I am starting out in life as a lawyer/Islamic finance postgraduate with no debt, and I would appreciate help and advice with regards to my future career choices and personal finances.
June 12, 2010 8:13 AM Subscribe
I'm a 24 year old law graduate. I am currently chambering with a law firm and doing a postgraduate degree in Islamic banking/financing. I have no debt. How do I make the best of my situation? Please advise me how I may plan and start my life properly, from the perspective of both personal finance and professional work. I would also appreciate being advised on how to invest, or save, or acquire assets. To sum it up: "If you could start off your life from my position, how would you do it, both professionally and financially?"
I am a 24 year old male law graduate, and I am currently chambering (i.e. doing legal training) in a law firm. At the same time, I am just beginning (the equivalent of) a recognized Masters degree in Islamic banking and finance, which would end in about 1.5 years, or 2+ years the industry training. By the time I end my postgraduate studies, I would be 25 or so.
I have no idea where life will take me, but I hope to be able to work overseas or in an international bank -- though I am sure that my postgraduate degree, being fully accredited and backed by my country's central bank, will be very helpful. To whatever extent that I can, I would prefer not to practice law, as my father is a lawyer, and I grew up fully appreciating the difficulties of being a practicing lawyer. (i.e. Being a lawyer is my backup plan; if all other plans do not work, I will still be professionally qualified to practice as a lawyer, and I did fairly well so to become a lawyer would not be a problem.)
Regarding my finances: I have no personal liabilities, other than an old loan for a engineering degree which if converted to US dollars amounts to approximately $30,000. (The engineering degree didn't happen, as though I did very well in school and in the sciences, I became disenchanted with engineering when I entered university, and switched to law after my first year mostly because of the flexibility of a law degree). I am blessed as my father could afford to pay for me through university. However, regarding the study loan, I have seeded an investment account with some small capital, and its monthly dividend is enough to automatically pay off the loan's monthly installment until all of it is paid, so the loan is not too worrisome a matter.
I do not have a car, or a house, nor do I plan to get either for now. (The car, maybe in one or two years, but the house, definitely much later.) I have only one bank account, in which there is currently nothing. My siblings and I are currently living with our parents (in my culture, it's considered rude to depart from home, for both males and females, unless you marry or must work in some faraway place) so at least I do not have to worry about rent, bills, car fuel, etc. I also have no plans to marry or have children anytime soon, because I'm prioritizing my career and financial stability first.
As for income: I am currently receiving an allowance from the law firm, which though not a very handsome sum, is more than enough for me, as I do not spend much. (More on my spending habits below.)
My spending habits: I am not so frugal, but I'm not a spendthrift either. I splurge only on the occasional coffee and big meals with friends, but other than that I don't spend much money elsewhere. When I was younger, I used to love gadgets -- e.g. PDAs, phones, iPods, game consoles, etc -- but having grown up a bit I realized that these things usually bring me no joy after the first few months fade away, so these days I make calculated spending decisions and buy only those things that I know I will last and enjoy repeated use from. (E.g. guitars, non-branded clothes, etc. MetaFilter's financial advice really helped me out -- I learned how to save by thinking of a purchases as a matter of cost versus hourly income, and the "$1 per use" value of an item, etc.)
About me: I enjoy the occasional movie, but I don't watch TV. (I haven't sat on the TV sofa for several years.) But I love books, and I read a lot of non-fiction. In my spare time, I also study languages, partly out of passion, and partly because I'd like to use it for work. (I can read Japanese well, and I already qualify for JLPT1, but I will take the test sometime later as I don't have the time. Who knows, maybe with it I can get finance work in Japan?) I've done programming work before, and though I'm no John Carmack, I'm quite alright. I am satisfied with all I personally have at this point (my guitars, my effects pedal, my computer) and there is really nothing else I want.
I am not hungry for money. So when I actually start working, I wouldn't mind starting off with a medium-sized pay, but I'd love to be able to maximize what I can do with that money through investments, savings, or asset acquisitions as soon as I can, and then, as the years fly by, do bigger things with my increased pay.
i.e. I would love to start off life intelligently, and I would like the smart people of MetaFilter to help me out. I'd be pleased to receive any kind of advice -- e.g. arguments like "a house is not an asset" , books to read, possible related job opportunities, investment methods, assets to buy, what bank products to look out for or how to employ my bank account properly, ways to steer my life professionally, etc. Anything goes. I am here to learn, and I will lend an ear to all advice. If I must buy books or do things to read, then I will go out and buy those books and do whatever else I have to do. (But I am not that smart financially, so if your advice is very technical advice, I will try my best to understand but I would also appreciate simple analogies to start off with.)
