Alicia Vanderschuere’s energy is infectious. Her company, rosieMADE has a mission to inspire others to be “stronger, bolder, and better.” By featuring the products of other female business owners across the United States, Alicia has not just started her own company; she’s started a revolution. Through the rosieMADE shop and community, women can get together to inspire and encourage each other, whether through purchasing products or soaking in resources about female leadership.

Read on to learn more about this innovative company and the woman behind it all. To learn more about rosieMADE, visit www.rosieMADE.com.

Can you tell us a little bit about rosieMADE and how you got started?

We are an online gift retailer, focusing on USA Made products from women-friendly companies. Our goal is to point the power of consumer spending towards women in business. We also run features and giveaways to help build awareness of women’s businesses and offer a free business directory.

My background is in corporate buying, where there is still a surprisingly few female executives in most companies. Since consumer spending is so powerful, it seemed like the perfect way to help women business leaders become more influential. Our company focuses on the US economy, since it is the most powerful in the world. We expect a trickle-down effect to the rest of the world’s women by elevating women here.

How did you secure the start up funds in order to start your company?

We have bootstrapped thus far. I squirreled away money while in Corporate America and have been blessed to have my husband’s income to rely on now for all household expenses. Securing additional funds is an ongoing debate for me, since there are so many pros and cons of each option. Hopefully I will make the right decision when the time comes.

What financial struggles did you overcome during the company’s early stages?

As a start-up, it’s difficult to know the best use of funds, especially when these funds are limited. It’s also difficult to project sales and expenses accurately. For us, we focused on trying a variety of marketing tactics to figure out what works best and focused especially on low-cost or no-cost options. We also did our best to control the right expenses, understanding that a company has to spend money to make money.

What advice do you have for other women who want to be entrepreneurs?

It’s important to be passionate about your business. That’s the best way to onboard customers, team members, and media sources. As an entrepreneur, you have to LOVE your company, its mission, and products since you will be thinking about it 24 hours a day.

Seek out advice and support for your business, whether that is the local SBA, WBC, SBDC, SCORE, local networking groups, or friends and family. It is really important to know the resources available and to utilize them.

Be realistic. The big businesses or brands that are part of everyday vocabulary have been in business for years. Very few businesses are an overnight success, and the few that are aren’t always sustainable. Set small goals that will help you achieve larger goals and give yourself credit for accomplishments.

Dream big. Statistically speaking, women’s businesses tend to be smaller. We need to recognize this and then we need to consciously create bigger, bolder dreams.

Did you ever envision that you’d end up where you are today?

I had always thought entrepreneurship sounded interesting, but I would have never expected to have become a social entrepreneur with women businesses and leadership as my focus.

How do you try to achieve a work/life balance?

Right now, work/life balance doesn’t come easily for me. I have a baby business, a 17 month old, a husband who travels regularly for work–all on top relocating less than a year ago. My husband is a wonderful partner (and much better cook than I am), and we share household responsibilities. We try to stay as organized as possible, with tools like shared calendars and menu planning. I have also learned to let things go (i.e. the perfectly clean house, being the perfect parent, etc.). Asking for help is essential for me in managing work and family.

What are some of your favorite products that rosieMADE sells?

That’s tough! I’m an avid tea drinker, so I’m a huge fan of our gourmet teas from Octavia Tea. Our chocolate is also wonderful with all organic ingredients. It’s the perfect splurge. The salted caramels are the perfect combination of sweet and salty. I’m also really excited about one of our newest vendors, Green Toys. All of their products are made from recycled plastic.

High quality ingredients, artisanal craftsmanship, and social consciousness are an underlying theme of all of the products we carry.

What are your future personal and professional goals?

Right now, my biggest goal is to get rosieMADE out of the starting gates and become a well-known and respected brand. I’m big on evolving, so I look forward to learning each day, and helping others learn. Ideally, I’d like for rosieMADE to become irrelevant by having so many women achieve their dreams, that our mission is no longer necessary. From a personal standpoint, I’d like to expand our family in the coming years.

