[ Makenzie Way, 3L at the University of Pennsylvania ]
Law school is undeniably expensive. Covering the cost of tuition, books, rent, food, and social events hit hard, especially if you received limited scholarships and/or family assistance. It was easier in 1L and 2L to push money concerns somewhat to the side, but now as 3L’s it’s time to start thinking about what we’re going to do when our student loan money ends, and repayments begin.
1. Student Loan Refinancing
Unbeknownst to most, many banks offer student loan refinancing for account holders (even new account holders). Such programs can save you heaps of money and make your monthly payments lower. Consider for instance that the federal rate for unsubsidized graduate loans is approximately 6.08% whereas First Republic bank refinances loans with rates as low as 2.00% and returns all interest paid if you pay off your loans in under four years.
Even if you have limited student loans, refinancing just makes sense – why pay more money when you don’t have to? For more information on what refinancing is and what to consider when deciding if/where to refinance your loans, check out the following Student Loan Hero article.
2. Employer Cash Advances
With graduation taking place in May and the bar exam scheduled in late July, many employers wait until the fall to bring new hires on – meaning you may be “unemployed” for a period of six months or longer following law school graduation. On the one hand, this gives you a chance to study, recharge after writing the bar exam, and sufficient time to take a bar trip or two. On the other hand, money will surely become tight as you continue paying rent and/or moving expenses during that time period.
Thankfully, many employers understand that extended durations without pay isn’t feasible. In consideration, if this they’ll often offer cash advances or interest free loans. If your employer hasn’t already reached out with information on such programs, take it upon yourself (if you require the assistance) to inquire. Just remember, any money you receive in advance will be deducted from your bi-weekly or monthly payments in the beginning.
3. Student Line of Credit
Many banks will permit you to take a student line of credit, even though you’re technically graduated because you’re studying for the bar exam. Thus, if you’re still feeling strapped for cash, consider taking a line of credit with your bank – just remember interest rates for such loans are often high.
Finally, there’s no better way to ensure you avoid going too far in debt than creating a budget – in fact, the earlier you create a budget the better! If numbers aren’t your thing don’t worry, there are a number of apps that are ready to help you!