Budgeting for the Bar Exam

Bar study is stressful! I don’t have to tell you that. The long hours, the anxiety, the uncertainty… Especially now as the COVID-19 pandemic has been creating even more unpredictability than usual, it’s a good idea to start planning for unforeseen circumstances like exam dates getting pushed, and exams being cancelled. You know what else you should probably think ahead about? Finances. Now that almost nothing is going as planned, running out of funds is a real possibility for many bar students.

Did I mention studying for the bar is also super expensive? Well, it is. For many students, preparing for the bar exam is basically wading further and further into student loan debt—especially if you you’re fortunate enough to forego working while studying: lots of money pouring out, nothing coming back in.

Worse yet, sometimes students seem to equate high price tags with a better shot at passing. Any of these sound familiar?

“If my hotel room is luxurious and comfortable, I will sleep better and be more likely to pass.”

“If I purchase a high-priced bar prep. course, I will definitely succeed!”

“I need that $150 book because so-and-so used it and passed on their first try.”

Sure, I’ll admit, sleeping in 1,000 thread count sheets sounds better than tucking into a sofa bed in your brother’s living room the night before the exam. Eating take-out every night while you study likely really would save you some time. A new laptop is probably faster than your current computer. But how much of this stuff do you actually need? Obviously, that depends on your budget and your bar study plan. Bottom line: bar study is not a time to go crazy with added expenditures if you can help it.

Here is some advice for how to budget for your bar, and where you can cut costs and still get what you need to pass:

1. Start planning your bar finances as a 1L (or before)

Those federal student loan dollars won’t come in forever, and, after graduation, you won’t be eligible for student aid. That’s right. No federal student loans for bar study. What should you do? Start setting a little aside here and there before bar study so you won’t have to take on a higher-interest private loan after 3L year.

If you do need a private loan, know that your interest rate may be based on your credit score, so you should get that in order now if you can. First step: order a free credit report from each of the three credit reporting agencies at: annualcreditreport.com and check it for errors. Second step: make sure you’re paying all your bills on time (bill pay makes up 35% of your credit score).

2. Cut spending on some non-essentials (not all)

The first step is always to assess the damage. Here are some steps you can try before you begin bar study:

• Track your regular expenses for a month and see what you can cut
• Check grocery receipts and make a note of higher-priced items
• Download an app that compares prices across stores before making a big purchase
• Make a mental note of splurge tendencies and timing and impulse buys
• Consider quitting an expensive habit or activity while you study

Next, suss out essentials vs. indulgences. When it comes to this step, everyone has different priorities. Consider the following items. Ask yourself which of these fall into categories like: “must-have-to-function” versus “sounds nice, don’t need it”:

• Gym membership, yoga or fitness class
• Upgrades to your phone, laptop, tablet, or headphones
• Happy hours and/or dining out/take-out
• Social activities and outings
• Professional self-care: massage, manicure, haircut, facial (life coach, cat therapist)
• Monthly subscriptions: news apps, TV/music, magazines, Amazon Prime, CSA box

It’s not an either/or. You can make concessions and tailor your budget however you want. I’m not saying you should cut every modicum of delight or extravagance from your life. Enjoy time with your friends and factor in some entertainment, but do it according to a plan so you end up spending less.

3. Narrow down study aids

The bar students I work with are often overwhelmed with black letter law materials. They have a big box of books from their bar review course, a supplement their roommate swore by, three sets of commercial outlines, and two how-to-pass-the-bar guides. Do you need to buy all of this stuff? No. In fact, you shouldn’t.

There are several concise sets of full outlines that contain all the law you need to pass the bar exam. You can try out websites like Bar Essays, Lean Sheets, or Smart Bar. The point is, you should pick one set of outlines that seems the most user-friendly to you, and stick with it.

I’ve seen a lot of students spin their wheels and waste a lot of time checking and double-checking between multiple outlines. Don’t do this. Do your research before bar season starts, narrow it down, and choose your top favorites. You can also master the MBE using tools like Adaptibar. We’ve written about all of these tools for bar exam success on our blog, so check them out.

4. Make a credit card back-up plan

Credit card interest rates are high! For this reason, you always want to avoid carrying a balance on a credit card. If you think you can pay off your card in full every month, that’s great, you won’t pay any interest! However, if you don’t anticipate being able to do this, just know that the type of card you sign up for can make a big difference. Do your research to find the card that fits your needs best and know that opening and closing new accounts can also affect your credit score.

5. Consider working while studying

For many bar students, working is not so much a question as a necessity. However, even if you’re fortunate enough to choose whether to work or not, you may want to consider it if finances are a concern. The obvious pro here is that you’d get a paycheck while studying. The con? Potentially less time to study.

However, you can successfully work while studying. In fact, over the years, I’ve seen many students for whom working during bar prep is actually a better option.

Those include:

• Students who need a more structured schedule rather than open-ended study days
• Those who are easily bored or tend to procrastinate when given unlimited free time
• People who have several months to dedicate to part-time study (slow and steady wins the race!)
• Employees of part-time gigs with flexible hours and/or an understanding boss

A little flexibility can go a long way. So, if you’re working while studying, consider asking for a later start time several days per week, or see if you can finish early on Mondays and Fridays. Try to take the last few weeks right before the exam off if you possibly can.

No matter how you decide to financially gear up for the bar, it’s never too early to start. A little preparation now could go a long way toward cutting down the price tag on your ultimate bar experience, and (hopefully) helping you avoid too many high interest loans.