PSA: Most Law Schools a path to debt-ridden poverty

[stateofbeasley]

Law is great, right? The reality is very unforgiving.

AP Report

Also on the NY Times

The media and public seem to think that lawyers make a ton of money right out of school. Its not true. A select few from top universities or at the top of their class will get a six figure job. The rest will struggle on 30-40k/year. Try paying your bills when you have $150,000 in loans.

I went to a public law school so my loans are not bad, but many of my coworkers are paying $1000/month or more in student loans, and will be doing so for the next 20-30 years. It is hard to raise kids, buy a house, and move on with life with such a crushing financial burden.

Edit: Also, keep in mind that the lawyers who make a ton of money are very small % of lawyers out there. Your average lawyer working in a PI or Insurance Defense firm will not be making much. The benefits in smaller firms are also terrible.

I think higher education loans will be the next subprime disaster. Too many people took out too much money that they will have trouble paying back. The loans always come due... don't take out more than you can repay.

 

[Ronstang]

Higher education only costs so much because they make so many loans available and people are so willing to go into debt. It is just like health care insurance. The money keeps being provided so they charge what they want. Take all that loan money away and make people pay for it out of pocket and the price would drop....because attendance would drop sharply. I sure am glad I went to college when I did back in the 80s. I paid for it all myself and graduated both undergrad and grad school with zero debt.

 

[Dirigible]

'Tis true. Law school loans are large. Some attorneys earn big money right off the bat, but I'd venture to say most do not. I've seen the struggles of those that don't. And even the attorneys making the big bucks at big firms tend to be miserable.

Going to law school is a bad idea for most.

 

[Slew Foot]

I know about 10 people I went to college with who went to law school. All of them now are making more than 200K a year.

 

[Deleted member 4644]

This is very true. We need 20 more med schools in the country and 40 fewer law schools. Honestly.

 

[Akiba]

i knoe a lawyer making 35K a year. tis a shame. i can make that working as a general manager in a taco bell

 

[Ronstang]

Originally posted by: Akiba
i knoe a lawyer making 35K a year. tis a shame. i can make that working as a general manager in a taco bell

Too bad they didn't take a few hundred dollar community college economics course first to learn about the concept of oversupply.

 

[skim milk]

on the other hand, I know a guy who just graduated law school making over $300,000 his first year after bonus

 

[ponyo]

Originally posted by: Ronstang
Higher education only costs so much because they make so many loans available and people are so willing to go into debt. It is just like health care insurance. The money keeps being provided so they charge what they want. Take all that loan money away and make people pay for it out of pocket and the price would drop....because attendance would drop sharply. I sure am glad I went to college when I did back in the 80s. I paid for it all myself and graduated both undergrad and grad school with zero debt.

So true.

 

[sjwaste]

Originally posted by: Ronstang

Originally posted by: Akiba
i knoe a lawyer making 35K a year. tis a shame. i can make that working as a general manager in a taco bell

Too bad they didn't take a few hundred dollar community college economics course first to learn about the concept of oversupply.

Hey, I have an economics degree and still went to law school

Definitely taking a non-traditional path out, though. Even at the money some make, the lifestyle isnt worth it.

 

[Corporate Thug]

Ugh. Let me try to clarify some things here.

Firstly, I just graduated law school and have about $125k in debt (combined, w/under grad). I went to a good school and got mediocre grades. I got a government job w/ decent pay pending bar passage.

Fact of the matter is that my loans are consolidated income-sensitive repayment plan with a whole $0/month due prior to you know, making an income. Then, then is a fairly complicated formula which results on a repayment of about $650 on $70000 or so income (but the formula is based on adjusted gross income so it varies for each person).

So all in all, not really buried in debt ridden poverty.

 

[Corporate Thug]

Originally posted by: Ronstang

Originally posted by: Akiba
i knoe a lawyer making 35K a year. tis a shame. i can make that working as a general manager in a taco bell

Too bad they didn't take a few hundred dollar community college economics course first to learn about the concept of oversupply.

Competent lawyers are a dime a dozen. Great lawyers are very difficult to come by. A lot of my professors are practitioners and they don't have any problems pulling in the big bucks in an oversupplied market.

 

[legoman666]

Good. The world could use less lawyers.

 

[Corporate Thug]

Originally posted by: legoman666
Good. The world could use less lawyers.

I love hearing that. All my friends and even my parents used to say the same thing. Easy to say until you need one.

America is as litigious as it is not because of lawyers, it's because of GREEDY PEOPLE.

