Money, Student Loans

What You Should Spend Your Money On As A Young Attorney

Would you rather fail the bar exam or be debt free? Choose wisely.

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Over the past several weeks, I have discussed ways that anyone can save money while working as a young attorney.  Since many young lawyers have student loans with insanely high interest rates, it is important to save money and pay off this debt as soon as possible.  However, there are certain things that are important to spend money on while working as a young attorney, and this article discusses some of the things you should purchase even while living frugally to devote more cash to student debt.

It is extremely important for every law school graduate to spend money on preparing for the bar exam.  I know that enrolling in a bar review course is expensive, and many law school graduates need to borrow additional debt to purchase bar review materials and to have cash for living expenses while studying for the bar.  It is true that there are people out there who studied for the bar exam by purchasing outlines online for a few hundred dollars and miraculously passed the bar exam.  These individuals likely saved thousands of dollars by not having to enroll in a bar review course, and it might be tempting to save money this way as well.

However, I also know plenty of people who did not take a traditional bar review course and ended up failing the bar exam.  These individuals are very smart and capable people, and I am convinced that they only failed the bar exam since they did not purchase the resources necessary to succeed on this test.  Failing the bar exam can have many consequences in the life of a young lawyer, and if you fail, you will have to pay all of the costs associated with taking the bar exam again.  All told, it is worth spending money to be well-prepared for the bar exam, since the amount of money spent on bar review courses is nothing compared to the cost of law school, and the consequences of failure are severe.

A few weeks ago, I spoke about how I spent very little money on clothes while working in Biglaw and at my first job after leaving Biglaw.  And in most situations, there is no need to wear expensive outfits.  However, it is also important for every young lawyer to purchase at least one good professional outfit to use on job interviews, court appearances, and other situations where you need to look your best.

There were a few times after I had just graduated from law school when I felt a little out of place because I was wearing the same suit that I purchased in high school.  One time, when I was only two years out of law school, I had to conduct a class-action fairness hearing in federal court.  This was one of the biggest moments of my career up to that point, and the regular $100 suit I wore definitely felt inadequate.

Federal court in New York is a lot different than New York state court, and the carpeting, wall panels, and the august building itself all added to the grandeur of the occasion.  I am convinced that New York federal court even smells better than state court!  In any case, I felt out of place at that hearing in my worn-down outfit, and I wished I had something more “suitable” for the hearing.  All told, it is advisable to purchase an outfit or two that can be used on important occasions.  Even if this wardrobe costs more money, it is worth the additional expense, since there are definitely times when you need to look your best.

You should also not be afraid to spend money as a young attorney if it is reasonably related to expanding your network.  Being a successful attorney is all about relationships, and the best lawyers have an active social calendar.  Networking with other attorneys increases the likelihood that you will originate new business, and networking can also be helpful if you need to reach out to someone about a novel or complex legal issue.  I once had a mentor who told me that you should never eat or drink alone, and every young attorney should be encouraged to pay for meals or drinks to expand their network.

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It is also a good idea to spend money to attend networking events, even if your firm does not cover these expenses.  Although it is usually best to network with individuals you already have a connection with, attending events sponsored by schools you attended or community groups you are involved with can be very rewarding.  I have met many unique individuals at networking events sponsored by organizations (including great Above the Law events I attended over the years!), and it is worth paying a modest sum, if necessary, to attend these events.

In the end, although it is important to save as much money as possible to devote more cash to student debt, it is also wise to spend money in certain situations.  It is true that this might mean that you cannot pay off your student loans as quickly possible.  However, the rewards of advancing your career and enriching other parts of your life should be well worth the sacrifice.

Jordan Rothman is the founder of Student Debt Diaries, a personal finance website discussing how he paid off all $197,890.20 of his college and law school student loans over 46 months of his late 20s. You can reach him at Jordan@studentdebtdiaries.com.

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