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Messages - kenpostudent

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251

And as for why law is different from accounting, law is far more stratified and (slightly irrationally, in my opinion) obsessed with the idea of "prestige".

Supply and demand is the largest difference in the professions, actually. There are more jobs than accountants to fill them. I wouldn't say that there is a glut of lawyers, but in certain practice areas that may be true. Also, there are no prestigious accounting schools. Some are rated higher than others, but a debit is a debit at every school. You won't get a better education at UoT Austin or USC than at UNLV. I think this is also true for law, but the demographics of the job market force employers to attempt to distinguish applicants by splitting hairs over irrelevant issues. There really is no difference in the quality of legal education at a T14 school compared to a T2 school. The curriculums are identical. Supply and demand in the job market perpetuate the perception of prestigious schools graduating better attorneys. If anything, the prestigious schools simply attract better talent rather than produce a better final product.

Maybe lawyers are more insecure because their profession is really not that difficult. Accountants that go into law find it incredibly easy in comparison. So, if you don't have skill and talent to hang your hat on, maybe prestige is all that's left. I know I would rather write briefs and research case law than calculate derivative liabilities or value joint venture interests in foreign currencies and tranlate the unrealized gain/loss to USD.

252
Now, I don't know if you can move from a boutique firm to big law. I don't see why that is not possible, but I have no facts one way or the other. I can only speak for the accounting profession. It's very easy to move from a small firm to a big 4 firm. Why is law different? Maybe it just is.

What do you mean by "boutique firm"?  Boutiques in the legal profession are generally firms that have similar hiring standards and compensation structures as the large firms but that simply happen to be smaller and more specialized.  For example, no one questions that a place like Susman Godfrey is populated by lawyers who could lateral to big firms. 

Firms that happen to be regional or local with smaller numbers of lawyers, easier hiring standards, lower compensation are not generally referred to as "boutiques".  There's no reason why a lawyer couldn't really distinguish herself at one of these places and lateral to a big law firm, but that's exceedingly rare from what I've observed.

And as for why law is different from accounting, law is far more stratified and (slightly irrationally, in my opinion) obsessed with the idea of "prestige".

I would define a boutique firm as a firm with less than 30 attorneys and a few practice areas, at most. I understand the prestige governs major markets in the legal profession.

Look at the attorney profiles of Las Vegas firms, though. Outside of the very largest of firms, you can't find anyone from prestigious schools. Phoenix is somewhat similar. The smaller firms seem to be full of non-prestige grads in those markets. Why? If what you say is true, then that shouldn't be the case.

253
How you came up with $9600 I have no clue, considering that's around what I paid on a lower income with a number of significant above the line deductions.  $15k is closer to reality.

OP was considering between Loyola LA, Hastings, and USC, so that's not flyover-state cost-of-living.

Did you read my post or just skim it? I said that CA would be a tough market to make it in based on my example. However, SLC, Las Vegas, Phoenix, and New Mexico, are all markets where someone could make it with that kind of debt load. A CA degree is very portable in those markets.

Let's use your figure of $15k in taxes (CA has local taxes that I didn't factor into my very generic example, which by the way, I could find more deductions if I wanted to). You would still have $27k to live on. That's enough in smaller markets, but not CA. You can always consolidate your loans at a lower rate and amortize them over a longer term to ease some strain. I used a high interest rate in my example and amortized loans over ten years.

You can live, though not on easy street, for sure. I don't know if you can lateral up to big firms, but even government jobs pay $100k or so with experience. I know grads from less than pretigious schools who got some good jobs with experience.

254

It sounds like what you really want to do is put people in jail.  But a fair enough distinction.
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People that deserve to go to jail, yes. Criminal law appeals to me because the cases resolve much faster, as well. Civil cases can drag on forever, only to settle after countless hours have been wasted on them. Plus, civil law is usually only about disputes over money. Sometimes there are other factors, but they can usually be quantified in a dollar amount. Fighting over money seems to bring the worst out in everyone. I doubt I would enjoy that work environment.

