How do you pay for med school?

[JDAD]

Tuition is very expensive, just wondering how other people pay for college/applications/MCAT/Interviewing/MedicalSchool?

I have made some money online that I get by on, but how do people do it if they want to avoid loans? I tried working a job at night, but it took up too much of my time?

How do people do it?

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[southerndoc]

Loans, loans, and more loans. Unless you're rich, you can't avoid them.

 

[JDAD]

I am trying to avoid loans.........so far I have been able to do it.

 

[OSUdoc08]

I am trying to avoid loans.........so far I have been able to do it.

Why? There is absolutely no reason to not take out loans.

You don't even have to begin paying them until you FINISH residency. At the salary for most physicians, you could pay off all of the loans in a couple of years.

 

[MrBoxy]

Why? There is absolutely no reason to not take out loans.

You don't even have to begin paying them until you FINISH residency. At the salary for most physicians, you could pay off all of the loans in a couple of years.

OSUdoc08,
It seems that you're a proponent of taking out loans, but are you refering to subsidized loans?
I've calculated my budget (for NSUCOM) and it seems like I will be taking out about 50 K a year, and 15K of that is private loan. Now, i'm very concern with private loan because if the high interest rate, about 9%. I saw a sample calculation it said that if I was to take out 10K in private loan and pay back in 20 years, i will be paying a total of 24K. Another word, after 4 years of medical school, my 60K private loan will equals about 136K (under the assumption of 20 years paypack). On top of that, there is also 140K of the subsizided and unsubsidized loan for 4 years. Isn't that a bit too much? this is not including my undergraduate loan of 40K (subsizided).
I'm looking at 316K in debt after my schooling....should I be concerned?

Thanks!

 

[ShyRem]

9%? You ought to shop around. I found one for each of my possible schools that have a rate of around 5-5.8% with capitalization at the start of repayment (thus interest doesn't generate interest).

 

[OSUdoc08]

OSUdoc08,
It seems that you're a proponent of taking out loans, but are you refering to subsidized loans?
I've calculated my budget (for NSUCOM) and it seems like I will be taking out about 50 K a year, and 15K of that is private loan. Now, i'm very concern with private loan because if the high interest rate, about 9%. I saw a sample calculation it said that if I was to take out 10K in private loan and pay back in 20 years, i will be paying a total of 24K. Another word, after 4 years of medical school, my 60K private loan will equals about 136K (under the assumption of 20 years paypack). On top of that, there is also 140K of the subsizided and unsubsidized loan for 4 years. Isn't that a bit too much? this is not including my undergraduate loan of 40K (subsizided).
I'm looking at 316K in debt after my schooling....should I be concerned?

Thanks!

You can take out $44,500 in Stafford & Perkins. Your private loan would only be $5,500. However, you can always cut back on your expenses and make that private loan even smaller.

If you have $316,000 in loans when you graduate, remember that you will not be required to pay back your loans until you finish residency. You should be making $150,000-250,000 your first year out of residency, depending on specialty and region. Let's say for argument purposes that your starting salary is $200,000.

You will already be making about $40,000 as a resident, so using about $100,000 of your salary for a few years will really be a step-up for you (it is more than doubling your salary.) During this time, you can use the other half of the salary to pay back your loans in just over 3 years.

Most repayment programs are 10 years, and you can stretch it out if you'd like, but there is no reason! It will not be a problem for you, unless you decide to take over for Doc Hogue in Grady (Squash capital of the South) for $35,000 a year.

 

[JDAD]

I can't get loans because I am not a US citizen. I am trying to find other ways, and I am quite happy to say that I found an awsome way to use the internet.

It will be interesting to see if that money can hold me over until I graduate.....

 

[MrBoxy]

You can take out $44,500 in Stafford & Perkins. Your private loan would only be $5,500. However, you can always cut back on your expenses and make that private loan even smaller.

If you have $316,000 in loans when you graduate, remember that you will not be required to pay back your loans until you finish residency. You should be making $150,000-250,000 your first year out of residency, depending on specialty and region. Let's say for argument purposes that your starting salary is $200,000.

You will already be making about $40,000 as a resident, so using about $100,000 of your salary for a few years will really be a step-up for you (it is more than doubling your salary.) During this time, you can use the other half of the salary to pay back your loans in just over 3 years.

Most repayment programs are 10 years, and you can stretch it out if you'd like, but there is no reason! It will not be a problem for you, unless you decide to take over for Doc Hogue in Grady (Squash capital of the South) for $35,000 a year.

Thanks for the advice!

 

[mfradin2]

That will eat you alive. News flash, you may be very special, but you do not get the special-case-exemption from concern about finances. Congratulations on stating it on the thread.

Most students have no idea how long it takes to pay back $5k, let alone $50K or $150 K. This includes people in financial aid offices who get free tuition for their kids, or would be out on their asses if they cannot get you to take a loan. A lot of university people just shake their heads in public and in private will tell you that the investment is no longer worthwhile. So heads up. People lie. Think for yourself. If you are smart enough to poke holes in flesh, you can think this through.

