Summer Associate Offers Plummet, Hitting 17-Year Low

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Anhimal
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby Anhimal » Thu Mar 04, 2010 3:28 pm

Aeroplane wrote:
Renzo wrote:68k x 3 years =$204

Yup - and this is actually a softball estimate. At graduation it'll be something like $230K w/all the interest (too lazy to do the math).


Why are we law students? =(

scionb4
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby scionb4 » Thu Mar 04, 2010 3:36 pm

The schools mentioned where you have over 200k in debt are all big city schools - the debt doesn't come from paying for law schools, it comes from paying to live in New York. You don't have to do that to get a law school education.

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nealric
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby nealric » Thu Mar 04, 2010 3:42 pm

Why are we law students? =(


Want to hear the even worse news?

That $230k post graduation will cost $573,293.90 if paid off on a 30 year plan (at the low, low monthy payment of $1592 a month). That's 19k a year. But wait, there's more! That 19k a year has to paid entirely in POST tax dollars if you actually make enough money to make those payments (so are above student loan interest deduction phaseout), so making those minimum payments will lop 25-30k off whatever salary you make (depending on your tax bracket). All that is paying off on a schedule that will have you still paying them off when your kids are in college.

Now try a 10 year repayment plan: That will cost you $2,718 a month or $32,616 per year. So lop off 40-60k a year of salary depending on tax bracket.

Suppose you want to get out of debt quick and go with a 5 year repayment plan: That will cost $4597 a month or $55167 a year. You won't be doing that without a biglaw salary, so count on 45-50% total tax liability (50% in NYC). So subtract $110k from your salary.

So in conclusion, even Biglaw associates won't be living large. If you borrowed the full 200k plus interest, you will get through 5 years of biglaw with your net worth back to about zero, and probably only minimal savings from frugally living in NYC on 40k (pre tax) a year.

Now try computing those numbers for temporary docreviewers making 40k and no benefits.

BTW: I was using the handy, dandy financial aid calculator here:
http://www.finaid.org/calculators/scrip ... yments.cgi

scionb4
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby scionb4 » Thu Mar 04, 2010 3:46 pm

nealric wrote:
Why are we law students? =(


Want to hear the even worse news?

That $230k post graduation will cost $573,293.90 if paid off on a 30 year plan (at the low, low monthy payment of $1592 a month). That's 19k a year. But wait, there's more! That 19k a year has to paid entirely in POST tax dollars if you actually make enough money to make those payments (so are above student loan interest deduction phaseout), so making those minimum payments will lop 25-30k off whatever salary you make (depending on your tax bracket). All that is paying off on a schedule that will have you still paying them off when your kids are in college.

Now try a 10 year repayment plan: That will cost you $2,718 a month or $32,616 per year. So lop off 40-60k a year of salary depending on tax bracket.

Suppose you want to get out of debt quick and go with a 5 year repayment plan: That will cost $4597 a month or $55167 a year. You won't be doing that without a biglaw salary, so count on 45-50% total tax liability (50% in NYC). So subtract $110k from your salary.

So in conclusion, even Biglaw associates won't be living large. If you borrowed the full 200k plus interest, you will get through 5 years of biglaw with your net worth back to about zero, and probably only minimal savings from frugally living in NYC on 40k (pre tax) a year.

Now try computing those numbers for temporary docreviewers making 40k and no benefits.

BTW: I was using the handy, dandy financial aid calculator here:
http://www.finaid.org/calculators/scrip ... yments.cgi


Shit. Those aren't nice numbers.

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nealric
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby nealric » Thu Mar 04, 2010 3:46 pm

The schools mentioned where you have over 200k in debt are all big city schools - the debt doesn't come from paying for law schools, it comes from paying to live in New York. You don't have to do that to get a law school education.


It's true that that 200k number is for "big city" schools, but that's not just NYC. All the UC system schools are up in that area (and most private schools in California). Even a state school like U of Texas will run you around $160k total cost of attendance (not including interest). Even "cheap" in-state tuition schools are starting to push into the six-figures- and none of those have LRAPs or significant prospects of getting a job that will allow aggressive loan repayment.

In sum, most of us are in trouble. :(

Renzo
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby Renzo » Thu Mar 04, 2010 3:49 pm

nealric wrote:
The schools mentioned where you have over 200k in debt are all big city schools - the debt doesn't come from paying for law schools, it comes from paying to live in New York. You don't have to do that to get a law school education.


