Tuition Fees and Student Loan Debt: A Shock?

[overedge]

This post has been getting a lot of discussion among the (graduated) lawyers that I know. So I'm interested to hear what others think about it, especially about the prospective student that's featured.

http://abovethelaw.com/2012/09/law-s...our-own-grave/

[sk8er1964]

I have a high school senior looking at colleges. I managed to save two years of college tuition (through a state education savings program) for him to use. My original plan for him was two years of community college (approx $4,000/year paid by me) then transfer to a four-year university for his final two years, paid for by the savings program. This way he could live at home for two years and save money, and possibly live at the university for his last two years. He'd come out of school debt-free, or pretty close to it.

Well, so much for the best laid plans - he wants to play golf in college. Which may require living on campus for four years, depending on the school. That changes the whole ball game.

I plan on sitting down with him shortly and discussing the college cost issue. What he'd face worse case scenario (ie no scholarship), because my reality is still that I have about $4,000 a year for tuition - a bit more if he isn't eating out of my fridge at home - but not enough to cover living on campus plus higher expenses at a four-year. I figure that he could come out of college about $30,000-$40,000 in debt.

He needs to decide if playing golf in college is worth this.

[manhn]

Does a school like, say, Harvard charge students differently depending on the courses they are taking? I am pretty sure when I went to law school, tuition for 3 years of law school was the same as 3 years of medical school or 3 years of psychology undergrad or 3 years of grad school. So, I don't think the issues facing prospective law student are different than those encountered by any other people trying to pursue high education.

There was an article recently in Maclean's (which I was reading while in the waiting room of my bank) about perhaps doing away with the articling program or at least modifying it some way (since so many students were not able to find an articling/apprentice position after graduation).

I honestly have no idea how Americans can deal with so much debt. My mortgage is about the size of these students' debts and I live in a darn expensive place! I have a year or so left before all my student loans are paid out, and they were really quite small to begin with (living at home had their benefits) and my monthly payment is slightly higher than my monthly cell phone bill.

Are there too many lawyers? Yes and no. Yes, in the sense that there are too many lawyers who want to make a decent wage and to do so, they have to charge some rather hefty fees and it's becoming harder and harder to find those positions in a traditional law firm setting. No, in the sense that there are still lots of people who need lawyers for whatever reason but can't retain one because the fees are too hefty. More and more people are self-representing and it's not making the system more efficient.

A truly entrepreneurial person who becomes a lawyer can still do quite well for themselves. You rarely see law firms shutting down entirely because there was a lack of business (downsizing? yes). Of course, a new law graduate is the least willing and equipped to start their own practice.

[Debbie S]

Does a school like, say, Harvard charge students differently depending on the courses they are taking? I am pretty sure when I went to law school, tuition for 3 years of law school was the same as 3 years of medical school or 3 years of psychology undergrad or 3 years of grad school.

Tuition depends on the university but from what I have seen, each grad school (law, medicine, business, dental, etc) sets their own fees. If it is a public university, then the state might have a say/approval over what gets charged, but usually law school, medical school, etc all have their own rates based on their operating costs.

While it's important to consider the expenses and amount of debt, it's really more important to consider how you will pay it back. Look at the data and talk to recent grads and find out about average starting salaries. Think realistically about how much money you will earn, what your loan payments will be, and how long it will take you to pay it off. There's no point in spending a huge amount of money for a degree where the salary doesn't match. Maybe the degree isn't necessary or maybe there is a cheaper option. It depends if the quality/reputation of the school is that important for success - i.e. will getting a grad degree from Harvard vs your state university really advance your career and income that much.

[Aceon6]

Public service oriented lawyers in greater Boston earn, on average, $35,000. Do the math.

[Anita18]

My boss is independently wealthy, which is how he could afford to devote his life to science without worrying about debt. I imagine that's the only way how a young lawyer could do public service oriented law out of law school as well. Or young doctors out of med school. Etc etc.

Science doesn't pay very well either, but at least PhD programs pay a stipend. One of my coworkers got a master's first though, so she's $50K in the hole for that...

[Debbie S]

My boss is independently wealthy, which is how he could afford to devote his life to science without worrying about debt. I imagine that's the only way how a young lawyer could do public service oriented law out of law school as well.

There's a reason most politicians come from wealthy families. Yeah, one is to be able to afford a campaign, plus have the connections to raise money. But salaries for local/state public officials (where most national politicians get their start) are pretty low and even those for Congress and Senate aren't as high as what an Ivy League-educated lawyer could potentially earn.

Science doesn't pay very well either, but at least PhD programs pay a stipend. One of my coworkers got a master's first though, so she's $50K in the hole for that...

It depends what you want to do with your science degree. Jobs in industry can pay very well, particularly with applied sciences like engineering.

[Anita18]

It depends what you want to do with your science degree. Jobs in industry can pay very well, particularly with applied sciences like engineering.

Of course. But academic research doesn't pay very well.