THESE ARE MORTGAGES on your future. It will cost you interest. Interest is usually 1.5 times the original principal on a 30 year mortgage. Go to www.finaid.org/calculators. These are very accurate. They will even tell you approximately what the payback period is and what kind of salary you'll need to cover your debt payment. The interest rate is critical. It will go up before you are done. The 200K you are looking at is average. Don't get too hung up on the shock of seeing what interest costs you. You'll have the same reaction every time you finance a car or buy a house. It just is.

YOU are the CEO of YOU Incorporated. This is important. Do NOT look at what other people are spending. You don't know where the money is coming from. Other people may have parents who have hocked the IRAs, or assume it will all come out ok. Its easy to see what people spend, not so easy to see what kind of debt is backing it up.

YOU MUST CRUNCH all the NUMBERS to know what you can spend, what you must earn, even when you can afford to have a family. DO NOT acquire a spouse that thinks you'll be rich and spends accordingly.


One way to look at managing debt is on a cash flow basis. This is how businesses manage their money. So you need to talk to some YOUNG and OLD physicians/residents about cash flow. DONT rely on students, they are too optimistic. The old farts may have had it a lot easier, but they can tell you what you can expect down the road.

Even if you have lots of deductions, you will still pay 22% (or more) of your salary in taxes. That means you will have to earn 100.00 for every 88.00 in loans. Servicing a student loan of $100,000 at 6.8% will require a monthly payment of $887.00 for 15 years. Before taxes, that's $1000 per month gross income. Scale that number up or down or go to FINAid.org/calculators and do it for yourself. Finaid estimates that you need a salary of $106.5K to service this loan, by the way. This is based on some underlying rules of thumb that you may be tempted to ignore. Remember: you are not special. the banks do not love you after you sign for the loan. life costs money, and you can't budget a best case scenario that will last 20 years. However, you may be able to deal with it by stretching it, with a debt free spouse that can help and living like a student for a while in a lower cost of living community. Pretty much all of the above will be required.

Back to managing cash flow. I'll have to think about it some more, but this might be one case in which your best life strategy is to take forever (30y) to pay the debt off and keep the monthly payments as low as possible. As long as you have income, you can service the debt. *** You just can't let interest accumulate and snowball the debt*****You'll need a boatload of life insurance and disability insurance to cover the eventuality that you lose your source of income. This called betting. The best bets have a limited downside and a good payoff. Your income will rise, maybe not meteorically. Don't take any floating interest rates. When you want to buy a house, the bank will mostly be looking at your cash flow, not your total debt load. You'll also be wanting to buy into a practice, same rules.

I know several physicians who have lost their houses because they and their spouses have assumed life would be easy and an excellent standard of living is just within reach. Debt isn't everything--until it runs your life.

There are loan forgiveness programs that can take the edge off if you are serious about being a do-gooder, or want to work in federal prisons.

Also note and this is REALLY important, that when you have debt making your choices for you, you may not be able to work in that free clinic, or do pro bono work. You will have to work for billings and that means patient throughput. There is a lot of merit in studying what physicians are saying is upsetting them about their careers. Debt pressure is right up there.

My advice. Don't pile up any loans you don't need. Live in your car, or with 10 other people. Stop and work if you can. Go public. Organize students to protest tuition. If nobody shows up with loan checks, they'll get worried. Go to Barnes and Noble and peruse "Generation Debt" in the business section. Feel lucky. You have a career with a decent upside. This is doable, but only if you really really understand the rules.

Good luck and be well, Auntie Em

OSUdoc08,
It seems that you're a proponent of taking out loans, but are you refering to subsidized loans?
I've calculated my budget (for NSUCOM) and it seems like I will be taking out about 50 K a year, and 15K of that is private loan. Now, i'm very concern with private loan because if the high interest rate, about 9%. I saw a sample calculation it said that if I was to take out 10K in private loan and pay back in 20 years, i will be paying a total of 24K. Another word, after 4 years of medical school, my 60K private loan will equals about 136K (under the assumption of 20 years paypack). On top of that, there is also 140K of the subsizided and unsubsidized loan for 4 years. Isn't that a bit too much? this is not including my undergraduate loan of 40K (subsizided).
I'm looking at 316K in debt after my schooling....should I be concerned?

Thanks!

 

[UserNameNeeded]

*claps*

mfradin2, PLEASE post more often. Especially about what you're considering/doing financially. That post was just awesome!

 

[UserNameNeeded]

Why? There is absolutely no reason to not take out loans.

You don't even have to begin paying them until you FINISH residency. At the salary for most physicians, you could pay off all of the loans in a couple of years.

You are giving really bad advice.

There's a lot of things I could say to counter your statements, but I'll just mention one concern I have: most people do not have the luxury of beginning repayment after residency. You can only defer-- if you've borrowed enough to qualify for a deferment-- for 3 years total after graduating from school. Residency can and does, for most people, last way longer than 3 years after graduation.

