Law school tuition goes up. That’s just what it does. It goes up during boom times, it went up during the recession. It goes up when lots of people apply to law school, it goes up when applications are at historic lows. If they could distill law school tuition into a pill, it would replace Viagra.
Law schools seem very good at estimating how much law school should cost. But are they as good at telling you how much you’ll need to spend while you’re in school besides tuition? Room and board, living expenses and transportation costs, these things go up too. But some students argue that when it comes time to estimating these costs — costs that are the basis for the federal loans that students take out in order to shelter themselves and eat while they’re in school — law schools set the bar unreasonably low. From the law school’s perspective, student expenses are relatively flat… it’s only the tuition that needs to go up.
Tipsters pointed out one school for a case study of this phenomenon….
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…
As part of a nationwide tour, Above the Law is coming to the great city of Chicago.
Join preeminent law firm management consultant Bruce MacEwen, Katten Muchin Chicago managing partner Gil Sofer, and JPMorgan Chase & Co. assistant general counsel Jason Shaffer for a panel discussion (sponsored by Pangea3) on the evolutionary and market forces bearing down on the law firm business model. Come on by Thursday, November 20, at 6 p.m., for thought-provoking discussion, food, drink, and networking.
Space is limited and there will be no on-site registration, so please RSVP
Average law school debt for graduates of private universities hovered around $122,000 last year. With only 57% of new attorneys actually obtaining real lawyer jobs, recent graduates have a lot to consider when it comes to managing their student loan payments. Thanks to our friends at SoFi, today’s infographic takes a look at student loan debt, including the possible benefits of refinancing for JDs…
Kinney Recruiting’sEvan Jowers is currently in Hong Kong for client meetings and still has a few slots available through October 22. Evan will also be in Hong Kong November 14 to December 15. Further, Robert Kinney has been in Frankfurt and Munich this week and is available for meetings with our Germany based readers.
One of our key law firm clients has referred us to one of their important clients in the US, Europe and China – a leading global technology supplier for the auto industry – in order to handle their search for a new Asia General Counsel and Asia Chief Compliance Officer.
Kinney is exclusively handling this in-house search.
This position will have a lot of responsibility and include supervision of eight attorneys underneath them in the Asia in-house team. The new hire will report directly to the global general counsel and global chief compliance officer, who is based in the US. The new hire’s ability to make judgement calls is going to be as important as their technical skill set background.
The position is based in Shanghai and will deal with the company’s operations all over Asia and also in India, including frequent acquisitions in the region.
It is expected that the new hire will come from a top US firm’s Shanghai, Beijing or Hong Kong offices, currently in a top flight corporate practice at the senior associate, counsel or partner level. Of course, the candidate can be currently in a relevant in-house role.