To sum it up: "If you could start off your life from my position, how would you do it, both professionally and financially?"
I'm also available for followup at [mef.anon@gmail.com].
[Note to Metafilter mods: I'm posting this anonymously, because I'd rather prefer not to attach information regarding my personal life/finances/professional career to my username. If this question is approved, please delete this paragraph.]
I am a 24 year old male law graduate, and I am currently chambering (i.e. doing legal training) in a law firm. At the same time, I am just beginning (the equivalent of) a recognized Masters degree in Islamic banking and finance, which would end in about 1.5 years, or 2+ years the industry training. By the time I end my postgraduate studies, I would be 25 or so.
I have no idea where life will take me, but I hope to be able to work overseas or in an international bank -- though I am sure that my postgraduate degree, being fully accredited and backed by my country's central bank, will be very helpful. To whatever extent that I can, I would prefer not to practice law, as my father is a lawyer, and I grew up fully appreciating the difficulties of being a practicing lawyer. (i.e. Being a lawyer is my backup plan; if all other plans do not work, I will still be professionally qualified to practice as a lawyer, and I did fairly well so to become a lawyer would not be a problem.)
Regarding my finances: I have no personal liabilities, other than an old loan for a engineering degree which if converted to US dollars amounts to approximately $30,000. (The engineering degree didn't happen, as though I did very well in school and in the sciences, I became disenchanted with engineering when I entered university, and switched to law after my first year mostly because of the flexibility of a law degree). I am blessed as my father could afford to pay for me through university. However, regarding the study loan, I have seeded an investment account with some small capital, and its monthly dividend is enough to automatically pay off the loan's monthly installment until all of it is paid, so the loan is not too worrisome a matter.
I do not have a car, or a house, nor do I plan to get either for now. (The car, maybe in one or two years, but the house, definitely much later.) I have only one bank account, in which there is currently nothing. My siblings and I are currently living with our parents (in my culture, it's considered rude to depart from home, for both males and females, unless you marry or must work in some faraway place) so at least I do not have to worry about rent, bills, car fuel, etc. I also have no plans to marry or have children anytime soon, because I'm prioritizing my career and financial stability first.
As for income: I am currently receiving an allowance from the law firm, which though not a very handsome sum, is more than enough for me, as I do not spend much. (More on my spending habits below.)
My spending habits: I am not so frugal, but I'm not a spendthrift either. I splurge only on the occasional coffee and big meals with friends, but other than that I don't spend much money elsewhere. When I was younger, I used to love gadgets -- e.g. PDAs, phones, iPods, game consoles, etc -- but having grown up a bit I realized that these things usually bring me no joy after the first few months fade away, so these days I make calculated spending decisions and buy only those things that I know I will last and enjoy repeated use from. (E.g. guitars, non-branded clothes, etc. MetaFilter's financial advice really helped me out -- I learned how to save by thinking of a purchases as a matter of cost versus hourly income, and the "$1 per use" value of an item, etc.)
About me: I enjoy the occasional movie, but I don't watch TV. (I haven't sat on the TV sofa for several years.) But I love books, and I read a lot of non-fiction. In my spare time, I also study languages, partly out of passion, and partly because I'd like to use it for work. (I can read Japanese well, and I already qualify for JLPT1, but I will take the test sometime later as I don't have the time. Who knows, maybe with it I can get finance work in Japan?) I've done programming work before, and though I'm no John Carmack, I'm quite alright. I am satisfied with all I personally have at this point (my guitars, my effects pedal, my computer) and there is really nothing else I want.