It's true that that 200k number is for "big city" schools, but that's not just NYC. All the UC system schools are up in that area (and most private schools in California). Even a state school like U of Texas will run you around $160k total cost of attendance (not including interest). Even "cheap" in-state tuition schools are starting to push into the six-figures- and none of those have LRAPs or significant prospects of getting a job that will allow aggressive loan repayment.

In sum, most of us are in trouble. :(

Right. Even if you could live in a park and eat at homeless shelters, many of the top schools cost around $40k/yr in tuition alone. $160k in tuition plus three years' cost of living in any city gets you most of the way to $200.

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Aeroplane
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby Aeroplane » Thu Mar 04, 2010 3:51 pm

scionb4 wrote:The schools mentioned where you have over 200k in debt are all big city schools - the debt doesn't come from paying for law schools, it comes from paying to live in New York. You don't have to do that to get a law school education.

Not really. Even a reasonable Midwest COL budget can be $14-$18K and lots of non-NYC schools have >$45K tuitions. I'm pretty sure Michigan & Cornell, for example, would also put you over $200K, although not by as much. Don't forget, tuition goes up every year, COL likely does too, and of course there's that 8-8.5% interest on most of the loans and origination fees.

Anonymous User
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby Anonymous User » Thu Mar 04, 2010 3:51 pm

nealric wrote:
The schools mentioned where you have over 200k in debt are all big city schools - the debt doesn't come from paying for law schools, it comes from paying to live in New York. You don't have to do that to get a law school education.


It's true that that 200k number is for "big city" schools, but that's not just NYC. All the UC system schools are up in that area (and most private schools in California). Even a state school like U of Texas will run you around $160k total cost of attendance (not including interest). Even "cheap" in-state tuition schools are starting to push into the six-figures- and none of those have LRAPs or significant prospects of getting a job that will allow aggressive loan repayment.

In sum, most of us are in trouble. :(


That scholarship from Saint Louis is looking better and better. Ive also been looking at every conceivable way to lessen the burden of loans - public interest careers that get loan repayment assistance, full-time jag careers that pay off federal loans, jag programs (looks like the only one you can do right after law school is the Army and the Army National Guard) that help with federal loans, outside scholarships (there doesn't seem to be anything there), anything that might take the load off, or at least help.

09042014
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby 09042014 » Thu Mar 04, 2010 3:51 pm

NU is just a hair shy of 70 per year. And their room and board budget won't even cover 12 months of rent for a studio near the law campus.

That is 210,000 without accounting accrued interest, or tuition increases.

Add in 15K for ugrad, and I'll probably top out at 250K.

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Drew2010
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby Drew2010 » Thu Mar 04, 2010 3:52 pm

scionb4 wrote:The schools mentioned where you have over 200k in debt are all big city schools - the debt doesn't come from paying for law schools, it comes from paying to live in New York. You don't have to do that to get a law school education.


You strike me as somewhat stupid...

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AngryAvocado
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby AngryAvocado » Thu Mar 04, 2010 3:53 pm

nealric wrote:
Why are we law students? =(


Want to hear the even worse news?

That $230k post graduation will cost $573,293.90 if paid off on a 30 year plan (at the low, low monthy payment of $1592 a month). That's 19k a year. But wait, there's more! That 19k a year has to paid entirely in POST tax dollars if you actually make enough money to make those payments (so are above student loan interest deduction phaseout), so making those minimum payments will lop 25-30k off whatever salary you make (depending on your tax bracket). All that is paying off on a schedule that will have you still paying them off when your kids are in college.

Now try a 10 year repayment plan: That will cost you $2,718 a month or $32,616 per year. So lop off 40-60k a year of salary depending on tax bracket.

Suppose you want to get out of debt quick and go with a 5 year repayment plan: That will cost $4597 a month or $55167 a year. You won't be doing that without a biglaw salary, so count on 45-50% total tax liability (50% in NYC). So subtract $110k from your salary.

So in conclusion, even Biglaw associates won't be living large. If you borrowed the full 200k plus interest, you will get through 5 years of biglaw with your net worth back to about zero, and probably only minimal savings from frugally living in NYC on 40k (pre tax) a year.

