FinancialAid

Managing Law School Debt

You have been accepted to law school. Now you are thinking about costs and payments toward this important investment in yourself and your career. Specifically, you are thinking about debt and how to manage it. I’m including in this post some useful information about debt management.

The College Cost Reduction and Access Act (CCRAA) established a new payment plan for borrowers of federal student loans (Stafford, PLUS, and Federal Consolidation Loans). The new plan is called “Income Based Repayment” (IBR). With IBR a borrower limits his/her payment to no more than 15% of his/her annual income – and in most cases the percentage is a bit less. I’ll skip the details about percentages and simply give an example of what this means for a typical borrower.

Total debt:                                              $  180,000
Annual income:                                       $  80,000
Plan A - Repay in 10 years:                     $  2,140 per month
Plan B - Repay in 25 years:                     $  1,330 per month
Plan C - Income Based Repayment:     $  812 per month

The CCRAA also established a loan forgiveness program. Under this program, borrowers who commit to 10 years of public service and who make payments using IBR, are eligible to have any remaining debt forgiven after 10 years of repayment. Under Plan C above, this borrower’s payments of $812 would not be sufficient to even cover the accruing interest. Therefore at the end of the 10-year period, the entire principal balance plus some accrued interest would be forgiven.

What types of employment qualify a borrower for forgiveness? Some obvious examples include government positions at the federal, state and local level; and working for a non-profit organization.  Teaching, law enforcement, and military are also good examples.

All borrowers, regardless of employment are eligible for loan forgiveness after 25 years.

In addition to income-based repayments, forgiveness, federal student loan programs provide options to “stop” payments during periods of economic difficulty, and to have loans discharged should the borrower become permanently disabled.

Understanding and Completing the FAFSA

Typically the FAFSA is considered the “first step in applying for financial aid.”  Before a student can be determined eligible for federal student loans, he or she much complete a “Free Application for Federal Student Aid” (FAFSA).  While the FAFSA is not really an application for a loan, it provides necessary information to a school so that the loan processes can be completed.  Namely, the FAFSA confirms citizenship information and the financial information requested is used to determine how much of the loan will be “subsidized.”

A “subsidized” loan means that while you are in school, the government will pay the interest for you.  The maximum amount of subsidized loan each year for Graduate and Professional (e.g., Law) students is $8,500.  Most Law students qualify for the full $8,500.

When should I complete the FAFSA? 

For The Columbus School of Law, we recommend completion at the same time you complete your federal tax return.  Since some of the questions on the FAFSA ask you to take information directly from your tax return, this makes answering these questions quick and easy.

What do I need to know when completing the FAFSA?

1.  The FAFSA will take about 20-30 minutes to complete.
2.  Most of the questions are biographical.  If you have your taxes done, the required financial information may be taken directly from tax return.
3.  If you do not have your tax return done, you may use estimated information.
4.  You complete the FAFSA at www.fafsa.ed.gov.
5.  You will use your Federal PIN to sign your FAFSA.   If you don’t yet have a federal PIN, or have forgotten it, you will apply for a PIN as part of the application process or you may request a PIN or a “duplicate” PIN at www.fafsa.ed.gov.
With your initial FAFSA, you may choose up to six schools to which your FAFSA data will be sent.  The “school code” for the Columbus School of Law is E00131.
6.  If you later want to add other schools, you will complete a “Correction” at www.fafsa.ed.gov.

What is the Expected Family Contribution (EFC)?

The “final result” of the FAFSA is often expressed as the EFC number.  A good way to think of the EFC is to see it as a standardized index of your financial strength to pay for school.  A formula looks at your income and assets, your family size, and how many are in school and is the same for all students.  Your EFC can be anywhere from “0” to “99999.”

The school then compares the EFC to the cost of attending the particular school (tuition, books, living expenses, etc.).  The difference between “cost” and the EFC is your financial “need.”  The “need” figure is used to calculate eligibility for subsidized loans, and other need-based aid that a school may use.

