Budgets, Salaries, & Offers - Capital University Law School

Budgets, Salaries, & Offers

  • Before you can accurately submit salary requirements or effectively evaluate an offer of employment, you have to know what is realistic and manageable. 

    Determining Cost of Living

    The amount of money needed to sustain a certain level of living, including basic expenses such as housing, food, taxes, and healthcare is your cost of living. Cost of living is often used when comparing how expensive it is to live in one city versus another. 

    If you are planning to move to another city or state, you should determine your new cost of living. Use an online cost of living calculator such as:

    Setting a Realistic Budget

    To set a realistic budget, begin by understanding key terms:
    • Gross v. Net Income: Gross income is the amount of salary or wages paid to the individual by an employer, before any deductions are taken. Net income is the residual amount of earnings after all deductions have been taken from gross pay, such as payroll taxes and retirement plan contributions.
    • Taxes: It is safe to assume 25%-30% for federal taxes, and an additional 5%-10% for state income taxes, if applicable.
    • Necessary v. Discretionary Expenses: A necessary expense is the cost associated with money spent on food, housing, clothes, transport, etc. A discretionary expense is a cost which is not essential for the operation of a home.

    When considering how to budget your net-salary, you may want to consider the following recommended percentage distributions:

    • 30% Housing
    • 10% Utilities and other housing expenditures (including renters insurance)
    • 15% Food (at home and away)
    • 10% Transportation (including car loan)
    • 10% Debt repayment (student loans and credit cards)
    • 10% Saving
    • 5% Clothing
    • 5% Entertainment
    • 5% Car insurance and miscellaneous personal expenses

    Determining a Salary Range 
    Online Resources 

    Print Resources (available for review in the Office of Professional Development) 

    • NALP Associate Salary Survey
    • NALP Public Sector & Public Interest Attorney Salary Report
    • Robert Half Salary Guide

    Stating Salary Expectations 
    When applying for a job, you may encounter a request to state your current salary requirements or salary expectations in your cover letter. The salary or salary range you state should be based on your research and consideration of the items above including your cost of living and budget. Consider the following options:

    "My current salary requirements range from $55,000 to $65,000, negotiable."
    "My salary requirements are negotiable. As I’m interested in and qualified for this position, I believe I will be open to any fair offer."

    Understanding the Economics of an Offer of Employment
    Following an offer of employment, you should expect to receive some form of detail regarding compensation and benefits. This may come in the form of a letter or memo of understanding. 
    Things to Consider in an Offer
    • Billable Hour Requirements
    • Business Development Expectations
    • Fee Arrangements
    • Bonus Structure
    • Option for Equity/Ownership
    • Malpractice Insurance Coverage
    • Travel Reimbursement

    Fringe Benefits
    • Health Insurance (HSA v. Employer Plan)
    • Dental Insurance
    • Other Medical Insurance
    • Bar License Fees
    • Professional Association Dues
    • Continuing Legal Education (CLE) Registration Fees
    • Parking
    • Retirement Plans/Contributions
    • Tuition Reimbursement
    • Loan Repayment Assistance
    • Gym Memberships
    • Cell Phone/Laptop/Tablet/Other Tech Allowances
    • Vacation Time
    • Sick Time
    • Flex Time