Now that you have a beginner’s guide to investing, the question remains: How do you know if you’re ready to invest?

Have you read headlines about the bull market and wondered “Is now the time to jump into investing with both feet?” While it’s true that placing your bets on a strong market can be the path to fast cash, the hope of great rewards also involves risk. Here are four questions concerning your financial past, present, and future to help you gauge whether you’re ready to invest.

Have you eliminated costly debt?

Financial counselor Andi Wrenn says the most common financial error she sees among her clients is seeking investment advice before they have addressed typical money “must haves,” including a solid understanding of their budget and debts.

“I often see clients who are paying high interest rates on debts, have too high a debt to income ratio, or have no savings. It is great to invest in your retirement, at least a small percentage from the beginning of work, but it doesn’t make sense financially to be paying a debt at 11-21 percent when your investments are earning 4 to 7 percent,” says Wrenn.

Can you afford to lose?

Nope–not if you don’t have at least six months of your monthly income stashed and secure in a rainy day account. Certified financial planner Henk Pieters of Investus Financial Planning says that people commonly underestimate life’s uncertainties and discount the need to have cash available for events like unemployment, illness, disability, and family emergencies. In fact, if you have any concerns about job security, or own your own business, he recommends having at least twelve months worth of your income saved before placing your bets on the market.

Do you have a general understanding of the stock market?

You may know the meaning behind terms “bull” and “bear” market—but do you know how to spot a potentially high-yielding stock from one that is overpriced? Before diving headfirst into the market based on media frenzy alone, Wrenn suggests taking time to learn the basics of investing and the different tools you can leverage to do so, including mutual funds, ETFs, securities, bonds, treasuries–and what they entail in regard to other market conditions.

Start reading credible media outlets like The Wall Street Journal and Barron’s daily to familiarize yourself with expert analyses of the market and how it is impacted by the macro-economy. You will be surprised at how quickly you’ll start to understand critical investment terminology, like options, moving averages, market capitalization, spread, and price-to-earnings ratio. Though stock analysts make a living tracking and predicting the movement behind securities, spotting the real winners in the stock market often rests on spotting a good stock pick—before it hits the headlines.

Can you can commit for the long haul?

Stocks provide an average nine percent yield over the long term, giving them more promise than other investments in building wealth–including real estate. But, to realize those kinds of yields, you need to be able to stomach the fluctuations of the market and commit for the long haul. Though there are day traders who have scored major profits with rapid trading (and some online brokerage houses allow you to execute trades for about $8), it’s unlikely that you’ll be able to react to constantly changing market conditions–or that your trade will be placed at the exact time of day and price you want–as a novice investor.

For this reason, it’s important to stay committed for the long haul when it comes to investing. Be prepared to ride the ups and downs of the market in order to get the best return on your investment.

Did you miss last week’s #SavingsAndDebt chat? We talked about building your savings while paying down debt, as well as how various situations affect your credit score in different ways. #SavingsAndDebt was co-hosted by Credit.com along with experts Teresa Dentino and Gerri Detweiler.

Teresa Dentino pioneered financial education for women thirty years ago when she became one of the nation’s first women stockbrokers. Since then, she has achieved many firsts in advancing women-centric financial literacy. In 2001 she founded The Financial 411 (www.thefinancial411.com), the first ever exclusively educational platform for women. You can read more about Teresa here.

Gerri Detweiler is the Director of Education at Credit.com, a leading personal finance website which empowers consumers to take control of their debt. She has devoted her 20+ year career to helping consumers find reliable answers to their credit questions. You can read more about Gerri here.

A big thank you to all who participated and supplied prizes including Teresa Dentino, Gerri Detweiler, Zilchworks, and Rhyme & Reason Clothing! Five lucky winners walked away with prizes! Hope to see everyone at the next chat!