Do I Need to Include my Parent’s Information on the FAFSA? 

Some schools request parental information – particularly if they have institutional need-based grant programs.  Even if you include your parental information on the FAFSA it will not be included in the EFC calculation, and therefore does not impact eligibility for any federal or state programs.  The school, however, may review this information for their own programs.  Schools who do not need this information will simply ignore it.

The Federal Subsidized Stafford Loan.

You have to have financial need of at least $8,500, to be eligible for the Subsidized Stafford Loan.  If you have a scholarship or a grant then the “need” equation is a little more complicated.  With a scholarship or grant, eligibility for the Subsidized Stafford Loan works like this:  COA minus EFC minus [Scholarship or Grant] = Need.  So, it is possible that a scholarship might impact your eligibility for the Subsidized Stafford Loan, but scholarships do not impact the eligibility for the Unsubsidized Stafford Loan.  All students are eligible to receive the same amount of Stafford Loan, $20,500 per year, regardless of EFC or Financial Need.  If you have a high EFC (and thus low financial need) the amount of “subsidized” loan may be reduced, and the amount of the unsubsidized will be increased.  The total will always be $20,500.

Preparing Financially for the Fall Semester

Fall Semester of Law School begins August 20.  Are you ready, financially?  Here are a few important tips that will smooth your financial path.

1. Have adequate savings to:
   1. Make security deposits on your apartment, and possibly rent for September.
   2. Cover moving expenses.
   3. Buy a few weeks worth of groceries.
   4. Purchase books.
   5. Make miscellaneous necessary and immediate purchases.

Or, if you do have savings, then

2. Have an active credit card with a sufficient credit limit to cover items noted above.
3. If you are planning to use federal loan programs (Stafford and PLUS) be sure to have your FAFSA completed by mid-June to allow adequate time for completing the subsequent financial aid steps.
4. If you are planning to use loan proceeds for living expenses, be sure to have your loan applications completed by early July to allow adequate time for CUA to complete the necessary school certifications.
5. If you are planning to use the CUA Student Health Insurance Plan, complete the on-line enrollment by July 15, if possible.
6. If you are using a monthly payment plan for paying tuition expenses, complete the enrollment application as soon as possible.

So, now with the “tips” in mind, here is how it all fits together for a typical student, “Joe,” who has no savings and will be relying on student loans for living expenses.

On April 16 Joe completed his FAFSA.  On May 1, Joe used his User ID and Password to sign on to Cardinal Station at https://cardinalstation.cua.edu.  First, he “viewed” his financial aid which consisted of an $8,500 Federal Subsidized Stafford Loan, a $12,000 Federal Unsubsidized Stafford Loan and a $38,125 Graduate PLUS Loan. Then, using the form provided on Cardinal Station, he “accepted” his Stafford Loans and $30,000 of the PLUS Loan eligibility.  (He knew he could later make adjustments, if needed.)  That same afternoon, he consulted the “preferred lender” list on the Financial Aid website (http://law.cua.edu/finaid/lenderlist.cfm), and selected Access Group as his chosen lender.  Using the link provided, he completed the applications for these loans.

On July 15, Joe will go to www.chickering.com and complete his enrollment in the CUA Health Insurance plan. On approximately August 5, Joe will receive a bill from the CUA Student Accounts Office showing charges for tuition ($16,615), fees ($890), and Health Insurance ($1,324).  Joe’s seat deposits were credited to his account, so the “balance due” will be $18,229.  The bill states that payment is due August 1.  Joe knows that his loans will cover his balance due, so no actual payment at this time is due from Joe.

Joe moves from Indianapolis, Indiana in early August, and uses his credit card to access cash to make a security deposit on his apartment.  He purchases some groceries, and a few basic supplies for his apartment, again using his credit card.  On August 14, Joe visits the CUA bookstore, and using his credit card purchases books for the fall semester.

