Concerned about DEBT - please help! (especially recent grads)

[wja91]

Hello friends!

I am in a serious pickle. I was accepted to USC (my dream program) and decided to defer to 2014. I am going to be paying for graduate school entirely through loans - no help from my parents. Ever since I wanted to be an OT, USC has been my dream school. I connect with their philosophy and believe that I would be presented with great resources and opportunities if I went there. However, the cost is insane. It is roughly $22,000 per semester. For the entire program, that comes out to be around $150,000 - before interest.

I have sought advice from anyone and everyone I know. I have found that I receive one of two thought processes:

1. Absolutely do not go to USC. Being in that much debt will prevent you from buying a house, a car, starting a family, etc. Go to a more affordable program. Which school you attend doesn't matter that much, it's about your job experience.

2. Absolutely go to USC. It is a once in a lifetime opportunity, and you will regret turning down your dream school forever. People manage to live comfortably with debt all the time, you will figure it out.


I am wondering what you all think about this. My parents are extremely against me going to USC. They want me to apply to Michigan schools (assuming I would even be accepted) and stay in state. At this point, USC is the only program I was accepted to.

I understand there are federal loan forgiveness programs and things such as IBR, but I would love to hear recent grads' take on all of this. Is the cost of USC really worth it? Or should I try to get into Michigan programs instead. Does debt really limit the way you want to live, or are my parents just being paranoid? Many people my age (21) are in the same situation as me, and they keep telling me it will be fine. But I don't want to be naive! I don't know what it's like to have to worry about paying for a house, car, kids, etc. I would really appreciate some advice from people within my profession.

Sorry for the long post. Thank you in advance!

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[Gemut]

Let me say first off congratulations on be accepted to USC, that in itself is a great accomplishment. The question you are facing before enrolling is one many wish they had faced prior to starting their MOT programs. It Is a question I am grappling with now and it is really an actuarial question requiring an in depth financial analysis that would be tailored to each school including all costs of attendance, not just tuition and books. To do this analysis justice an entire spread sheet going 20 years with accurate salary projections and corrections for inflation, earning potential without OT licensure and comparisons between earning potential of various OT programs would be helpful data. Little of this data is readily available or easily calculable.

I have done rudimentary back of the envelope number crunching to try and validate loans for OT grad school that I have found wanting upon recent rumination of the matter. For example, I considered the idea of a shorter program that gets my licensed a year earlier to be valued at $75k, the median amount of an OT's salary. The lifetime value of being licensed one year earlier may higher than that, and that's where actuarial analysis would be of use. Using this simple $75k as a baseline however, does that mean you can take on $75k more in loans? Of course not, because there are taxes, living expenses, and other unforeseen expenses that reduce that $75k down quite a bit. The real question is how much is one willing to dedicate toward loan service each year after licensure. This question allows you to work backwards from your personal comfort level to loan amount to program which could be afforded by that loan. Currently, a $50k student loan at the recently established 6.8% interest rate amortized over 10 years will be around $575 per month. Triple that and you are looking at $1725 per month, you could buy yourself a decent home for that. Of course it is not that simple as you must compare your earning potential and job satisfaction in an alternative career as well as other potential issues including burnout, family situation, residence, and other hard to calculate variables and you are left with quite a few imponderables. This does not even consider partial loan forgiveness for working with a charitable organization, special student loan repayment based on disposable income, and employee loan repayment programs that you mention in your post. Each of these options will reduce your take home pay while at the same time reducing your indebtedness and would have to be evaluated on a case by case basis.

On that note, the OT I volunteered with an OT that went to USC who is talented, capable, and very smart. Because he got scholarships, his indebtedness is less than the typical USC MSOT graduate. With that caveat, he still feels strapped by his $600 per month loan repayment on a $5k per month salary. Because he works as a school based OT and chooses to not work summers, his salary is less than a 12 month a year OT. Still, he has said he would probably have chosen a state school over USC given the financial burden. He had also gotten into CSC-DH, SJSU, Dominican, and SMU to give some perspective from one on the other side of those loans.