 

[KeypoX]

Originally posted by: Corporate Thug

Originally posted by: legoman666
Good. The world could use less lawyers.

I love hearing that. All my friends and even my parents used to say the same thing. Easy to say until you need one.

America is as litigious as it is not because of lawyers, it's because of GREEDY PEOPLE.

yeah right my roommate got a job out of law school for a whooping 53k a year, and he must sue something like 300 people a month.... hmm sounds like the greedy people are the lawyers

We do need less law schools and lawyers, and make it harder to get into law school its way to easy right now, also from what i have been told once your in they wont kick you out for grades you will pass...

 

[legoman666]

Originally posted by: Corporate Thug

Originally posted by: legoman666
Good. The world could use less lawyers.

I love hearing that. All my friends and even my parents used to say the same thing. Easy to say until you need one.

America is as litigious as it is not because of lawyers, it's because of GREEDY PEOPLE.

If I ever need one, there will be an over abundance of them.

 

[Corporate Thug]

Originally posted by: KeypoX

Originally posted by: Corporate Thug

Originally posted by: legoman666
Good. The world could use less lawyers.

I love hearing that. All my friends and even my parents used to say the same thing. Easy to say until you need one.

America is as litigious as it is not because of lawyers, it's because of GREEDY PEOPLE.

yeah right my roommate got a job out of law school for a whooping 53k a year, and he must sue something like 300 people a month.... hmm sounds like the greedy people are the lawyers

We do need less law schools and lawyers, and make it harder to get into law school its way to easy right now, also from what i have been told once your in they wont kick you out for grades you will pass...

Tier I and II schools wont kick you out. Tier III schools may or may not depending on the school. The non ranked and unaccredited schools have mandatory cuts.

 

[Corporate Thug]

Originally posted by: legoman666

Originally posted by: Corporate Thug

Originally posted by: legoman666
Good. The world could use less lawyers.

I love hearing that. All my friends and even my parents used to say the same thing. Easy to say until you need one.

America is as litigious as it is not because of lawyers, it's because of GREEDY PEOPLE.

If I ever need one, there will be an over abundance of them.

Like I said, competent lawyers are a dime a dozen. Truly great ones are very hard to come by.

 

[rh71]

my brother's gf went to law school and in the middle of it had to declare bankruptcy and owes over $100k. But she makes a ridiculous amount at a firm right now.

 

[CanOWorms]

I would be happy if I only had $150k in debt if I went to law school full-time. Damn you undergrad loans! I guess that I don't have to worry too much about settling for a $40k/year job though.

 

[Special K]

Let me make sure I understand the loan situation correctly:

Right now, a law student's only loan options are:

1. Federal Stafford Loan
2. GradPLUS loan

Federal Stafford loans are available to anyone who fills out a FAFSA, but the amount of loans that are subsidized depends on your need, which is demonstrated by filling out a FAFSA. The interest rate on both is 6.8% fixed. Also, interest on the unsubsidized loans begins to accrue immediately. You can defer payments until after graduation, but then the unpaid interest is just added to the principal of the loan, as with a neg-AM mortgage.

GradPLUS loans can then be used to borrow up to the entire cost of the education, so a law student who did not receive enough in Stafford loans would be forced to make up the difference with GradPLUS loans. These carry a 8.5% interest rate, and interest begins to accrue immediately when the loan is taken out. You can defer the interest payments on these as well, but it will be added to the principal.

Given that most law students are not bringing in a ton of cash while they are in law school, assuming they have a job to begin with, that means they are carrying debt that will compound at 6.8% and/or 8.5% interest for 1-3 years. It seems to me that you would need to make a shit-ton of money after graduation to come out ahead. Don't forget the opportunity costs of not going to law school.

Unless there are some special loans for law students that have a super-low interest rate and government-paid interest, I can see how law school could become a very difficult financial hole to dig yourself of.

I have actually been considering patent law in the future, but I would need to perform a very detailed analysis to take into account borrowed money interest rates, opportunity costs, and the like. I suspect that even with a degree from a tier-1 school, it would take me another several years after law school to finally come out ahead, relative to the case where I just continued to work/advance in my current position and invest my money.

 

[JulesMaximus]

Lawyers...the downfall of Western Civilization.

