Grad student loan advice to new students

docjohng · Jun 28, 2009

As you're applying to or enjoying your first year or two of grad school, let me give you a word of advice about student loans, especially for the psychology field. Especially for those who are paying for their own grad school education:

Do not take out more than $100k in student loans, and try and stay under $50k.

Of course, I am not a financial consultant, so take this as just one professional's opinion (who graduated with nearly $70k in debt in 1995).

You are studying to become a psychologist, not a surgeon. Even the best psychologists, 10 years out of school, get into 6 figure incomes only when everything is working well (whether you're a clinician or researcher). Most surgeons can handle the loan debt of 6 figures; virtually 99% of psychologists can not.

Starting salaries of most psychologists will make your first couple of years challenging out of school. If you're also trying to juggle the debt of a 6 figure student loan, what was difficult has just become virtually impossible without putting off repayment. And putting off repayment (or paying only interest or what-not) is just delaying the inevitable financial burden.

One of the things we sometimes tell ourselves is, "Oh, it'll be better in a few years, because I'll be more well-established, the economy will be better, etc. etc." Then you forget oh yeah, you wanted to start a family (hello new debt, hello college savings fund!), oh and you wanted to buy a nice house for your new family, oh and how about all those extracurricular activities the kids want to enjoy? etc. etc.

In other words, our irrational thinking misleads us -- sometimes right into making poor financial decisions.

I remember, year after year, spending a lot of time in my school's financial aid office, filling out the forms that brought nearly instant (and seemingly unlimited) amounts of money. I knew exactly how much debt I was taking on at the time, and understood the trade-off; I have no regrets about taking on that debt. I worked my butt off in grad school, in addition to my studies and practicums, to keep that amount as low as possible.

But some of my classmates didn't think well enough about the debt levels they were taking on. And they have not been happy campers at typical psychologist-level salaries in most places.

Investigate all means of other financial instruments available to you outside of loans -- grants, stipends, research awards, you name it.

In other words -- don't take this debt on lightly and think, "Oh, it'll be okay, I'll make more than enough money in salary to cover it." You probably will be okay in salary in covering it, but it does make things more challenging with that debt on your credit record for decades to come.

John

cyclechic · Jun 30, 2009

Thanks for the great post!

The financial burden of grad school almost seems like a taboo subject, however it's the reality we are left with after the diploma is conferred. Having consoled friends who have taken on nearly six figure debt for a Master's level education, I welcome all students contemplating a doctoral degree to seriously consider the financial repercussions of even low interest debt.

For a reality check, visit a student loan calculator.

deleted176373 · Jun 30, 2009

I think this is GREAT advice for the majority of students who are considering loans as a way to pay for school! While there are exceptions to the rule, they are few and far between and often involve sacrifices that most people wouldn't make, can't make, or just don't qualify for... (e.g. Working on an Indian reservation, serving in the military, or other position where loan repayment/forgiveness exists.)

Having seen what psychologists make in general (without a fair amount of experience and outside of a specialist private practice.) You have been well advised by a professional (see above) not to get into too much debt. It takes forever to pay off $100k worth of debt, and it will put a cramp into your lifestyle as well as limit your ability to make drastic changes in your life without considering your debt first.

Mark

aagman01 · Jul 13, 2009

Those of us seeking employment at colleges/universities, or non-profits and schools, etc.........

Loan forgiveness (after 10 years) PLUS income based repayments are now available!

Read up and spread the word....

http://www.ibrinfo.org/what.vp.html

docjohng said:
As you're applying to or enjoying your first year or two of grad school, let me give you a word of advice about student loans, especially for the psychology field. Especially for those who are paying for their own grad school education:

Do not take out more than $100k in student loans, and try and stay under $50k.

Of course, I am not a financial consultant, so take this as just one professional's opinion (who graduated with nearly $70k in debt in 1995).

You are studying to become a psychologist, not a surgeon. Even the best psychologists, 10 years out of school, get into 6 figure incomes only when everything is working well (whether you're a clinician or researcher). Most surgeons can handle the loan debt of 6 figures; virtually 99% of psychologists can not.

Starting salaries of most psychologists will make your first couple of years challenging out of school. If you're also trying to juggle the debt of a 6 figure student loan, what was difficult has just become virtually impossible without putting off repayment. And putting off repayment (or paying only interest or what-not) is just delaying the inevitable financial burden.