255
Where should I go next fall? / Re: Columbia vs. NYU
« on: July 03, 2008, 11:04:51 AM »
I reserve the right to tell you that your are an idiot if you publish a ridiculous view. However, I give you the same courtesy to similarly judge any view of mine that you think is foolish or unfounded.

As for my contribution to American policy, how is that relevant? I served in Bosnia. I was a low level enlisted man. I could influence no policies, only carry them out. I don't need to be a policy guru at a Washington think tank to recognize a threat when it is presented.

Well then we end up in a world where people point fingers at each other and call each other idiots simply because they disagree.

And I didn't say policy, I said polity.  It's relevant only in terms of what kind of tone I decide to adopt.

Sorry, I didn't recognize the word. I don't think I have ever used it before. Why do I have to contribute to American polity to judge a foolish proposition? I vote and have served in the military. Moreover, I have a strong desire not to glow in the dark.

256
Why do T14 schools place so much better?  Are firms fond of saying, "we have people from CLS," or is there more to it than that?

I honestly think it's just laziness on the part of big law recruiters. Why should they venture out of the T14 when they are inundated with applications from those schools? If you have have slots to fill and you get 100 applications from HYS alone, are you going to bother to look at some middle of the class Loyola grad? Since the recruiters can only schedule a limited number of interviews, they select from what they consider to be the strongest pool of talent.

257
That was one of the smartest posts I have read. I am currently a CPA who wants to attend law school to become a criminal prosecutor in white collar crime (long term goal) or work for the SEC Enformcement Division (dream job). I will more than likely take a pay cut at my first job. Those are simply the facts. If I were to stay in accounting and move to a bigger firm, in two years I would probably be making at or near six figures.

I want to practice law for the intrinsic value of the profession and love for the work. Job satisfaction is more important to me than making money. So, I am willing to sacrifice a few years of salary increases to do something that I know I will love. If you want to make big money, law is a very risky way to do it. You will need to be at the top of your class, graduate from the right schools, inverview well, and secure the big firm job. That's just the beginning of your journey. Then you have to navigate the political minefield up the path to partner at the big firm. If you get frozen out at the senior associate level, you'll hit a ceiling near $500k (give or take a $100k). That seems like alot of money now, but it won't after you have adjusted to that lifestyle.

The only other path big money in law is to become a successful trial attorney (i.e. John Edwards, Johnnie Cochran, Bill Lerach). If you're not a hustler, good luck with that. I believe that the legal profession can ensure a middle to upper middle class living to any competent attorney, however. If big bucks are the goal, do what one of my clients is doing: he's taking his company public and buying up subsidiaries like candy in hopes of selling out to a big market player in his industry (i.e. Honeywell or Siemens). He'll retire far richer than most attorneys if he is successful.

Oh, another great practice for attorneys is the shell factory game. I have a client who is an attorney. He creates shell companies and hires me to audit them. I do a registration statement and an audit. He then sells them for a couple hundred thousand dollars to private oompanies looking to take a shortcut to going public. His cost is in the tens of thousands for each shell. He is the only attorney at his firm and has never worked a day in big law. He can write a check for anyone's law school tuition for an entire year with what he makes in a month. Who says attorneys don't make good money outside of big law (oh, btw, he attended the University of San Diego, not a T14)?


258
I mean you no disrespect, but you don't have a clue of what you are talking about. I hope you are not an accountant. I am a CPA, though. So, let me give you some numbers:

With $120k of debt coming out of law school (I'm rolling undergrad debt into this) and a loan amortized over 10 years at 9.5%, your minimum monthly payment would be $1,552.27. If you amortized it over 30 years through consolidation, you would pay $1,009.03, assuming the same interest rate. Let's go with ten years at 9.5% (which is a little high). Your annual aggregated loan payments would be roughly $18,600. So, lets assume that you make $60k out of law school, just for argument's sake. I estimate federal and state taxes (with no material deductions) to be roughly $9,600. After taxes and loan payments, you have $33,700 (roughly) of disposable income. That's more than I make now after taxes and student loan payments. I live just fine, drive a new car, and live in a nice neighborhood. I'm not wealthy, but I have no trouble living and saving money.

