lawlcat4179 wrote:Well, the consensus seems to be NYU. I have a tendency to be debt averse (as well as play devil's advocate), so I'll offer my disagreement and you can take it for what its worth. Here is why Texas is the better offer.
1. Salaries are not created equal. 160000 in NYC is not equal to 160000 in Dallas, Houston, Austin, etc. I ran the cost of living calculator and 160000 in texas is equal to roughly 350000 in NYC. Lets say that texas has a 35% chance of getting you a salary around 160,000. If this is the case you have a 35% chance of coming out of Texas making the NYC equivalent of 350,000 a year, and you'll have zero debt from day one. Basically, you'd be living like a king.
2. Taxes are not created equal. In NYC you have to pay taxes. NYC state taxes are roughly 6.5%. City taxes are roughly 3.5%. This is 10% of your income that gets taxed that wouldn't get taxed in Texas. Suddenly your 160K salary in NYC is now 144k.
3. Cost of attendance is not created equal. To attend NYU, you would be looking at roughly 15-20k extra per year in cost of attendance. Even at 15k per year this is about 50K after you graduate (including interest).
4. If you go to NYU you get 60k less in scholarships and it costs you 50k more to attend. This is 110 thousand dollars. This 110 thousand dollars will take a long time to pay off in NYC (see reasons 1 and 2). This 110 thousand dollars will charged at an 8.5% interest rate through grad plus. This will add roughly 30k to your debt if you can pay down your debt incredibly quickly (within 4 years).
5. If you go to Texas, the money you make and don't have to pay in loans can be reinvested to actually make you money. At a return rate of roughly 8.5% you will make roughly 30K within about 4 years. This, when compared to the interest problem in point 4, is roughly a 60k swing.
6. At NYU, it would probably take you about 4 years to pay off your debt. Do you plan on working biglaw your whole life? If you are like most, you will be out of biglaw in 4 years. Your reward for those 4 years... you get to break even on your loans. At texas, if you hit biglaw, after year 4 you could conceivable save up 150k or more. This is a pretty good nest egg going forward.
7. If you fail miserably at NYU, you will have over 100k in loans with no way to service them. If you fail miserably at Texas, you will have no loans and it wouldn't completely ruin your life.
8. The big reason in favor of NYU would be that you probably have double the chance of making biglaw. Lets say 70% to Texas' 35%. The upside at NYU is that you have a 70% chance of being able to pay back your loans before you get canned from biglaw, and texas you have a 35% chance of living like a king.
9. My conclusion, if you're looking for career security/money, texas wins by a mile. Would you rather come out of texas making 40k a year in shitlaw while working your way up to a higher salary/ partner, or working in a sweatshop in NYC hoping that you can pay off your massive debt before they can you? To me, the choice is incredibly easy. Plus, at Texas you do have a realistic shot at making 150k a year with no debt.
Honestly, the only real reasons I see for taking NYU are the following... 1. You want to say you went to NYU, 2. You have delusions of being a biglaw partner in NYC, 3. You really hate texas and want to move. Of course, only you can put a monetary value on these things. Anyway, just my 2 cents. Don't necessarily listen to the groupthink mentality.
Beautiful. Thank you
I gotta be honest, being TLS and all, I never really expected anyone to take the debt aversion angle very seriously. Since it appears you did, I feel I should offer some caveats to think about.
1. When I mentioned the COL differences, bear in mind that at NYU you could conceivably come back to Texas and reap the benefits of a Cost of Living difference. If this is factoring into your decision at all, I would email a couple partners at Texas firms and see how they view NYU grads vs Texas grads. If NYU doesn't offer you a boost (which I suspect it probably wouldn't in Texas vs. UTexas), this would be something to think about.
2. Something that could also factor into the decision is stress. Knowing that you have a full ride could reduce your stress level, this could either be beneficial or detrimental to your performance depending on your personality. The opposite effect at NYU. WIth a huge debt level, you may be A. motivated to do really well cuz otherwise youre screwed, or B. overly freaked out about the debt causing you stress and a lower quality of life/performance. Only you know how you would react in such a situation
3. I will close by saying this: Based off of what I have heard/learned, law school is similar to a poker game. To call it a gamble is the wrong analogy since you have some control over your outcome, but to call it all skill is very misguided as well. In poker you can have pocket aces, the single best hand possible, and yet against any given hand you generally won't ever be more than a 90% favorite to win. Many times in poker you can do everything right, you read people perfectly, lay a trap for them, and get them to put in all their money drawing to only a couple outs. Unfortunately, even sometimes when you do everything right you can still lose. Sometimes you just get unlucky. As in law school, sometimes you can do everything right (pick a great school, study hard, network, etc) and still lose. No one would deny that your odds of losing at Texas are better. This is backed up by data. However, you need to evaluate the risk into the equation as well.
Even adjusting for COL differences, I think that on average (using expected value) a degree from NYU would make you more money over the course of your lifetime. However, with Texas you have a free shot at the game, and a pretty good shot as well. No one would argue to go to Cooley for free vs 150K to go to NYU. The placement stats from NYU would just be too great of a disparity. But UTexas is not Cooley. It is a great school that places roughly a third of its students into the top paying firms in the country. Also, coming in with a full ride, your LSAT and GPA would suggest that you would do well there. Obviously LSAT and GPA can only predict so much, but a .4 correlation is pretty significant and if I had to bet on someone to beat the curve, it would be you.
I'll end my rant with this. I feel like the upside at Texas is better than the upside at NYU (biglaw with no debt vs biglaw with debt). I also feel that the worst case scenario from texas is better than worst case from NYU (unemployed or shitlaw with no debt vs unemployed or shitlaw with huge debt). However, in the middle of the curve is in my opinion where NYU is the better play. Biglaw with debt would certainly trump shitlaw with no debt (by how much I don't know). No one is going to hold it against you for going with either (they are both great options), but if you do think that you want to go to NYU, you need to really assess the possibility of the worst case scenario. To do otherwise and just block it out as if it doesn't exist would be incredibly nieve (same with Texas since unemployment would be a real possibility if in the bottom third). If you are prepared for that possibility, go for it and don't look back.