]]> http://gogirlfinance.com/lifestyle/heres-what-you-missed-at-our-savingsanddebt-twitter-chat/feed/ 0 http://gogirlfinance.com/lifestyle/heres-what-you-missed-at-our-savingsanddebt-twitter-chat/ http://feedproxy.google.com/~r/GoGirlFinance/~3/g6uQOnR5Zqg/ http://gogirlfinance.com/money/invest-with-confidence-a-step-by-step-guide-for-new-investors/#comments Mon, 13 May 2013 11:30:29 +0000 Guest http://gogirlfinance.com/?p=8169

One of the biggest misconceptions people have about investing is that they have to know everything about the market before they begin. Truthfully, I can see where that feeling comes from. Investing terminology is not user-friendly, and the sheer number of accounts, investment types, and philosophies can be overwhelming.

Don’t let analysis paralysis stop you from investing for retirement. Start investing with confidence by following these steps.

Open the right accounts

The first place to start is with a 401(k). If your employer matches any part of your contribution, you are literally getting free money. To set up this account, talk to your HR reps. They’ll let you know how to join and how much to invest to get the employer match. Also, ask how long you have to stay in your job to get vested.

If your workplace doesn’t have a 401(k) program, or you have extra money at the end of the month to invest, open a Roth IRA. Most likely, you can contribute $5,500 per year (as of 2013), and you can take money from it tax-free in retirement.

To open this account, choose a broker, such as Charles Schwab or TD Ameritrade. You can apply for a Roth IRA online, or you can go into a branch to set it up.

Know your risk tolerance

Once you know where your money will go, you must know yourself. In the investing world, understanding your risk tolerance shapes everything about the way you invest. Many people think of risk as “I’ll lose all of my money.” They become highly conservative investors and miss the REWARD part of the risk-reward relationship.

Instead, think of risk as the spectrum of return you might get. Here are three examples:

• If you choose a conservative investment like a bond, you might see returns ranging from -3% to 5% over the course of a year.
• If you choose a moderate risk investment like an index fund, you might see returns between -10% to 20%.
• If you choose a high-risk investment such as an individual stock, you may see returns as wide as -20% to 50%.

There is virtually no chance you’ll lose your entire savings while investing. There’s no need to become stock picker, but if you invest too conservatively, your real risk is not being able to retire!

Determine your asset allocation

Once you know your risk tolerance, you can create a portfolio of assets to meet that risk.

For the average 30-something investor with a moderate risk profile, here’s a healthy mix:

• 50% U.S. Stock
• 20% Foreign Stock
• 20% Bonds
• 10% Cash

For a breakdown of your optimal asset allocation using your real age, risk profile, savings, and goals, use this financial calculator.

Pick your Investments

Now that you know your asset allocation, you can buy investments to match. Good starter investments are target-date funds and index funds.

In a target-date fund, you choose one fund with a year that corresponds to the year you plan to retire (say, “Awesome Broker Fund 2050” if you plan to retire in 2050), and the fund manager does all the work for you. They choose investments that optimize your risk and asset allocation throughout every stage of your life.

If you want a little more control, choose index funds. Index funds follow the movement of a particular market index, like the S&P 500 (the top 500 publicly traded companies in the U.S.).

You’ll never “beat the market” but you’ll generally “meet the market.” That’s a healthy place to be, seeing as how the stock market has returned 8% on average since it opened in the 1920s.

To follow the asset allocation we talked about above, aim to invest 50% of your investment dollars in a total U.S. market index fund, 20% in a world market index fund, and 20% in a bond index fund and keep 10% of your money in cash.

Start small with investing

When you’re just starting out, putting big chunks of money into the great unknown is scary. Luckily, it is more important that you get into the habit of investing rather than focusing on the exact dollars you’re putting in each month.

You can get started in index funds and target-date funds for $100 or less, depending on your broker. If you’re on a small budget, start with one investment in your ideal portfolio. Then the next month, pick another.

The Bottom Line

You don’t need to know everything about investing to get started. You just need to set up your accounts, know your risk tolerance, apply a good asset allocation, and consistently contribute to your future. And if the mood strikes you later to invest in individual stocks, take on more risk, or to learn the nitty-gritty mechanics of mutual funds, go for it. That happy 70-year-old version of yourself thanks you from her water aerobics class!