And I think you're being waaay to optimistic if you think most physicians will be starting out at 200K. I'm pretty sure the take home pay is far, far less and, by that time, most doctors-- like most normal human beings with normal lives-- will have greater financial committments (wife and kids, home, transportation, aging/ill parents, etc.) than when they were younger. I think it's safe to say most new doctors do not want to put their lives on hold any further when it comes to having some semblance of a normal lifestyle. How sad would it be to be living alone at middle age, just so you can pay off six figure debt?

 

[UserNameNeeded]

I can't get loans because I am not a US citizen. I am trying to find other ways, and I am quite happy to say that I found an awsome way to use the internet.

It will be interesting to see if that money can hold me over until I graduate.....

Can you tell us your awesome way to use the internet to help pay for medical school? Pretty please.

 

[OSUdoc08]

You are giving really bad advice.

There's a lot of things I could say to counter your statements, but I'll just mention one concern I have: most people do not have the luxury of beginning repayment after residency. You can only defer-- if you've borrowed enough to qualify for a deferment-- for 3 years total after graduating from school. Residency can and does, for most people, last way longer than 3 years after graduation.

And I think you're being waaay to optimistic if you think most physicians will be starting out at 200K. I'm pretty sure the take home pay is far, far less and, by that time, most doctors-- like most normal human beings with normal lives-- will have greater financial committments (wife and kids, home, transportation, aging/ill parents, etc.) than when they were younger. I think it's safe to say most new doctors do not want to put their lives on hold any further when it comes to having some semblance of a normal lifestyle. How sad would it be to be living alone at middle age, just so you can pay off six figure debt?

I don't see anything in here that demonstrates how it will be difficult to pay off loans in a timely fashion.

The residencies for most people really does last only 3 years, since the majority of physicians do EM, IM, FM, and Peds.

Of those only IM, FM, and Peds make less than 200k, on average. The rest of the specialties make more.

P.S. If you have a wife, make her work.

 

[CruiseLover]

I don't see anything in here that demonstrates how it will be difficult to pay off loans in a timely fashion.

The residencies for most people really does last only 3 years, since the majority of physicians do EM, IM, FM, and Peds.

Of those only IM, FM, and Peds make less than 200k, on average. The rest of the specialties make more.

P.S. If you have a wife, make her work.

In my midwest community, pediatricians and GPs start at about $110,000. No where near $200,000. I appreciate the previous posts that actually make people think about the debt that they are taking on. It is a SERIOUS committment. Unfortunately, society is encouraging our upcoming generation to take on debt.

PS - Depending on your tax bracket, wife's chosen profession, and daycare costs - it may not pay to work.

 

[OSUdoc08]

In my midwest community, pediatricians and GPs start at about $110,000. No where near $200,000. I appreciate the previous posts that actually make people think about the debt that they are taking on. It is a SERIOUS committment. Unfortunately, society is encouraging our upcoming generation to take on debt.

PS - Depending on your tax bracket, wife's chosen profession, and daycare costs - it may not pay to work.

If the debt is really a concern, it's time to move (or choose a higher paying specialty.)

 

[UserNameNeeded]

If the debt is really a concern, it's time to move (or choose a higher paying specialty.)

This is even worse, OSU.

If you move to get a higher salary, chances are you're moving to a higher cost of living area and the associated costs of moving to the Northeast or to California would also be a con.

And choosing a higher paying specialty?! C'mon-- most good people (I would hope) do not base the specialty they'll aim for just because it pays well.

At this point, I really really wanna do primary care (pediatrics) for a lot of reasons and I'm in Texas (and plan to stay here because the other 49 states suck ). I do not want to specialize in something else (at this point), just because pediatrics doesn't pay well enough. So, yeah, taking out loans is something to head into with a lot of caution.

 

[OSUdoc08]

This is even worse, OSU.

If you move to get a higher salary, chances are you're moving to a higher cost of living area and the associated costs of moving to the Northeast or to California would also be a con.

And choosing a higher paying specialty?! C'mon-- most good people (I would hope) do not base the specialty they'll aim for just because it pays well.

At this point, I really really wanna do primary care (pediatrics) for a lot of reasons and I'm in Texas (and plan to stay here because the other 49 states suck ). I do not want to specialize in something else (at this point), just because pediatrics doesn't pay well enough. So, yeah, taking out loans is something to head into with a lot of caution.

I disagree. In Oklahoma, EM physicians are paid 100k above the national average, but the cost of living is one of the lowest in the nation.

 

[mshheaddoc]

Ok I've been following and now I have to jump in.

Pet Peeve of mine, the lack of financial knowledge that most people have, ESPECIALLY med students.

First of mfradin2 .... You rock You put everything I was thinking into words.

Loans ...

"OH THEY ARE CHEAP!" THAT's great if you qualified for for full federal financial aid, not everyone gets perkins. But you still have a variable interest rate (yes it has a cap) but you'd be surprised how fast 5% can rack up especially with subsidized interest.

And even then, I believe current student loan legislation does not allow for "fixed" federal student loans with consolidation. I think last July was the last time you were eligible to do this.

