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Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:18 pm
by remz
I owe about $70K from an Ivy League undergrad. I will be attending Columbia in the fall where the total COL is $70K per year. By the time I graduate I will owe $280K in federal loans (slightly less if I land a 2L summer gig). Let's say I'm lucky enough to land a BigLaw job in NYC and live very moderately and within my means. How long would it take to pay off these loans when taking taxes and interest into consideration?
I've looked at loan calculators but don't know what to plug in for certain tax variables so I'm looking for an estimate. About how much money per month and for how long? And when I say living moderately I truly mean it. I'd live in a small place and hopefully pay about $1100-1500 per month in rent in NYC.
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:19 pm
by ckoz11
I'd live in a small place and hopefully pay about $1100-1500 per month in rent in NYC.
HA
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:20 pm
by budafied
ckoz11 wrote:I'd live in a small place and hopefully pay about $1100-1500 per month in rent in NYC.
HA
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:21 pm
by dominkay
budafied wrote:ckoz11 wrote:I'd live in a small place and hopefully pay about $1100-1500 per month in rent in NYC.
HA
That is actually totally doable.
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:21 pm
by spondee
ckoz11 wrote:I'd live in a small place and hopefully pay about $1100-1500 per month in rent in NYC.
HA
I pay in the low end of that range for an alcove studio in an elevator/doorman building.
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:23 pm
by ckoz11
well when I lived there that rent was tough to find in the bronx
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:24 pm
by remz
ckoz11 wrote:I'd live in a small place and hopefully pay about $1100-1500 per month in rent in NYC.
HA
I don't know why that is unreasonable. I currently live in NYC and know plenty of people that pay in this range. Living with my girlfriend, the total cost of the apartment would be more, but $1100-1500 is my contribution.
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:26 pm
by ckoz11
remz wrote:I don't know why that is unreasonable. I currently live in NYC and know plenty of people that pay in this range. Living with my girlfriend, the total cost of the apartment would be more, but $1100-1500 is my contribution.
ckoz11 wrote:I'd live in a small place and hopefully pay about $1100-1500 per month in rent in NYC.
HA
I don't know why that is unreasonable. I currently live in NYC and know plenty of people that pay in this range. Living with my girlfriend, the total cost of the apartment would be more, but $1100-1500 is my contribution.
I'd say thats about right, 2200 for decent small place in Manhattan, but 1100 is really pushing it
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:28 pm
by dakatz
280K in loans!!?? I just threw up in my mouth... Good luck getting that biglaw gig, and may god have mercy on your soul if you don't
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:28 pm
by dominkay
ckoz11 wrote:I'd say thats about right, 2200 for decent small place in Manhattan, but 1100 is really pushing it
Your idea of decency is pretty interesting. Good luck with your student loans.
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:30 pm
by remz
So any estimates? Let's say per month over 10 years.
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:30 pm
by GratefulDead
Uh, I don't think all of you live in the city. I live in Harlem=535$+utilities per month. If you get roomates, it's very cheap. 1,000-1,500 in not the most desirable area is totally doable.
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:31 pm
by Pearalegal
dominkay wrote:ckoz11 wrote:I'd say thats about right, 2200 for decent small place in Manhattan, but 1100 is really pushing it
Your idea of decency is pretty interesting. Good luck with your student loans.
Agreed, 1100-1500 is a reasonable range and in plenty of great neighborhoods. But sorry OP, no clue about the loan things--try one of the calculators.
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:32 pm
by D. Professor
I owe about $70K from an Ivy League undergrad. I will be attending Columbia in the fall where the total COL is $70K per year. By the time I graduate I will owe $280K in federal loans (slightly less if I land a 2L summer gig). Let's say I'm lucky enough to land a BigLaw job in NYC and live very moderately and within my means. How long would it take to pay off these loans when taking taxes and interest into consideration?
OMG! And I thought my owing $80k when I am out of lawschool would be a problem. Ouch!
Good Luck bro, you're going to need it.
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:34 pm
by remz
D. Professor wrote:I owe about $70K from an Ivy League undergrad. I will be attending Columbia in the fall where the total COL is $70K per year. By the time I graduate I will owe $280K in federal loans (slightly less if I land a 2L summer gig). Let's say I'm lucky enough to land a BigLaw job in NYC and live very moderately and within my means. How long would it take to pay off these loans when taking taxes and interest into consideration?
OMG! And I thought my owing $80k when I am out of lawschool would be a problem. Ouch!
Good Luck bro, you're going to need it.
Haha. I'm really hoping that going to a T4 school will assist me in landing a BigLaw job in NYC so I can pay off these loans.
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:38 pm
by DaveBear07
studentloans.com has a great loan repayment calculator.
if you're not able to find the exact interest rates for your loans then I'd suggest just tinkering around to your satisfaction with 6.8% rates or 10% rates.
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:40 pm
by Pearalegal
Before I get yelled at, I just used one of the random finaid calculators to give a ballpark.
To pay off in 10 years:
Loan Balance: $280,000.00
Adjusted Loan Balance: $280,000.00
Loan Interest Rate: 6.80%
Loan Fees: 0.00%
Loan Term: 10 years
Minimum Payment: $50.00
Monthly Loan Payment: $3,222.25
Number of Payments: 120
Cumulative Payments: $386,669.87
Total Interest Paid: $106,669.87
Note: The monthly loan payment was calculated at 119 payments of $3,222.25 plus a final payment of $3,222.12.