About the Author

Leah Manderson is a personal finance blogger and aspiring Certified Financial Planner. Sign up for her free newsletter for more tips on how to simplify your financial life.

It can be hard to think of the end of your life when you’re in the middle of living it.

No one ever expects to get fatally ill or end up in a car crash. But if the unthinkable happens, it will be devastating for those you leave behind. Not only are they grieving, but they may face a host of confusing legal and financial decisions about your property.

It’s important, then, to take time while you’re healthy and capable to put your finances in order and your wishes in writing.

The Basics on End of Life Financial Planning

To start out with, it’s important to have two types of wills and life insurance.

The first type of will is the one we all think of: it lets the executor of your estate (even if that estate is just one checking account) know who your heirs are and how your property should be divided. Different states and countries have their own rules about how your property is divided if you have no will, and sometimes the state is not obligated to notify your next-of-kin about all your accounts. For the benefit of your heirs, it is important to have this all spelled out.

You should also have a living will in place, which gives instructions should you be incapacitated. For example, if you are in a coma, do you want to be kept on life support? For how long? Who is responsible for making your medical decisions? Talk with a lawyer and make sure you have your wishes thoroughly outlined.

Finally, you should have life insurance. Rebecca Z., an insurance agent with State Farm, recommends thinking about three things in particular: medical and death expenses, dependants, and debt.

The average funeral in the United States costs around $15,000, so your life insurance should be enough to cover those costs, as well as have a cushion to pay for any end-of-life medical expenses. If you have anyone dependent on your income, such as a spouse or children, make sure you also have enough insurance to replace it for two years. Finally, if you have any debt, such as student loans, have enough life insurance to cover those costs, otherwise your next-of-kin will be stuck paying them out of pocket.

Prepping Your Online Accounts

Most email, social media, and online banking companies will not give out passwords to next-of-kin, so its important to have a list of accounts that you hold and their passwords. You should also include information on bills that are automatically paid from your accounts and airline accounts if you have frequent flyer miles.

Digital property has also complicated inheritance issues in recent years. Many people now have invested significant money in ebook, music, and video libraries, but most of these companies do not recognize your right to will your account to an heir. In these cases, it is better to pass on the actual device you use to access it, such as a computer or e-reader, as well as your passwords to a specific person.

Joint Banking

If you share bank accounts and you pre-decease your partner, he or she may be left with a lot of red tape to navigate. Many banks will not simply remove one partner’s name – to ensure proper IRS reporting, they are often required to close the joint account and reopen a new one in the remaining partner’s name. This requires the identifying numbers of all the accounts, as well as confirming the username and password for your online banking, so make sure both of you have this information.

It’s important to discuss this process with your bank long before it becomes an issue so both account holders understand how it works. As your account rolls over to a new name, you may lose access to withdrawals or online banking, or you may lose all your information on bills that are paid from the original account. Make sure you are prepared with alternate access to the account and a list of all automatic payments.

Retirement Accounts

Retirement accounts present different challenges than other bank accounts because of the way they are taxed. At age 59 ½, you can access the money in a standard IRA without paying a 10% penalty to the IRS. However, if your spouse or child inherits an account from you before that age and tries to roll it over into their name, this can be considered accessing the money and they will have to pay a penalty fee, in addition to taxes on it as income.

In this instance, have the account set up to become an “inherited IRA”; this will remain in your name until they reach the age of 59 ½, at which point it rolls over to their name and they can access it without penalty.

Other Assets

If you have a spouse that you intend to leave property, such as a house, stocks, or car, to, it’s always easiest to simply have the property in both names. This is much easier on the surviving partner; trying to prove inherited ownership of property requires showing the ownership documents, a marriage certificate, certificate of death, and working with a lawyer and notary to ensure that the transfer of property is legally recognized.

If you are leaving property to someone other than your spouse, have the details fully outlined in your will, along with any certificates of ownership that you have in your possession. Don’t rely on online accounts for this, as your heirs may have trouble accessing them: have the papers printed out and stored with your will.

