| Topic Name: |
I am down with CHRISBAX's msgs about DEBT. Let's talk more |
| Message Name: |
To both your last posts |
| Date Posted: |
04/24/2002 |
| In Reply To: |
Just answer this simple question.
If you can separate the answer from financial issues then your probably on to something. People who go to law school to get rich are just foolish.
Taking a year off makes sense if you can't decide between law or accounting.
If you have a chance at a job with a firm that practices law where you have an interest, take the job and talk them into paying the tuition. If you want to practice at a different type or size of firm. Visit a firm that is of interest to you and speak with a couple of partners. Besides making the contact, thier advice will be invaluable. |
| Message: |
1) Risk free interest rate is 3-4% (includes inflation of course, I incorrectly added the rates last calculation.) 7% is still the conservative number used most frequently because in the past 50 years in America, you would have been hard pressed to do worse with your investments (over time of course.) Almost everyone uses 7% to discount future payments because it's a solid conservative number that's proven itself. It usually is higher, but 7% is the "fail safe" number.
2) As I said in another post that costs of law school ex ante and ex post are not the same. The OP asked about 160G being reasonable debt. If he's got that debt the assumption is that he already went to law school. Opportunity cost is only a consideration before law school.
3) Your thorough calculations being what they are, they still ignore several things which are too numerous to get into. You assume too much information. If you honestly believe you are better off going to a "lesser" school than an "elite" school, then you are truly ignoring many other factors. Regardless, I don't really care. All I ever said (allbeit forcefully) is that your numbers are exagerated to fit your argument. All the number crunching in the world wouldn't change that the loans are only ~180G.
4) All that being said, I believe that people should absolutely think very very very carefully about going to law school. ANYONE (other than maybe Trump) should be careful when they make a 160G investment. But again like what someone else said, you are still ignoring some things with your calculations. The benefit of going to an elite school cannot be accurately measured, but as most anyone will tell you, they are worth it. That isn't to say that going to 2-4th tier school will permanentaly handicap you 'cause that just isn't true, BUT, your likelihood to do equally well as a graduate of an elite school is lower. There aren't any shortcuts or sure things in life. It is unfortunate, but true, that 160G debt to go to Columbia is a much better investment than 160G debt to do to Florida Coastal Law :)
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