Many law students take on extraordinary amounts of educational debt to finance increasingly expensive legal educations.  But those students on public-service career paths in particular must confront the fact that the primary tool they’ll have to dig out of debt – their salary – seems alarmingly insufficient to the task.

The Problem:

The recently released Law School Survey of Student Engagement (LSSSE) report (which provides some fascinating insights into an array of issues affecting law students) tells us:

“The percentage of full-time U.S. students expecting to graduate owing more than $120,000 is up notably in 2009 from prior years. In 2006, 2007, and 2008, the percentage of students expecting to owe more than $120,000 at graduation rose gradually each year. For example in 2006, 18% of students fell into this category. In 2007 the percentage rose to 19%, and 23% in 2008. This past year saw a 6% increase; in 2009, 29% of students expect to graduate with this level of debt.”

Cliff’s Notes Version: Just about 3 in 10 full-time students expect to leave law school with over $120,000 in debt.  Further, according the the LSSSE report, the percentage of such students is rising more rapidly among students at public law schools.

This makes sense in light of ABA data on law school tuitions, which show that public school tuitions have risen at a much faster clip than private school tuitions.  In 1987, the median tuition for a state resident at a state law school was $2124.  In 2007, it was $14,313.  Correspondingly, the 1987 median tuition figure at a private school was $8690.  In 2007, it was $32,168.  The private school tuition attracts most folks’ attention because of its sticker-shock effect.  But it is the public school tuition figure that, while lower in dollar value,  has risen much more quickly.  And alarmingly so.  Between 1987 and 2007, in-state median tuition at state schools skyrocketed by 573% compared with the 270% increase on the private-school side.  Traditionally, state schools have been highly attractive options for students on public-service career paths because of the relatively low cost of tuition.  To be sure, tuition is still lower in state schools, but relatively speaking state schools are not the bargains they used to be.  (And remember, these are median figures; by definition half of the schools in the measurement pool have tuitions higher than the median.)

Of course another problem deals with salaries offered in public-service positions.  NALP’s 2008 Public Sector & Public Interest Attorney Salary Report (we’ll release an updated version of the report later this year) paints a…let’s say “realistic”…picture.  The national, median starting salary for civil legal services lawyers was $40,000.  For local prosecutors, it was $45,675.

This combination of a high, anticipated debt load and relatively low salary leaves even those students who are most committed to public service to wonder if the reward is worth the sacrifice.

The Solutions  

1. Become financially literate.  It was easy to sign that promissory note before your 1L year, wasn’t it?  Be honest: did you read the fine print?  (Your author, who is a former legal services lawyer and who knows what it is like to struggle with student debt, did not read the fine print.  He does not think he is alone.) If you do not have a firm grasp on the nature of your borrowing, now is the time to learn.  Make an appointment with your financial aid office.  Call your lender.  Check out the self-help, educational materials offered by the Project on Student Debt.  Knowing exactly how much you’ve borrowed, what kinds of loans you have, and how interest will accrue on the principals is a key to managing your debt.  If you ignore it, it will grow more quickly than if you pay attention to it.
2. Keep borrowing to a minimum while you are in school.  Cutting out $1000 here and there as you apply for loan disbursements is very, very meaningful in the long run.  Be mindful of the “bar loans,” too, which are typically made available by private lenders to folks who need to supplement their incomes during the bar-exam prep period.  Many 3Ls take this approach: “Well, I’ve already borrowed $80,000.  What’s another $10,000?”  The answer: it’s another $10,000.  Interest will accumulate on it.  Private loans may not be as easy to manage as federal government loans either, and the interest rate is likely to be higher.
3. Get to know about Loan Repayment Assistance Programs (LRAPs).  LRAPs can be God-sends for newly minted public service lawyers who are scraping by on low salaries.  For many grads they are the difference between being able to pursue their career goals and, well, not being able.  Learn more about LRAPs on PSLawNet’s Financing a Public Interest Career page. 
4. Become familiar with the College Cost Reduction and Access Act of 2007.  Heard of the CCRAA?  This federal legislation 1) created a new repayment option for qualifying public service lawyers – called Income Based Repayment (IBR), and 2) established a loan forgiveness program which will forgive eligible educational debt after a 120-month (10-year) period of repayment.  These programs are designed to work so that, after paying via IBR for period of time, a public service lawyer may be eligible to to have the rest of their eligible loans forgiven.  The CCRAA could have a huge impact in the public interest community – significantly lightening the load for debt-laden public interest attorneys and leading to a forgiveness of eligible debt altogether.
5. Take advantage of Equal Justice Works’ resources.  No organization has done more work on student-debt issues for public service lawyers than Equal Justice Works. Visit their Student Debt Relief page, and you’ll find links to educational resources on the CCRAA, details on various LRAP programs, FAQ’s, archived student-debt webinars led by a national expert on the issue, and more. 

In Summary…

A weighty student debt load can be a formidable obstacle for a student or recent grad on a public service career path.  It must be taken seriously, and each student/grad should “take ownership” of their borrowing by becoming as well informed as possible about its consequences.  While daunting, the student-debt obstacle need not be insurmountable.  Wise, fully-informed borrowing decisions, the aquisition of knowledge about how to manage debt, some perseverance, and some common sense may make all the difference in pursuing a unique and rewarding public service career.  Good luck!

– Steve Grumm