 

[Wreckem]

Originally posted by: Special K
Let me make sure I understand the loan situation correctly:

Right now, a law student's only loan options are:

1. Federal Stafford Loan
2. GradPLUS loan

Federal Stafford loans are available to anyone who fills out a FAFSA, but the amount of loans that are subsidized depends on your need, which is demonstrated by filling out a FAFSA. The interest rate on both is 6.8% fixed. Also, interest on the unsubsidized loans begins to accrue immediately. You can defer payments until after graduation, but then the unpaid interest is just added to the principal of the loan, as with a neg-AM mortgage.

GradPLUS loans can then be used to borrow up to the entire cost of the education, so a law student who did not receive enough in Stafford loans would be forced to make up the difference with GradPLUS loans. These carry a 8.5% interest rate, and interest begins to accrue immediately when the loan is taken out. You can defer the interest payments on these as well, but it will be added to the principal.

Given that most law students are not bringing in a ton of cash while they are in law school, assuming they have a job to begin with, that means they are carrying debt that will compound at 6.8% and/or 8.5% interest for 1-3 years. It seems to me that you would need to make a shit-ton of money after graduation to come out ahead. Don't forget the opportunity costs of not going to law school.

Unless there are some special loans for law students that have a super-low interest rate and government-paid interest, I can see how law school could become a very difficult financial hole to dig yourself of.

I have actually been considering patent law in the future, but I would need to perform a very detailed analysis to take into account borrowed money interest rates, opportunity costs, and the like. I suspect that even with a degree from a tier-1 school, it would take me another several years after law school to finally come out ahead, relative to the case where I just continued to work/advance in my current position and invest my money.

Well, it really depends.

Someone that got a BA is probably making $30-35k out of college. If they go to law school and rack up $100k combined debt, but are then making $90k+ after law school. They are coming out ahead.

The amount of money you make depends on two things. Where you graduated from, and where you graduated in your class.

If you graduate in the top 10% of your class or you went to a top 50 school. You should be able to cover your loans.

Its the people that graduated at the bottoms of their classes that have problems.

 

[AccruedExpenditure]

Originally posted by: Corporate Thug
Ugh. Let me try to clarify some things here.

Firstly, I just graduated law school and have about $125k in debt (combined, w/under grad). I went to a good school and got mediocre grades. I got a government job w/ decent pay pending bar passage.

Fact of the matter is that my loans are consolidated income-sensitive repayment plan with a whole $0/month due prior to you know, making an income. Then, then is a fairly complicated formula which results on a repayment of about $650 on $70000 or so income (but the formula is based on adjusted gross income so it varies for each person).

So all in all, not really buried in debt ridden poverty.

No offense and I know it's not the point you're making but if you went to law school to come out and just make 70k a year I don't think it was worth it
-AE

 

[Corporate Thug]

Originally posted by: Special K
Let me make sure I understand the loan situation correctly:

Right now, a law student's only loan options are:

1. Federal Stafford Loan
2. GradPLUS loan

Federal Stafford loans are available to anyone who fills out a FAFSA, but the amount of loans that are subsidized depends on your need, which is demonstrated by filling out a FAFSA. The interest rate on both is 6.8% fixed. Also, interest on the unsubsidized loans begins to accrue immediately. You can defer payments until after graduation, but then the unpaid interest is just added to the principal of the loan, as with a neg-AM mortgage.

GradPLUS loans can then be used to borrow up to the entire cost of the education, so a law student who did not receive enough in Stafford loans would be forced to make up the difference with GradPLUS loans. These carry a 8.5% interest rate, and interest begins to accrue immediately when the loan is taken out. You can defer the interest payments on these as well, but it will be added to the principal.

Given that most law students are not bringing in a ton of cash while they are in law school, assuming they have a job to begin with, that means they are carrying debt that will compound at 6.8% and/or 8.5% interest for 1-3 years. It seems to me that you would need to make a shit-ton of money after graduation to come out ahead. Don't forget the opportunity costs of not going to law school.

Unless there are some special loans for law students that have a super-low interest rate and government-paid interest, I can see how law school could become a very difficult financial hole to dig yourself of.

I have actually been considering patent law in the future, but I would need to perform a very detailed analysis to take into account borrowed money interest rates, opportunity costs, and the like. I suspect that even with a degree from a tier-1 school, it would take me another several years after law school to finally come out ahead, relative to the case where I just continued to work/advance in my current position and invest my money.

It all depends. I know several people starting at Mega Firms in LA and SF, all starting @ 160k. Tier 1 school + 15% percentile and your set - maybe even more wiggle room for a patent attorney because they are rare. W/ 160K, you should be able to knock out that loan in 2-3 years. Maybe even 1 year if you manage your $ well since the 160K does not include bonuses.