When planning for your end-of-life, it can be difficult to think of every eventuality or to be sure that you have all the pieces in place that your heirs will need. It’s important to sit down with a lawyer and financial planner, as they will know what needs to be done and what information will be necessary. Many financial planners also have resources such as programs for safely storing your online and financial information that can prove invaluable.

For the sake of your family and loved ones, take advantage of the help they can offer before the unthinkable occurs. You’ll be glad that you did.

Organizing and securing finances is probably one of the most challenging projects you can take on. However, it’s also one of the most important ones. If you’re struggling to keep your finances and financial plan in order, below are some ideas to help you whip them into shape.

Get Your Financial Documents in Order

You have to have a good understanding of your financial history and your hope for your financial future if you’re going to get your finances organized. Knowing your past means keeping your tax documents secure. It means making copies of important receipts. Also, if you are in credit card debt, make sure that you have a good record of when your payments are due. Call up your credit card companies to see if you can get your interest rates lowered so that you can get out of debt sooner.

If you are currently trying to learn how to budget, then you can start by making a spreadsheet. This doesn’t have to cost you anything and can be created using pre-formatted documents in Excel. Track your spending, enter it in your spreadsheet, and you will automatically feel as if you are in control of your finances. Adjust it as needed every month and see if you can cut out any expenses. You can also utilize the envelope system, which is a great way to practice staying on a budget.

Lastly, speak to a financial planner about your future, and check your retirement accounts. Are you regularly contributing to them? Do you have a method of automatically funding them so you don’t forget? All of these tasks are very easy to put off, but I promise it’s one of those chores that only takes a few minutes to set up. Afterward, you’ll wonder why you didn’t do it sooner.

How to Clean Up Your Finances

It’s not enough to get your finances in order. You have to continue to keep them clean and maintained. The best way to do that is to update your budget every week. Then you can set up a time to regularly meet with your spouse (if you have one) to make sure that you are both contributing to your financial wellness.

Of course, there are many other methods that people use to organize their finances and keep their “financial house” in order. These are just a few ideas, so if none of them work for you, be sure to keep trying different systems until you find one that does.

How do you keep your finances in order? How did you develop your financial plan for the future?

For starters, Manisha recommends checking out the wealth of information here on GoGirlFinance.com to get educated about money (in fact, check the links at the bottom of his post to read some of our latest posts on this very topic).

How to budget without feeling restricted. 

Budgeting isn’t sexy and Manisha recognizes that it’s also important to not feel deprived when you’re trying to manage and pay down your debt. One tactic she suggests is using an “hourly rate” test to determine if an expense (or a splurge!) is worth it. For example, if you can make $15 an hour and want to buy something for $150, do the math. Is the item worth ten hours of your work? Do you want it “ten hours bad”?

Discipline, not just the lottery, can make you a millionaire! 

As you probably know 401Ks and IRAs accounts have special tax benefits that can hep you save for retirement. Here’s the exciting part – if you are 25 and save $5,000 each year in one of these tax-deferred vehicles, earning an average 7% return per year, by 65 you will be a millionaire. Yes, really!

For more tips from Manisha and Chelsea, check out the full episode here.

Also check out these posts from GoGirl Finance on paying down your student loans.

Everything You Need to Know about Money, Children and College

Tips and Tricks to Pay for Grad School

Planning for College? How to get Financial Help

Money 101 for the College Student: How to Manage Your Finances in College

Where to Find Scholarships for College

Are you trying to build a savings while paying down debt?  Join us, Credit.com, and experts Teresa Dentino and Gerri Detweiler for the GoGirl Finance and Credit.com Experts Twitter Party and get tips on saving while in debt. Prizes will be provided by Rhyme&Reason Clothing, Credit.com, The Financial 411, and ZilchWorks.