One of the things we sometimes tell ourselves is, "Oh, it'll be better in a few years, because I'll be more well-established, the economy will be better, etc. etc." Then you forget oh yeah, you wanted to start a family (hello new debt, hello college savings fund!), oh and you wanted to buy a nice house for your new family, oh and how about all those extracurricular activities the kids want to enjoy? etc. etc.

In other words, our irrational thinking misleads us -- sometimes right into making poor financial decisions.

I remember, year after year, spending a lot of time in my school's financial aid office, filling out the forms that brought nearly instant (and seemingly unlimited) amounts of money. I knew exactly how much debt I was taking on at the time, and understood the trade-off; I have no regrets about taking on that debt. I worked my butt off in grad school, in addition to my studies and practicums, to keep that amount as low as possible.

But some of my classmates didn't think well enough about the debt levels they were taking on. And they have not been happy campers at typical psychologist-level salaries in most places.

Investigate all means of other financial instruments available to you outside of loans -- grants, stipends, research awards, you name it.

In other words -- don't take this debt on lightly and think, "Oh, it'll be okay, I'll make more than enough money in salary to cover it." You probably will be okay in salary in covering it, but it does make things more challenging with that debt on your credit record for decades to come.

John

JockNerd · Jul 13, 2009

cyclechic said:
Thanks for the great post!

The financial burden of grad school almost seems like a taboo subject,

Some of us on the board get told that we never shut up about it. 😉 Sometimes we get told TO shut up about it.

Having consoled friends who have taken on nearly six figure debt for a Master's level education,

Insanity.

Therapist4Chnge · Jul 13, 2009

cyclechic said:
Having consoled friends who have taken on nearly six figure debt for a Master's level education....

I know some people at the MA/MS level who did this too (NYC / Boston areas). Tuition can be insane, on top of the cost of living.

aagman01 · Jul 13, 2009

Doc John,

I have to disagree with your advice.

Check out the new loan forgiveness program that was passed by Congress. There are two parts to it -

(a) Income Based Repayment (IBR)
and
(b) Loan Forgiveness

(a)
IBR guarantees that loans never exceed 10% of total annual income (and is normally actually less, depending on # of dependants and what not)

(b)
Loan forgiveness kicks in when you make 120 consecutive re-payments (at that 10% 0f your annual salary). As long as you are working in non-profit or government institution (including as a researcher or academic in college/university, as a psychologist in a school or 501 (3c) , as a psych in the armed services/VA hospital, or in a non-profit where it can be documented, you are eligible for the forgiveness. You also have to consolidate your loans into the federal loan program.

Basically, this new legislation guarantees you pay no more than 10% per year of your salary for 10 years, and then everything is forgiven. I could have made it through the remainder of my doctoral studies with no further loans above the $40,000 I accrued between undergrad and starting doctoral work, but now I am considering taking out some more loans.

I am planning to, obviously, do more research into this and also plan to talk to a few financial advisors / university financial aid types before I make final decisions on this in September, but so far it seems good and legitimate.

Here is information on the loan forgiveness & income based repayment:

http://www.ibrinfo.org/what.vp.html

or for q/a section

http://www.ibrinfo.org/faq.vp.html

This organization has live online question and answer sessions regarding all this on their facebook page (that links to the lecture/discussion). They also have several previously recorded lecture/discussions that are very informative that you can listen to at any time. Just facebook them at Project for Student Debt to join!

docjohng said:
As you're applying to or enjoying your first year or two of grad school, let me give you a word of advice about student loans, especially for the psychology field. Especially for those who are paying for their own grad school education:

Do not take out more than $100k in student loans, and try and stay under $50k.

Of course, I am not a financial consultant, so take this as just one professional's opinion (who graduated with nearly $70k in debt in 1995).

You are studying to become a psychologist, not a surgeon. Even the best psychologists, 10 years out of school, get into 6 figure incomes only when everything is working well (whether you're a clinician or researcher). Most surgeons can handle the loan debt of 6 figures; virtually 99% of psychologists can not.

Starting salaries of most psychologists will make your first couple of years challenging out of school. If you're also trying to juggle the debt of a 6 figure student loan, what was difficult has just become virtually impossible without putting off repayment. And putting off repayment (or paying only interest or what-not) is just delaying the inevitable financial burden.