A good friend of mine decided to go to Columbia's midwifery Physicians Assistant program about 5 years ago. Because of the length of her program and the cost of living in NYC she accumulated $250k in debt in completing her degree. She now works as a hospital based midwife in NYC and her remuneration includes loan forgiveness but she insists she would not take on this level of indebtedness if she had to do it over again. Case studies aside, a handy rule of thumb to establish a personal cap on student loan indebtedness would be equal to one's earning potential in the entry level of one's chosen career. For an OT, that would be about $60k for the first year after licensure. Even if you blithely estimate a starting salary of $80k, $150 in loans seems like too much. Of course the second year of OT grad school presents more opportunities for scholarships but it would not significantly reduce the percentage of your indebtedness the way going to a state school in Michigan would. Not knowing your stats and experience it is hard to quantify your chances of getting into a state school. At 21, however, you have time on your side. Even if you waited two years to start school you would still be in a good place after graduation.

I am so glad you asked this question. I am currently enrolled in a program that begins in August but I am now reevaluating my decision based on a more thorough analysis. My program would leave me with about $75k in loans after graduation. By the above cited rule of thumb, I am right on the cusp. I am actually looking very closely at the CSU schools even though it would extend my studies and licensure by a year or more.

I am convinced that an actuarial analysis that could calculate living expenses, tuition costs, lost opportunity costs by waiting a year to begin grad school, quality of the school one is attending, among other variables and imponderables and it would be able to cogently distill these many factors and give you a number that is a red line for indebtedness. So far, I have not come across to this calculus but you could at least start crunching numbers on the back of an envelope. Good luck with whatever you decide.

 

[BHSUStudent]

You'd at least have to get a second job and live within your means to survive. 100k is pushing it, 150k is just too much though. And hopefully, you don't have any additional debt from say, your Bachelor's degree for example.

Unfortunately, in our society, the average "middle class" person has a masters degree and is drowning in debt.

 

[FutureOT2013]

I was in your exact position a little over 2 years ago. When I decided to become an OT it was USC or bust, all of my hard work and preparation were geared to get me into USC and I told myself money was not going to stop me. I got accepted and noticed I still had time to submit an application to SJSU so I would at least have that in my back pocket. Ended up holding out as long as I could and went to the new student orientation at USC, but once I sat and crunched the numbers all of the things I wanted to do after I graduated flashed before my eyes. This could stop me from buying a home or living a comfortable life financially and my decision on starting a family. This was a second career for me so I don't have all of the time in the world to pay this money back. Sarah Kelly ended up calling me personally to get my decision on the last day I could make my decision and I told her no. I will always live with this decision, but I was happy that they accepted me. Turns out SJSU was more competitive anyways and everything is fine right now. I should be certified early next year and ready to start my new career.

 

[OTtoBe2013]

Wja91---Does the 150,000 include room and board? How long is the program? I am in the exact same boat only I am a 27 year old who was recently accepted into an OTD program that is 120,000 for tuition and additional fees -- not counting room and board. The program is 3 full years. I have 30,000 saved and am able to borrow the rest at a 3% interest rate (much better than the 7.8). I am also going to live with my dad for free room and board. I will also get food stamps and a part-time job while in school. I should say that I only have a 3.2 gpa and am concerned that I will not be accepted into a program next year.

Even with all of this, I am completely on the fence about accepting my admissions offer. I too, would welcome any advice. I think if I do accept the offer I will plan on living dirt poor for the first few years after graduation and work as much as possible with the highest paid job to pay off the debt as soon as possible.

Thank you! Good luck with your decision Wja91

 

[BHSUStudent]

With all of that in plan, you could probably turn 120k into 90, making it more practical. Also look into scholarships of course, which could save you a couple more thousand. The 3% interest is good in the long run. Once you graduate you should get a full and part time job, continue to live within your means, and focus on paying down the debt for a few years (which you have already planned). Also look for non-profit or government jobs that offer loan forgiveness. SNFs tend to pay the highest, but that type of environment takes a certain type of person to handle the job. Your focus should be on paying down debt and gaining a financial leverage over the student loans. Once you get into the 60-70k range, you can relax a bit more.