We will be co-hosting this party with Credit.com, Credit.com is a trusted source of financial information for consumers. Founded in 1994, and run by leading credit & money experts, Credit.com offers the latest news, advice, and free, easy-to-use tools to help consumers gain valuable insight, save money and make smarter financial decisions. Its flagship product, the free Credit Report Card has been recognized as an innovative consumer finance tool by CNN, Wall Street Journal, Fast Company, and others.

Teresa Dentino pioneered financial education for women thirty years ago at the time she became among the nation’s first women stockbrokers. Since then, and through the firm she founded in 2001, The Financial 411 (www.thefinancial411.com), the first ever exclusively educational platform for women, she has achieved many firsts in advancing women-centric financial literacy. Through conversations with thousands of women, combined with major academic study findings on women’s behaviors with finance and investing, Teresa has developed a systematic approach that imparts financial empowerment to women of any experience level. Her evidence-based coaching also prepares women for solo financial management brought upon commonly by widowhood and divorce. Teaching women the financial management skills they need to be informed decision-makers – whether they work with a professional adviser or not – is her forte. Teresa earned the FINRA licenses Series: 7, 3, 63, 65, and 24, achieving the highest designation of General Securities Principal, and the Certified Divorce Financial Analyst™ credential. Teresa also works with financial institutions to help them understand how to better serve the unique needs and behaviors of women clients. A popular speaker, writer and media guest, Teresa is available for speaking engagements and interviews or you may follow her on Twitter @thefinancial411.

Gerri Detweiler is the Director of Education at Credit.com, a leading personal finance website which empowers consumers to take control of their debt. She has devoted her 20+ year career to helping consumers find reliable answers to their credit questions. Gerri is a recognized expert on credit issues, and has been interviewed more than 3000 times by leading news outlets, including The Today Show,Dateline NBC, The New York Times, USA Today & Reader’s Digest. She also has co-authored five books, including Reduce Debt, Reduce Stress & Debt Collections Answers: How to Use Debt Collection Laws to Protect Your Rights, and is the host of TalkCredit Radio.

A full 10% of the price of every garment you purchase from Rhyme&Reason goes directly to the charity of your choice. That’s not 10% of profits or 10% to a celebrity spokesperson, but a full 10% right off the top of your purchase price, straight to the charity of your choice. You Do Good with every purchase.

So come join us, May 9, and find out all about #SavingsAndDebt!

When: May 9, 2013
Time: 8:30pm EST
Hosts: @GoGirlFinance, @CreditExperts, @TheFinancial411, @RhymeClothing
Hashtag: #SavingsAndDebt

Don’t forget to RSVP with your Twitter handle to be eligible for prizes (see the linky below). Rhyme&Reason Clothing will be giving away several gift cards as well as software from ZilchWorks and copies of Reduce Debt Reduce Stress and eBook Women Get Financially Fit! You must be following all hosts and be present (and tweeting!) for the party in order to qualify for prizes. Winners will be picked at random using random.org and will be announced during the party. You will receive a Direct Message requesting your contact and mailing information.

For most women, estate planning ranks right up there with a root canal – it’s painful but necessary. If you truly want your loved one’s inheritance protected at the time of your death, you must take some time now to review what plans, if any, you currently have in place and what you want to leave behind. Failing to plan will likely leave a great burden for your loved ones as well as tie up your estate for months or years in court, potentially diminishing any assets or property left behind.

First and foremost, seek the professional guidance of a capable estate planning attorney. They are experts in the legal aspects of estate planning and must stay up-to-date with any changes made to legal statutes. They will ensure that all your wishes are legally sound and carried out to the fullest extent of law. They have a wealth of experience in dealing with estate and inheritance issues and will advise you on the best way to distribute property to your heirs. Remember, just as every person is unique unto themselves, each estate is completely different and should be treated as such. Beware of cookie cutter solutions. Professional guidance at this stage is essential.

Even so, estate planning isn’t just about what happens after your death. It involves what happens to you if you are incapacitated and unable to make decisions for yourself and your family. That being the case, there are certain items every woman should consider having in her estate plan.