In late August, Joe’s lender, Access Group, will electronically disburse directly to CUA one-half the amount borrowed from each of the loan programs.  For the PLUS Loan, the lender withholds a 3% origination fee.  Thus, the following amounts will post to Joe’s account:  $4,250 Federal Subsidized Stafford Loan, $6,000 Federal Unsubsidized Stafford Loan, and $14,550.  This total amount ($24,800) when applied against total charges of $18,229 will result in a credit balance of $6,571.  Within the next week or so, the Student Accounts Office will issue a “refund check” in the amount of $6,571 for Joe to pick up.

Joe will use a portion of the $6,571 to pay off the credit card charges he used during August.  He will use the balance to meet his living expenses for the fall semester.  Hopefully, Joe will receive his refund check in time to pay his September rent, but if not, he has his credit card a “plan B,” if needed. 

In early January Access Group will disburse the remaining funds to CUA, and a similar “refund check” will be issued, by CUA, to Joe.

Joe is a full time student, and was actually able to borrow more than the $30,000 he originally requested.  In the spring, should Joe experience some unexpected expenses, he will contact the Office of Financial Aid and also his lender, Access Group, and request an additional $3000.  These additional funds will be disbursed within a week or so to CUA, again to be refunded to Joe, after they are credited to his account.

As you can imagine, there are many variables in the above scenario, such as using a monthly payment plan, or enrolling in the Health Insurance Plan after refund checks are distributed, etc.  The two most important points to keep in mind are:

1. Be prepared to handle initial expenses through mid September should unexpected delays occur in the disbursement of loan funds, and
2. CUA understands that “the perfect” sequence of events does not apply to everyone. No one is excluded from classes because of delayed payments.

The Office of Financial Aid is happy to work with you to answer any questions and to resolve any unusual situations as quickly as possible.

Applying for Student Loans

Once you have completed your FAFSA, your school will present you with an offer of financial aid – sometimes called an “Award Letter.”  At the Columbus School of Law, you receive notice of your offer (“Award Letter”) via email.  With that notice, you also receive a User ID and a Password that allows you to sign into the CUA web-based portal to view your financial aid offer.  Once you have viewed your offer, the next step in the process is to accept your financial aid.  The Office of Financial Aid, provides an online form you use to accept your financial aid.

Closely related to the “Accept My Financial Aid” step is the loan application process.  If you wish to use loans as part of paying for education related expenses, include tuition, fees, books, and living expenses.

As you approach the coming academic year, you have taken time to plan for your expenses and now have a pretty clear idea of how much money you may need to borrow, if any.  There are two important considerations to keep in mind at this point.  First, throughout the academic year, you always have the opportunity to modify your loan amount to meet changes. Second, the amount of loan eligibility shown on your “Award Letter” is a maximum amount.  Most students, with careful planning and use of other resources, borrow considerably less than the maximum allowable amount.

If you have no other resources, such as savings to draw upon or family assistance, the need to plan and budget carefully is doubly important.  Many students do use student loans, and wise borrowing is the result of careful planning.

This column will discuss the application procedures and for those who have already applied, this entry will be a good reminder of the key points.  I’ll begin with a quick overview of the steps that are involved in the loan application and disbursement process.  The following steps describe a typical process for lenders who have completed technological “arrangements” with schools to handle the process electronically.  This process is typical for most lenders. Some lenders remain more “paper-based,” but the steps are essentially the same.

1. Student selects a lender (usually from the school’s preferred lender list, but students are free to select any lender of choice).

2. Student contacts his lender and applies for loans from one or more loan program as needed to meet expected costs.

3. For credit-based loans (e.g., private loans) or credit-related (e.g. Graduate PLUS) loans the lender reviews the applicant’s credit history and approves the loan – usually communicating the approval to the applicant within minutes of completing the application.

