Spending & Budgeting
iGrad has a page dedicated to COVID-19 for students. Here are some related articles:
- Financial wellness touchstones during a recession
- How COVID-19 is affecting jobs & where to look for support
Additionally, check out our page on COVID-19 and impacts to student loans.
- iGrad.com contains articles and tutorials on financial literacy for students.
- Building Wealth Guide: The Federal Reserve Bank of Dallas covers budgeting, loans, credit, investing and saving, and insurance.
- Take this 15 minute online course from UC Berkeley: Creating a Budget.
- Budgeting templates
- Barbri 1L budget worksheet
- A free online budgeting tool is mint.com
- More sophisticated budgeting software for purchase: You Need A Budget
Developing a personal budget for the years you spend as a law school student will help you keep your expenses low with the ultimate goal of graduating with the lowest debt burden possible.
- Create a weekly budget (see external resources for more budget templates).
- Keep track of receipts, bank statements, pay stubs, bills, and other payment records or maintain a daily log for future reference.
- List income and anticipated expenses like rent, utilities, food, transportation, etc. to determine whether your expenses exceed your income/other funding. Aim to increase discretionary income and reduce expenses.
- Cost of Attendance Adjustment: If you incur additional costs such as a computer purchase, medical bills, or relocation expenses within the current academic year, you can submit a Cost of Attendance Adjustment Request to increase your loan eligibility. You can learn more about the process and complete an application here.
Student Loans
A law school education is usually funded through student loans. More information about the various types of loans can be found on our loans page.
- Interest rate reductions are often more valuable than principal reductions (read the full article here).
- Read the fine print carefully. All the important things to know about your loan–fees, interest rate, grace period, etc.–will be in the promissory note.
- Remember to set up auto debit of your monthly payment in the way the lender requires.
- Make monthly payments on time. Otherwise, you risk defaulting on your loans.
- Federal vs. private loans: consider the benefits that come with federal loans (such as income-driven repayment, deferment and forbearance, and the Public Service Loan Forgiveness program) before applying for a private loan.
- Co-signers: To get the best interest rate on a private student loan, consider applying with a credit-worthy co-signer.
- Compare costs: Analyze and compare different private lenders for hidden costs (i.e. some may charge an insurance premium at the beginning of repayment period).
- LRAP ineligibility: If there’s the possibility that you will enroll in Berkeley’s LRAP program, remember that private loans do not qualify.
Loan Repayments and Managing Debt
- Overview: Loan payments will vary depending on the loan type, how much you owe, and the repayment option you chose. It is important to establish a budget and determine how much money you will need to borrow in loans. Don’t borrow more than you need! You can always return unused loans before the end of the semester by contacting the Financial Aid Office.
- Monthly payments: If you are having difficulty making monthly loan payments, there are options.
- You can apply for an income-driven repayment plan to reduce your monthly payment amount to as low as $0 a month.
- In certain situations, loans can qualify for deferment (loan payments are temporarily suspended and interest does not accrue on subsidized loans).
- If you do not qualify for deferment but are experiencing financial hardship and difficulty making loan payments, you may qualify for forbearance.
- Estimating repayment and amortization: There are three useful calculators to help you determine your monthly payments and how they’ll impact your loan balance over the years:
- The Federal Student Aid loan simulator allows you to compare all the federal repayment plans, like the Standard 10-year plan and the Income-Driven Repayment plans.
- This loan payoff calculator allows you to see how long it’ll take to pay off your loans if you pay $XX amount per month, or what you should pay per month if you want to pay off your loans in XX years.
- This loan amortization calculator allows you to predict how your loan balance will change each year depending on how much you pay.
- Key terms: See other loan related key terms here.
For other information on loan repayment and LRAPs, see the following links:
- Student Borrower Protection Center: contains resources for successfully applying for PSLF
- Equal Justice Works: contains student debt resources and webinars for borrowers
- Student Loan Borrower Assistance: get help managing repayment
- Student Debt Crisis Center: student loan repayment tools
- American Bar LRAP: check out state-sponsored LRAP programs
- If you plan to work in a public interest career:
- Consider utilizing LRAP support during repayment.
- You may also qualify for Public Service Loan Forgiveness.
- AccessLex Institute: Funding Your Legal Education and Debt Management resources.
- Studentaid.gov: the Federal Student Aid website.
- Read articles linked below about different topics related to managing student loan debt:
- What expenses you should and shouldn’t pay for with student loans
- Should I pay off my credit card debt or student loans first?
- How to buy a house while having student loan debt
- How student loans affect your credit score
- Everything you need to know about managing debt
- Simplifying student loan payments
- Balancing your law school loans
- Real life student loan mistakes: stories from students who overborrowed
- Pay off debt before law school: Since consumer debt generally has a high interest rate and monthly credit card payments are not factored into the student budgets used to award financial aid, we encourage you to pay off as much of this type of debt as possible before law school.
- Good vs. Bad Debt: Having more student loan debt isn’t automatically bad for your credit score. Focus on making student loan payments on time. It’s likely to have the biggest impact on your credit score.
- Credit Score: Review your credit report each year by obtaining a free credit report from each credit bureau once per year annualcreditreport.com. It is important to understand your credit score and what lenders are looking for if you want to get a loan after law school.
- Read more about maintaining good credit:
- Qualities of good borrowers
- How to buy a house while having student loan debt
- What expenses you should and shouldn’t pay for with student loans
- Should I pay off my credit card debt or student loans first?
- How student loans affect your credit score
- Everything you need to know about managing debt
- Using credit cards responsibly