Law School Life
dollars and sense
Financial Planning for Law Students
By Meredith Rainey Permar, 3L at Emory University
School of Law and Tiffany Taylor, 2L at Emory
University School of Law
M
oola. Dough. Cold, hard cash. For some of us, the
dream of bringing home the big bucks is the reason
we went to law school in the first place. For others,
giant checks were never a consideration—until they began
writing them to cover their law school expenses, of course.
The New America Foundation recently reported that the
typical law student graduates with over $140,000 in debt and
pays $1,187.00 each month for student loans. Whether or
not you fit into this category, it is important to prepare now
for your future. The Atlanta Lawyer sat down with Patrick J.
McGonigle and Jeffrey B. Rosengarten, financial planners
with Homrich Berg, to discuss financial planning for law
students and what we should be doing to secure our futures.
Mistakes to Avoid
Spending too much, relying on credit cards, and not
participating in 401(k) programs are some of the biggest
mistakes that young professionals make when it comes to
their financial well-being. While students might not be able to
add to a 401(k) until after they begin their careers, they can
take the initiative to prepare for the future while they are still
in school by taking the steps below.
Create a Budget
A personalized budget is really the first building block of a
financial plan. Writing down your expenses, categorizing
them, and allocating your income provides a strong
foundation for your financial plan and saves you money
because budgeting helps you identify where you are
overspending so that you can adjust your habits accordingly.
8 THE ATLANTA LAWYER
January/February 2015
The Emergency Fund
The first hurdle, once you have set up your budget, is to
build up an emergency fund in a money market or savings
account that can be accessed in urgent situations. If you
don’t know where to start, aim for saving enough money to
cover 3-6 months’ worth of expenses in case of job loss,
difficulty finding work, and financial hardships.
Make a Savings Plan
Decide how much you should realistically be saving right
now. There is no magic number, but you should target
saving 10-20% of your earnings. Save or invest your chosen
amount of income first rather than at the end of the month
because money has a tendency to disappear in between
paychecks. When it comes to saving, some is always better
than none.
Compound Interest
and Start Early
Get an early start!
Because of the power of
compound interest, the
earlier you begin saving