 

[wja91]

Hi,

The program is 2 years and the $150k I estimated does include room and board and any other expenses. Actually, it would be closer to $170k.

Wja91---Does the 150,000 include room and board? How long is the program? I am in the exact same boat only I am a 27 year old who was recently accepted into an OTD program that is 120,000 for tuition and additional fees -- not counting room and board. The program is 3 full years. I have 30,000 saved and am able to borrow the rest at a 3% interest rate (much better than the 7.8). I am also going to live with my dad for free room and board. I will also get food stamps and a part-time job while in school. I should say that I only have a 3.2 gpa and am concerned that I will not be accepted into a program next year.

Even with all of this, I am completely on the fence about accepting my admissions offer. I too, would welcome any advice. I think if I do accept the offer I will plan on living dirt poor for the first few years after graduation and work as much as possible with the highest paid job to pay off the debt as soon as possible.

Thank you! Good luck with your decision Wja91

 

[BHSUStudent]

Hi,

The program is 2 years and the $150k I estimated does include room and board and any other expenses. Actually, it would be closer to $170k.

I am not sure why it costs that much. Maybe it is the living expenses, but that is insane (especially for a 2 year program). I'd imagine that the loan repayments would be around 1,500-1,900 per month depending on the the plan. I mean come on, that is close to half your income if you're making 50k per year. I personally would find a cheaper school.

Just fiddle around with a loan calculator and see what the results are. I put in 170k, did a 15 year repayment plan at 6.8% fixed interest. After everything is said and done, you would end up paying $271,631.63.

 

[c2902]

Some thoughts…

Correct me if I’m wrong, but as far as I know, new legislation states that subsidized loans are no longer available to graduate students. That means that loans start accruing interest as soon as they’re taken out, not after graduation. This is something to consider.

Correct - the Stafford Loans available to grad students are no longer subsidized, as of 2012, I believe. And if Congress doesn't get their rear in gear, the interest rate will be double what it used to be. So $150,000 for OT school seems extremely unreasonable.

 

[wja91]

Thank you very much for this insight and for sharing your personal experiences. My gut is telling me that having all of that debt will be super hard to deal with. I like having financial freedom and the thought of not having any "wiggle room" for 10-15, maybe even 20 years is definitely scary. I am definitely looking into more affordable programs. Do you know any friends who chose to go to more expensive schools and now regret it? My best friend is going to dental school at USC and that program is $100k per year (4 year program). She keeps reassuring me that it will be okay if I go to USC; I will still be able to live comfortably. I will just have to expand my repayment period so I can lower my monthly payments. But then I think...she will be starting at about $140k as a dentist where as I will be starting at around $60-70. When I bring that up, she makes the point that our ratio of debt to salary will be the same. Thoughts??

Some thoughts…

Correct me if I’m wrong, but as far as I know, new legislation states that subsidized loans are no longer available to graduate students. That means that loans start accruing interest as soon as they’re taken out, not after graduation. This is something to consider.

Also: life can get pretty expensive. I spend a lot of time budgeting and estimating the costs of OT school, but you always have less money than you think and school costs always seem to go up. Also…stuff just happens. Sometimes—school costs aside--the bills pile up at once. Registrations, renewals, service and “convenience” fees, hidden fees, etc. come out of nowhere. Your car might need an expensive repair, you might get a ticket or something you bought might break and can’t be returned. But it’s not all bad stuff—maybe the first year of OT school will be stressful and you’ll want to go on vacation during the summer. Maybe you’ll want to splurge on some shoes or go out for sushi or buy your friend a fancy gift for his birthday.