Estate Planning for Women: Drafting A Will

This is the most common and important of all documents you create. Without it, the laws of your state of residence, and not necessarily your wishes, are enforced when distributing assets. Even more importantly, a will allows you to designate guardianship decisions for your minor children. When creating a will, you must clearly identify the document as a will and name the executor of your estate. Your executor is responsible for carrying out your final wishes as outlined in the will. Additionally, you must clearly state your wishes for your children, assets, and property.

A Plan for Medical Decisions

In the event that you become incapacitated, what medical procedures do you want performed? Is there a certain point in which you would prefer treatment stopped all together? An Advanced Directive for Medical Decisions, which is similar to a Living Will, can address these issues well ahead of time. Without something concrete in writing, clearly stating your wishes, you will not have the option to chose who makes end of life decisions for you. Remember, once you are incapacitated, it’s too late!

A Power of Attorney

Like the Advanced Directive, a Power of Attorney (POA) is essential in the event of an unforeseen tragedy. If you are not able to make financial decisions for yourself, you need to know that someone you trust will take care of your financial affairs. After all, who will take care of your pets, pay your bills, see that your medical insurance is properly filed, and make sure your minor children are cared for? A POA will allow you to assign someone you trust to oversee those issues.

A HIPAA Release

You may be aware of the many new laws governing the release of medical information. Imagine for a moment your loved one is desperately trying to coordinate with your doctors and insurance to provide you with much needed care but can’t get the necessary medical forms. That’s a headache no one wants, especially when your life may be on the line. Prevent the confusion and take care of this problem before it arises.

Remember, estate planning involves much more than deciding who gets your jewelry when you’re no longer around. It also involves thinking about and planning for all the things that could happen to you and those you care about while you’re still alive, even if you’re incapacitated.

In my financial planning work with women, if a client doesn’t have an up-to-date estate plan, it is always the number one priority that I tell them needs to be addressed.

Being a lawyer used to be seen as a direct and sure path to permanent success and financial security, but thanks to skyrocketing tuition costs and daunting job prospects, going to law school is now fraught with financial concerns that might make you think twice about what you really want out of a law degree.

The Reality About Law School

In an article last year, the Wall Street Journal claimed only one out of two newly graduating lawyers would be gainfully employed as a lawyer within nine months of receiving a degree. Keep in mind that not all lawyers pull in high salaries, but also that this data does not include employment in other fields where a law degree is desirable but not required.

Outside of Tier 1 schools, which come with a healthy network of connected alumni, the odds of gaining a lucrative position fall even further. Between governmental budget freezes, older lawyers putting off retirement, and an economic crunch that means people have less money available for legal services, avenues for employment have narrowed considerably for young lawyers. In addition, new law schools and growing law school class sizes have meant more lawyers being produced.

How Much Law School Really Costs

According to US News & World Reports, law school grads carry an average of just over $100k in debt. On a 10-year repayment plan at current rates, that’s a $1200 monthly payment. Yes, income-based loan repayment programs can lower that figure (to 10% of your adjusted gross income), but that means you’ll be repaying this debt for up to 25 years.

If you can’t find a job as a lawyer–or at all–you still have to pay the loan back. Even if you go bankrupt, student loans are not dischargeable, meaning you could lose everything else and find a percentage of any money you’ve earning garnished to pay back the debt–and that includes disability or Social Security payments. There is also no time limit on how long the government can pursue legal action; unless you pay them faithfully, these loans are never going away.

Last year, several suits lodged by law school grads against their schools were dismissed for various reasons, the most common being a form of ‘caveat emptor’: buyer beware. Although job placement rates at many schools were shown to be skewed by selective reporting and even school policies, those entering the costly professional school are expected to dig deeper and be aware of the risk.

Before you sit for the LSAT, it’s worth taking a second look at both your prospects and your motivations in becoming a lawyer. If you’re under the impression that going to law school will set you up for a well-padded life, it’s important that you acquaint yourself with the current realities of the field because more than ever, pursuing a law degree is a lifelong commitment, financially and otherwise.