Now try computing those numbers for temporary docreviewers making 40k and no benefits.

BTW: I was using the handy, dandy financial aid calculator here:
http://www.finaid.org/calculators/scrip ... yments.cgi



Well, at least interest paid on student loans is tax deductible... :oops:

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nealric
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby nealric » Thu Mar 04, 2010 3:56 pm

Add in 15K for ugrad, and I'll probably top out at 250K.


Yep. My numbers were actually somewhat optimistic in that I assumed no ugrad debt. My biglaw numbers were somewhat pessimistic, as I was assuming no raise/bonus. At the same time, some associates who started in 2007 have yet to get either (some have gotten salary cuts). Can't count on raises.

I really think a lot of people haven't run these numbers, or haven't fully appreciated their meaning (especially the people setting tuition). There was truly no way to get that deep in the hole for our parent's generation.

Don't forget kiddies: Student loans aren't dischargable in bankruptcy!

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nealric
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby nealric » Thu Mar 04, 2010 3:57 pm

Well, at least interest paid on student loans is tax deductible... :oops:


Not if you actually make enough money to make the payments. 70k phaseout FTL :(

09042014
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby 09042014 » Thu Mar 04, 2010 3:59 pm

AngryAvocado wrote:
nealric wrote:
Why are we law students? =(


Want to hear the even worse news?

That $230k post graduation will cost $573,293.90 if paid off on a 30 year plan (at the low, low monthy payment of $1592 a month). That's 19k a year. But wait, there's more! That 19k a year has to paid entirely in POST tax dollars if you actually make enough money to make those payments (so are above student loan interest deduction phaseout), so making those minimum payments will lop 25-30k off whatever salary you make (depending on your tax bracket). All that is paying off on a schedule that will have you still paying them off when your kids are in college.

Now try a 10 year repayment plan: That will cost you $2,718 a month or $32,616 per year. So lop off 40-60k a year of salary depending on tax bracket.

Suppose you want to get out of debt quick and go with a 5 year repayment plan: That will cost $4597 a month or $55167 a year. You won't be doing that without a biglaw salary, so count on 45-50% total tax liability (50% in NYC). So subtract $110k from your salary.

So in conclusion, even Biglaw associates won't be living large. If you borrowed the full 200k plus interest, you will get through 5 years of biglaw with your net worth back to about zero, and probably only minimal savings from frugally living in NYC on 40k (pre tax) a year.

Now try computing those numbers for temporary docreviewers making 40k and no benefits.

BTW: I was using the handy, dandy financial aid calculator here:
http://www.finaid.org/calculators/scrip ... yments.cgi



Well, at least interest paid on student loans is tax deductible... :oops:


I think there is an income cut off.

Personally if I get a 160K a year job in Chicago, I'll live like I make 60K and pay as much back as I can as fast as I can. This is assuming we aren't experiencing 1970's like inflation, in which case I'd pay as little back as possible. It'll still probably take 5 years.

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nealric
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby nealric » Thu Mar 04, 2010 4:02 pm

This is assuming we aren't experiencing 1970's like inflation, in which case I'd pay as little back as possible. It'll still probably take 5 years.


Seriously. A lot of law students should be hoping for Zimbabwe style inflation.

09042014
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby 09042014 » Thu Mar 04, 2010 4:04 pm

nealric wrote:
This is assuming we aren't experiencing 1970's like inflation, in which case I'd pay as little back as possible. It'll still probably take 5 years.


Seriously. A lot of law students should be hoping for Zimbabwe style inflation.


The Fed did increase the money supply to make up for the reduced velocity. Maybe they won't reduce it fast enough.

coherentowst
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby coherentowst » Thu Mar 04, 2010 4:08 pm

We are more likely in for a Japanese-style deflationary period than inflation, if I have it right. But who knows. I sure wouldn't gamble on massive inflation anytime soon.
Last edited by coherentowst on Thu Mar 04, 2010 4:15 pm, edited 1 time in total.

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Stringer Bell
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby Stringer Bell » Thu Mar 04, 2010 4:13 pm

ruleser wrote:2/3 of the economy is consumer spending - when jobs go overseas, would-be consumers don't have cash, that 2/3 of the economy collapses, all tiers get hit.