I guess the point of what I’m saying is that life is expensive and unpredictable and it’s good to give yourself some wiggle room. Though it’s doubtful that an OT who has gone through school, passed the boards and is doing what they love every day will look back and regret not going to a “dream school,” it’s almost certain that an OT starting their career might regret being $150,000 in the hole with a 60K salary and interest accruing every month. From my own personal experience, I once dreamt of attending NYU for undergrad. Like most people, the fun and excitement of living in New York City intrigued me. I was accepted, but after seeing the crazy price tag, I declined my spot. I graduated a couple years ago from a better school, am almost debt free and am 110% thankful that I made the decision. My advice would be to make financial load your priority when choosing a school. Instead of looking at it as if you’re turning down a dream, think of how many dreams you could accomplish if you were living with minimal or no debt.

 

[Sunny324]

Hi Wja91,

Have you checked out this calculator from finaid.org? http://www.finaid.org/calculators/loanpayments.phtml

Put your estimated debt figures in there and it will tell you what your monthly payment will be, how much you will pay in interest, and the salary recommended to be able to afford that amount of debt.

A rule of thumb is to not borrow more than your first year's expected salary post-graduation. The rationale being that owing more than 10% of your salary to debt greatly increases your chances of defaulting on that debt. There is room to wiggle here if you are fortunate, but $170,000 is WAY out of the ballpark.

My take: don't do it. That debt will hang around your neck and change your life forever. Every big decision you make will have to take that huge monthly payment into account.

There are plenty of OT schools to apply to in Michigan. Give them a shot!

 

[prodigiousflame]

agree with sunny

 

[CharacterZero]

Will you be receiving any financial aid (other than student loans)?

$170,000 seems like a lot - When I go to USC's OT site and add up the tuition, fees, and estimated book costs for the two year program it comes to $108,433.

http://ot.usc.edu/admissions/financial-aid/tuition-and-fees

Granted, you would still need to figure in living expenses (rent, food, transportation, insurance, etc) and account for a small increase in tuition, but that shouldn't add up to 60,000 over two years.

While 170,000 is a lot, you might rethink what it actually costs, and how you can reduce your living expenses. I know a lot of people say not to take out loans more than 10% of what your income will be, but I think you must also consider what standard of living you are willing to employ. I happily don't live on much now, but still have a nice place to live, don't stress over bills, and don't live paycheck to paycheck. I don't need an expensive home, a new car, designer clothes - so if I maintained my current standard of living, but was making 30,000 more a year as an OT, that 30,000 could go towards student loans (well maybe 25,000 so I can take a nice vacation!)

Let's say you make 65,000 just out of OT school (could potentially be more, and would certainly increase with experience). If you take maybe 25% out for taxes, you take home 48,750/year, or divide it by 12 and get 4062/month. According to the loan calculator in the above post, a $150,000 loan would require a monthly payment of $1726 over ten years, which would leave you with 2336/month for living expenses. Could you do this? I think that's certainly do-able. But what if you made more money than 65,000? Less? Are you going to have kids that you need to take into account? Do you have a significant other that would contribute to the household income, reducing your share of the rent/bills?What if you extended the repayment period to 15 years (1331/month loan payment)? 20 years (1145/mo loan payment)?

Debt sucks. I don't want to go in more than I have to, and I want to repay it as quickly as possible (learned my lesson from undergrad). But I also think you need to take into account how you will spend that salary you will be making (your standard of living) and take more into account than the "10% rule". Good luck on your decision!

 

[LuLu123]

I would not do it, no OT program is worth that much. I really liked USC but after researching the cost I did not even bother to apply there knowing I could not justify the expense. Student debt is just too big of a problem and congress seems to be doing nothing about it. I chose to prioritize an in state school and obsess about getting in, so I researched their average accepted profile and went for above and beyond that and was accepted into their program...I ended up getting a fellowship to a private school in my hometown though, so it ended up being the same price as my in-state program,and so I am going there. I see so many facebook status updates about grad school debt that are horrifying...many friends are paying the same amount on their monthly student loan payments as their mortgage costs (yikes). And these are friends who went to grad school before loans grad school loans became unsubsidized. If you ever want to take some time off work in your future (like in my case I will want some time for kids some day and may only want to work part time) you will end up feeling like you cannot take any time off because you are in so much debt. Or life may throw you other unexpected curve balls where for whatever reason you cannot work as a full time OT.Having to sacrifice so many things in your future for a program that is only about 2 years of your life does not seem worth it because there is a much cheaper road to get you to your career. Also not sure if you are married yet or have a SO, but I would imagine any spouse/so would not be jazzed about that amount of debt as it would likely interfere with the type of mortgage you would be able to get in your future.

