On plans delayed, and loans destroyed

Almost two years ago, I began planning, and then executing, my path out of the legal "profession" and Document Review. But even the best plans rarely survive the initial stages of battle, and I did not foresee just how bad the recession would become.

2008 and 2009 were horrific years not only for lawyers, but everyone else. Many of my friends in other professions were let go from their jobs: bankers, engineers, marketing consultants, etc. As companies slashed payrolls and froze hiring, I found myself trapped in document review. Still, I played the game well, and was fortunate enough to land on several big projects, some of which had generous overtime hours. I worked as many hours as I could, hoping my luck wouldn't run out. And after two more years of document review, my student loans are practically wiped out.

My blunder into the so-called "legal profession" has cost me the better part of a decade, and I will never recover the thousands of miserable hours spent pouring over documents. But those thousands of hours of tedious work paid handsomely, and I no longer worry about being chased after by scumbags from Scammie Mae and her debt collector band. Now as I stare into the wreckage of the US economy and plot my next move, the question lingers: what next?

Marching relentlessly

I am learning some new skills. It is sometimes tiring going to class after a full day of work, but I think it is worth it. I am also getting a better sense of where I am going with all this.

One door closes, another opens

Today I started my transition away from document review, and away from the law. I am sure that friends and family will be aghast and perhaps dissapointed, but the truth is that I knew by the start of my 3L year that I did not find legal work personally satisfying.

My venture into the legal world came at great cost -- four and a half years and tens of thousands of dollars of debt. And I will leave it all behind, because future misery in a profession I care little for is not worth staying in because of the sunk costs.

If all goes according to plan, I will be reviewing documents for another year, and then finding a job in a field related to my undergraduate degree.

Exit Strategy

I know that there are many contract attorneys like myself who want to make an exit from the legal profession. Some of us hated the endless paper-pushing. Others despise having to deal with irate and irrational A-type bosses concerned with nothing but their own prestige. Whatever the reason, I think it's a good idea to have a viable exit strategy.

The problem for lawyers wanting to exit the profession is that we need to make ourselves marketable to employers outside the legal field. I believe that retraining is the best option.

I encourage those of you who want to get out to take night classes in something you are interested in. It could be accounting, photography, information technology, automobile repair, chemistry, art, or whatever else. Build skills to show employers that you are serious about getting out of the law, otherwise that J.D. just pegs you as a potential flight risk.

2007 Victories, Looking to 2008

2007 was certainly an entertaining year. The Wall Street Journal exposed the reality of the legal job market, Brooklyn Law School and Seton Hall suffered massive public relations damage, and WSJ readers voted 'Loyola 2L' Attorney of the Year.

Here's a link recap for those who missed these events:

Loyola 2L's award:
http://blogs.wsj.com/law/2007/12/19/the-law-blog-lawyer-of-the-year-loyola-2l/

Legal Job Market Reality exposed:
http://online.wsj.com/article/SB119040786780835602.html

http://www.elsblog.org/the_empirical_legal_studi/2007/09/distribution-of.html


Brooklyn Law School administration criticised:
http://temporaryattorney.blogspot.com/2007/12/2007-beastly-behavior-award-joan-king.html

The public relations battle continues to rage on blogs, jdunderground, and pre-law websites like lawschooldiscussion.org. I predict that the number and quality of applicants to low-ranked private law schools will continue to drop through the 2008 admissions cycle.

The word is out -- these schools have mediore to poor job prospects and cost up to $40,000/year in tuition alone. Don't be fooled by misleading law school publications advertising high "average" starting salaries. Save yourself money. Go Prestigious, Go Public, or Don't Go At All.

Contract work and the high life

Contract work can be a money trap. People get on a great project that lasts a couple months, and make good money working a lot of overtime. What I've observed is that people get used to living as if they will always be hauling in large paychecks, and then get into trouble when the project has its hours reduced or ends alltogether.

In Philadelphia, the average pay rate is around $30/hr + OT. A 50 billable-hour work week means a paycheck of $1650. Bill 60 hours and that paycheck grows to $2100. It's not biglaw pay, but its a hell of a lot more than most working Americans will ever see on their pay stub.

There's a lot one can do with that much money. You can afford the payments on a new car, take out a mortgage on a condo, or buy a lot of stuff at the mall. But what happens if the project goes to 40/hrs a week, or you get let go? Can you afford to make those mortgage and car payments? Can you pay off that credit card?

Here are my thoughts on surviving financially as a contractor:

(1) Save at least 3 months of living expenses in a Money Market Fund or Online Savings Account. It is not uncommon to go a few weeks or months without work. The extra money will tide you over if you are unable to find a new contract before your umeployment benefits end.

(2) Avoid budgeting on the assumption that overtime hours will be freely available. Obviously, there's a huge gap between $1200/week and $2100/week. Project hours can go up and down at a moment's notice. Taking out that big mortgage might not be a good idea if your pay prospects are not certain.

And if by chance you get on a great project and have lots of disposible income:

(1) Use your agency's 401(k) plan. You can contribute up to $15,500 pre-tax each year. I generally recommend investing in mutual funds with low expense ratios. Check out Kiplinger.com, CNN Money, or other websites for investment advice.

(2) Open a Roth IRA or Traditional IRA. These are two great tax advantaged savings vehicles.

Contracting work may be boring, but there are few jobs that have the potential to allow workers to generate large amounts of cash in short bursts. Invest your extra cash, and you can give yourself an excellent chance of securing a comfortable retirement several decades down the line.

Wall Street Jorual Report: Job market poor for most law graduates

The findings of the WSJ speak for themselves.

In a nutshell:

1. Earnings for most law graduates and lawyers have been stagnant or declining since the 1970's.
2. The number of law schools and law graduates has dramatically increased, flooding the market with J.D.'s
3. The Cost of earning a J.D. has skyrocketed.
   
4. Generally, only attorneys at large firms have seen salary increases in recent years.

If you must go to law school, Go Prestigious, Go Public, or DON'T GO AT ALL! Save your finances. Save yourself. Avoid law school if you aren't sure you want to go.