4. Upon approval, the student signs a promissory note – usually using a “electronic signature” process.

5. Upon receiving the signature, the lender then communicates with the school (usually electronically), informing the school the applicant has been approved for a loan.  The communication from the lender to the school in this step is called a “request for certification.”

6. The school responds to the “request for certification” by (1) certifying the applicant has met basic eligibility requirements – such a citizenship, for federal loans, (2) reporting the amount the student desires, and (3) certifying the requested amount is within the school’s established maximums.

7. The lender then prepares to disburse funds to the school.  Usually the appropriate funds are sent by “wire” within a few days of the beginning of each semester.

8. Upon receipt of the funds, the school’s business office, transfers the funds to the individual students’ accounts, thus making payment for charges that are on the students’ accounts – typically, charges for tuition and fees.

There are two other parts of the loan disbursement process that are important:

1. If the student is a first-time borrower of a federal student loan, the student is required to have completed an entrance counseling session before the funds can be transferred to the student’s account.  In some cases, there may be additional documents required of a student before funds can be transferred.  Students for whom additional documents are required will hear directly from the school in these instances.

2. Once the funds have been transferred to a student’s account, and all current charges have been “paid,” any excess funds will be refunded to the student in the form of a check from the school.  This “refund check” is usually are distributed within the first two weeks of classes each semester.

The first step in the loan application procedure is to select a lender.  The Office of Financial Aid has selected three lenders, who have demonstrated leadership in both service and pricing to law students, and has created links to these lenders on the Financial Aid web pages.  For the lenders listed, and many others, electronic arrangements have been set up and fully tested, so the loan certification and disbursement processes should proceed smoothly.

Most loan applications are online processes, and most lenders have created intuitive procedures that quickly guide an applicant through the essential steps.  These include entering names, addresses (including email), and phone numbers for the applicant and usually two references.  The purpose of the reference is to provide the lender a “back-up” contact should there ever be a need to try to contact a borrower who appears to have been “lost.”  The references do not have any financial obligation with respect to the borrower or the loan.  Other information requested include: your drivers license number, the name of your school, your year in school, your program of study, the loan/enrollment period, and in some cases the amount of loan desired.

In some instances, particularly with private student loans, a borrower may be asked to provide a co-signer if the borrower’s credit history does not meet the standards of a particular lender.  Many lenders have provisions to “release” a co-signer after a certain number of on-time payments are received once the borrower goes into repayment.

The final step in the loan application process is to provide a signature for the promissory note.   For the Federal Stafford Loan program, the applicant actually signs a Master Promissory Note with his first loan, thus eliminating the need to sign additional promissory notes in future years.  Otherwise, a signed promissory note is usually required with each loan application.

Robert A. Shuker Scholarship Fund

The Robert A. Shuker Scholarship Fund, Inc. intends to award two scholarships per year ($7500 each, subject to available funding) to one or two residents of the Greater Metropolitan Area of Washington D.C., who are or will be studying on a full-time basis in an accredited J.D. program.

The Greater Metropolitan Area of Washington D.C. is defined as including the Maryland counties of Montgomery, Prince Georges, Anne Arundel, and Howard and the Virginia counties of Arlington, Fairfax, Loudon, Prince William and the City of Alexandria.
Selection is made from those applications submitted, which meet the criteria, and on an objective and nondiscriminatory basis.  Grantees are required to make reports each grading period concerning their grades and academic standing during the one-year scholarship period. Follow-up procedures are used when a grantee is not performing satisfactorily and payments will be withheld in such a case. If a grantee ceases study prior to the completion of the undertaking, the grantee will be required to refund a prorated amount of the grant for the portion of study that was not completed.

Grantees for both scholarships will be chosen on the basis of financial need, demonstrated community service, prior scholastic ability, recommendations from instructors, and conclusions the Board of Directors might draw from a personal interview as to the individual's motivation, character, ability, and potential.

