January 16, 2011

Law School Is A Bad Investment

The New York Times article Is Law School a Losing Game? carried by Yahoo talks about a recent law school grad who hasn't landed permanent job and can't pay his $250,000 in loans.    Thats just one example of a law grad facing problems.   Below I list a a few very solid reasons why law school may be a very bad choice financially.

(note: if your LSAT is over 170 then you can probably ignore this article)

Law school is very expensive.

Tuition for law school can easily run $30,000 to $40,000 a year.   Plus you have living expenses on top of that.    The average amount borrowed is over $90,000 according to the ABA.    You also have to keep in mind that the government doesn't throw much if any 'free' grant money at people getting law degrees.   If there are any scholarships for lawyers then they are likely to be highly competitive.   I would expect to pay most of the bill for law school out of your own pocket.

There are too many new law grads for the jobs available.  

The NYT article says that "About 43,000 J.D.'s were handed out in 2009".  The ABA has similar data dating back a few years showing over 40,000 grads for each of the most recent 5 years.   Thats a lot of new grads coming out of law school each  year.    O*net says that there will be a projected 240,400 job openings in the field from 2008 to 2018.   Thats about 24,000 jobs per year on average.    Notice a big problem?    Theres 43,000 new grads in a year and projection of 24,000 job openings per year.    Thats almost twice as many new law grads looking for work as the number of job openings.

Many Lawyer Jobs don't Pay big Bucks

I'm sure we all know that lawyers make big bucks right?   We see them on TV all the time and they all drive luxury sports cars and wear expensive clothes.    Many lawyers do make very high wages.    The BLS says that  "In May 2008, the median annual wages of all wage-and-salaried lawyers were $110,590." and that "The middle half of the occupation earned between $74,980 and $163,320."     So half of the experienced lawyers make under $110k and 1/4 of experienced lawyers make under $75k.    New lawyers hired out of law school make less of course.   The median wage for new lawyers 9 months after graduation was $68,500 and for the new lawyers working in government they made $50,000 median.

If you add that all up then :   You work hard in school for 3 years and pile up $100,000 in debt.   Then you graduate and find a job market with only enough jobs for 50% of the grads.   You then end up with a one in 4 chance of making under $75k.    Doesn't sound very good to me.

Bottom Line:   A career in law is not a lucrative money ticket and you should seriously think twice before you pursue the field or you may end up underemployed with a giant student loan debt.

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