Can a lawyer be a millionaire?
in Careers Advice, Legal Profession

Can a lawyer be a millionaire?

I was asked this question last week by an entrant to the legal profession who had probably read too many newspaper headlines about fat cat lawyers! We see the accounts of law firms all the time as well as have a good idea of salary levels in the niche commercial and high street firms.

The quick answer is yes if you reach the top of your game (probably as a commercial QC) or if you are a business person owning a law firm other than working as a practising lawyer.

Fat Cat Lawyers Myth

There is a myth around law (as most of the readers of this newsletter will know!) that the vast majority of lawyers are all multi-millionaires, earn huge amounts of money from their legal practice and cream in huge amounts of money from their oligarch clients. Nothing could be further from the truth. I would argue that the overwhelming majority of the 120,000 or so qualified solicitors in the UK will never earn more than £50,000 in their careers, with the vast majority lacking sufficient pension provision.

A sizeable minority of lawyers work in the City of London firms and it is these lawyers who earn higher amounts of money, but this is the minority rather than the majority. Even then their salaries will not be sufficient to achieve millionaire status and even less likely to achieve a millionaire lifestyle of not having to work..

So how is it possible for a lawyer to be a millionaire? The answer is that it is almost certain to be tied up with business interests as well as law. To give you an example, we have recently worked on a Fintech in-house legal job role in Central London. The firm in question were looking to recruit an in-house counsel, pay them a fairly low salary but also offer them shares in their business, which is a start up tech company.

If that fintech (financial technology) company takes off then the lawyer will have been in the right place at the right time to benefit from the increased value in shares, and if everything goes well there’s a very good chance they will end up a millionaire.

In a conventional in-house legal role the lawyer would definitely not be offered shares in the company, and instead would be paid a salary, with the usual range for in-house legal counsel being somewhere between £70,000 and £150,000 per year. It is very unlikely that this kind of role will end up in a lawyer becoming a millionaire.

Summary

In summary there are two ways of becoming a millionaire lawyer. I have seen both in my time in the business, although the first way is probably less stressful!

Option 1 – start a law firm, take on staff, develop the practice, do no fee earning work and keep building until you are turning over at least £5 million. At that point there is probably enough money sloshing around for you to either take a millionaire’s income or to sell the practice.

Option 2 – find some very disreputable clients, get involved in some dodgy finance scheme and cream off a sizeable amount of money. Hope the SRA never catch up with you or make sure you have money stashed somewhere safe whilst you are in the slammer.

Jonathan Fagan

Jonathan Fagan LLM FIRP is Managing Director of Ten-Percent Legal Recruitment. He has been recruiting solicitors and legal support staff for law firms and in house legal departments for over 20 years and handles roles from junior fee earners through to partners and law firm sales/purchases. A non-practising solicitor on the Roll since 2000, he is also the author of a number of legal career books, which are available at www.ten-percent.uk. You can contact Jonathan at cv@ten-percent.co.uk