Although private loans are available - its highly dependant on credit. IF you are young with no credit, you might need a cosigner for that 5% fixed or 7% fixed. Usually 680 is the cutoff for the really good loans.

In residency, if you are single, FANTASTIC! You can pay your loans and be done with them. For the rest of us with actual lives, spouses, kids, houses, etc they have manage their families future as well as their own. Also, since most residencies/fellowships are more than 3 years you have to come up with that $2000 monthly payment. Also if you have a spouse making a highly decent income, there is a good chance you WON'T qualify for deferment during residency. There are a few people on here who have discussed this in detail.

To close, financial aid is a great resource for those who have that option and use it wisely. It disheartens me when I see people who don't worry about being $200K in debt. Its those people that you see later down the road in financial troubles due to spending beyond their means. And I've seen it in my prior life. Its a really sad thing.

OSUdoc you probably have it made if you are single and stay in the midwest with salaries. But not everyone might luck out to your situation and you have to remember to "generalize" your comments. The world isn't always seen through one person's eyes.

 

[OSUdoc08]

Ok I've been following and now I have to jump in.

Pet Peeve of mine, the lack of financial knowledge that most people have, ESPECIALLY med students.

First of mfradin2 .... You rock You put everything I was thinking into words.

Loans ...

"OH THEY ARE CHEAP!" THAT's great if you qualified for for full federal financial aid, not everyone gets perkins. But you still have a variable interest rate (yes it has a cap) but you'd be surprised how fast 5% can rack up especially with subsidized interest.

And even then, I believe current student loan legislation does not allow for "fixed" federal student loans with consolidation. I think last July was the last time you were eligible to do this.

Although private loans are available - its highly dependant on credit. IF you are young with no credit, you might need a cosigner for that 5% fixed or 7% fixed. Usually 680 is the cutoff for the really good loans.

In residency, if you are single, FANTASTIC! You can pay your loans and be done with them. For the rest of us with actual lives, spouses, kids, houses, etc they have manage their families future as well as their own. Also, since most residencies/fellowships are more than 3 years you have to come up with that $2000 monthly payment. Also if you have a spouse making a highly decent income, there is a good chance you WON'T qualify for deferment during residency. There are a few people on here who have discussed this in detail.

To close, financial aid is a great resource for those who have that option and use it wisely. It disheartens me when I see people who don't worry about being $200K in debt. Its those people that you see later down the road in financial troubles due to spending beyond their means. And I've seen it in my prior life. Its a really sad thing.

OSUdoc you probably have it made if you are single and stay in the midwest with salaries. But not everyone might luck out to your situation and you have to remember to "generalize" your comments. The world isn't always seen through one person's eyes.

Exactly. My point is that it IS doable.

 

[mshheaddoc]

Do you ever see things in gray or only black and white?

Sometimes you are the exception, NOT the rule. Last I checked most of the population (and medical schools) were distributed along the coasts with high prevelance on the eastern seaboard and the midwest. Neither which I think can beat Oklahoma's cost of living.

 

[digAndy]

In my search for financial aid information I found a very comprehensive podcast about financial aid, scholarships, and paying for school. Didn't realize they had such podcasts. Here's the link:

http://www.podzinger.com/results.js...onsumer+Finance+Podcast&s=PZSID_pod1_6_1_0002

 

[rgerwin]

I think with the rising debt of doctors you are going to see a significant shift of people favoring higher paying specialties than tyoes of primary care. I know I can't even think about something like that. Also, never underestimate the value of small deductions in lifestyle. They add up. Every little bit helps, and definitely minimize your loans, wherever possible. Just remember, it may not be that possible.

 

[TypeA]

I can't get loans because I am not a US citizen. I am trying to find other ways, and I am quite happy to say that I found an awsome way to use the internet.

It will be interesting to see if that money can hold me over until I graduate.....

Quit freaking advertising you idiot.

 

[Jamers]

Ok I've been following and now I have to jump in.

Pet Peeve of mine, the lack of financial knowledge that most people have, ESPECIALLY med students.

First of mfradin2 .... You rock You put everything I was thinking into words.

Loans ...

"OH THEY ARE CHEAP!" THAT's great if you qualified for for full federal financial aid, not everyone gets perkins. But you still have a variable interest rate (yes it has a cap) but you'd be surprised how fast 5% can rack up especially with subsidized interest.

And even then, I believe current student loan legislation does not allow for "fixed" federal student loans with consolidation. I think last July was the last time you were eligible to do this.

Although private loans are available - its highly dependant on credit. IF you are young with no credit, you might need a cosigner for that 5% fixed or 7% fixed. Usually 680 is the cutoff for the really good loans.

In residency, if you are single, FANTASTIC! You can pay your loans and be done with them. For the rest of us with actual lives, spouses, kids, houses, etc they have manage their families future as well as their own. Also, since most residencies/fellowships are more than 3 years you have to come up with that $2000 monthly payment. Also if you have a spouse making a highly decent income, there is a good chance you WON'T qualify for deferment during residency. There are a few people on here who have discussed this in detail.

