And at Mr PoP’s job, it was “wear shorts to work” this week and when Mr PoP didn’t, one coworker commented that the only time he had seen Mr PoP wearing shorts was his swim trunks on beach day. To which Mr PoP responded, “Those Hawaiian swim trunks ARE my only shorts…”
    But though we’re a little on the weird side, it’s never been anything that hindered relationships since we’d much rather spend money hanging out with folks than on super fancy cars or shorts. =)

    1. That shorts thing is a little weird. 🙂 I consider shorts a quintessential part of my wardrobe much more so than long pants. Unless it’s below freezing, someone’s getting married, dies or graduates from somewhere important, I don’t see a need to wear long pants. Maybe I’m the weirdo?

      1. It depends on the weather where you live. Here in San Jose, California, the weather is mild year round and it typically cools off into the mid to high 50s even in summer. The summer humidity is much lower than in North Carolina (and pretty much everywhere else in the eastern half of the US) as well. I went on a trip to Istanbul, Turkey last September and their September high temperatures are about the same as ours in San Jose (high 70s, low 80s), but OMG the humidity in Istanbul was unbelievable! (It’s surrounded by water on 3 sides).

        For this reason, I have only a few pairs of shorts and typically wear pants year ’round since I get cold easily and don’t like changing from shorts to pants in the same day.

        1. Mid to high 50’s and little humidity sounds nice. Unfortunately, summers here mean variation between 70 and 90 degrees throughout the day and often high humidity. Even in the middle of the night, it can be steamy or at least warm.

          I’m loving the weather right now. Cool in the 50’s and 60’s lately. Even at 10 pm, it’s still in the 50’s. Not bad for December. Shorts weather as far as I’m concerned. 🙂

  11. I cringed pretty hard when I read they weren’t maxing out two 401ks on that income. Two 401ks, two IRAs and an HSA should be nothing on that salary.

    1. I’m not sure what fund choices they have in their 401ks, but I agree – I’d generally recommend maxing 401ks, especially when you’re in the 30+% tax bracket. I’d have to look a little closer if all 401k offerings had high fees (like over 1% expense ratio). That’s actually a good year-end suggestion for Jane and Sam for 2014 – max out your 401ks. For IRA’s, they likely make too much to contribute in a straightforward way, but “back door Roths” might be an option.

      From conversing with Jane, I think they wanted to ensure they have plenty of money between now and age 59.5 to permit this career renaissance without worries of being able to access the money, and then worry about the 401k/IRA for the traditional retirement age spending later.

      The good news is that they have a massive taxable account that will have a lot of capital gains and qualified dividends taxed at a rather low level when they sell and withdraw the funds. In my crystal ball, I can see them having plenty of near zero income tax bills in the future!

  12. Great story. I always shake my head when I read those articles that high income earners are struggling…even in a high cost of living area. I’m in NYC and we’re doing alright…although early retirement (well before 40) would be difficult. I’m an attorney but work in government so I feel like I have less pressure to keep up with the Joneses. Props to Sam and Jane for keeping that frugal lifestyle in private practice…it really is difficult not to succumb to peer pressure and to “look the part”

    1. No way, Andrew! It’s impossible to live in NYC on less than $400k! 😉

      In reality, there are tons of people who have comfortable enough lives in NYC or DC making way less than $100k/yr. They would have emigrated to a different city by now if they weren’t doing okay. I wanted to put this article out there to serve as a counterpoint to the WSJ/NYT nonsense articles about “barely scraping by on $X00,000 per year”. 🙂

  13. It took us a while to get on the financial independence pathway, but now that we’re finally there, we’re working together to make it happen. We used to be “those people” who made a lot (200k) and were still close to financial ruin. Now, we’ve lowered our expenses and are working to retire in 10 years.

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