I am not hungry for money. So when I actually start working, I wouldn't mind starting off with a medium-sized pay, but I'd love to be able to maximize what I can do with that money through investments, savings, or asset acquisitions as soon as I can, and then, as the years fly by, do bigger things with my increased pay.
i.e. I would love to start off life intelligently, and I would like the smart people of MetaFilter to help me out. I'd be pleased to receive any kind of advice -- e.g. arguments like "a house is not an asset" , books to read, possible related job opportunities, investment methods, assets to buy, what bank products to look out for or how to employ my bank account properly, ways to steer my life professionally, etc. Anything goes. I am here to learn, and I will lend an ear to all advice. If I must buy books or do things to read, then I will go out and buy those books and do whatever else I have to do. (But I am not that smart financially, so if your advice is very technical advice, I will try my best to understand but I would also appreciate simple analogies to start off with.)
To sum it up: "If you could start off your life from my position, how would you do it, both professionally and financially?"
I'm also available for followup at [mef.anon@gmail.com].
[Note to Metafilter mods: I'm posting this anonymously, because I'd rather prefer not to attach information regarding my personal life/finances/professional career to my username. If this question is approved, please delete this paragraph.]
Develop your empathy. Connections to other humans are an important thing to accomplish. If you aren't in love, you should probably consider volunteering to help people or animals that fill you with joy.
posted by amtho at 8:25 AM on June 12, 2010
posted by amtho at 8:25 AM on June 12, 2010
I am satisfied with all I personally have at this point and there is really nothing else I want.
You are lucky to realize this; it will save you much time in chasing after things you think you need or desire. As amtho suggested, philanthropy in time and money will bring you emotional connections, but it will also help you identify as a citizen of the world in all its joys and failings, and not just a member of your particular socioeconomic culture. It's easy to fall into the thought that just a little more money will let you relax about finances, but there's never an end to it because each jump up brings new justifications for wanting more.
posted by catlet at 8:59 AM on June 12, 2010
You are lucky to realize this; it will save you much time in chasing after things you think you need or desire. As amtho suggested, philanthropy in time and money will bring you emotional connections, but it will also help you identify as a citizen of the world in all its joys and failings, and not just a member of your particular socioeconomic culture. It's easy to fall into the thought that just a little more money will let you relax about finances, but there's never an end to it because each jump up brings new justifications for wanting more.
posted by catlet at 8:59 AM on June 12, 2010
Easy enough, and you are on the right track.
Here's what I'd do if I were in your situation. I would work on paying of my student loans, building up an emergency fund, and saving for retirement.
First and foremost, does your law firm offer matching for a 401k. If so, put in the maximum every month, actually you should start saving about 10 to 15% of your income for retirement.
Next, start building an emergency fund. You don't have to do it quickly, but figure out how much it would cost you to live without a job for 6 months and save that much. Keep it liquid and in a high interest (yes, I know, kind of funny in these times) bearing account- about 1 1/2 to 2% is the bst you are going to find these days, but don't use it unless it's, well, an emergency.
After that, figure out how much money is left over, after all of that, and put anything extra toward your student loan. Unless you have a 0% interest rate, you should try and pay that down as quickly as possible. The only point when it becomes smart not to pay more than the minimum is when the interest you are paying is less than $2,500, what is deductible on your taxes. However, if you make more than 50k, or whatever the "magi" amount now is, then pay it off.
Don't be frugal to the point of exclusion though. While it's good to have a financial plan and stick to it, it sounds like you are in a pretty good spot here and should enjoy some things (especially if the hours you work are as bad as I've heard).
posted by TheBones at 10:06 AM on June 12, 2010
Here's what I'd do if I were in your situation. I would work on paying of my student loans, building up an emergency fund, and saving for retirement.
First and foremost, does your law firm offer matching for a 401k. If so, put in the maximum every month, actually you should start saving about 10 to 15% of your income for retirement.
Next, start building an emergency fund. You don't have to do it quickly, but figure out how much it would cost you to live without a job for 6 months and save that much. Keep it liquid and in a high interest (yes, I know, kind of funny in these times) bearing account- about 1 1/2 to 2% is the bst you are going to find these days, but don't use it unless it's, well, an emergency.
After that, figure out how much money is left over, after all of that, and put anything extra toward your student loan. Unless you have a 0% interest rate, you should try and pay that down as quickly as possible. The only point when it becomes smart not to pay more than the minimum is when the interest you are paying is less than $2,500, what is deductible on your taxes. However, if you make more than 50k, or whatever the "magi" amount now is, then pay it off.