To close, financial aid is a great resource for those who have that option and use it wisely. It disheartens me when I see people who don't worry about being $200K in debt. Its those people that you see later down the road in financial troubles due to spending beyond their means. And I've seen it in my prior life. Its a really sad thing.

OSUdoc you probably have it made if you are single and stay in the midwest with salaries. But not everyone might luck out to your situation and you have to remember to "generalize" your comments. The world isn't always seen through one person's eyes.

Okay, then what do you suggest? It is easy to say "don't get loans!" but is hard to give alternatives. I have 58,000 in debt from undergrad (17 of it from Stafford and the rest from private). I have applied to the Army and Airforce but, I am uncertain if I want to give up that many years of my life and possibly be living in a tent being bombed by people because another idiot president decided that some other country disrepected his father. I can manage a budget very well, but, for the first year, I think I have to take out the full amount (how the hell do I know how much it costs for this and that besides rough estimates?) In that case, it is better off to HAVE extra money then to NEED extra money. My parents cannot support me (my father is 70 and lives off social security) and there are very few scholarships out there (I got one for a grand, wow, a grand). So, what are YOU doing if not loans?

 

[rgerwin]

Me too. Between me and my better half, we have your undergrad debt X 2. No parental support, and no state school. It'll have to be loans, and I'll never be a pediatrician. I'll have to pick a specialty that I enjoy, but that definitely makes more, which is fine, if that's how it has to be. There are alot of great options. I also don't plan on buying a house, car, or having kids until after residency, which is also a personal choice. So, that helps alot.

 

[mshheaddoc]

I never said I wasn't for loans. I am just trying to pass along the knowledge of how to use loans as well as nothing in my post suggested NO loans. I was refuting OSUdocs comments about how easy it is to repay them. Especially with a family.

Most of us will be in boku debt when we graduate and I just am on here trying to educate people about the difficulties of debt. I would suggest getting loans and using what is needed. I am PRO LOANS as they are much better than credit cards (which I have seen some med students use for part of tuition/living expenses).

 

[OSUdoc08]

I never said I wasn't for loans. I am just trying to pass along the knowledge of how to use loans as well as nothing in my post suggested NO loans. I was refuting OSUdocs comments about how easy it is to repay them. Especially with a family.

Most of us will be in boku debt when we graduate and I just am on here trying to educate people about the difficulties of debt. I would suggest getting loans and using what is needed. I am PRO LOANS as they are much better than credit cards (which I have seen some med students use for part of tuition/living expenses).

That's the key. No family = no problem.

Not everyone in medical school has one.

 

[mshheaddoc]

No but most people that I know of end up engaged/married/child in residency/school. Maybe its just who I know but as stated, it depends on school location, COL, and how much debt you have.

 

[Jamers]

I never said I wasn't for loans. I am just trying to pass along the knowledge of how to use loans as well as nothing in my post suggested NO loans. I was refuting OSUdocs comments about how easy it is to repay them. Especially with a family.

Most of us will be in boku debt when we graduate and I just am on here trying to educate people about the difficulties of debt. I would suggest getting loans and using what is needed. I am PRO LOANS as they are much better than credit cards (which I have seen some med students use for part of tuition/living expenses).

I applogize, I did not mean for it to come off as if I was attacking you. I was asking for your advice on what I should do then. I have been applying to as many scholarships as possible, but, with undergrad debt, its still going to set me back.

 

[mshheaddoc]

Honestly, not much of us can give you advice. Some consider military scholarships (which I would HIGHLY HIGHLY not recommend - at least until maybe considering for their residency program. I have seen 3 people who did it before med school, now have significant others and are dealing with this accordingly. Some relationships have been torn apart by this). But loans are the most part. Since you would qualify for full stafford (or most people do at least) you will have that going for you.

I feel for you because when I left college one of the things that held me back was student loans and the amount I had already amassed. Now I little lighter (NOT MUCH) I trudge on. Being 100K in debt PRIOR to med school is a daunting prospect. Adding on another $150K is just terrifying. But most professions allow you to live comfortably. having good grades/research expreiences/ etc can help you get scholarships to the schools but I planon playing the lottery weekly as well as trying to find scholarships. There are some organizations out there if you search fastweb, not many but a few.

 

[Doctor Bagel]

I think with the rising debt of doctors you are going to see a significant shift of people favoring higher paying specialties than tyoes of primary care. I know I can't even think about something like that. Also, never underestimate the value of small deductions in lifestyle. They add up. Every little bit helps, and definitely minimize your loans, wherever possible. Just remember, it may not be that possible.

True. I'm going to take out a ton of loans, and I don't really have a choice about it. If I had other options, especially a cheap state school, I'd be all over it, but I don't. I do like the idea posted above about marching to protest high tuition. Tuition at my instate school that supposedly focuses on trying primary care physicians is $30k. It's ridiculous.

I guess the thing is that we shouldn't be happy or cavalier about the loans, but we have to be okay with them. If this is what we want to do, most of us are going to have to borrow a lot of money.