 

[hopefullyOT]

I was in your exact position a little over 2 years ago. When I decided to become an OT it was USC or bust, all of my hard work and preparation were geared to get me into USC and I told myself money was not going to stop me. I got accepted and noticed I still had time to submit an application to SJSU so I would at least have that in my back pocket. Ended up holding out as long as I could and went to the new student orientation at USC, but once I sat and crunched the numbers all of the things I wanted to do after I graduated flashed before my eyes. This could stop me from buying a home or living a comfortable life financially and my decision on starting a family. This was a second career for me so I don't have all of the time in the world to pay this money back. Sarah Kelly ended up calling me personally to get my decision on the last day I could make my decision and I told her no. I will always live with this decision, but I was happy that they accepted me. Turns out SJSU was more competitive anyways and everything is fine right now. I should be certified early next year and ready to start my new career.

What's your thought about starting a family though? I mean does having an OT career delay motherhood?

 

[ExceptionalSea]

@hopefullyOT i don't think having an OT career has to delay motherhood. when i did my observation hours i ran into several young OTs (still in their 20s) who were either pregnant or had recently had a baby. really nice perks of being an OT/working in the health care field are the great health insurance, maternity leave, and PTO benefits you get. as someone working in the business world, let me tell you those benefits are certainly not standard for everyone's work place. once you start working having these benefits can definitely provide you with what you need to start a family should you choose, even if you have some student loan debt.

as to the original poster, it's a difficult decision to tell you if it's worth it to take out that much debt. yes - that amount of debt is very scary, and if the option were there obviously we would all tell you to go to the cheaper school. but it sounds like a cheaper school is not an option, so you are stuck with the options you have. however, i think what a lot of people are missing is it's not just question of money, but also your experience at the school, your outcome, and your professional standing within the real world. what i mean to say is, becoming an OT has it's definite benefits: helping people, having a stable career and hopefully not ever wanting for a job or being downsized, having a decent salary, having the aforementioned work benefits, having an autonomous position where you run your own workload, having the option for flexible scheduling, etc. you said USC is your dream school - is this dream so strong that you would feel very professionally successful and personally satisfied if you graduated from there? (i'm not mocking it, i understand that these kinds of things can be very important). are these things worth that much to you to go into $150k in debt? only you know the answer to that question.

would you be okay with waiting to start OT school and instead apply to much cheaper schools instead, hoping you get into one? that could be an option for you as well. i also like what @CharacterZero had to say - how extravagantly do you wish to live? if i had enough money to easily make my loan payments and still have $2k a month leftover for living expenses, i would be a happy camper. i found it extraordinary about the other poster who said their friend made $5k a month and still felt strapped by their $600 per month student loan payment. having $4k leftover per month after my student loan payment still sounds like heaven to me! it's all relative.

the thing is, $150k in debt is a serious matter and it's good you are thinking hard about it. but i want you to weigh these other things that a lot of people may not have pointed out to you. for me, personally, taking out some grad school loans is worth every penny. i'm currently worked to the bone for a very small salary with no benefits (and still am SOMEHOW able to make my undergrad student loan payments) so the idea of making twice as much, with great autonomy and great benefits, even if i had to pay half of my $60k salary to student loans, and also being able to work a normal 8-5 schedule instead of the sometimes 12-13 hour days i have now...it's a no brainer. every penny of debt will be worth it to me when i can have a better standard of living after i graduate. but like i said, only you can weigh these things.

