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Tuition discounts: The price of free money

Free Money

Law schools are giving away more money to students than ever before. But that’s not necessarily good news for you today or for tomorrow’s law students. Here’s why.

Most law students receive some form of financial aid. In 2015, PreLaw Magazine calculated that the average tuition discount for law school was 25 percent off the original price, amounting to $1.12 billion in scholarships during FY 2013-2014.

Some schools even discounted more than half of their advertised tuition. That should be a great prospect for all law students. Free money is great since more free money means fewer loans you have to pay back and greater purchasing power.

But Bloomberg pointed out that fewer applicants and the greater amounts in tuition discounts to attract the dwindling amount of revenue-generating students is “an increasingly urgent threat to the business model underlying legal education in the United States.”

The ABA Task Force on the Financing of Legal Education noted that to increase revenue generation, admissions offices have expanded, as have many law school financial aid offices, and have become the front lines for revenue generation.

Not only has the expansion of admission office and financial aid offices increased the cost for law schools, but merit and recruiting scholarships have increased the cost as well. The ABA task force calculated that the discount rate has increased from an average of 12 percent in 1990-91 to 20 percent in 2009-2010. PreLaw Magazine’s analysis above only shows that the discount rate is continuing to grow.

Again, growing discounts should be great for law students, right? In reality, the discount rate is deceiving. Despite the increasing discount rate, U.S. News and World Report noted that 85 percent of law graduates boasted an average debt load of $98,500.

According to an ABA Journal article, “The Law School Bubble,” this discount rate leads to some students graduating with little or no debt, but a much larger group of graduates with considerable debt. This may be because despite the growing discount rate, Law School Transparency reports that the average private law school tuition is 2.6 times more expensive than in 1985 after adjusting for inflation; the average public law school tuition is 5.5 times as expensive.

Instead, the greater financial effort to recruit students by law schools may create a positive feedback loop in increasing the costs of law school and pulling resources away from students once they enter law school. Students may find they’re not getting the best deal and may in fact be losing purchasing power in the long run by not going to a school that would best prepare them for a career.

Current law school applicants and students are being told their tuition is discounted, when in reality, law school tuition has skyrocketed past the rate of inflation (and in turn, the rate of increasing pay) and thus causing students to borrow more and repay less. Future generations of law school students may find themselves with a lot of debt but not a lot of options to pay for it. There can be a solution though.

ABA Law Student Division Chair Kareem Aref has launched the DREAM Initiative, dream. And as chair of the Law School Division’s Education Cost Committee, I’m working with other law students to figure out how to make education more accessible and affordable, not just now, but also in the future.

If you’d like to join us to help figure out ways to decrease the cost of education in law school, email me at

SAMUEL CHANG is a 2L at University of California Hastings College of the Law in San Francisco.

Student Lawyer Student Lawyer magazine provides guidance on educational, career, and related issues for ABA Law Student Division members and other subscribers. It is published four times a year by the Law Student Division of the American Bar Association. Student Lawyer is available online to members of the ABA Law Student Division and to print subscribers.