One of the things we sometimes tell ourselves is, "Oh, it'll be better in a few years, because I'll be more well-established, the economy will be better, etc. etc." Then you forget oh yeah, you wanted to start a family (hello new debt, hello college savings fund!), oh and you wanted to buy a nice house for your new family, oh and how about all those extracurricular activities the kids want to enjoy? etc. etc.

In other words, our irrational thinking misleads us -- sometimes right into making poor financial decisions.

I remember, year after year, spending a lot of time in my school's financial aid office, filling out the forms that brought nearly instant (and seemingly unlimited) amounts of money. I knew exactly how much debt I was taking on at the time, and understood the trade-off; I have no regrets about taking on that debt. I worked my butt off in grad school, in addition to my studies and practicums, to keep that amount as low as possible.

But some of my classmates didn't think well enough about the debt levels they were taking on. And they have not been happy campers at typical psychologist-level salaries in most places.

Investigate all means of other financial instruments available to you outside of loans -- grants, stipends, research awards, you name it.

In other words -- don't take this debt on lightly and think, "Oh, it'll be okay, I'll make more than enough money in salary to cover it." You probably will be okay in salary in covering it, but it does make things more challenging with that debt on your credit record for decades to come.

John

deleted176373 · Jul 14, 2009

aagman01 said:
Doc John,

I have to disagree with your advice.

Check out the new loan forgiveness program that was passed by Congress. There are two parts to it -

(a) Income Based Repayment (IBR)
and
(b) Loan Forgiveness

(a)
IBR guarantees that loans never exceed 10% of total annual income (and is normally actually less, depending on # of dependants and what not)

(b)
Loan forgiveness kicks in when you make 120 consecutive re-payments (at that 10% 0f your annual salary). As long as you are working in non-profit or government institution (including as a researcher or academic in college/university, as a psychologist in a school or 501 (3c) , as a psych in the armed services/VA hospital, or in a non-profit where it can be documented, you are eligible for the forgiveness. You also have to consolidate your loans into the federal loan program.

Basically, this new legislation guarantees you pay no more than 10% per year of your salary for 10 years, and then everything is forgiven. I could have made it through the remainder of my doctoral studies with no further loans above the $40,000 I accrued between undergrad and starting doctoral work, but now I am considering taking out some more loans.

I am planning to, obviously, do more research into this and also plan to talk to a few financial advisors / university financial aid types before I make final decisions on this in September, but so far it seems good and legitimate.

This is a great program, but it's akin to making a deal with the devil. As a result, I believe that you are wrong in staking out a position suggesting that accumulating a huge debt load is ok.

You might want to think carefully about this, because a great many of the people taking these loans WILL NOT be in the situation where they can work in government programs and there are other situations too where you will shoot yourself squarely in the foot.

Let's say I take the gamble, I go to Argosy for my Psy.D. and rack up $150k in debt to pursue my dream of being a psychologist. I am unfortunate and do not secure a funded APA approved internship. Now, I don't know about you... but to me that means... No VA, No military, Unlikely to get an academic or research position. This leaves you with few options, basically you're screwed.

Even if you do get the coveted non-profit/research/VA job you want and the lower repayment option, thinking... this is no problem. I can get away with paying $500 a month for 10 years while I make 60k per year. No problem. I can afford that.

You then meet the "love of your life." You want to get married... only to find out that, Ooops, with his/her income my student loan will explode to almost a $1000 a month even though they only make 40k per year.

Another scenario to consider... you get laid off from your position working with a non-profit, now... unless you get another non-profit job... you're gonna be facing some real ugliness. You will be held to the conditions and should you no longer meet the exemption, you will be forced to increase your payments. You also will not be eligible for forgiveness until 25 years unless you return to public service. 25 YEARS.

The original poster is correct. You need to limit your debt load, it's stupid to rack up this much debt for an education in this field without having a nearly bullet proof way of paying for it.

Mark

Wildcat06 · Jul 14, 2009

Well stated Mark.

Also keep in mind that the major problem with income based repayment (and graduated payment) schedules is that it stretches out the repayment period, meaning that you will be paying an awful lot more interest in the long run. The sooner you can pay off any kind of debt the better.

Note also that the IBR info says the loan may be forgiven after 25 years of "qualifying" payments. I'm guessing that means one late payment by a day in 25 years and you'll lose eligibility. Kinda unlikely that in 25 years you won't space on just one or have a check get stuck in the mail...