Don't be frugal to the point of exclusion though. While it's good to have a financial plan and stick to it, it sounds like you are in a pretty good spot here and should enjoy some things (especially if the hours you work are as bad as I've heard).
posted by TheBones at 10:06 AM on June 12, 2010
"However, regarding the study loan, I have seeded an investment account with some small capital, and its monthly dividend is enough to automatically pay off the loan's monthly installment until all of it is paid, so the loan is not too worrisome a matter."
Just out of curiosity, how much is your monthly dividend? Most students I know pay a few hundred a month in loans and I'm dying to know how much your dividends really are and where the heck you are investing if it covers your full student loan!
As for advice...well, I'm 27. I was fortunate enough to have school entirely paid for and have zero debt. I have had average paying jobs for the past few years and am now making close to $70k with work and my side projects. I've also been trying to sock away 10-20% in my 401k and savings every year and also invest in some mutual funds.
What you might want to consider doing is invest your money in some side business projects that you can grow into real revenue over time. If you are successful, your rate of return could be MUCH higher than any other option out there for investments, plus you will gain some solid experience and hopefully have fun.
posted by Elminster24 at 10:51 AM on June 12, 2010
Just out of curiosity, how much is your monthly dividend? Most students I know pay a few hundred a month in loans and I'm dying to know how much your dividends really are and where the heck you are investing if it covers your full student loan!
As for advice...well, I'm 27. I was fortunate enough to have school entirely paid for and have zero debt. I have had average paying jobs for the past few years and am now making close to $70k with work and my side projects. I've also been trying to sock away 10-20% in my 401k and savings every year and also invest in some mutual funds.
What you might want to consider doing is invest your money in some side business projects that you can grow into real revenue over time. If you are successful, your rate of return could be MUCH higher than any other option out there for investments, plus you will gain some solid experience and hopefully have fun.
posted by Elminster24 at 10:51 AM on June 12, 2010
It sounds like you're doing pretty well already.
I'm only 25 and I'm sure I make much less than you, but I think the best financial advice is simply to live way beneath your means. In my retirement account I have a handful of index mutual funds that I think have the right balance of growth vs. risk. I automatically deposit 10% of my pay every month in this account. If I were you I would save and pay down debt and all that, but I would also save up some money to travel somewhere cool.
The fact that you love to learn and read is great. TV is mostly mind rot - I've lived happily without one for years (if I want to watch a sports game or something there are always bars/friend's houses).
The advice about volunteering is good too--maybe you could figure out a way to help others with your legal knowledge?
But most importantly though, I would say to create the life that you want to live. Not Mom or Dad, or people on Ask Mefi for that matter. Too many friends of mine are desperate to be on the career, owning a home, having a family track--which is all fine, if you want it--because they feel that's what one ought to do at this point in life. There are other options, too.
Maybe it would help to write down 5 or so priorities in your life (or things you want to be priorities) and arrange your life from there. If learning languages and traveling are at the top, go do that. If something else is at the top, focus your time and resources on doing that.
The great thing about life is that there's no one way to live. Figure out what you want and go seek it out.
posted by squawk at 12:42 PM on June 12, 2010
I'm only 25 and I'm sure I make much less than you, but I think the best financial advice is simply to live way beneath your means. In my retirement account I have a handful of index mutual funds that I think have the right balance of growth vs. risk. I automatically deposit 10% of my pay every month in this account. If I were you I would save and pay down debt and all that, but I would also save up some money to travel somewhere cool.
The fact that you love to learn and read is great. TV is mostly mind rot - I've lived happily without one for years (if I want to watch a sports game or something there are always bars/friend's houses).
The advice about volunteering is good too--maybe you could figure out a way to help others with your legal knowledge?
But most importantly though, I would say to create the life that you want to live. Not Mom or Dad, or people on Ask Mefi for that matter. Too many friends of mine are desperate to be on the career, owning a home, having a family track--which is all fine, if you want it--because they feel that's what one ought to do at this point in life. There are other options, too.
Maybe it would help to write down 5 or so priorities in your life (or things you want to be priorities) and arrange your life from there. If learning languages and traveling are at the top, go do that. If something else is at the top, focus your time and resources on doing that.
The great thing about life is that there's no one way to live. Figure out what you want and go seek it out.
posted by squawk at 12:42 PM on June 12, 2010
This thread is closed to new comments.
That said your comment about a house not being an asset is actually fairly accurate for most people.
posted by dfriedman at 8:22 AM on June 12, 2010