Preference will be given to (1) applicants who have demonstrated an interest and a strong desire to work in the administration of justice or other public interest areas, (2) applicants who are currently residents of the District of Columbia, and (3) applicants who are already in law school with a 3.0 grade average on a 4.0 grading scale, or the equivalent thereof, who are in need of financial aid to continue their law school education. No student is prohibited from applying for successive scholarships.

Applications for the 2007 - 2008 academic year are due by April 20, 2007. Please download (www.shukerscholarship.com) and complete all portions of the application and send with the required attachments to:

Donald Bucklin, President of the Robert Shuker Scholarship Fund
Squire, Sanders & Dempsey, L.L.P.
1201 Pennsylvania Avenue, NW, Suite 500
Washington, D.C. 20004

The Robert A. Shuker Scholarship Fund was established in 1993, to honor the late Judge Robert A. Shuker, Associate Judge of the Superior Court of the District of Columbia. Its primary purpose is to find and assist young people in obtaining an education that have few financial resources, but a burning desire to learn, achieve, and serve the public. Robert A. Shuker was an extraordinary lawyer, an outstanding judge, and a remarkable person. He was a man with an unmatched combination of courage, intellect, wisdom, and integrity. Although from an impoverished background, Judge Shuker believed in education, and that through education one could achieve any goal. Thus, he worked during his school years at many different jobs, and with scholarship assistance, ultimately achieved his aspirations first by becoming a lawyer and later a judge. Throughout his life, even in the most difficult times, he never lost his compassion for other human beings, his love of life, his distinctive wit, or his special sense of humor.

It’s FAFSA Time!

This is the time of year for completing the Free Application for Federal Student Aid (FAFSA).  By now, you’ve probably learned from one source or another at the FAFSA is the “first step in applying for financial aid.”  Many of you may be wondering, “what is this application for?”  Here is the short answer:  The FAFSA is the required first step to receive a Federal Stafford Loan and the information is used to determine how much of the loan will be “subsidized.”  (The long answer comes later in this BLOG.)

When should I complete the FAFSA?  For The Columbus School of Law, we recommend completion at the same time you complete your federal tax return.  Since some of the questions on the FAFSA ask you to take information directly from your tax return, this makes answering these questions quick and easy.

What do I need to know when completing the FAFSA?

1.  The FAFSA will take about 20-30 minutes to complete.
2.  Most of the questions are biographical.  If you have your taxes done, the required financial information may be taken directly from tax return.
3.  If you do not have your tax return done, you may use estimated information.
4.  You complete the FAFSA at www.fafsa.ed.gov.
5.  You will use your Federal PIN to sign your FAFSA.   If you don’t yet have a federal PIN, or have forgotten it, you will apply for a PIN as part of the application process or you may request a PIN or a “duplicate” PIN at www.fafsa.ed.gov.
With your initial FAFSA, you may choose up to six schools to which your FAFSA data will be sent.  The “school code” for the Columbus School of Law is E00131.
6.  If you later want to add other schools, you will complete a “Correction” at www.fafsa.ed.gov.

Long Answer to “What is the FAFSA?”

Primarily the FAFSA is a data-collection tool.  The information you provide on the FAFSA is “crunched” to provide what is known as the EFC (Expected Family Contribution).  Before I talk further about the FAFSA, I need to define the EFC and a few other key terms:

1.  The COA (Cost of Attendance);
2.  The EFC (Expected Family Contribution);and
3.  Financial Need.

Cost of Attendance (COA).  Each school develops a “cost of attendance” which is an estimate of tuition, fees, and living expenses for students who attend their school.  While tuition and fees are fairly precise numbers, living expenses are only estimates, and tend to represent maximum amounts.  With a little effort and creativity, you can usually get by for less than the school’s published COA.  And, you should try to do so, if at all possible. For most students, money saved in living expenses means less debt upon graduation.

Expected Family Contribution (EFC).  I like to think of the EFC as a standardized index of your financial strength to pay for school.  The formula used to crunch the FAFSA data and come up with the EFC is the same for all students.  The formula looks at your income and assets, your family size, and how many are in school.  Your EFC can be anywhere from “0” to “99999.”

