Andy Hough

How I Screwed Up Law School

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If you’re thinking of attending law school you need to ask yourself why you want to go to law school.  Once you determine why you want to go to law school you need to ask yourself if your reason for attending law school is a good one.  I read this advice before I attended law school but didn’t really heed it.  I just had a fuzzy idea of getting my law degree, making big money for a few years and then retiring.  This could be a good reason for some but it wasn’t for me.

This led me to make mistakes on deciding which law school to attend.  Since I wanted to make big money I felt I needed to go to the highest ranking school I could get into.  I was accepted to a top 25 school with no scholarship money and decided to go there and forego the scholarship offers I received at other schools.  After a year of attending law school it was obvious to me I wasn’t going to land a big money job and even if I did it would be something I’d hate.

This led me to transfer to my state school to save about $15,000 a year in tuition.  This was probably another mistake.  Once I had decided to attend the high ranking school I needed to just stick with it.  Things were going well for me there and I should have remembered the old adage,” If it ain’t broke don’t fix it.”  After switching schools I had a hard time adjusting and struggled academically. Even though I’m saving tuition money here there is a good chance I could have made up the extra tuition expense at the higher ranking school with better paying job offers.  If I would have gone to the state school in the first place I would have received a good scholarship.  As a transfer student no scholarship was available.  It would have been much smarter to go to the state school in the first place or just stay at the high ranking school.

Now I’m not sure if I should have attended law school at all.  So far I don’t like any of the work I’d likely be doing as a lawyer.  I’m going to finish because I already have three years and many thousand of dolllars invested in it.  If you’re thinking of attending law school be sure of your reason for doing so and what you hope to get from it.

The Cost of Free Tickets

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I received a couple of free tickets to see the Kansas City Chiefs preseason game last night.  This was because some friends that live out of state have season tickets. The preseason games are included in the season ticket package.  They decided that it wasn’t worth the expense of travel to see a preseason game and since preseason tickets are almost worthless I was able to score them for free.

There was a $22 charge for parking which I thought was awfully high.  It was split between me and my friend so that was $11 each.  It had been a long time since I’d been to a professional sports event.  I had forgotten how expensive concessions were.  It was $7.25 for a beer.  It may have been a preseason game but they were definitely charging regular season prices.  I opted to not have any concessions since I couldn’t justify paying such a high markup.  My total cost to attend was only $12 but if I would have had any concessions that total would have risen quickly.  Even when you receive somethng for free you have to consider the costs involved.

That being said I’m glad I went.  I’m a life long Chiefs fan but have never seen them play at Arrowhead.  I actually prefer to watch games on TV in the comfort of my own home.  It is nice to have had the stadium experience at least once just so I know what it is like.  And the Chiefs won which is something they probably won’t be doing a lot of this season.  Overall it was a good deal.

Five Free Frugal Resources

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When you’re trying to be frugal getting something for free is a big help. Here are some great free resources that won’t cost you a dime.

  1. The Public Library- You can get books free here and also music and movies. My local library charges a dollar for movies but the books are still a good deal.
  2. 1-800-Free-411- I just recently found about this.  I just avoided using directory assistance before but now take advantage of this free deal. You just have to listen to a short advertisement before you get your information.
  3. Mint,GnuCash,PearBudget,etc.- There is lots of free money management software out there. I use PearBudget right now since my finances are pretty simple. I’m thinking of upgrading to more detailed software though.
  4. Hulu.com,ABC.com,CBS.com,etc.- These are sites where you can legally watch TV shows and movies at your own convenience online. With these sites you really don’t need cable.
  5. BBC.co.uk/languages- At this site you can take language lessons online for free. There are many other free language learning sites out there.  I haven’t tried these yet but learning a foreign language is on my list of things to do someday.

Those are just a few of the free frugal resources available. There are lots of things you can do for free.

Alternative Income- Cash Back

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This isn’t really an alternative income source since you have to spend money to get it. If you only purchase things you would spend money on anyway though this provides a little extra money. There are two main ways that I get cash back.

The first way is through online cash back shopping portals. The ones I most commonly use include Ebates ($10 signup bonus), Big Crumbs, and My Points. There are many more out there but these are the ones I’ve used and know.

I’ve mainly used Ebates for online shopping.  Their cash back is good but they only let you cash out four times a year and you have to earn a minimum of $5.01 not counting referral bonuses to cash out. This is a problem for me since don’t shop online(or offline) that much.

I’ve just started using Big Crumbs but I think it is going to be my main cash back site now. They pay on a monthly schedule. One of their big draws is that they allow you earn cash back on Ebay purchases. The other thing I most like about them is they allow you to earn money on your referral’s shopping activity. If you have a lot of referral this could be a decent amount of passive income.

MyPoints I don’t actually do any shopping through. I just get paid to read their emails and occasionally do a survey. I joined them earlier this year and it looks like I’ll make about $20 a year in gift cards from them. If I were more active I could increase that amount.

The other big way to get cash back is through the use of cash back credit cards. My personal favorite is the Chase Freedom(SM) Credit Card. I earn 3% back on my top three categories and 1% on the rest. If you wait until you have $200 cash back accumulated you will get a bonus $50 which effectively turns your cash back rate to 3.75%. I should have $200 accumulated by early next year and I’m waiting to cash out until then.

The other cash back card I use is the Discover® More(SM) Card. The trick to getting the most out of this card is to focus your purchases on their bonus 5% cash back categories. They switch these four times a year giving you a variety of categories to save money on. They currently have 5% cash back on gas which I’ve already earned my maximum amount of $20 on. I’ll now set the card aside until I can use it for the next 5% cash back promotion.

You can view some more cash back cards here.

Remember if you buy something you don’t need just to get the cash back you’re not saving any money.

Keep Savings Aside from Retirement Accounts

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You shouldn’t have all your savings in retirement accounts. You need to keep some of your money outside retirement accounts for emergencies.  There are several reasons for this.  The main one is if you have to pull money out of your retirement accounts for an emergency you will get hit with a large tax bill.  On a 401k you’d have to pay a 10% penalty plus ordinary income tax on the amount you withdraw. This could eat up almost half of your withdrawal.  On a Roth IRA you’d also have a 10% penalty but you’d only owe ordinary income taxes on your withdrawn earnings not your contributions.  There are exceptions that will let you avoid the penalty but they won’t apply to most withdrawals.

The other big reason to avoid pulling money out of your retirement accounts is that you lose the ability to contribute that amount to your retirement accounts.  If you put $5,000 in your Roth IRA and then have to withdraw it you can’t put it back in.  You’ve lost the ability to contribute $5,000 to your Roth IRA for that year and you’ll have to wait until the next year to start contributing again.  Since you are only allowed to put a certain amount in retirement accounts it is important to make full contributions if possible.

Those are just the biggest drawbacks to using your retirement accounts as an emergency fund. Some people think it is worth the risk to keep all of their savings in retirement accounts but I wouldn’t recommend it and it isn’t what I do.  I may not be able to fully fund my Roth IRA this year because I don’t want to bring down the balance of my non-retirement savings too low.  There is a drawback to this too because I’m losing the ability to contribute that amount.  What would you do, keep a fully funded emergency fund or withdraw most of it to contribute to a Roth IRA?