It is estimated that you will need an annual salary of at least $386,670.00 to be able to afford to repay this loan.
30 years:
Loan Balance: $280,000.00
Adjusted Loan Balance: $280,000.00
Loan Interest Rate: 6.80%
Loan Fees: 0.00%
Loan Term: 30 years
Minimum Payment: $50.00
Monthly Loan Payment: $1,825.39
Number of Payments: 360
Cumulative Payments: $657,141.02
Total Interest Paid: $377,141.02
Note: The monthly loan payment was calculated at 359 payments of $1,825.39 plus a final payment of $1,826.01.
It is estimated that you will need an annual salary of at least $219,046.80 to be able to afford to repay this loan.
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:48 pm
by Geist13
Pearalegal wrote:Before I get yelled at, I just used one of the random finaid calculators to give a ballpark.
To pay off in 10 years:
Loan Balance: $280,000.00
Adjusted Loan Balance: $280,000.00
Loan Interest Rate: 6.80%
Loan Fees: 0.00%
Loan Term: 10 years
Minimum Payment: $50.00
Monthly Loan Payment: $3,222.25
Number of Payments: 120
Cumulative Payments: $386,669.87
Total Interest Paid: $106,669.87
Note: The monthly loan payment was calculated at 119 payments of $3,222.25 plus a final payment of $3,222.12.
It is estimated that you will need an annual salary of at least $386,670.00 to be able to afford to repay this loan.
30 years:
Loan Balance: $280,000.00
Adjusted Loan Balance: $280,000.00
Loan Interest Rate: 6.80%
Loan Fees: 0.00%
Loan Term: 30 years
Minimum Payment: $50.00
Monthly Loan Payment: $1,825.39
Number of Payments: 360
Cumulative Payments: $657,141.02
Total Interest Paid: $377,141.02
Note: The monthly loan payment was calculated at 359 payments of $1,825.39 plus a final payment of $1,826.01.
It is estimated that you will need an annual salary of at least $219,046.80 to be able to afford to repay this loan.
You didn't account for the fact that over half of these loans will be GRADPLUS and therefore at the 8.5% rate not the 6.8% stafford rate.
according to my calculations you will be paying at least $3350 per month in loans for ten years. Over the course of a ten year payment plan, you will pay back over $400,000.
On a 25 year payment plan you will pay about 2,100 per month for 25 years. Over the course of the entire period you will pay over $630,000.
These numbers do not include the amount of interest that will accrue, and therefore need to be paid off, on the UG loan that is deferred while you are in law school.
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:51 pm
by Pearalegal
Yeah, like I said, I just used one of the calculators for whatever sort of a rough estimate.
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:56 pm
by remz
Maybe I should just withdraw from Columbia now haha.
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 3:59 pm
by dominkay
remz wrote:Maybe I should just withdraw from Columbia now haha.
No, you should marry your girlfriend. Share the debt!
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 4:01 pm
by Geist13
remz wrote:Maybe I should just withdraw from Columbia now haha.
All kidding aside, dude, you absolutely should. If you can get into columbia, you can get some awesome scholarships elsewhere. You should spend the year working. While you work, you will being paying off student loans and experience just how burdensome debt can be. In the fall shoot for the t20 schools and the lower t14 and see what type of offers you will get. Trust me, once you start making some loan payments, you will really appreciate the perspective it gives you.
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 4:14 pm
by remz
Geist13 wrote:remz wrote:Maybe I should just withdraw from Columbia now haha.
All kidding aside, dude, you absolutely should. If you can get into columbia, you can get some awesome scholarships elsewhere. You should spend the year working. While you work, you will being paying off student loans and experience just how burdensome debt can be. In the fall shoot for the t20 schools and the lower t14 and see what type of offers you will get. Trust me, once you start making some loan payments, you will really appreciate the perspective it gives you.
I got into two other T14s and waitlisted at eight. I didn't get much money from any of them. So Columbia was my best option.
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 4:22 pm
by LoriBelle
Hello IBR. I mean, wow...I'll only have ~$52,000 by the time I graduate (all in sub/unsub Direct Loans), and I'm kind of uncomfortable.
At an annual salary of $60K, which is totally doable (median at our school with over 90% reporting and 90-95% of those employed), combined with hubby's income, we're looking at being debt free (including the mortgage) within five years after graduation. No WAY would I take on $280K in debt...but then again, I won't be making the big bucks in BigLaw either. Then again, $60K in my city is roughly equivalent to $125K in NYC, so maybe I'll be sitting pretty after all. Time will tell, I guess, and maybe it's worth the risk to you, but I do see IBR in your future.
Re: Paying back loans with BigLaw salary- how long?
Posted: Fri Jul 16, 2010 4:26 pm
by Geist13
remz wrote:I got into two other T14s and waitlisted at eight. I didn't get much money from any of them. So Columbia was my best option.
What about Vanderbilt? Very good career options, seems to give away a lot of money. Last year Columbia placed 54% of its class in NLJ250 firms, Vanderbilt placed 47% of its class in the NLJ250. It's not that much of a difference
What happens if you're not above median after 1L? That would mean slim chance at biglaw SA and therefore slim shot of biglaw career.