 

[hippocrateze]

True. I'm going to take out a ton of loans, and I don't really have a choice about it. If I had other options, especially a cheap state school, I'd be all over it, but I don't. I do like the idea posted above about marching to protest high tuition. Tuition at my instate school that supposedly focuses on trying primary care physicians is $30k. It's ridiculous.

I guess the thing is that we shouldn't be happy or cavalier about the loans, but we have to be okay with them. If this is what we want to do, most of us are going to have to borrow a lot of money.

One important reason to minimize debt is that it severely limits your freedom in terms of changing the direction of your career. I've known people forced to continue in specialties they belatedly realised they were unhappy in, simply because of the pressure to repay loans. Nothing is ever all that it seems. Being debt-free (or minimally debt-ridden) can allow you the latitude to reverse poor career choices.

 

[Doctor Bagel]

One important reason to minimize debt is that it severely limits your freedom in terms of changing the direction of your career. I've known people forced to continue in specialties they belatedly realised they were unhappy in, simply because of the pressure to repay loans. Nothing is ever all that it seems. Being debt-free (or minimally debt-ridden) can allow you the latitude to reverse poor career choices.

But again how do you achieve that and still manage to become a physician? I'm sure I'm not alone in the fact that I'll have to borrow $200k at least to get that MD. I know it's not great, but I want to be a physician enough that I'll deal with it. Is anybody actually advocating not pursueing medicine because of debt issues?

 

[rgerwin]

Nooo! That's the only consistent piece of advice I've ever gotten. Don't worry so much. Yes, it may affect some future decisions, but it won't ruin them. Just do't rack up the debt, and fail your boards.

 

[mari1126]

loans kill

 

[-Goose-]

please tell me ya'll realize this whole thread started as an advertisement for the OP's get-rich-quick scam. So much for the 'no advertising' policy.

 

[DD214_DOC]

I've seen a lot of you complaining about alternatives to loans. There really are only a couple:

1) Military HPSP
2) USUHP or whatever it is
3) NHSC
4) Have a spouse with a good job
5) Scholarships
6) Loans

I chose Option #1. Even though I could feasibly get through school without the military, I want to serve and I think the benefits outweigh a lot of the negatives. You get paid almost twice as much as a military resident than a civilian resident. You also come out with no debt.

Many of you have stated that paying the loans back isn't a problem. That may be true depending on the field you eventually enter. When you apply for a mortgage, auto loan, or anything else, your student loans will drastically bump up your DIT and reduce the amount of funds you can get as well as potentially increase the interest rate; the more debt you take on the more risk you will be to a lender.

Racking up tons of debt in loans is just an idiotic idea, whoever said it. Avoid as much as you can.

 

[OSUdoc08]

I've seen a lot of you complaining about alternatives to loans. There really are only a couple:

1) Military HPSP
2) USUHP or whatever it is
3) NHSC
4) Have a spouse with a good job
5) Scholarships
6) Loans

I chose Option #1. Even though I could feasibly get through school without the military, I want to serve and I think the benefits outweigh a lot of the negatives. You get paid almost twice as much as a military resident than a civilian resident. You also come out with no debt.

Many of you have stated that paying the loans back isn't a problem. That may be true depending on the field you eventually enter. When you apply for a mortgage, auto loan, or anything else, your student loans will drastically bump up your DIT and reduce the amount of funds you can get as well as potentially increase the interest rate; the more debt you take on the more risk you will be to a lender.

Racking up tons of debt in loans is just an idiotic idea, whoever said it. Avoid as much as you can.

This is why it is best to live meagerly the first few years out, so you can pay back the high interest loans as quickly as possible. The low interest loans can be drawn out over several years to as much as 10 years, if needed.

By meagerly, I mean in a nice loft apartment instead of a mansion.

 

[Doctor Bagel]

I've seen a lot of you complaining about alternatives to loans. There really are only a couple:

1) Military HPSP
2) USUHP or whatever it is
3) NHSC
4) Have a spouse with a good job
5) Scholarships
6) Loans

I chose Option #1. Even though I could feasibly get through school without the military, I want to serve and I think the benefits outweigh a lot of the negatives. You get paid almost twice as much as a military resident than a civilian resident. You also come out with no debt.

Many of you have stated that paying the loans back isn't a problem. That may be true depending on the field you eventually enter. When you apply for a mortgage, auto loan, or anything else, your student loans will drastically bump up your DIT and reduce the amount of funds you can get as well as potentially increase the interest rate; the more debt you take on the more risk you will be to a lender.

Racking up tons of debt in loans is just an idiotic idea, whoever said it. Avoid as much as you can.

Honestly, I'd rather rack up a ton of debt than join the military. It's just not a feasible option for me. So, I'm opting for the racking up tons of debt, but I'm not an idiot. I do plan to live cheaply, but just borrowing for tuition and $20k or so a year in living expenses adds up to a ton of money.

 

[DD214_DOC]

Honestly, I'd rather rack up a ton of debt than join the military. It's just not a feasible option for me. So, I'm opting for the racking up tons of debt, but I'm not an idiot. I do plan to live cheaply, but just borrowing for tuition and $20k or so a year in living expenses adds up to a ton of money.