I think that loans are for many a necessary evil but as John stated, one you should not take lightly.

aagman01 · Jul 14, 2009

Wildcat06,

Definately appreciate your and others suggestions.

This process should not be taken lightly.

The loan forgiveness programs cancels loans for anyone in a government or non-profit position after 10 years of repayment (capped at 10% of income, due to the IBR that is automatically a part of the loan forgiveness).

The IBR can also be seperate. If seperate, you pay (maximum of 10% of income) for 25 years, and then your loans are forgiven. It doesn't matter where you work (i.e. non-profit/government/VA or for-profit).

In my case, I am pursuing a doctorate in school psychology. My plans are to work in a hospital/community mental health center - as a backup, I can work in a public school setting if I wish. There is an extreme shortage of school psychs, which makes finding a public school job fairly non-competitive (even in this economy).

But you are right....every person and situation is different. Right now, I have about $40,000 in subsidized loans. So it would take me about 10 to repay. Since I will definately be working in public setting, it really seems to make sense FOR ME to accumulate additional loans while I am still in school, since I will be paying off loans for 10 years afterwards and they will be forgiven regardless of whether I have $40,000 or $100,000 in loans.

Wildcat06 said:
Well stated Mark.

Also keep in mind that the major problem with income based repayment (and graduated payment) schedules is that it stretches out the repayment period, meaning that you will be paying an awful lot more interest in the long run. The sooner you can pay off any kind of debt the better.

Note also that the IBR info says the loan may be forgiven after 25 years of "qualifying" payments. I'm guessing that means one late payment by a day in 25 years and you'll lose eligibility. Kinda unlikely that in 25 years you won't space on just one or have a check get stuck in the mail...

I think that loans are for many a necessary evil but as John stated, one you should not take lightly.

deleted176373 · Jul 14, 2009

aagman01 said:
But you are right....every person and situation is different. Right now, I have about $40,000 in subsidized loans. So it would take me about 10 to repay. Since I will definately be working in public setting, it really seems to make sense FOR ME to accumulate additional loans while I am still in school, since I will be paying off loans for 10 years afterwards and they will be forgiven regardless of whether I have $40,000 or $100,000 in loans.

Exactly, you are the expert on you and you know what your planned career trajectory is. You are an exception to the rule in some ways, and that's fine.

Others have their own unique circumstance too. I think you did a great job highlighting a program that others may not have known much about. I know had I been paying for school, I would pay close attention to opportunities like this. I was almost in that boat, and it was always in the plan to return to military service. So for me, this would have been very similar to the path I was considering.

I would have been making payments and applying for LRP through the military. Once again, it's a good plan, but if I did not get into the military? What if I couldn't get a waiver for LASIK surgery, cholesterol, blood pressure or other possible medical condition that occurred during the 5 years of graduate school? I would have been faced with a real mess and real debt. Sometimes you do need to roll the dice and throw caution to the wind. Just have a good backup plan.

Therapist4Chnge · Sep 23, 2010

Here is a great article from right here on SDN: http://www.studentdoctor.net/2010/09/common-mistakes-when-repaying-student-loan-debt//

DrGero · Sep 23, 2010

What about for those of us who have already made the insane, six-figure debt gamble (me)? What do we do?

My loans are consolidated with Wells Fargo at a fairly low rate. My payments are (and will stay) at around 550 bucks per month for the rest of my life. With my VA job it's not unmanageable. But I would love it if there were more options than just paying it and hoping my income rises enough later to decrease my relative debt load.

Apparently I do have the option, within the VA, of applying for student loan repayment funds, but I'm not confident I'll get a significant chunk of $$$$ from this program (who knows, though).

I've been looking into signing up with the Army Medical Command, as they offer student loan repayment, but my wife is skeptical and the geographic issues make her leery of this idea (much less the risk of deployment issue - although I'm pretty sure I could handle that).

Anyways, I appreciate the existence of a thread like this, but I wish there were more threads for those of us out there who have (wisely or unwisely) already taken the debt plunge in their quest to attain their doctorates. I didn't get a lot of advise like this when I was getting into graduate school (I wish I had), I still feel like financial guidance would be much appreciated. Anyways, just talking out loud....

ILGirl · Sep 23, 2010

aagman01 said:
Those of us seeking employment at colleges/universities, or non-profits and schools, etc.........

