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You lose all your benefits, so your medical insurance, etc. is no longer subsidized. That’s expensive especially if you have a family. You pay tax in every state the firm does business, you have to pay your own payroll tax, you have to pay for your share of the firms unreimbursed business expenses, plus you are taxed base on how the firm recognizes earnings, not your actual cash earnings. So there is a major hit in terms of taxes and new expenses and cash flow issues from year to year. It took me three years to go cash flow positive from being a Sr. Mgr.
All depends on the firm. Nothing to worry about until you get there. Usually a firm sponsored loan and the interest on capital is more than the loan interest so it’s a net positive.
Im gonna guess aggresive numbers and being on the road 5/5 days.
What’s the rough buy-in amount for a newly promoted partner? A few hundred $k?
You don’t put in the money until you actually make it from what I understand
Hard.
Yes, you have to buy in. Most forms structure this as a low/no interest loan that is paid via paycheck deduction. So there’s never really a negative cash flow event
Lol- there is definitely a negative cash flow event. And yes you have to buy into most of the private firms that have a true partnership. The buy-in/ capital loan isn’t that bad, it’s everything else that gets you.
P1, what’s the “everything else that gets you?"
D2- all the things you mention are just the other perks of the job :)
P1 that sounds a lot like a B4, but is certainly not the case at MBB - partner election is very much net accretive