Well, my idiot comment was meant for the suggestion that you should just wildly rack up thousands of dollars in loans, even if you don't have to, or the mentality of, "I'll worry about them later".

 

[Doctor Bagel]

Well, my idiot comment was meant for the suggestion that you should just wildly rack up thousands of dollars in loans, even if you don't have to, or the mentality of, "I'll worry about them later".

Yeah, you're right. It makes sense to live frugally when you're living off of loan money. Even though worrying about them later might be a necessity for one's sanity.

 

[DD214_DOC]

I'll paint two very different pictures for anyone who is reading this but not accepted yet

For income, I used an average FP income of $130,000/yr. Afer taxes, this is a takehome of $3,366 every two weeks, or roughly $6,732/mo.

Without HPSP/Some type of national scholarship
My undergrad.......$44,000
Wife's undergrad...$23,000
My gradschool......$8,000
Med school..........$224,000
Total..................$299,000 principle
+ 15yr 5.75%......$150,000 interest
.........................$449,000 total payback
.........................$2482/mo payment or 36% of your montly income.

The top number is very important, as any DIT above 20% is considered bad. Your student loans ALONE have increased your DIT to 36%. Pile on a mortgage and autoloans, credit cards, and everything else and you start to be in pretty ****ty financial shape.

My undergrad went into repayment this past month. A whopping $482/mo. Obviously I applied for and was approved for an extended forebearance. No way I could have made the payment on just the $44,000 loan.

With HPSP/Some type of national scholarship
My undergrad.......$44,000
Wife's undergrad...$23,000
My gradschool......$8,000
Med school..........$40,000 (Using as a lower-interest loan for payoffs & save)
Total..................$115,000 principle
+ 15yr 5.75%......$57,000 interest
.........................$172,000 total payback
.........................$980/mo payment or 14.5% of your monthly income.

Because of the increased pay I will be receive, I *plan* to have both undergrads and the small grad school loans paid off, so hopefully I will only have the $40,000 left.

I don't know if I did everyting right. It's 1AM and I'm tired.

 

[Laker]

Remember consolidations. My wife (she is the MD) and I just consolidated our loans independently. We have over 250k combined. I went to law school.

Anyway, hers are in deferment thankfully, and mine are just starting to enter repayment. I have a fed loan of 76k and a private loan of 32k. I was able to get 30 year repayments so that we can afford to make the monthly payments. My fed loan is 320/month and the private is about 215/month. I realize that the longer payment term will require more interest, however the low monthly payment will get us through residency and my first few years experience in the law. After residency, we will focus on taking care of all private loans quickly, then use the 30 year repayments on the federal loans. We were able to lock in last July at 2.85% which will decrease with direct debit and also ontime payments.

I feel bad for those who will not be able to consolidate federal loans at a fixed rate. At least you can still consolidate private loans but the rates aren't fixed.

 

[red dot]

hey guys, i've been following this thread for a while and i was hoping you could answer a few questions (if not all of them? ). sorry it's a long post.

i did some manual number crunching as well as the www.finaid.org/calculator site, and so far my stafford unsubsidized will amount to ~$150,000 (more or less) post-capitalization, and upon entering repayment. i am really really really scared, since this is just the starting point. and then there will still be that 6.8% interest per annum accruing on all of my already-capitalized unsubsidized stafford loans and, as far as i know, the 5% interest rate for the perkins/institutional loans will then begin and continue to accrue per annum as well. is this information correct? do they want one of my arms or legs too? because i'm really freaked out.

all in all i think i will be owing ~$230,000-235,000 upon repayment (of all loans). does this sound NORMAL? am i miscalculating?

also, when you go into repayment, can you start one at a time? i am under the impression that i can start repaying my stafford loans first and then my perkins/institutional loans, without having to start repaying both at the same time. or in other words, can i defer one and then the other?

i called a number of lenders, and even asked them what kind of repayment plan they've seen most people do (with the servicers).
i was told that most doctors apply for deferment for the entire residency. someone here has explained that you can only do this for 3 years tops, however, i am still confused as to how you can repay during your 4th and 5th years of residency, especially when almost a quarter of your income is taxed away?
it's not like i can save that much the first 3 years of residency to begin repayment during the 4th year. and if you can, wouldn't you just opt to start repayment right away during your first year?

then assuming that you go for the standard repayment plan, that even if you paid the $50 minimum towards your staffords and the $40 minimum towards your perkins on a monthly basis, it would still be highly unlikely for you to be able to repay it all within the required 10 years since the first half of that is residency. i asked one of the lenders if most people manage to do it in 10 years, and she said "no."

and some of you have mentioned the practicality of having a spouse and dependents (who need college funds), houses, and cars as well. how do you plan to factor all of that in too?

so... can i ask what you guys plan to do? do you plan to repay it all in 10 years? or are you just going to pick one repayment plan and see where www.finaid.org/calculators takes you? i did all the loan calculators and i still do not think that i will be able to afford even $500 out of my paycheck per month, through 4-5 years of residency.

at this point, i'm not sure what to do. with loans this huge, to me, choosing a lender is almost a wash, and the only thing that might matter concerning that is whether or not they have an (and how much their) interest reduction rate is, to save my ass on a monthly basis during residency.

any suggestions? i am up for any suggestions or advice. please? thanks!