Loan forgiveness (after 10 years) PLUS income based repayments are now available!

Read up and spread the word....

http://www.ibrinfo.org/what.vp.html

Sounds great, for me. My fear: It is available now, but will it be available in the future, or will it get pulled a couple years from now, and everything goes back to the status quo?

Once you choose income-based repayment will it stay that way, or could the government renege, and I am left having to repay tremendous debt?

Until this albatross is off my neck, I will not be able to breathe entirely freely. This IBR is hopefully the way for me to go.

aagman01 · Sep 23, 2010

I would argue that the IBR and Public Loan Forgiveness Act are both, in effect, huge financial incentives for the middle class. Our fine congressional delegates are, I would argue based on previous experience in govenment affairs work, less likely to cut a program like this than a program for the poor (not that I personally support such preferences for middle class over the poor). Also, this act was passed into law along with the healthcare overhaul which, despite the political posturing occurring, is not easy to "undue".

For more on the IBR and Public Loan Forgiveness Act (and for an organization who can answer your statement/question far better than I), check out the following:

http://www.ibrinfo.org/what.vp.html

I spoke with one of the lawyers who work with the organization in Berkley, cA. Very knowledgeable and articulate.

ILGirl said:
Sounds great, for me. My fear: It is available now, but will it be available in the future, or will it get pulled a couple years from now, and everything goes back to the status quo?

Once you choose income-based repayment will it stay that way, or could the government renege, and I am left having to repay tremendous debt?

Until this albatross is off my neck, I will not be able to breathe entirely freely. This IBR is hopefully the way for me to go.

Student4Life0 · Sep 23, 2010

While this is good advice, it's not always feasible. As someone that will be coming out of their MA degree with 50 grand in debt, I will not sit around and feel bad for that decision. Do I wish I didn't have that debt? Yes. Is there anything I can do about it now? No. I also got some very valuable experience during my MA. Now it's time (hopefully) next year for my doctoral degree. How is one expected to live without taking out extra for cost of living? I am aiming for a funded program, so that I can hopefully finish without more than 100,000 in debt. But that may not happen. Oh well...what's a poor student to do?

Student4Life0 · Sep 23, 2010

DrGero said:
What about for those of us who have already made the insane, six-figure debt gamble (me)? What do we do?

My loans are consolidated with Wells Fargo at a fairly low rate. My payments are (and will stay) at around 550 bucks per month for the rest of my life. With my VA job it's not unmanageable. But I would love it if there were more options than just paying it and hoping my income rises enough later to decrease my relative debt load.

Apparently I do have the option, within the VA, of applying for student loan repayment funds, but I'm not confident I'll get a significant chunk of $$$$ from this program (who knows, though).

I've been looking into signing up with the Army Medical Command, as they offer student loan repayment, but my wife is skeptical and the geographic issues make her leery of this idea (much less the risk of deployment issue - although I'm pretty sure I could handle that).

Anyways, I appreciate the existence of a thread like this, but I wish there were more threads for those of us out there who have (wisely or unwisely) already taken the debt plunge in their quest to attain their doctorates. I didn't get a lot of advise like this when I was getting into graduate school (I wish I had), I still feel like financial guidance would be much appreciated. Anyways, just talking out loud....

absolutely agreed.

deleted176373 · Sep 23, 2010

Student4Life0 said:
While this is good advice, it's not always feasible. As someone that will be coming out of their MA degree with 50 grand in debt, I will not sit around and feel bad for that decision.

Is there anything wrong with feeling bad about a bad decision? I am not saying that this was a bad decision, although I might look at it as a bad decision from where I stand, you may feel that it was the best money you ever spent.

Do I wish I didn't have that debt? Yes. Is there anything I can do about it now? No.

Well you could avoid racking up additional debt, that's one thing that you can do now.

I also got some very valuable experience during my MA. Now it's time (hopefully) next year for my doctoral degree.

Was it worth $50,000 and 1 to 2 years of study?

How is one expected to live without taking out extra for cost of living?

Either you find alternative funding or you learn to live extremely frugally. Does it suck? Yep, it sure does. However it is possible to live on the cheap.

I am aiming for a funded program, so that I can hopefully finish without more than 100,000 in debt. But that may not happen. Oh well...what's a poor student to do?

