Unfunded PhD, Next steps to recover from debt?

[therow]

Hi Everyone,

After three cycles of applying to Clinical Psychology programs, I finally got accepted to one and recently started this year. While I am enjoying my program, the only caveat is that it's unfunded. I know there's a huge discourse surrounding not attending unfunded clinical programs but I don't think people realize how difficult admissions have become. Given that programs have waived the GRE, hundreds of applicants fighting for 5 or less spots (depending even if the advisor accepts any student). I also want to add that I had a well rounded CV, 4.0 GPA, 4 publications, 2 conferences and multiple RA experience. My program is not a diploma mill, it's existed since 1970's, it's accredited and has a relatively small cohort (8-9 students per year). This program is certainly more focused on clinical training and does not emphasize research as you apply to the program as a whole as opposed to working with an advisor. While I was completely aware of the tuition, I will need to take out a student loan to be able to fund my education. Of course, I am thankful to have been accepted to a PhD program but there's always this thought in the back of my head as to how much debt I will have to pay off years following graduation. I've heard that private practice is the best way to go; I am curious to hear from other professionals what would be the smartest way to pay off these loans as a psychologist in the field.

Sorry to add: we’re looking at 80K debt and also I am a Canadian attending a US institution.

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[WisNeuro]

How much debt are we talking here?

 

[futureapppsy2]

How much total debt are you looking at?

 

[PsyDuck90]

VA is giving out EDRP for basically every position at this point, which is up to $200K I believe, so a VA psychology career can be one avenue of managing the debt burden, depending on how much debt you are going to take on.

 

[therow]

How much total debt are you looking at?

80K

 

[therow]

VA is giving out EDRP for basically every position at this point, which is up to $200K I believe, so a VA psychology career can be one avenue of managing the debt burden, depending on how much debt you are going to take on.

How much debt are we talking here?

How much debt are we talking here?

80K

 

[therow]

VA is giving out EDRP for basically every position at this point, which is up to $200K I believe, so a VA psychology career can be one avenue of managing the debt burden, depending on how much debt you are going to take on.

Unfortunately, I’m not an American citizen so I don’t think I would be eligible

 

[WisNeuro]

80K

Total? As in all of the loans you'd need to to take out for tuition and living expenses for 4-5 years of grad school and 1 year of internship?

 

[summerbabe]

I am curious to hear from other professionals what would be the smartest way to pay off these loans as a psychologist in the field.

My biggest advice would be to do whatever you can to limit debt while in grad school within reason (e.g., living alone versus with roommates, considering internships in reasonable cost of living locales).

One big decision would be whether to do a formal postdoc or go immediately into a job. A formal postdoc will reduce your income that year (maybe between $15000 to $25000 give or take?) which is money that can go towards paying down interest and getting into your principle so you can pay things off quickly.

But a formal postdoc may be very beneficial for licensure in your desired state, potentially be an opportunity to learn something that will pay for itself many times over down the line and help with future employment opportunities.

Once you get licensed, private practice has the highest variance in income potential but if you're starting out new as a fully licensed psychologist or somebody who skips postdoc but needs supervised hours (which an institutional might provide as part of your employment), working an institutional job out of grad school might be a better bet.

You'll have a guaranteed salary & benefits versus a likely split in somebody else's private practice which might not work in your favor. If you're fully licensed, you could start your own private practice but you'll be on the hook for all startup costs, insurance, and would have to weather slower periods.

So one option could be to get an institutional job with the best salary and fringe benefits and also work on building your own private practice slowly (like see a small caseload for 2-4 hours a week during evenings or weekends) which would not only bring in some extra income but you can then potentially transition to that full time once you get a hang of things and if you enjoy that. Good luck!

 

[therow]

Total? As in all of the loans you'd need to to take out for tuition and living expenses for 4-5 years of grad school and 1 year of internship?

Yes, I’m fortunate to not have to worry about living expenses as my parents cover my living expenses. I just have to worry about tuition.

 

[AcronymAllergy]

Personal opinion--obviously no debt is the ideal, but I think $80k is manageable on a typical psychologist's salary. I would strongly second the recommendations above about EDRP with VA. As was said, they offer up to $200k total, at $40k/year, meaning you could pay the loan off for "free" after 2-3 years (depending on interest and what not). You'd just have to adjust your spending/lifestyle during that first year to be able to live off your salary minus $40k until VA reimburses you for those loan payments.

That's probably the quickest way to get the loans taken care of.

And building on summerbabe's advice, if you opt for a formal postdoc, try to get on an income-based repayment plan and make payments during that time; I believe with the way things are currently set, as long as you're making the minimum payment each month, interest will not accrue even if the payment doesn't cover the interest. And when you finish postdoc, keep your lifestyle at that same level even when your salary increases (i.e., what the physicians refer to as "living like a resident"). Even if you don't go the EDRP route, you should be able to pay off $80k in loans in 3-4 years, or less, if you're only living on ~$50-60k of your salary. You could accelerate the timeline in a salaried position by doing some side work and putting all of that money toward the loan.