 

[OSUdoc08]

hey guys, i've been following this thread for a while and i was hoping you could answer a few questions (if not all of them? ). sorry it's a long post.

i did some manual number crunching as well as the www.finaid.org/calculator site, and so far my stafford unsubsidized will amount to ~$150,000 (more or less) post-capitalization, and upon entering repayment. i am really really really scared, since this is just the starting point. and then there will still be that 6.8% interest per annum accruing on all of my already-capitalized unsubsidized stafford loans and, as far as i know, the 5% interest rate for the perkins/institutional loans will then begin and continue to accrue per annum as well. is this information correct? do they want one of my arms or legs too? because i'm really freaked out.

all in all i think i will be owing ~$230,000-235,000 upon repayment (of all loans). does this sound NORMAL? am i miscalculating?

also, when you go into repayment, can you start one at a time? i am under the impression that i can start repaying my stafford loans first and then my perkins/institutional loans, without having to start repaying both at the same time. or in other words, can i defer one and then the other?

i called a number of lenders, and even asked them what kind of repayment plan they've seen most people do (with the servicers).
i was told that most doctors apply for deferment for the entire residency. someone here has explained that you can only do this for 3 years tops, however, i am still confused as to how you can repay during your 4th and 5th years of residency, especially when almost a quarter of your income is taxed away?
it's not like i can save that much the first 3 years of residency to begin repayment during the 4th year. and if you can, wouldn't you just opt to start repayment right away during your first year?

then assuming that you go for the standard repayment plan, that even if you paid the $50 minimum towards your staffords and the $40 minimum towards your perkins on a monthly basis, it would still be highly unlikely for you to be able to repay it all within the required 10 years since the first half of that is residency. i asked one of the lenders if most people manage to do it in 10 years, and she said "no."

and some of you have mentioned the practicality of having a spouse and dependents (who need college funds), houses, and cars as well. how do you plan to factor all of that in too?

so... can i ask what you guys plan to do? do you plan to repay it all in 10 years? or are you just going to pick one repayment plan and see where www.finaid.org/calculators takes you? i did all the loan calculators and i still do not think that i will be able to afford even $500 out of my paycheck per month, through 4-5 years of residency.

at this point, i'm not sure what to do. with loans this huge, to me, choosing a lender is almost a wash, and the only thing that might matter concerning that is whether or not they have an (and how much their) interest reduction rate is, to save my ass on a monthly basis during residency.

any suggestions? i am up for any suggestions or advice. please? thanks!

1. This amount of debt is very common. In fact, that is about the amount that I will owe.

2. Yes you can pay Perkins later, but the rest of your loans should be consolidated and repaid first.

3. If you can no longer defer your loans, you can go into forbearance if your salary is too low. If you live like you did as a student, it shouldn't be a problem.

4. The first half of the 10 year repayment program does not begin until after your first 3 years of residency. Depending on how long your training program is, you will be paying back in 7-10 years AFTER finishing residency/fellowship. Unless you are in one of the low paying specialties, you should be able to pay back in LESS than 10 years. The key is living like you did as a resident. Do start buying million dollar homes until your loans are repaid.

5. Use Total Higher Education (T.H.E.) at http://www.northstar.org for your loans. They have the best plan.

 

[red dot]

1. This amount of debt is very common. In fact, that is about the amount that I will owe.

2. Yes you can pay Perkins later, but the rest of your loans should be consolidated and repaid first.

3. If you can no longer defer your loans, you can go into forbearance if your salary is too low. If you live like you did as a student, it shouldn't be a problem.

4. The first half of the 10 year repayment program does not begin until after your first 3 years of residency. Depending on how long your training program is, you will be paying back in 7-10 years AFTER finishing residency/fellowship. Unless you are in one of the low paying specialties, you should be able to pay back in LESS than 10 years. The key is living like you did as a resident. Do start buying million dollar homes until your loans are repaid.

5. Use Total Higher Education (T.H.E.) at http://www.northstar.org for your loans. They have the best plan.

hey OSUdoc, thanks for the reply. I have been looking into T.H.E. and am now deciding between that and CitiBank. I don't care too much for the MedLoans loan credit/cash back, and the borrower's benefits Access Group offered no longer applies after this July. but i feel a lot more relieved knowing that everyone pretty much owes that amount.

 

[UserNameNeeded]

...but i feel a lot more relieved knowing that everyone pretty much owes that amount.

Say that again when you see a record number of medical school graduates/drop-outs defaulting on their loans in the 2010s.

 

[Doctor Bagel]

About the forbearance, you qualify for the hardship forbearance if your loan payments exceed 20% of your income. With our huge loan payments coupled with a resident salary, I don't think those of us with the big loan balances will have trouble qualifying.