Make intelligent decisions about debt. A Ph.D. or Psy.D. in psychology is not worth spending $150,000 to get, the opportunity costs coupled with the relatively modest pay that psychologists face in the marketplace make it a dubious proposition.

Mark

DrGero · Sep 26, 2010

Jon Snow said:
Dr Gero,

You might want to check with direct loans, or the appropriate government agency, to find out if your loans qualify for the 10 year dismissal. I would think yes, because you work for the VA, but I don't know. If so, you may want to check on your payment levels as I think they have strict definitions of qualifying monthly payments. I got an email about this. As it doesn't apply to me, I'm somewhat hazy on the details. But, I think it counts the number of qualifying payments in its time calculation for dismissal of the loans. So, you could, conceivably, meet their entry criteria, paid for 10 years, but made no qualifying payments.

So I took your advice, did some research, and actually found out that I am able to consolidate my loans into the Direct Loan program (which means I can qualify for PSLF!). The downside is that in order to qualify for the PSLF program, my monthly payments will have to go up a bit (probably about 150 bucks) and I'll have to file separately from my wife (which would either be slightly bad or very bad for our taxes, not sure yet), but, apparently I can qualify... as long as I stay with the VA and work full-time (which, unfortunately, is not the case right now, but that's another story and can be rectified down the line).

I'll be filing the Direct Loan Consolidation stuff next week.... hopefully this will all work out....

aequitasveritas · Oct 1, 2010

150k is actually a low number. Most unfunded doctorates are costing that much in tuition alone.

I think the point of the original thread can't be disputed: that if you can accum. zero debt...do so.

Don't spend tomorrow's money today...or tomorrow will suck.

MissSPSS · Nov 10, 2011

Unfunded PhD- $100,000 + past loans $60,000. The number isn't even real to me yet.

deleted176373 · Nov 11, 2011

MissSPSS said:
Unfunded PhD- $100,000 + past loans $60,000. The number isn't even real to me yet.

It will be one day.

yeti2213 · Nov 11, 2011

From what I've seen stipend numbers run somewhere from 14 - 24k a year. And I'm trying to imagine living in a major metro area, like the one I'm in now, on that. It would be incredibly tight even if one were pretty frugal, rent alone would consume 50% or more of the lower figure. And I'm not sure if health insurance is subtracted from that or a benefit in addition to....

Are people making it through funding programs without accruing debt?I get the general thrust that there is funding but I'm not clear on the intricacies of doctoral funding, so if someone wants to venture an broad explanation of that I'd be grateful?

Quynh2007 · Nov 11, 2011

yeti2213 said:
From what I've seen stipend numbers run somewhere from 14 - 24k a year. And I'm trying to imagine living in a major metro area, like the one I'm in now, on that. It would be incredibly tight even if one were pretty frugal, rent alone would consume 50% or more of the lower figure. And I'm not sure if health insurance is subtracted from that or a benefit in addition to....

Are people making it through funding programs without accruing debt?I get the general thrust that there is funding but I'm not clear on the intricacies of doctoral funding, so if someone wants to venture an broad explanation of that I'd be grateful?

I have not accrued debt. I can live very comfortably. My stipend is $2300 each month during the school year, and $1800 during the summer. School pays for traveling for research/professional development purposes, and health insurance. So, basically, I spend less than $1000 on necessities (mortgage, internet, car insurance, food, etc) each month, and the rest goes into luxuries (clothes, shoes, the dog's vet visit) and savings account.

yeti2213 · Nov 11, 2011

Quynh2007 said:
I have not accrued debt. I can live very comfortably. My stipend is $2300 each month during the school year, and $1800 during the summer. School pays for traveling for research/professional development purposes, and health insurance. So, basically, I spend less than $1000 on necessities (mortgage, internet, car insurance, food, etc) each month, and the rest goes into luxuries (clothes, shoes, the dog's vet visit) and savings account.

Sure, I think the top end of that scale, around 24, which is where you are would be a lot more manageable. And at that income you are not paying 35% in federal and state combined. I was automatically lopping that off the top in my head. So that helps.

But also your location says Nashville, if that is accurate. The total cost of living index there is like 88 where as where I am is 145. Also the housing index for nashville is only 72 vs over 200 for where I am... if I were to stay around here I don't think I could hold my basic monthlies (rent, electric/gas, cell phone, car insurance, gym membership) to under 1200. Then throw in food on top of that. And add about 10 percent of total income to that for taxes. It starts to look tight.

