The Future of PSLF

[FlavivirusProtease]

Hi everyone!

Im about to be entering first year in July and I want to know everyone’s thoughts on Public Service Loan Forgiveness. I know it’s 14 years in the future, but whether or not it will likely still be around will determine how I chose to take out and use the loans I receive.

Has anyone spoken to their financial aid offices or heard information on whether or not they think it’s going to last for a while?

Thanks!

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[Raryn]

Hi everyone!

Im about to be entering first year in July and I want to know everyone’s thoughts on Public Service Loan Forgiveness. I know it’s 14 years in the future, but whether or not it will likely still be around will determine how I chose to take out and use the loans I receive.

Has anyone spoken to their financial aid offices or heard information on whether or not they think it’s going to last for a while?

Thanks!

Obama's last couple budgets proposed a cap to the loan forgiveness. So did Trump's budget last year. Congress has not passed nor seriously discussed such a cap yet.

It's probably inevitable that it will be curtailed somewhat. When is anyone's guess. Current borrowers will *probably* be grandfathered in without a cap, but there's no guarantees there either.

No financial aid office will be able to tell you much more than that

 

[mostwanted]

It is better to focus on, how you can limit your expenses, limit your loans, and be debt free as soon as possible. Don’t count PSLF or any other shortcuts that sound too good to be true.

Take some time to do financial planning regularly, it can be worth hundreds and thousands of dollars. For me it equaled being debt free six months after fellowship.


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[Oso]

It is better to focus on, how you can limit your expenses, limit your loans, and be debt free as soon as possible. Don’t count PSLF or any other shortcuts that sound too good to be true.

Take some time to do financial planning regularly, it can be worth hundreds and thousands of dollars. For me it equaled being debt free six months after fellowship.


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How?

 

[Forever Geebs]

How?

Live WAY below your means, lean on your spouses, work like there’s no tomorrow, etc.


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[Money Moniker]

It is better to focus on, how you can limit your expenses, limit your loans, and be debt free as soon as possible. Don’t count PSLF or any other shortcuts that sound too good to be true.

Take some time to do financial planning regularly, it can be worth hundreds and thousands of dollars. For me it equaled being debt free six months after fellowship.

Meh, I don't think going hardcore to limit your expenses during med school is particularly "high yield." The tuition is obviously non negotiable, and that's 80% of your total debt load right there.

After that, what's the maximum monthly living expense allowance you are able to take out, anyway, like $1600-2000 I would assume at most schools. I have to spend at least $1200/month between rent +utilities, car, and the most basic and restrictive of ramen noodle diets just to literally not die. So if I want to reduce my eventual debt load all I have is like $600/month of "discretionary" spending to work with, at the cost of literally eating ramen and never going out to have even the slightest bit of fun for 4 prime years of my life. No thanks, that 600 bucks isn't going to make a material change to my debt load at the end of the day but it can make my life at least somewhat more bearable in my 20s.

 

[SunsFun]

Live WAY below your means, lean on your spouses, work like there’s no tomorrow, etc.


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This is not a good advice. Even if you cut your living expenses spending dramatically, it is unlikely to significantly affect your level of debt or quality of life after your done with school and residency. It can however, worsen your performance in school, by introducing anxiety, less convenient living arrangement, less social life and networking opportunities. More importantly, IMO, you may need to compromise your diet and exercise habits, sacrificing your health for couple extra thousands in your savings account.

 

[Oso]

This is not a good advice. Even if you cut your living expenses spending dramatically, it is unlikely to significantly affect your level of debt or quality of life after your done with school and residency. It can however, worsen your performance in school, by introducing anxiety, less convenient living arrangement, less social life and networking opportunities. More importantly, IMO, you may need to compromise your diet and exercise habits, sacrificing your health for couple extra thousands in your savings account.

Yes. Plus, I'm single AF

 

[mostwanted]

I did none of extremes mentioned above. Two major expenses you can impact are housing and auto. Find good roommates unless married, you will be studying most of the time anyway. The most I paid for rent from MS1-PGY5 was MS1 bc I was stupid. $1200 vs $800 is close to $5k x number of yrs. Had friends paying 2k per month rent, I was paying less than half that.

Leasing vs buying an old corolla can be a difference of 40k. Returning extra loans you don’t need helps. Living within your means doesn’t mean starving and sacrificing your health. I was in best shape of my life PGY 4, simple body weight exercises and limiting junk food.

After becoming attending, rented, lived like a resident for a few months and hit the principal hard.

The key is to make small smart financial choices over span of 10 yrs difference is drastic. Anyone telling you to disregard planning, simply doesn’t understand its importance.

There is a reason most physicians are known to make poor financial decisions.

 

[Money Moniker]

I did none of extremes mentioned above. Two major expenses you can impact are housing and auto. Find good roommates unless married, you will be studying most of the time anyway. The most I paid for rent from MS1-PGY5 was MS1 bc I was stupid. $1200 vs $800 is close to $5k x number of yrs. Had friends paying 2k per month rent, I was paying less than half that.

Leasing vs buying an old corolla can be a difference of 40k. Returning extra loans you don’t need helps. Living within your means doesn’t mean starving and sacrificing your health. I was in best shape of my life PGY 4, simple body weight exercises and limiting junk food.

lol, my rent is less than 800, I live with roommates, and I bought my car for under $5k with money saved from my previous life and I still have to spend the maximum monthly loan limit set by my school to have any quality of life whatsoever.

I'm not sure what you're talking about when you mention friends paying 2k for rent alone or how deciding to buy a cheap car is a wiser decision than buying a new one for 40k. You may be referring to people who get money from daddy, because sure as hell the school isn't going to give you enough money per month to have turning down a 40k car or $2k/month apartment a financial "decision" you are able to make. We are already forced to live a thrifty lifestyle by our loan limits, that's the whole point, that there is no discretionary money floating around out there that we can decide to spend or not to spend in order to minimize debt unless we're going to live like a literal beggar to come significantly under our glorious $1800/month living allowance.

 

[mostwanted]

@Money Moniker, the whole point is to do the best that you can do with what you can control. And you don't have to live like a beggar to make good decisions. You will make those decisions about car and rent, maybe not as drastic in medical school but definitely in residency. If you are leasing through med school and residency, that will set you back significantly more compared to a reliable used car. (I personally leased for over 6 yrs during this time and it was a dumb decision and probably cost me over 25 k)

It is all about doing what you can with what you have. And these habits learned do shape your decision making as an attending.

I think a book that really helped me grasp this concept fully was The Slight Edge. It is about the small decisions you make over time that ultimately decide where you end up. That is true for Step scores, success in residency, financial freedom, becoming an excellent attending or accomplishing any goals in life.

 

[DBV]

Once you're an attending you just live like a poor person for a few years. No I mean literally on the streets with a cup for change. There now you have no rent or utilities as well as a second stream of income. Loans gone in no time.