timbs4339 wrote:scifiguy wrote:Let's assume a person attends a relatively good law school (we'll choose a T20 to make it realistic): Vanderbilt.
Let's also assume this person was decently wise in not putting himself or herself at "too much" loan debt risk and got out at under $100K. Let's be realistic again here and assume this person leaves law school with $90K law debt ($45K from living expenses and $45K from law tuition - just assume they had a scholly from being a good undergrad student and got a pretty good LSAT).
Suppose our "top" law school grad, who was wise enough to go without incurring over $100K debt, graduates from law school and was unable to secure biglaw, a federal clerkship, or other PI or gov't job that would enable them to have a high enough salary or LRAP to start paying back their loans.
So, our person who tried to do everything right is in a worst-case scenario position.
Suggest a plan of survival for our recent, unemployed law grad? With $90K loans, a JD from a good school, but just unable to land that great position. What options would this person have?
What types of jobs or plan could this person immediately take to avoid missing loan payments and possibly ending up on IBR? How long does this person have before the loan payments start becoming due? How long of under/unpayed loan payments before this person may have to go on IBR for the rest of their life?
I'm wondering in the worst of the worst cases for someone who may have done things "right," what can that person do? I'm asking beacuse tihs could be a realistic scenario for TLS'ers.
You have roughly six months after graduation before your loans are due. Interest starts running immediately after graduation and is capitalized after the six-month grade period. Your payments will be around $1100 per month (I have around 100K in debt).
You need to spend three months studying for the bar, unless you are abandoning law. During this period you could work part-time, I did.
Otherwise, you need to find a job. Any job. Your loan payments are $13200 per year on the ten-year schedule. Do the math on the salary you need to live. Remember that your most likely scenario is 40-60K small law.
Thanks dude! Pretty helpful actually!!
Yeah, I think $50K salary is reasonable if assuming small law from what I've read online here. Of course, that's assuming you're able to get a legal job in small law. We could do a calculation using $50K first.
And then we could do a calculation assuming no legal job. That's harder to do. But maybe a worst case scenario like waiting tables at Olive Garden for $35K/year would be interesting to see.
In terms of the annual loan payments, do they get deducted from your taxes? So, if you make $50K, do you have to take taxes out first and then also take out thsoe loan payments? Or do you get some kind of tax break from your loans?
Once I get some numbers straight, I'll try to run a calculation based on different geographic locations. In a big city, I think $50K/year salary + $13,000K loan payments would be very difficult to live on.