 

[mgeagle]

@hopefullyOT i don't think having an OT career has to delay motherhood. when i did my observation hours i ran into several young OTs (still in their 20s) who were either pregnant or had recently had a baby. really nice perks of being an OT/working in the health care field are the great health insurance, maternity leave, and PTO benefits you get. as someone working in the business world, let me tell you those benefits are certainly not standard for everyone's work place. once you start working having these benefits can definitely provide you with what you need to start a family should you choose, even if you have some student loan debt.

as to the original poster, it's a difficult decision to tell you if it's worth it to take out that much debt. yes - that amount of debt is very scary, and if the option were there obviously we would all tell you to go to the cheaper school. but it sounds like a cheaper school is not an option, so you are stuck with the options you have. however, i think what a lot of people are missing is it's not just question of money, but also your experience at the school, your outcome, and your professional standing within the real world. what i mean to say is, becoming an OT has it's definite benefits: helping people, having a stable career and hopefully not ever wanting for a job or being downsized, having a decent salary, having the aforementioned work benefits, having an autonomous position where you run your own workload, having the option for flexible scheduling, etc. you said USC is your dream school - is this dream so strong that you would feel very professionally successful and personally satisfied if you graduated from there? (i'm not mocking it, i understand that these kinds of things can be very important). are these things worth that much to you to go into $150k in debt? only you know the answer to that question.

would you be okay with waiting to start OT school and instead apply to much cheaper schools instead, hoping you get into one? that could be an option for you as well. i also like what @CharacterZero had to say - how extravagantly do you wish to live? if i had enough money to easily make my loan payments and still have $2k a month leftover for living expenses, i would be a happy camper. i found it extraordinary about the other poster who said their friend made $5k a month and still felt strapped by their $600 per month student loan payment. having $4k leftover per month after my student loan payment still sounds like heaven to me! it's all relative.

the thing is, $150k in debt is a serious matter and it's good you are thinking hard about it. but i want you to weigh these other things that a lot of people may not have pointed out to you. for me, personally, taking out some grad school loans is worth every penny. i'm currently worked to the bone for a very small salary with no benefits (and still am SOMEHOW able to make my undergrad student loan payments) so the idea of making twice as much, with great autonomy and great benefits, even if i had to pay half of my $60k salary to student loans, and also being able to work a normal 8-5 schedule instead of the sometimes 12-13 hour days i have now...it's a no brainer. every penny of debt will be worth it to me when i can have a better standard of living after i graduate. but like i said, only you can weigh these things.

I totally agree with ExceptionalSea on this one, I am going to OT school and anticipate having more than your 150k debt and it does not bother me at all because of how I see the end game. Sure it sucks to be in that much debt but imagine how life will be for you say 10 years after school. A good portion of the debt has been handled and you will be in your early 30s in the prime of adulthood making a pretty good salary, have decent work hours, have great benefits, and have job stability that many people in their 40s and above do not have. You will also be in a position to even move up in OT and possibly have some sort of administrative duties which would only increase your salary and make your life that much better. I see it as an investment for the future. The payments are a lot more manageable than people make out (trust me I have several family members who went to expensive nursing schools). You may have to sacrifice some of the luxuries of life that you specifically want for a while but the way I see it there will always be nice cars, nice houses, nice vacation spots, nice clothes, and nice stuff in general somewhere at any given point in time for you to purchase so being a little bit more frugal than you would like for 5-10 years to help manage loan debt really isn't all that bad when after that you have a lifetime to live it up more. I would understand more of a concern if you were entering OT school say in your late 30s or 40s because a lot of people at that point have a spouse, kids, and aging parents that may need a little extra care to be concerned with so adding a 150k loan debt to that would not be very ideal but nevertheless still doable. Also keep in mind that if you wait and reapply there is no guarantee that you will get in as OT is becoming more and more competitive.

HOWEVER, everything that I have just said is how I see it, so if you see it differently than that is just fine. If hearing what ExceptionalSea and I have said still does not offer very much peace of mind then no problem, maybe you just need more time to evaluate exactly what you want and what you are willing to sacrifice to have it. Hopefully this help and best of luck in whatever you decide to do !!