Now, I don't know if you can move from a boutique firm to big law. I don't see why that is not possible, but I have no facts one way or the other. I can only speak for the accounting profession. It's very easy to move from a small firm to a big 4 firm. Why is law different? Maybe it just is.

Now $60k may not be enough in CA, NY, DC, ect. It's more than enough in Las Vegas, Phoenix, New Mexico, Utah, ect. So, if you plan to practice in CA, you might be in trouble with large sums of debt and job prospects that fall short of the largest firms. Those are the breaks of trying to compete in saturated markets.

If you take the free school, you have much more wiggle room.

259
To answer the original question, I suppose it depends on what type of law you want to practice. Corporate lawyers may be affected more by hard economic time because corporations tend to do fewer risky business ventures in down markets. Corporations also tend to cut costs in a recessionary economy; sometimes that tranfers to professional fees, but not always. For instance, public companies still need to pay for their audit fees and keep current on their corporate filings. Securities lawyers, therefore, tend to have a very stable income. Sometimes companies may dispute invoice charges, but this is usually not too significant. I've seen it in accounting firms. I have clients who have scaled back the scope of their services in response to cost-cutting directives from upper management.

Another practice area that is less volaltile is criminal law. People commit crimes in all economic conditions. They will still need lawyers, regardless of the economic climate. The trick with criminal law is cash management, like with all small businesses. In criminal law, you really have to demand you money up front. Finding clients that can pay can be tough. Some markets are better than others. My girlfriend works for a criminal law firm; the partners and associates there do very well. Most of their cases are DUI, domestic violence, and solicitation (it's in Las Vegas, no surprises here).

Family law is a great practice, as well. The divorce rate is 50% or better. You do the math. The average uncontested divorce in Las Vegas, prepared by a lawyer as opposed to a paralegal, runs about $1,500. I've never seen cheaper from an attorney. It goes up considerably when the divorce is contested. People don't consult Marketwatch to find the most opportune time to get divorced.

Once attorneys get experience, I doubt they will ever be broke because of lack of demand for their services.

260
I agree that you can not assume that you will finish higher at Loyola simply because of the lower ranking.  BUT, I also think that this article lays out the case as to why "always going to the best school" might not be the best advice either, especially when that school is outside the T14.  As you can see from the chart, less than 20 percent of USC grads made NLJ250 firms.  And looking up their cost on LSAC reveals that they are $40K a year alone in tuition.  I imagine you can easily spend $180K over three years if you add together tuition and cost of living.  Is it worth that gamble?

The only rational way to answer that question is to look at a lot of different factors -- how obsessed are you with making BIGLAW?  What do the majority of Loyola grads do?  Would you be happy with only making say $60K or maybe even less coming out of law school?  Does that outweigh the risk of taking out $180K in loans?  Do you have prior connections that might come in handy come job search time?  How far above Loyola's 75 percent range are your GPA and LSAT score?  Do you have undergrad debt?  What type of salary do the non-BIGLAW people at USC make?  Could you stomach having $180K in loans and maybe only making $50 or $60K?  Have you run those numbers to see what your loan repayments would be?

These are all variables that I think you have to consider.  Different answers to those questions should determine the answer to this question.  What I think is the wrong strategy however is just blindly using USNWR or blindly taking a scholarship offer.  You have to realize that there are very complicated tradeoffs in this equation.  Simply going to the higher ranked school however is NOT a guarantee of getting a better job -- it statistically increases your chances but even that increase might be very small and not worth the additional debt.   
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I think this is all great advice. Let me propose this question: is it really the end of the world if a grad doesn't get into big law right out of school? Is it not possible to make lateral moves up the big firms from smaller boutique firms? Even with $100k plus of debt, you can still service your debt with an $60k job if you budget well. I suppose that claim is dependent on the market you practice in, though. You can live cheap for a few years and then make it to the big time. Am I wrong?

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