Financial Do's and Don't's (FOR NEW LAWYERS!) | Summary and Q&A

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March 4, 2020
by
Angela Vorpahl
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Financial Do's and Don't's (FOR NEW LAWYERS!)

TL;DR

Learn how to avoid financial mistakes and pitfalls as a new lawyer, including managing student debt, saving for the future, and avoiding excessive spending habits.

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Key Insights

  • ðŸ’Ļ Student debt is a significant financial burden for new lawyers, and finding ways to save on interest payments can make a significant difference in their financial well-being.
  • ðŸ’Ķ Balancing work and personal finance is crucial for young attorneys who often struggle with long working hours and lack of time for financial planning.
  • 😋 Overspending on conveniences like food delivery and ride shares can quickly add up and hinder financial progress.
  • ✋ The allure of luxury purchases can create a cycle of higher expenses and limit opportunities for saving and building a secure financial future.
  • ☠ïļ Misconceptions about how much to spend on rent or mortgage, understanding interest rates on student loans, and tax considerations can have a significant impact on financial planning for young lawyers.
  • ðŸŠĪ Financial planning can provide young attorneys with the freedom to pursue fulfilling careers and avoid being trapped by excessive expenses.
  • 🆘 Seeking professional financial advice tailored to the legal profession can help young lawyers navigate their unique financial challenges.

Transcript

Angela (00:00): Hey guys, welcome back to my channel, the number one place for new and aspiring lawyers on all things law school, the lawyering life, and the legal industry. I'm so excited about today's video because we are talking about an insanely important topic for new lawyers in particular, which is how to manage your money. Because for new la... Read More

Questions & Answers

Q: What are the biggest financial difficulties faced by young lawyers?

Student debt is a major concern, often exceeding $250,000 with high interest rates. Additionally, limited time and energy make it hard to focus on financial planning, while the compulsion to financially assist family members can strain finances.

Q: What spending habits often get young attorneys into financial trouble?

Young attorneys frequently overspend on food delivery and ride shares due to long working hours. They also tend to splurge on big-ticket items like luxury housing, which hinders future financial planning and creates unnecessary financial burdens.

Q: What are some common misconceptions young attorneys have about finances?

Young attorneys often believe in the "30-33% of income toward rent or mortgage" rule, which may not be suitable for everyone. Understanding the importance of interest rates on student loans and considering tax implications are other commonly misunderstood financial aspects.

Q: How can financial planning create opportunities for young attorneys?

Sound financial planning allows young attorneys to not only secure their future by paying off debts and saving for retirement but also gives them the freedom to pursue their dream careers and walk away from jobs that no longer fulfill them.

Summary & Key Takeaways

  • New lawyers often struggle with high student debt, with interest rates that can be a financial burden. There are opportunities to save money on student loans and avoid unnecessary interest payments.

  • Time constraints and long working hours make it difficult for young attorneys to focus on their financial future and live the way they want. Finding a balance between work and personal finance is crucial.

  • The temptation to spend on food delivery and ride shares, as well as indulging in big-ticket items like expensive housing, can lead to irresponsible spending and hinder long-term financial planning.

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