The costs of law school have swollen in recent years. But the cost of school is not just the face value of tuition. One of the first things that my Contracts professor taught us in school is opportunity cost. (Confession: as a philosophy major, I had no idea what he was talking about).
On day one of Contracts, our professor began pontificating on opportunity cost. This was all part of a longer speech on “do you really want to do this for the next three years of your life?” Even if you are going to a public school and paying in-state tuition, the average cost of tuition and fees in 2017-18 was $26,864. (The average private tuition was $47,112!). Living a lean lifestyle in a moderately priced city will cost you about another $20,000 a year and so, for the average in-state school you’re talking about roughly $46,000 a year without any tuition money. That means taking out about $150,000 in loans to get you through to graduation and then perhaps another $10,000 to pay for your bar review course, exam fees, and food/rent/car for the summer after you graduate.
But the opportunity cost of going to law school is even higher than that. You aren’t just starting out $150,000 in the hole, you’re also missing out on three years of salary which you didn’t earn while you were in school.
In 2018, the average college graduate secured a job paying $50,390 a year, according to CNN. It’s worth noting here, that if you’ve followed my advice and you’re going to the right type of law school, you are likely above-average anyway and would have been earning more than this.
This means that the average law student will be $300,000 worse off than their same-aged counterpart who did not go to law school right out of the gates. Now, there are plenty of ways to catch up and pass the non-lawyer, but it will take time.
There is not meaningful “average” starting salary for lawyers. The distribution of salaries coming out of law school is bimodal.
This graph shows the starting salaries of 4,600 members of the Class of 2014. There is one peak at $160,000 (then the starting salary of just about everyone in a major city working for a BigLaw firm) and another set of peaks in the $45,000 – $60,000 range. Even adjusting for inflation since 2015, these salaries are not considerably higher than the $50,390 earned by a college grad. AND you’ll likely be dealing with crushing student loan debt.
In 2006 and 2007, when my law school class was interviewing for jobs, the skies were blue and the sun was out and we were all but promised $160,000 jobs. Markets were so good in the early 2000s that loads of new law schools began cropping up – some not even accredited by the American Bar Association.
Then, the bottom fell out of the credit markets. In 2008 and 2009, BigLaw firms began cancelling summer associate classes, laying off associates, and rescinding offers. Many of the folks who went to the lower level law schools after having been promised huge salaries ended up filing lawsuits against their schools because the school had misrepresented employment data and no one wanted to hire them.
You need to have a full grasp of what you’re getting into going to law school. Personally, I cannot see myself doing anything else. I love being a trial lawyer. But if you are on the fence and are going to law school because you don’t know what to do or because your parents are pressuring you, you probably are not going to enjoy law school and you probably are not going to be financially better off on the other end.