For other poster, seriously? Conservatives sold us free trade - from what planet your 'protectionism' comment comes from not sure, but enjoy it up there - when you rejoin reality, enjoy the conservatives who downsized/free traded/outsourced/undercut us into collapse.


So what are you proposing? A completely self sufficient isolated economy that has no trade with other nations? If that's the case, GDP falls through the floor. If we had a completely isolated economy we would have to accept a substantially lower standard of living.

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Stringer Bell
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby Stringer Bell » Thu Mar 04, 2010 4:16 pm

coherentowst wrote:We are more likely in for a Japanese-style deflationary period than inflation, if I have it right. But who knows. I sure wouldn't gambe on massive inflation anytime soon.


Bernanke has said that he would get in a helicopter and drop money out before he would let deflation occur.

coherentowst
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby coherentowst » Thu Mar 04, 2010 4:22 pm

Stringer Bell wrote:
coherentowst wrote:We are more likely in for a Japanese-style deflationary period than inflation, if I have it right. But who knows. I sure wouldn't gambe on massive inflation anytime soon.


Bernanke has said that he would get in a helicopter and drop money out before he would let deflation occur.


The Japanese central bank used all kinds of helicopter tactics, IIRC. Didn't work.

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underdawg
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby underdawg » Thu Mar 04, 2010 4:27 pm

Stringer Bell wrote:
ruleser wrote:2/3 of the economy is consumer spending - when jobs go overseas, would-be consumers don't have cash, that 2/3 of the economy collapses, all tiers get hit.

For other poster, seriously? Conservatives sold us free trade - from what planet your 'protectionism' comment comes from not sure, but enjoy it up there - when you rejoin reality, enjoy the conservatives who downsized/free traded/outsourced/undercut us into collapse.


So what are you proposing? A completely self sufficient isolated economy that has no trade with other nations? If that's the case, GDP falls through the floor. If we had a completely isolated economy we would have to accept a substantially lower standard of living.

d00d what happens when you act like your elastic product is an inelastic one?

awesomepossum
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby awesomepossum » Thu Mar 04, 2010 4:31 pm

Anhimal wrote:
Aeroplane wrote:
Renzo wrote:68k x 3 years =$204

Yup - and this is actually a softball estimate. At graduation it'll be something like $230K w/all the interest (too lazy to do the math).


Why are we law students? =(




To get duckies from firms? :wink:

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Dick Whitman
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby Dick Whitman » Thu Mar 04, 2010 4:35 pm

Stringer Bell wrote:
ruleser wrote:2/3 of the economy is consumer spending - when jobs go overseas, would-be consumers don't have cash, that 2/3 of the economy collapses, all tiers get hit.

For other poster, seriously? Conservatives sold us free trade - from what planet your 'protectionism' comment comes from not sure, but enjoy it up there - when you rejoin reality, enjoy the conservatives who downsized/free traded/outsourced/undercut us into collapse.


So what are you proposing? A completely self sufficient isolated economy that has no trade with other nations? If that's the case, GDP falls through the floor. If we had a completely isolated economy we would have to accept a substantially lower standard of living.


Free Trade is as widely accepted by economists as evolution is by biologists. That includes by democratic economists (and most are). There simply isn't any doubt that a policy of free trade is to the benefit of our general welfare, regardless of the actions of our trading partners. We would be far better off by helping the losers from free trade directly.

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nealric
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby nealric » Thu Mar 04, 2010 4:35 pm

The Japanese central bank used all kinds of helicopter tactics, IIRC. Didn't work.


Then they didn't print enough money. If you print enough, there WILL be inflation.

coherentowst
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Re: Summer Associate Offers Plummet, Hitting 17-Year Low

Postby coherentowst » Thu Mar 04, 2010 4:46 pm

nealric wrote:
The Japanese central bank used all kinds of helicopter tactics, IIRC. Didn't work.


Then they didn't print enough money. If you print enough, there WILL be inflation.


Well, part of the problem is that printing itself isn't enough. If you printed out enough money to give everyone $10,000, and they all just put it in the bank, there would be no inflation. You need people to spend it.

Now at some point if you gave people enough they would start to spend it in sufficient quantities to cause inflation. But there are practical and political limits to how much central banks can print and how much governments can spend. Obviously this is just a guess, but I think that there's no way the Fed can get away with printing the amount of money it would require to cause serious inflation, even if Bernanke wants to do just that.




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