Financial Need.  COA minus EFC equals Financial Need.  Now that you know this, you too, can be a Financial Aid Administrator!  But, you want to be a lawyer. Once the school knows your EFC they can make some decisions about financial aid that is based on “financial need.”  And I’ll get to that in a minute.  But first, here is an answer to a very common question:

Do I need to include my parent’s information on the FAFSA?  “But, I’m 26 years old,” you say.   “I’m independent.”   You are correct.  Even if you include your parental information on the FAFSA it will not be included in the EFC calculation.  I repeat, it will not be included in the EFC calculation.  However, some schools like to have parental information, and I’ll explain why a little later.

Now that you know how financial need is calculated, I’ll discuss some forms of financial aid that are based on financial need.

The Federal Subsidized Stafford Loan.  You have to have financial need of at least $8,500, to be eligible for the Subsidized Stafford Loan.  This loan is called “subsidized” because the federal government has agreed to pay the interest on this loan to the lender (bank) while you are in school, and you don’t have to.  If you have a scholarship or a grant then the “need” equation is a little more complicated.  With a scholarship or grant, eligibility for the Subsidized Stafford Loan works like this:  COA minus EFC minus [Scholarship or Grant] = Need.  So, it is possible that a scholarship might impact your eligibility for the subsidized, but scholarships do not impact the eligibility for the Unsubsidized Stafford Loan.  (More about the Unsubsidized Loan in found later in this BLOG).

Need-Based Grants and Scholarships.  Some schools provide scholarships or grants based on financial need.  Further, for some schools will also look at parental information in addition to the student’s financial need, when determining eligibility for need-based grants and scholarships.  The scholarships here at the Columbus School of Law are all based on “merit” (e.g., LSAT Score, GPA, and other factors) thus financial need is not relevant to the awarding of these scholarships.

What if I have a high EFC, can I still get the Subsidized Federal Stafford Loan?  You may still get the same amount of Stafford Loan, regardless of your EFC or Financial Need; however, if you have a high EFC (and thus low financial need) the loan will be called an Unsubsidized Federal Stafford Loan.  All students who complete the FAFSA are eligible to receive the annual maximum Federal Stafford Loan of $20,500.  Your financial need determines the amount of the $20,500 that will be “subsidized.”  The maximum amount of “subsidized” Stafford Loan each year is $8,500.  But all students are eligible to receive a total of $20,500 each year from the Federal Stafford Loan program, whether it be “subsidized” or “unsubsidized.”  For most students it will be a combination of both.

Why should I complete the FAFSA?  So, we are now back to the original question: why the FAFSA?  As you have seen, from a practical standpoint, the primary reason for the FAFSA is to allow you to receive, if possible, a student loan that is “interest free” (to you) while you are in school.  In fact, to receive the Federal Stafford Loan (subsidized or unsubsidized) completing the FAFSA is a required first step.

In a later BLOG, I’ll discuss applying for student loans in greater detail.  I’ll also discuss other student loans such as the Federal PLUS Loan and alternative (private) loans.  Loan applications are usually done in May and June for the upcoming year.

Getting Started...

This period of time is when you are preparing for the financial aid process, which will actually get underway after January 1.  In future posts I will discuss searching for scholarships and other specific steps of the financial aid processes.

A Brief Overview of Financial Aid Resources

Financial aid comes from three sources: (1) Grants and Scholarships, (2) Student Loan Programs, and (3) Work-Study Programs.

The sooner you begin looking for grants and scholarships, the better.  There are a variety of resources to help you in this search which I will discuss these in my next entry.

Not many law students use work-study programs at the Columbus School of Law, but I’ll discuss these options in a few weeks, as well.