 

[hopefullyOT]

I totally agree with ExceptionalSea on this one, I am going to OT school and anticipate having more than your 150k debt and it does not bother me at all because of how I see the end game. Sure it sucks to be in that much debt but imagine how life will be for you say 10 years after school. A good portion of the debt has been handled and you will be in your early 30s in the prime of adulthood making a pretty good salary, have decent work hours, have great benefits, and have job stability that many people in their 40s and above do not have. You will also be in a position to even move up in OT and possibly have some sort of administrative duties which would only increase your salary and make your life that much better. I see it as an investment for the future. The payments are a lot more manageable than people make out (trust me I have several family members who went to expensive nursing schools). You may have to sacrifice some of the luxuries of life that you specifically want for a while but the way I see it there will always be nice cars, nice houses, nice vacation spots, nice clothes, and nice stuff in general somewhere at any given point in time for you to purchase so being a little bit more frugal than you would like for 5-10 years to help manage loan debt really isn't all that bad when after that you have a lifetime to live it up more. I would understand more of a concern if you were entering OT school say in your late 30s or 40s because a lot of people at that point have a spouse, kids, and aging parents that may need a little extra care to be concerned with so adding a 150k loan debt to that would not be very ideal but nevertheless still doable. Also keep in mind that if you wait and reapply there is no guarantee that you will get in as OT is becoming more and more competitive.

HOWEVER, everything that I have just said is how I see it, so if you see it differently than that is just fine. If hearing what ExceptionalSea and I have said still does not offer very much peace of mind then no problem, maybe you just need more time to evaluate exactly what you want and what you are willing to sacrifice to have it. Hopefully this help and best of luck in whatever you decide to do !!

Both of those posts makes me want to just grab the career and not even look back at the debt and sacrifices I'll make. Hope I get into Loma Linda.

 

[TennesseeOT]

I'm feeling pretty panicked with you, as we all probably are. I'm at a pretty cheap school and I'll still come out with around $100k. Whatever you do, don't look at that loan repayment calculator. It suggested I have to make $124k/yr to pay that back

 

[mgeagle]

I'm feeling pretty panicked with you, as we all probably are. I'm at a pretty cheap school and I'll still come out with around $100k. Whatever you do, don't look at that loan repayment calculator. It suggested I have to make $124k/yr to pay that back

Yea that online loan calculator seems a bit faulty to me because I have asked people generally what their payments were like from varying plans and it was nothing like what the calculator predicted.

 

[hopefullyOT]

I'm feeling pretty panicked with you, as we all probably are. I'm at a pretty cheap school and I'll still come out with around $100k. Whatever you do, don't look at that loan repayment calculator. It suggested I have to make $124k/yr to pay that back

that's pretty impossible if you're only making 60000 a year lol

 

[TennesseeOT]

@mgeagle @hopefullyOT It said that was if you used 10% of your income to make payments, although I'm not sure how that makes sense since they're fixed payments. The calculator is kind of dumb.

 

[hopefullyOT]

yeah isn't 6.8%? lol

 

[mgeagle]

yeah isn't 6.8%? lol

I think the 6.8% is the interest......

 

[TennesseeOT]

@hopefullyOT @mgeagle Yeah that's the interest, but I mean the monthly payments themselves. The whole thing was confusing and I'm just going to ignore the calculator all together.

 

[lavitae]

Do you guys know what the "average" amount of debt students accumulate from undergrad along with OT school?

 

[dobber]

I can't stress this enough. GO TO THE CHEAPEST SCHOOL YOU CAN.
I know there are dream schools and that one school you really want to go to... But dude (or dudette - can't really tell from your user name lol) in the end of the day, you'll get the same license regardless of going to a top 10 school or some unknown state school. Keep that in mind before you decide to let your loans swallow you up

 

[BowlofSunshine]

I can't stress this enough. GO TO THE CHEAPEST SCHOOL YOU CAN.
I know there are dream schools and that one school you really want to go to... But dude (or dudette - can't really tell from your user name lol) in the end of the day, you'll get the same license regardless of going to a top 10 school or some unknown state school. Keep that in mind before you decide to let your loans swallow you up

Co-sign this post.

