Monday, July 23, 2007

Law School Debt

Ok - time to fess up. Debt is killing me! I think I have posted here about student debt before, and I know that I talk about it a bit in my book. But, I think it is time for a dose of reality - both for myself and for my readers.

I have racked up about $95,000.00 in debt because of my choice to become a lawyer. How? Well, I carried about $24K of student loans into law school. I then racked up about another $18K of student loans during law school, and about $17K of a student line of credit. Of course, we also racked up some credit card debt during law school, and during my article, and during my first year of practice.

Luckily, I was able to receive a number of grants, bursaries and scholarships to pay for my expenses during law school.

A debt like mine is not unusual for law graduates. Many will build up debts in excess of $100K before entering their articling year. Some will add to that debt during their articling year because of a low salary.

I have been living in semi-denial for about a year now. Suffice it to say, starting up a law practice cannot be done for free. And suffice it to say, the money does not start rolling in on day one.

But, now is the time to face reality head on.

Here's the deal: I have started a blog called The Debt Elimination Game. It is an open door look at my personal debt. It is a confession of sorts. It is an opportunity to make myself accountable and to face the problem head on. The truth is that it is a problem - a big one.

The reason I have been able to face this problem is that for the first time in my adult life, I feel like I am in a place where I can actually service my student debt. I am finally making a decent salary.

Many people in my position might want to extend the period over which they service their debt. But, when I had a close look at the situation, I realized that I am paying about $1,000 per month to pay minimum payments on all of my debts. I am paying almost half of that $1000 in interest. It's killing me. And that is with interest relief on my Canada student loans.

Like everything in my life, I am taking on a really big bite. I have made a personal goal (in conjunction with my spouse) to pay off all of my debts, save my mortgage, in 18 months. That's $95K in 18 months. Ludicrous? I don't know. I really think that I can do it.

I am hoping that as the story unfolds, I can learn a lot, and perhaps pass it along to current and graduated law students - to help them avoid the debt, and then to tackle it.

Debt is a major problem for many graduating students. Debt can be crippling. It can be depressing. It can be debilitating and limiting. It can limit your options dramatically. It can trap you into a lifestyle that you don't enjoy, with little hope of escape.

Join me as I take on the next chapter in my quest to become the best lawyer that I can be, the best person that I can be. Join me in the Debt Elimination Game.

2 comments:

Anonymous said...

I notice that your tracking of your debt adventures at "Debt Elimination Game" didn't last very long. I think that violates Rule #2. Although I will admit that there would be considerable stress involved in trying to maintain two blogs, your own practice and aggressive debt elimination practices simultaneously, I am a little disappointed that such efforts were so short lived.

Adam Letourneau, author of So, You Want to be a Lawyer, Eh? said...

Thanks for your comment. It inspires me to continue to post to that blog.

Adam