Financing Your Legal Education

Attending law school is extremely expensive. Tuition at a private law school, plus living expenses and books, can run as high as $45,000 per year. Only the wealthiest students can afford to pay this amount as they go through three years of law school. Most law students have to borrow substantial amounts to finance their law school education.

According to admissions data, the average debt for graduating law students is at least $60,000; for some students it is as high as $120,000. These figures do not include debts from undergraduate schools. Based on the normal repayment period of 10 years, and current interest rates, the monthly debt service on such loans ranges from about $600 to $1,2000.

Law school tuition at a public university in the state where you reside will be substantially less than at a private school. Although there is no public law school in Massachusetts, the law schools at the University of Connecticut and the University of Maine offer reduced rates for residents of all the New England states. If cost is an important criterion for you, consider a law school at a public university. It may be worth thousands of dollars to wait a year in order to establish residency.

Is law school a good investment?
The nuts and bolts of law school financial aid
Private lenders
Institutional aid
Working during law school

Is law school a good investment?

Given the longterm financial ramifications, it is imperative that you ask yourself this question. There is no universal answer -- only you can decide whether, given a number of factors, law school represents a good investment for you. Among the factors to consider are the following: why do you want to go to law school? Are you certain that you want to practice law or if not, that you need a law degree to do what you want to do? Do you feel you have a good idea of what lawyers do? Do you have a realistic idea of how much lawyers earn (1) in the field in which you want to practice, (2) in the geographic area in which you want to live, and (3) with a degree from the law school you are likely to attend? Are you willing to work upwards of 60-80 hours a week during your first few years of practice in order to pay off your loans?

One of the leading causes of dissatisfaction among practicing lawyers is the feeling that they are "stuck" in their jobs due to their enormous debt. Absent other professional training or experience, law school does not adequately prepare you for other types of well-paying jobs. If you find that you do not like the practice of law once you have completed law school, you will still need to pay back your loans, and being a lawyer will probably be your best-paying option. (And, in case you were beginning to contemplate other ways out of the debt, you should know that educational loans are generally NOT dischargeable in bankruptcy.)

If you are like most students considering law school, this is the first major financial decision -- with consequences lasting a decade or more -- that you will make. Do not jump into law school lightly, or on a whim, or because your parents want you to do it, or because "there's nothing better to do." You alone (as well as your future spouse and children) will bear the burden of your decision. Especially since taking time off before law school will not harm your chances of getting admitted, you should be very certain that law school is the right investment for you.

The nuts and bolts of law school financial aid

Each law school calculates its annual "cost of attendance," or COA (sometimes referred to as the "student budget"). This figure includes tuition, fees, books, rent, food and health insurance. It does not include credit card debt or car payments. You will be eligible to borrow up to the amount designated as the COA. In calculating the COA and the amount you are eligible to borrow, law schools assume that you will not work while you are in school. (See below for a discussion of working during law school.)

When you accept an offer from a specific law school, you will work closely with its financial aid office to plan the financing of your education. They will guide you through the various programs and their requirements. Law school financial aid offices serve a much smaller population and tend to be more “user friendly” than what you may be used to at UMass.

The following information is intended only as guide to help you and your family start thinking about how you will finance your law school education.

Need-based loans from the federal government

There are three types of loans available from the federal government based on financial need:

Subsidized federal Stafford loans. If you demonstrate financial need, currently you can borrow up to $8,500 per year. The government pays the interest while you are in school.

Unsubsidized federal Stafford loans. You can borrow an additional $10,000 per year. With this program, though, you pay the interest while you are in school or let it accrue.

Perkins federal loans. These loans are available to students at certain schools only. The government pays the interest while you are in school.

Private lenders

Certain private lenders specialize in loans to law students. They include Law Access, Law-Loans, and The Education Resource Institute. Commercial lenders have different restrictions on the interest rates they can charge, usually allowing them higher limit on rates than for government-backed loans.

These loans are dependent on the applicant’s own credit history. As a Massachusetts resident, you are entitled to one free copy of your credit report from each of the three major credit reporting agencies, Experian, TransUnion and Equifax. You should review your credit report before applying for loans so that you can address any problems in advance. If you have had any problems with your credit in the past, try to clear them up as soon as possible and strive to have as clear a record as you can for as long as possible.

Institutional Aid

Scholarships and grants are a key method law schools use to compete with each other for top students. Law schools offer scholarships and grants to students based on defined criteria such as academic achievement, race, ethnicity, gender, or residency. As a general rule, law schools use their limited scholarship funds to attract students they don't have enough of -- e.g., high LSAT scorers at some schools, people of color at other schools, etc.

Merit awards are very competitive. The financial aid office at the school you plan to attend can help you identify sources of funding.

If you are considering a career in Public Interest law, you should also look into whether the schools you are applying to have a Loan Repayment Assistance Plan/Program (LRAP). These programs help lawyers make payments on their qualifying loans if they are working in the public sector (e.g., legal services or legal aid, some government work, other law-related non-profits).

Working during law school

During your first year of law school, you can expect to log 12-15 hours per week in the classroom. The most often-cited benchmark for outside study time is 2 hours of study for every hour of class time. Please note that that figure is an average -- some students will study more and some lucky (or brave) few will study less. That means straight schoolwork will take up, on average, 45 hours of your week.

Now compare that 45 hours/week to what you are doing currently, either combining school and work as an undergraduate, or working full-time as a graduate. If it seems like a lot to you, then you probably will not want to work your first year of law school. If it seems like very little, then you may want to explore employment options.

Consider the following as your think about whether working during law school is a realistic part of your financial planning:

* law school entails a different kind of studying for most people, and it will likely take you longer to prepare for class than you are accustomed to;
* many schools place restrictions on student employment during the first year;
* all schools, as mandated by the ABA, restrict second and third year students to no more than 20 hours a week of employment during the school year;
* depending on where you go to school, the opportunities for paid employment will vary widely;
* in upper years, you will have other demands on your time besides classes, including moot court, law journals and other student activities.

Don't forget your summers. Most students try to obtain paid legal employment during the summer. How easy that is depends in large part on where you go to law school, and what the local market for law student associates is. This can be a highly remunerative source of employment if you are in a big law firm in a medium or large city. Summer legal employment may be much less financially rewarding (but beneficial in other ways) if you work in a public interest firm or for a small law firm. Summer employment is not just a way to make ends meet and potentially diminish the next year's tuition bill. It is also an investment in your future career in terms of professional networking and the exposure to actual law practice. Make sure you talk to your law school's career services center about summer employment during your first semester at school.