Plus,there is no such thing as a "Dream OT program". At the end of the day, all OT students are required to take the same exam and are required to be licensed in their respective state. Potential employers don't care about where you went to school as the NBCOT exam is what determines your competency in the field.

Plus it just doesn't make good financial sense to spend close to or over $100K on an OT program and your entry level salary is <$80K/year.

 

[TennesseeOT]

@BowlofSunshine If you don't mind me asking, what is your debt looking like? I'm going to the cheapest school offered and tuition is about $4k per semester. It's an OTD program that runs through fall, spring, and summer for 3 years. That ends up being around $12k/year, only ~$36k total for tuition. However, with living expenses, books, etc. for 3 years I'm still ending up around $75k. I also have to add $30k from undergrad. That's a grand total of around $105k, and that's if I work hard to keep costs down. Lol, what am I doing wrong?!

 

[ExceptionalSea]

Co-sign this post.

Plus,there is no such thing as a "Dream OT program". At the end of the day, all OT students are required to take the same exam and are required to be licensed in their respective state. Potential employers don't care about where you went to school as the NBCOT exam is what determines your competency in the field.

Plus it just doesn't make good financial sense to spend close to or over $100K on an OT program and your entry level salary is <$80K/year.

OP doesn't have an option of a cheaper school because they deferred their admittance for another year. obviously, anyone would advise the OP to go to a cheaper school. i think the main point of the post was to ascertain if it was worth it to go ahead with the program and go into $150k in debt or start all over again and apply to cheaper schools (hoping to get in). @mgeagle and i were trying to point out the other benefits of going into debt for an OT degree that a lot of people only focused on looking at the numbers are missing out on - these include quality of life, standard of living, stability and other things, flexible scheduling, the ability to move and live in many places - an investment for many years to come over a 20-30 year career. yes, debt is scary, and it is obviously smarter to try to find the cheapest option available. but even if the cheapest option isn't available, perhaps the debt is still worth it for your long term career goals and life plan, and actually makes the most sense financially when thought of in terms of lifetime earnings and quality of life. it's all relative to each individual.

 

[mgeagle]

OP doesn't have an option of a cheaper school because they deferred their admittance for another year. obviously, anyone would advise the OP to go to a cheaper school. i think the main point of the post was to ascertain if it was worth it to go ahead with the program and go into $150k in debt or start all over again and apply to cheaper schools (hoping to get in). @mgeagle and i were trying to point out the other benefits of going into debt for an OT degree that a lot of people only focused on looking at the numbers are missing out on - these include quality of life, standard of living, stability and other things, flexible scheduling, the ability to move and live in many places - an investment for many years to come over a 20-30 year career. yes, debt is scary, and it is obviously smarter to try to find the cheapest option available. but even if the cheapest option isn't available, perhaps the debt is still worth it for your long term career goals and life plan, and actually makes the most sense financially when thought of in terms of lifetime earnings and quality of life. it's all relative to each individual.

Thank you @ExceptionalSea!!! I feel like you and I were being put under question and doubt for our earlier posts lol.

 

[BowlofSunshine]

@BowlofSunshine If you don't mind me asking, what is your debt looking like? I'm going to the cheapest school offered and tuition is about $4k per semester. It's an OTD program that runs through fall, spring, and summer for 3 years. That ends up being around $12k/year, only ~$36k total for tuition. However, with living expenses, books, etc. for 3 years I'm still ending up around $75k. I also have to add $30k from undergrad. That's a grand total of around $105k, and that's if I work hard to keep costs down. Lol, what am I doing wrong?!

I'm a little under $100K for both undergrad and grad. That's about the norm, unless you have no undergrad debt.

It doesn't make good financial sense to go into an exorbitant amount of debt for OT school, which is not law or business school where rankings matter.