Many Lawyers Mismanage Own Money

Many young lawyers don't want to believe this, as they contemplate seemingly fat salaries after years of student budgets. But their funds are limited. And they don't necessarily manage their money all that well.

"What I’m fighting is houses and cars," Thomas Haunty, the author of a book for young lawyers about managing their money, tells the Wall Street Journal Law Blog. "They want to buy a house in New York City, it’s ridiculous. They say, 'I don’t want to live in New Jersey.' But it competes with their ability to pay the debt off. I get them to see they have a limited supply of income. They have to look at the next 15 to 20 years. What happens when you get married? When you have to put your kids through college? I try to give them a scare."

Haunty, a certified financial planner in Madison, Wis., says many young attorneys are focused on debt—not surprisingly, since for many it can easily exceed $100,000 by the time they earn a law degree. But, after they consolidate their student loans to get the best terms and interest rate, they need to focus on saving, investment and spending as well as debt to get the most out of their money, he says. "You have to do all four at once—you can’t focus on one."