You’ve graduated from law school. Congratulations! There’s just one small problem: you’ve now got six figures of debt attached to your name, and you have absolutely no idea how to pay it all off. You’re determined to do it, though, come hell or high water.
Having a modest income, you signed yourself up for income-based repayment. You thought (perhaps mistakenly) that it would be the best option for you. You want to get all of your financial ducks in a row so that you’ll be able to make the most of your future.
Alas, your Mint account just told you that you’re doomed…
Earlier this month, the National Jurist released its first-ever ranking of the private law schools with the “best value.” We found it odd, of course, that the “best value” designation was awarded to schools where less than half of students (and in some cases, less than a third of students) are able to retain their merit scholarships, but we tried to give the magazine the benefit of the doubt. After all, this is the same publication that used incorrect indebtedness figures to crown at least three schools as offering the “best value” in the nation, as recently as last year.
We thought that maybe things would be better when National Jurist rolled out its seventh annual Best Value rankings, for both public and private law schools. The Best Value ranking system takes into account a law school’s tuition (25% of study), students’ cost of living expenses (10%), students’ average indebtedness upon graduation (15%), the percentage of graduates who got a job after graduation (35%), and bar passage rates (15%). As in years past, National Jurist ranked only the top 20 schools, and gave letter grades to the rest of the schools on the list, ranging from A- to F.
So were this year’s Best Value rankings as fraught with error as last year’s? Continue reading to find out…
Three of your Above the Law editors — David Lat, Elie Mystal, and Joe Patrice — met up in the ATL offices earlier this week to discuss whether going to business school is a better financial decision than going to law school.
Spoiler alert: Elie thinks law schools cost too much.
These days, when we speak about new lawyers, we tend to focus less on the mere accomplishment of graduating from law school, mainly because the only admissions requirement at some institutions is a pulse, and more on sobering topics like incredibly high student debt loads and rampant joblessness. This is the “new normal” for law school graduates, and it isn’t as appealing as deans would have you believe.
Given the fact that the market for legal employment dropped out from underneath those who graduated between 2009 and 2011 (and continues to falter to this day), servicing high amounts of law school debt is more difficult than ever before. Declaring bankruptcy isn’t a real option for many, and enrolling in income-based repayment is a temporary solution that has been called a ticking time bomb. You just can’t win.
Unwelcome debt situations usually go hand in hand with law degrees, and they can happen to the best of us — even those who were once lauded as geniuses, like Andrew Carmichael Post. In America, even if you graduate from college at 17, enroll in law school at 18, and pass one of the most difficult bar exams in the nation at 22, you’ll still be saddled with unmanageable debt — in this case, to the tune of $215,000.
How in the world will Post be able to shoulder such a heavy debt burden?
Andrew Kravis, recent Columbia Law School grad and new millionaire.
Congratulations to Andrew Kravis. He graduated from Columbia Law School this past May, but he’s already earned enough money to pay off all his student loans.
And no, he doesn’t work at a hedge fund or private equity firm. He doesn’t even work in Biglaw. He’s a public interest lawyer, about to start a fellowship at Lambda Legal, the nation’s oldest and largest legal organization working for LGBT civil rights. He was honored upon graduating from CLS as one of two students “who have demonstrated outstanding achievement in the furtherance of lesbian, gay, bisexual, and transgender rights.”
So how did this outstanding do-gooder also do so well? How did he earn enough money to pay off all his student loans, and then some — a cool $2.6 million, to be exact?
As we mentioned in Non-Sequiturs last night, JPMorgan Chase is getting out of the student loan business. The bank will stop accepting new student loan applications this October.
A spokesperson for the bank said: “Students and their families are increasingly relying on government-backed loans rather than private student loans, and as a result the market has declined by 75% in the last five years.”
My friends, this is a bad sign. JPM is just a minor player in the student loan game, but the fact that they don’t think lending money to students for education is a good business anymore should make us worried. The fact that the federal government has crowded out this private lender is not good.
It means that we’re one step closer to the whole student loan bubble bursting…
Our readers love nothing better than law school rankings, so it was kind of the National Jurist to roll out its first-ever list of the Best Value private law schools. This new ranking comes in addition to its regular ranking of Best Value schools (which is usually dominated by public institutions of learning). These lists are usually released in alphabetical order, but this time, National Jurist assigned letter grades to each school due to a post-publication error. We’re off to a great start already.
The Best Value ranking typically takes into account the following criteria: tuition, cost of living, average student debt, the percentage of graduates employed nine months after graduation, and bar passage rates.
When the National Jurist created the Best Value rankings to “honor schools that took the cost of legal education seriously,” why choose to highlight private law schools at a time when tuition is higher than ever?
We’ll explore possible answers to that question, as well as reveal the rankings, after the jump…
With nothing else to rank at the moment, U.S. News decided to try its hand at “news” and put out an article analyzing the expected fallout from the new mortgage lending rules coming down from the Consumer Financial Protection Bureau. The new rules are intended to stem the tide of future foreclosures by clamping down on profligate lending.
But all clampdowns leave people out in the cold.
To put this more directly: if you thought being a lawyer with good credit would put you in a position to buy your own home, you’re probably wrong….
Student loans are a real bitch, and declaring bankruptcy won’t even save you from them — unless you can prove you’ve got undue hardship and a “certainty of hopelessness” about you, which most people have too much pride to admit. Without government payment plans like Income-Based Repayment, Pay As You Earn, and Public Service Forgiveness, a much larger portion of our population would be living in a van down by the river, still drowning in educational debts, but too far off the grid for the bill collectors to come a-knocking.
This is why people absolutely lost their minds when the Daily Currant, a satirical online newspaper, published a story about President Barack Obama’s supposed bid to forgive all student loans. Given the responses, it looks like the youth of America is still in need of some change they can believe in…
When Chintan Panchal decided to leave a global BigLaw partnership to start his own firm, he could only hope that he would face the high-quality problem of firm building that many had cautioned him about. Focused on the uncertainty surrounding of a new firm launch, he decided to tackle staffing needs, IT challenges, and financial planning requirements after he had built up his legal practice.
Panchal Associates LLP–a corporate/finance and outside general counsel boutique–was quickly off to a great start. Clients and matters were flying in the door, and Chintan soon had a team of lawyers and staff with a variety of operational needs. To continue building an excellent team and provide them with a competitive benefits package, to expand his physical presence to include a European practice and additional partners, and to scale his operations and IT capabilities to support this growing enterprise brought with it demands of time, money, and expertise. Chintan knew he needed help.
“With the assistance of NexFirm, we have upgraded the capabilities of our firm to meet, and in some cases exceed, the standards we were used to at our former BigLaw firms. Operationally, we can now attract and service clients we didn’t have the bandwidth to support in the past, and continue to build our team with the best and brightest legal talent in the industry,” said Chintan Panchal, adding “It has worked out quite well in our case; NexFirm is an essential partner for us.”
The holiday season is upon us, and yet again, you have no idea what to get for the fickle lawyer in your life. We’re here to help. Even if your bonus check hasn’t arrived yet, any one of the gifts we’ve highlighted here could be a worthy substitute until your employer decides to make it rain.
We’ve got an eclectic selection for you to choose from, so settle in by that stack of documents yet to be reviewed and dig in…
Ed. note: The Asia Chronicles column is authored by Kinney Recruiting. Kinney has made more placements of U.S. associates, counsels and partners in Asia than any other recruiting firm in each of the past six years. You can reach them by email: firstname.lastname@example.org.
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