To accept or not to accept

[integratethis]

So before I returned to school to finish my bachelors degree, I saved up a little cash to pay for undergrad. I definitely don't have enough money to pay for med school, but I have enough to finish undergrad. Should I accept the undergrad loans that are being offered and just stash them in the bank until I need them? Or should I decline them, pay for school with the capital that I have, and figure out how to pay for med-school later? Spending all my cash makes me nervous, but so does getting in unnecessary debt.

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[StIGMA]

Short answer: Keep a rainy day fund, which will vary in size based on personal reasons (ex: 5k, 10k, 25k). Keep it separate from your spending/loan money. A rainy day fund for an employed person (not in school) would cover 6 months of expenses (allowing time to find a new job). Once you are in medical school (and have an essentially guaranteed stream of loans/money) you wont need a 6 month rainy day fund but it would still be a good idea to keep some money for expenses that loans may not cover (such as interviews, relocating for residency).

Take out loans for the remaining costs you cant cover.

 

[Mbekweni]

I would accept any subsidized federal stafford loans and Perkins loans you are offered. These have 0% interest while in school and are "free money." that you can put in a bank account even if you don't use it on tuition. Then when med school comes around you can roll that fun of essentially 0% loans into medical school tuition to shave a few interest points off your debt burden, while also maxing out the most advantageous loan programs at that point.

 

[The White Coat Investor]

Have you been accepted to med school yet? I'd be pretty hesitant to try to arbitrage student loans rates when my future was still uncertain.

Personally, I'd try to minimize loans at every stage of the game. Is it possible that you'll benefit from taking loans early at better terms instead of later at worse terms? Sure. Is it also possible that you'll spend more because you have more money available to you and end up in worse shape in the end? Absolutely.

 

[LanaPeters]

So before I returned to school to finish my bachelors degree, I saved up a little cash to pay for undergrad. I definitely don't have enough money to pay for med school, but I have enough to finish undergrad. Should I accept the undergrad loans that are being offered and just stash them in the bank until I need them? Or should I decline them, pay for school with the capital that I have, and figure out how to pay for med-school later? Spending all my cash makes me nervous, but so does getting in unnecessary debt.

Accept the loans you were offered. It's probably better to have the money in the bank just in case unforeseen circumstances arise!

 

[ThisCouldBeYou]

Geesh, why would you possibly want to increase or delay your debt????? It will always be there. The only difference is that if you wait, it will cost you more.