| Topic Name: |
Law School Debt |
| Message Name: |
Here's some more along those lines |
| Date Posted: |
04/23/2002 |
| In Reply To: |
1622*180=291960
That's not the point you idiot.
Paying 1622 per month is NOT the same as paying 291960. You have to discount the value of the monthly payments since you get the money now and you pay it back over time. AND you have to discount it by more than 4%... inflation is not the only consideration.
In business, the most generous interest rate used to discount money is 7%. The reason is that's about 3-4% for inflation (which you remembered you idiot,) plus another 3-4% which is the riskless interest rate value of money.
Under these assumptions your PV is only $180,457. So you are only paying $20,457 for the right to borrow $160,000 with nothing but your word to back it up. I don't find that at all distressing or unfair. AND it is a far cry from your $222,000 and even farther from $291,960.
Finally my original post just rounded your incorrect figures, that really isn't an issue 'cause your numbers are wrong anyway.
AND... these are conservative assumptions. Most people can get more out of their law degree than the riskless 3% APR. Most people can get more than that out of janitorial work.
Finally, you are an even bigger idiot for restating and defending your WRONG numbers.
And so you see that your 292G figure and your 222G figure are both exagerated and incorrect.
The only thing worse than being wrong, is being arrogant about it. |
| Message: |
> Most people can get more out of their law degree than the riskless 3% APR. Most people can get more than that out of janitorial work.
Dude, if you're gonna be that way, don't forget to factor in three years of being out of the full-time work force. With a BA, your earnings potential is probably at least $35k per year.
So three years cost of a degree = your loan + $95k in lost income.
Also, when you're arging that there's a return on a law degree, don't forget that without a law degree you're not necessarily unemployed. Therefor, return on the law degree should only refer to income above and beyond what you'd make with a B.A.
Since the average salary for a B.A., again, is about 35k, your return on the investment is only the income above that.
In other words, using your super-inclusive calculations, we're back up to 180k+95k, or 275k. Also, in calculating yearly return on that investment, you have to use law salary - 35k.
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