Student loan programs represent the single largest sources of financial aid for law students.  Access to these programs is simple and the application process is quite streamlined.  Most loan activity occurs in the months of May and June prior to beginning the fall semester.  I’ll discuss loans in greater detail in a later entry.

Almost all law students complete the FAFSA (Free Application for Federal Student Aid).  I’ll cover this topic in a later entry.  The important thing to know at this point is that the first date a FAFSA may be submitted (for the 2006-2007 year) is January 1, 2007.

What to Do Today . . .

Between now and January 1, 2007 please locate or request your Federal PIN.  Many of you probably already have this PIN.  If not, or if you’ve forgotten it, go to www.pin.ed.gov and request your new PIN or to request a “duplicate” if you’ve forgotten your number.

Scholarships and Other Opportunities

Searching for Scholarships

While the majority of financial aid for law students is made up of student loans, there are scholarship resources.  During the 12 months before you enroll in law school is a good time to focus on locating possible scholarships.  My discussion below is broken into two categories:  Scholarships from “Outside” organizations and Scholarships from The Columbus School of Law.

Scholarships from Outside Organizations

Many organizations provide scholarships to students.  One of the most popular scholarship search sites is www.fastweb.com.  The website, www.finaid.org lists a number of other scholarship search services in addition to FastWeb.  I have included on our website at www.law.edu a list of scholarship programs specifically for law students.  These are organized by application deadline dates.  In separate Blog posts I plan to highlight scholarship programs from time to time.

Scholarships from The Columbus School of Law

Scholarship programs at The Columbus School of Law, primarily are all merit-based, and do not require an application.  Scholarship awards from us, are determined by the Admissions Committee and are part of the admitting process.  Typically, the Admissions Office begins notifying admitted students of scholarship awards in February and thereafter on a rolling basis.

After completing your first year, you will receive a class rank based on your grade point average.  For a number of years we have had a policy of providing scholarships to students who finish in the top 25% of their respective classes.  At the present time we do not have plans to discontinue this program; however, budget considerations at some point in the future may mean changes in this program.

If you receive a scholarship from us, typically the scholarship is renewed for subsequent years, subject to you meeting the stated requirements for renewal.  Renewal requirements usually state that you must finish in the top 25% of your class.

Preparing Financially for Law School

Law School means preparing to make a significant financial investment.  For many students, part of this investment will be through the use of student loans.  Student loans are available for tuition and fees, as well as for living expenses.  You can’t do anything to change the amount that will be charged for tuition, but you do have much control over other expenses.  Because of accruing interest, compounding that occurs over time, and the length of time many students use to repay loans, $10,000 borrowed during the first year will result in repayments totaling over $22,000 (for a 20 year repayment period.)

Here are the basic strategies to employ to minimize the amount of financial investment:

1.  Minimize expenses – even to the extreme!  Remember, you are only a law student for three or four years.  This is a brief period of time, but during this period of time financial sacrifice can save you thousands of dollars over time.  Start practicing now to get used to living like a student.
2.  Maximize your efforts to save money now that can be used to meet expenses later.  Any money saved and used instead of borrowing is like doubling your money!
3.  Investigate scholarship opportunities.  Scholarships and grants do not have to be repaid.  I have a separate Blog category for conversations about scholarships.

Financial Planning Tips for Spring Semester 2007

Current students, here are some financial planning tips for the Spring Semester:

1. If you are expecting a refund check for the Spring Semester, Student Accounts has set January 16, 2007 as the “pick-up” date in Leahy Hall (after 3 p.m.). 

2. You will soon be receiving your next statement from the Student Accounts Office which will reflect your pre-registration for spring courses.  Please note that if your registration is not finalized, the appropriate adjustments will be reflected on the next statement.  This may actually affect your refund check – so if your refund check seems larger than expected, it is possible your tuition charges are not yet complete.

3. Student loan disbursements and scholarship credits will post to your account in early January.

4. Your financial responsibility for the upcoming statement is only the amount of your tuition and fee charges not covered by loans and scholarships.