For many students, the rigors of law school are offset by their dreams of joining a big law firm and earning a sizeable paycheck. Even if this dream becomes a reality, sometimes law school debt is so enormous that they’re unable to enjoy their new positions and salaries. New attorneys might even struggle to get by month over month, especially if they live in high-rent areas.
You’ll almost certainly owe money after law school, but there are ways to lessen the financial strain.
In this guide, you’ll learn what the average law school debt is and ways to avoid taking on crippling student loan debt as you study to become a lawyer. For more financial planning tips, call Power Forward Group at (646) 647-2150.
Average Law School Debt
In 2020, the American Bar Association completed a survey of 1,084 newer lawyers and recent law school graduates, asking them about their law school debt. They found that the average total student loan debt at the time of law school graduation was $164,742.
That’s like being given a mortgage before you even have a job to pay for it.
The survey also revealed that tuition and law school debt has risen at a higher rate than wages. This is distressing news for graduate students who are trying to find a way to create a stable future for themselves and their families.
This debt impacts not just the new lawyer but the family as well. They might have to buy a smaller house, put off buying a new car, or even postpone the decision to have children.
Thankfully, there are a few things students can do to avoid or significantly lower their law school debt.
Tips for Avoiding Significant Law School Debt
Whether you are just starting your undergraduate classes or in the middle of graduate school, there are certain things you can do to minimize your law school debt.
These are things that anyone can do, and all of them will help you owe less when you graduate.
One of the biggest mistakes college students make is to take out the maximum amount in their student loans. It seems like free money at the time! Unfortunately, as soon as you graduate, all of those loans are due, whether you have a job to pay for them or not.
Check this list and do as many of these things as you can. The more you can do to take out fewer loans, the better your finances will be when you graduate law school.
All of these things will give you a shot at owing less money for student loans.
Have a job during college - If you’re employed while you are in college, you’ll have enough of an income to pay for things like rent and food and won’t have to rely on expensive student loans for them.
Shop around and compare - Sometimes, the most expensive law school isn’t the best option. Look around and compare prices and choose the one that will give you the biggest bang for your buck.
Apply for scholarships - There are thousands of scholarships available. There are so many out there that it can be a part-time job just filling out all the forms, but the more scholarships you earn, the fewer loans you have to take out.
These are healthy habits you can carry with you throughout your entire adult life. Remember, it’s all about paying for as much as you can now and taking out as few loans as possible.
Make a budget - Write down all of your expenses and your current income and then only take out the minimum amount of loans you need to make up the difference. Making a budget is something that you can do your entire life to help you keep more of your money.
Live well within your means - Do not compare yourself to others. Decide to live within your means, no matter what everyone else is doing. This might mean you live in a small place, spend less on entertainment, or have a smaller budget for traveling.
Look for summer associate programs - Not only will a summer associate program give you additional income but it can help you land a lucrative legal position after you graduate.
Maximize the resources available to you at your school’s financial aid office - Speak with your school’s financial aid office and look for other options you might not have considered yet, like work-study programs or paying for school ahead of time.
We’re Here to Help You Stay Ahead of Debt
A very important part of financial planning for lawyers is avoiding or staying ahead of crippling debt. When you’re looking for ways to get a jump-start on your new lifestyle as a lawyer, avoiding law school debt can put you ahead of your peers.Speak with a financial advisor and discuss ways to get the most out of school while minimizing the financial impact after you graduate. Call Power Forward Group at (646) 647-2150 today.