G Costanza · Nov 11, 2011

yeti2213 said:
From what I've seen stipend numbers run somewhere from 14 - 24k a year. And I'm trying to imagine living in a major metro area, like the one I'm in now, on that. It would be incredibly tight even if one were pretty frugal, rent alone would consume 50% or more of the lower figure. And I'm not sure if health insurance is subtracted from that or a benefit in addition to....

Are people making it through funding programs without accruing debt?I get the general thrust that there is funding but I'm not clear on the intricacies of doctoral funding, so if someone wants to venture an broad explanation of that I'd be grateful?

I'm doing fine without any debt. My finding covers the cost of my tuition for 9 credits. It does not include those other fees like technology, enrollement etc. I usually pay about $500 a semester for that.
My stipend is about 16K a year. It's not great but I'm married and my wife works full time. That helps a lot. A lot of people in my cohort are single and they get by just fine with a roommate. You won't be going out to dinner much but it's a heck of a lot better than many other people.

In my program, most of us have the mindset that we are just lucky to be getting a top notch education for free. Some might argue that it's not free because you have duties within the department, but it certainly doesn't feel like work.

Quynh2007 · Nov 11, 2011

yeti2213 said:
Sure, I think the top end of that scale, around 24, which is where you are would be a lot more manageable. And at that income you are not paying 35% in federal and state combined. I was automatically lopping that off the top in my head. So that helps.

But also your location says Nashville, if that is accurate. The total cost of living index there is like 88 where as where I am is 145. Also the housing index for nashville is only 72 vs over 200 for where I am... if I were to stay around here I don't think I could hold my basic monthlies (rent, electric/gas, cell phone, car insurance, gym membership) to under 1200. Then throw in food on top of that. And add about 10 percent of total income to that for taxes. It starts to look tight.

love your avatar.

yeah, Nashville's got a pretty low cost of living compared to relatively sized cities. TN has no income tax, but has a high sales tax on everything, except for Amazon which you are suppose to declare and pay for when you file taxes...

cara susanna · Nov 12, 2011

I don't have any debt, but I'm in an area with a very low cost of living. My stipend was great but now I'm funded through my practicum, which is a lot less money. I'd be struggling if I didn't have a quarter-time TAship, a boyfriend who is also working, and also if my parents didn't pay for my car's gas.

yeti2213 · Nov 12, 2011

Quynh2007 said:
love your avatar.

thanks. nerd humor is the best humor

G Costanza said:
My stipend is about 16K a year. It's not great but I'm married and my wife works full time. That helps a lot.

Don't tell my mother that. She has been pointing out the same thing as a reason for me to get married. She also adds that any girl "from a good family" will also come with a dowry that would fund our living costs for a few years 🙂

Its good to know people are making it on the stipend. One thing all the low salary talk on this board has beat into me is that I definitely don't want a any debt coming out of school.

wigflip · Nov 14, 2011

my apologies if someone else has already noted that:

"Social Security benefits are off–limits to creditors, such as credit–card companies and banks. But the U.S. can collect debts to federal agencies by "offsetting," or withholding Social Security and disability payments."

This includes student loans.

http://finance.yahoo.com/retirement...d-loans-may-haunt-seniors?mod=retire-planning
http://www.globalaging.org/pension/us/socialsec/2006/studentloans.htm

Therapist4Chnge · Nov 14, 2011

That is solid advice from docjohng. It is amazing how quickly compound interest can add up. I (unfortunately) came in with a chunk of undergrad debt, so my outgoing debt was more than I would have liked ($100k+). A others have posted, there are a number of loan repayment programs, but it is a scary proposition to assume that these programs will still be present and applicable in the future. I am hoping to do the IBR program, as I plan on staying in academic medicine (or the VA system), but nothing is set in stone.

audchik · Nov 17, 2011

Thanks for this advice. Even the small debt I accrued during my undergrad was enough to slap some sense into me about the realities of payback time. Although I am going to have substantial loans for my graduate education, I am going into it with my eyes wide open. I am going to use every opportunity available to keep them as low as possible.

For many years students have been told that it's OK to go into huge debt for your education because it will "pay off". It most likely will, but that doesn't mean you should do it in such a carefree way...go into it realizing that when the real world hits, it might not be as easy as you once thought.

Grad student loan advice to new students

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