[Prancer]

I figure that he could come out of college about $30,000-$40,000 in debt.

He needs to decide if playing golf in college is worth this.

IME, student loan debt means nothing to high school kids because the amounts of money are not real to them and they have no concept of what it costs to just live. If you tell them "This is what you can expect to make a month and this is how much you will pay in loans," it sounds good to them because they have no idea of how much it will cost just to live, plus it's all waaaaaay off in the future and you worry too much.

I don't know what you have planned, but you might want to have him do a little research on things like starting salaries and living expenses.

[FunnyBut]

I'd like to know more details on why the young lady in the article feels that a law degree is necessary in her career in public service (I'm not saying it isn't , but she didn't give any specifics). Many jobs in public service are low pay, at least for a while , until a person gets a few promotions. For me personally, I can't be happy without being financially secure first. So no, I definitely wouldn't take on this kind of debt without reasonable assurance that I'd get a high paying job. If she were considering medical school I'd say it was worth it. But law salaries vary so much, and most of the well paying ones are corporate.

[maatTheViking]

IME, student loan debt means nothing to high school kids because the amounts of money are not real to them and they have no concept of what it costs to just live. If you tell them "This is what you can expect to make a month and this is how much you will pay in loans," it sounds good to them because they have no idea of how much it will cost just to live, plus it's all waaaaaay off in the future and you worry too much.

I don't know what you have planned, but you might want to have him do a little research on things like starting salaries and living expenses.

I sometimes think that is why it is better to delay college, especially if you don't know precisely what you want to do, and move out and get some non-degree required job, like grocery clerk or something. Then you really see what it costs to pay rent, food etc... of course in the US it is complicated by health insurance etc, where it may be beneficial for young kids to stay at their parents place. (or in this economy, can you even get jobs like that?)

[TheGirlCanSkate]

My son was able to get into the private universities of his choice but ended up at a state school because of the costs. He is on his junior year and his debt is 0. I have paid from a small savings for one year, but he applies for aid and also enrolls in programs that pay a stipend (and require a LOT of extra work) for the other 2 years.

That being said he will graduate without debt and is in the minority of doing it in 4 years (the average is 5+ years in state). For his masters or PhD program he plans on teaching to cover half the costs and other programs to cover the other half and other living expenses. He is selecting his university based on the programs offered and costs.

His career won't pay much but it's what he wants to do and he is very good at it. If law school is something the girls wants to do, she can figure out a way to do it. My friend was an rn - saved all of her money and when she could pay for a good piece of it, she went to medical school. It took her longer but she is now a doctor.

Sometimes people need to learn patience.

[modern_muslimah]

IME, student loan debt means nothing to high school kids because the amounts of money are not real to them and they have no concept of what it costs to just live. If you tell them "This is what you can expect to make a month and this is how much you will pay in loans," it sounds good to them because they have no idea of how much it will cost just to live, plus it's all waaaaaay off in the future and you worry too much.

I don't know what you have planned, but you might want to have him do a little research on things like starting salaries and living expenses.

So true. IA with maat. I think it is better for high school kids to work a bit before going to college and to get a sense of how much the cost of living is. When you're 17 or 18 years old and your parents have paid for everything, you don't appreciate how much the cost of living and how hard 20, 30, or 40 thousand dollars of debt can make your life.

[MacMadame]

An alternative approach is to make your kids start paying for things in High School. My kids had a budget and their allowance was based on that. If they wanted extras or things we weren't willing to pay for, they had to find another way to make it happen. What the budget covered varied per the maturity level of the kid but we start out small and work them up until they are paying for every except room & board out of their allowance.

I also told Mini-Mac how much we were willing to pay towards college & she's already working on a plan to go to the college she wants and not the one we can afford. She's only a Freshman so it's too soon to see if this approach totally works but so far, so good.

[GarrAarghHrumph]

I have a high school senior looking at colleges. ...He needs to decide if playing golf in college is worth this.

Part of the fit of a college is financial fit. You're right to be concerned.

What I usually recommend to students who need to play the aid game is that they apply to any school they like, but they don't fall in love with any of them until after they see the aid package. However, as part of their list of schools, they must apply to schools that will be relatively inexpensive for them, such as a public uni in their home state. In your case, he'd also apply to the community college.

In addition, he would want to apply to some schools (public and private in any state - but it must include some privates) where his GPA and SAT/ACT are high for that school, compared to their normal admitted student. In this way, they may throw some merit aid at him. And if he's also able to get a partial golf scholarship at that school, it might work out.

And even if your income is very good, if his academics are strong and they want him for golf, certain schools might (might, might) offer him some merit aid, to encourage him to attend, even if they don't offer sports scholarships. An example of a school that offers good merit aid if they really want you is Wesleyan U in CT. They know they're competing against the Ivys, and that the Ivys offer aid based only on income, not merit. So they will give merit aid to middle and upper income students who they really want, because they know that can hook them when the student doesn't get any/enough aid at Harvard because his income is too high.

