This week’s interview is with Austin Groothuis from the CALI’s Pre-Law Blog. Austin is a third year law student at Chicago-Kent. In addition to writing for CALI’s Pre-Law Blog, Austin is also the Communications/Marketing Coordinator for Computer Assisted Legal Instruction (CALI). (What a busy guy!)
1. How much student debt have you racked up during undergrad and law school?
I have just under $100,000 in combined school debt. I have paid for all of law school and virtually all of undergrad/graduate school plus cost of living during those times on loans/scholarships/or money I earned working while in school. I’ve had very little outside financial help so loans have really added up.
2. What action or habit do you think saved you the most money while in law school?
A lot of things combined. I buy all of my books used online at Amazon Marketplace or Half.com and then resell them at virtually the same price. It’s quite a racket the law school bookstores and casebook publishers have going on. I try not to participate in it as much as possible. I wrote about this on my blog here:
Whenever I need something new I’m freakishly insistent on getting the best price through research online. Basically all of my gifts for Christmas this year were bought on deal websites and over half of them had rebates involved.
I sold my car last year to save money on maintenance, gas, random fees, and inevitable street cleaning tickets in Chicago. I just don’t need it in the city.
Although I don’t know what I’d do without my girlfriend to chauffeur me around the city at times. She has a real job and a car so, obviously, part of my advice is get to get a sugar mama (don’t worry, she never reads my stuff).
And most importantly, I opted to take a full-time job with CALI and switch to school part-time in the middle of my second semester. This extended my time in law school. But it literally cut my debt in half. That’s right, I’d be looking at upwards of 160k in debt had I not taken this CALI job. Amazing. It really saved me.
3. If you have student loan debt, when would you like to pay it off? How do you plan on reaching your goal?
It’s going to be a real long-term thing that depends on how much I make, what career path I choose to take, and what kind of family decisions I make (dual income? children? where to live?).
Optimistically, I think the best case scenario is 15 years to pay it back. But I could see using up the whole 25 or 30 years. I’ve never really sat down and thought of a schedule because I just can’t get a grasp on what my life looks like and what opportunities will be presented to me after I graduate.
4. What other personal financial goals have you set for yourself?
Don’t default on my loans and never have to ask someone for financial help.
5. What is your weakness in regards to your personal finances and how do you think you can improve it?
Eating out and the Starbucks across the street from work/school. I’m at work and school all day so it’s just too easy to not make a lunch the night before and worry about lunch the next day.
And it’s not like I’m addicted to Starbucks. But paying 4.50 for a latte once or twice a week at most really burns me just due to the fact that I’m paying infinitely more per gallon for coffee than what I paid for gas. But I really do love the mocha. It’s a bad habit but at least I don’t smoke!
6. How do you manage your finances? Is there a particular software you use to keep track of your money?
I do everything online. I don’t have to keep balances because I pay all my bills online and my bank transactions are reflected really quickly in my online checking account. I haven’t written more than 2 or 3 checks in the past 2 years.
My credit card (which I pay in full from month to month) is through the same bank and I can access that info easily and simultaneously with my checking.
I have an HSBC personal online savings account that pays 5+% and has no fees for transfers to and from other accounts and no minimum balance. Compare that to the less than one percent you might find at your local bank. It’s awesome.
7. What do you think is the biggest money mistake law students make?
Not understanding the way law school and legal jobs work. I think a lot of future students rely on the average salary of a school or become star struck by the numerous law firms paying 150k+ salaries and sending out press releases every time they increase starting salary. So students think they can go to any law school and rack up a ton of debt because they will be able to pay it off in 5 years with a $160,000/year salary.
But go to a non-elite school and at most only 10-20% of students even have a shot at big paying jobs. And nearly all non-big firm jobs with opportunities for graduates pay an amount much less than $100,000, let alone $160,000. I’ve written about this several times on the Pre-Law Blog including here:
8. Do you have any suggestions to other law students regarding their personal finances?
Besides the sugar mama thing, huh? Don’t carry credit card debt. Don’t spend more than what you can pay in a month on a credit card bill.
Read The Frugal Law Student blog. No joke. There are also several other money saving tips sort of blogs out there that are good to read.
Not so much for law students, but those thinking about law school, understand the risks involved in choosing certain schools and in choosing to go to law school at all. Read some of what I’ve written about this above for a start. Make sure you weigh the risks vs. the benefits before you decide to go to school/ where to go to school.
Thanks, Austin, for that awesome interview! Head on over to CALI’s Pre-Law Blog. Austin has supplied some great information for those interested in attending law school and those who are already in law school. Make sure to sign up for his RSS feed as well.
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[tags]CALI, Austin Groothuis, law school, debt, personal finance[/tags]