So one option is to let him apply where he'd like, with no promises that he can actually attend unless the aid turns out right. But in addition, he also needs to apply to certain other types of schools, which you can pay for, or where aid may work out for him. See where he gets in, see what aid he's offered. Calculate the amount in loans each school would take to pay for, after aid. Then decide where he's going.

When he does get aid offers, it's also completely acceptable to approach the schools he likes best and try to negotiate better aid offers. The school can't always do better, but sometimes they can, and it's okay to ask.

[PDilemma]

IME, student loan debt means nothing to high school kids because the amounts of money are not real to them and they have no concept of what it costs to just live.

^This.

I had high school kids who were certain they could move out of their parents' house immediately on graduation and live on their part time minimum wage jobs. My nephew is a senior and certain he can get a 20 or 30 hour a week job as a freshman and have enough to pay for a car, insurance, and a fancy apartment style dorm at his preferred college. His mother is no help because she is convinced he is a "genius" and will be getting a full ride academic scholarship with his stellar record of no activities and a 2.4 GPA and if it is not a full ride, he can just get loans. Like the massive loans his (half) sister got to pay for a year abroad with the high paying career plan of teaching high school English in a state with very low starting salaries.

[Allskate]

Does a school like, say, Harvard charge students differently depending on the courses they are taking?

I don't know about Harvard, but other schools do. For example, the University of California charges more for its professional schools. The current cost of tuition and fees alone for UC law schools is close to 50K per year. I doubt you're going to find private schools that are any cheaper. What that means is that most students are coming out with six figure debt. What's even worse is that, unlike medical school, almost any college graduate can get into some law school. Therefore, there are a lot of people sinking a great deal of money into a legal education even though they will not be able to get a good legal job upon graduation. In California, only about half of graduating law students are getting jobs that actually require a law degree. Many of those who are getting legal jobs aren't getting good ones or ones they like. I know several students or recent graduates and I am so sad for them.

I do agree with those who say that a lot of people applying to college and graduate schools have no idea what it costs to support themselves. But, I think there's more to the problem. I think that some students bury their heads in the sand and think that they are going to be among the top tier who do get the jobs and money they want. Or they just don't even bother to think about job prospects at all.

I also think that parents are part of the problem. They should be educating themselves about the financial realities and then educating their kids. I know a recent law school grad who, quite frankly, does not have what it takes to get and hold a good legal job. (I'd feel bad for his clients if he ever manages to get a job practicing law.) I can't imagine that his father honestly thinks his son is all that bright. Yet, the father co-signed a bunch of this guy's loans. (The son is now over $150,000 debt and has an unemployed pregnant wife. My guess is that they'll be living with his parents.)

My friend's sister is thinking of going to law school even though she doesn't have the grades or LSAT scores to get into even a decent law school. Their father, who should know better, is encouraging her. She gets mad at her brother when he tries to make her realize that she's setting herself up for disaster.

And finally, I think schools are partly responsible. Many of them are not very good about being upfront with potential students about their job and earning prospects. Some of them are actually reporting deceptive employment statistics for their graduates.

[PDilemma]

And finally, I think schools are partly responsible. Many of them are not very good about being upfront with potential students about their job and earning prospects.

Having gone on a couple of college visits with my nephew now, admissions counselors are just selling the college. It is all butterflies and unicorns and monkeys in the psych lab and of course you'll get a great aid package and did we mention the cheesecake catered in to the cafeteria?

I can't imagine that it is any different for professional schools.

[misskarne]

And finally, I think schools are partly responsible. Many of them are not very good about being upfront with potential students about their job and earning prospects.

I certainly agree that most universities are very bad at that. I remember being told about the average starter wage for a beginner journalist during the degree - about $35,000 a year. Okay, says me. Not great. But that's all right, I'll have time to save up.

What they DIDN'T tell us? That FINDING a job as a beginner journalist is about as easy as going to the moon. Everyone wants two or three years of experience and almost no-one wants the graduates.

[Prancer]

I had high school kids who were certain they could move out of their parents' house immediately on graduation and live on their part time minimum wage jobs. My nephew is a senior and certain he can get a 20 or 30 hour a week job as a freshman and have enough to pay for a car, insurance, and a fancy apartment style dorm at his preferred college.

God love 'em, they really are clueless. One of my son's friends posted a plea on Facebook in early August asking for help finding a part-time job. Since I am on his list and I happen to know a lot about the school he is attending, I advised him to try to get a job on campus and gave him all kinds of links and told him that the time to apply was now, before school started and everyone else applied.

Well, he was really looking for something that started before the semester started so he could earn enough money to pay his car insurance, buy a laptop, and make a tuition payment.

In three weeks.

Once upon a time, my son and some of his friends were among those who planned to get an apartment and put themselves through college on their part-time jobs. They all know better now, but most of them are taking out a lot of loans because they only know some better.