$500,000 Debt

[Yourmother]

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Can anyone tell me when half a million bucks is going to be the norm for undergrad and medical school debt?

If inflation continue, my guess is 5 years.

 

[Doctor Bagel]

Yeah, it's scary to think where it'll be if tuition keeps on increasing at its current rate. I'm thinking there has to be a breaking point, but schools are really at a point where they have to continue to raise tuition to stay afloat.

The one thing I wouldn't be too surprised to see if a reduction in the availability of loans. International students who go to offshore schools are already seeing a bit of this.

 

[Yourmother]

http://money.cnn.com/2007/11/16/pf/young_doctors.moneymag/index.htm?postversion=2007111611

And here it is!

 

[Lesley]

http://money.cnn.com/2007/11/16/pf/young_doctors.moneymag/index.htm?postversion=2007111611

And here it is!

Yep, the numbers are staggering. However, what drew me to this article is that these two doctors are 28 and 29 having their first child; the same ages my husband and I were when had our first, also incidentally in November. Both my husband and I carried $65,000 each in school debt on top of a mortgage. The cost, the equivalent of three mortgages as this article also states, albeit, 25 years later, has not changed. Although their interest rates are more favorable, between 4-9%, ours were 5-20% thanks to the great "inflated" eighties! What has changed is the cost of education and the cost of living, relative to income; and this applies to everyone, regardless of their level of education. I would say at least 50% of the students in my class had significant if not complete help from their parents, now I suspect that number is 10%, maybe less. This number is sure to shrink too.

 

[yadayadadude]

If my numbers are not wrong, I think the class entering medical school in five years will see a total debt burden of around $500K. As things stand now, for the class entering this year (graduating in 2011), if they borrow $60K during their MS1 year ($35-40K for tuition and $20-25K for living expenses), and that number increases 5% for each year (halfway between the historical increase in tuition of around 7% and the overall inflation of around 3%), they pay in-school interest of around 7.5% on unsubsidized and GradPlus loans, then enter forbearance for four years ... the total debt that results is very nearly $400K. So I bet that for those students entering medical school in five years, assuming a roughly 5% inflationary increase per year, the total debt will be around $500K, after all is said and done.

Here's to you, class of 2016!

 

[Yourmother]

Even BETTER!

What if class of 2016 has $500,000 average debt

&

a national healthcare pulls physican incomes down by 50%

 

[Lopyswine]

500K

seems like its right around the corner. I wouldn't be surprised if it starts happening faster than in 5 years.

 

[gida]

The interesting thing is that in countries that have nationalized healthcare....they have free or almost free medical schooling, including Canada!!!

 

[Obnoxious Dad]

Even BETTER!

What if class of 2016 has $500,000 average debt

&

a national healthcare pulls physican incomes down by 50%

If we have an NHS system here in the US and incomes dive you will see:1) an end to FMG's coming here; 2) massive early retirements by doctors 55 and over; 3) a serious decline in the stats for med school applicants; and 4) (I know this sounds crazy) a flight of young doctors in debt from the USA until the government pays off reasonable debt levels or the government allows physicians to get rid of debt in bankruptcy.

It's just basic economics.😱

 

[Yourmother]

500K

seems like its right around the corner. I wouldn't be surprised if it starts happening faster than in 5 years.

Do I hear $700,00? $700,00 anyone....going once, going twice $750,000....we have one at $750,000......to the gentleman in the blue suit we have $770,000.....$770,000 going once......going twice.....$800,000 to the youngster in the scrubs.......going once, going twice...do I hear $900,000

 

[Yourmother]

The interesting thing is that in countries that have nationalized healthcare....they have free or almost free medical schooling, including Canada!!!

ok, so.

 

[thecatran]

If that's the case, then I'm may seriously consider another career besides medicine. I like medicine, but it's not the only career that would allow me to positively impact the health care system. Unless I get a scholarship, it looks like I won't be going.

 

[wanabdoc]

Can anyone tell me when half a million bucks is going to be the norm for undergrad and medical school debt?

If inflation continue, my guess is 5 years.

That is what the government wants 😉. According to an interview with a UK representative in Sicko, people in debt make much better workers for the economy and are more compliant.

 

[Krony]

My wife and I will have borrowed nearly exactly $500K (no, I'm not counting interest) by the time she finishes her dental residency 2.5 years from now. 😱

Me: 4 years private college + 4 years private medical school, 3.5 years of residency to go.
Her: 4 years private college + 4 years private dental school + 3 years of dental residency tuition that she must pay tuition for > dental school tuition

Sure...2 salaries but she'll be about 30 when she finishes then there's a bit of a window for family planning so at most she'll work half time. Anway...I think I'm going to half to work a lot.

 

[Lesley]

My wife and I will have borrowed nearly exactly $500K (no, I'm not counting interest) by the time she finishes her dental residency 2.5 years from now. 😱

Me: 4 years private college + 4 years private medical school, 3.5 years of residency to go.
Her: 4 years private college + 4 years private dental school + 3 years of dental residency tuition that she must pay tuition for > dental school tuition

Sure...2 salaries but she'll be about 30 when she finishes then there's a bit of a window for family planning so at most she'll work half time. Anway...I think I'm going to half to work a lot.

By the time both of you finish your residencies, including interest, what do you think you will owe? I'm sure it's a lot, quite a bit more than $500,000. Keeping in mind that you graduated more recently and most likely have consolidated your loans at low interest rates, you're in better shape than if you were starting medical or dental school today. Interest rates are now at 6.8% and 8.5% for government sponsored educational loans. Good Luck

 

[LADoc00]

I love how supposedly intelligent students can become so dettached from the economic fundamentals as to completely ignore their tuition as an investment.

As it stands now, the cost:benefit ratio for all medical specialities taken as 1 group doesnt support more than a total principal investment of more than 120-160K for both undergrad and grad.

Yes, if you are rads it might be higher or if you are Peds it might only be 50K, but those are the numbers at current interest rates.

500K is patently absurd. Anyone who is carrying that much debt is no different than home owners with upside down mortgages who now owe 200K more than their house is worth.

 

[yadayadadude]

I love how supposedly intelligent students can become so dettached from the economic fundamentals as to completely ignore their tuition as an investment.

As it stands now, the cost:benefit ratio for all medical specialities taken as 1 group doesnt support more than a total principal investment of more than 120-160K for both undergrad and grad.

Yes, if you are rads it might be higher or if you are Peds it might only be 50K, but those are the numbers at current interest rates.

500K is patently absurd. Anyone who is carrying that much debt is no different than home owners with upside down mortgages who now owe 200K more than their house is worth.

I agree with the thrust of this post, but am curious to know how you arrived at these numbers.

 

[Krony]

I love how supposedly intelligent students can become so dettached from the economic fundamentals as to completely ignore their tuition as an investment.

As it stands now, the cost:benefit ratio for all medical specialities taken as 1 group doesnt support more than a total principal investment of more than 120-160K for both undergrad and grad.

Yes, if you are rads it might be higher or if you are Peds it might only be 50K, but those are the numbers at current interest rates.

500K is patently absurd. Anyone who is carrying that much debt is no different than home owners with upside down mortgages who now owe 200K more than their house is worth.

500K is absurd, agreed. But regarding intelligence and economic fundamentals...even the most intelligent of students would be hard pressed during the medical school application process to be able to 1) know definitively what field he or she will match to, and 2) what the job market will be like in that field in 7-10 years. There are other difficult to calculate components as well, for example my wife's dental school deciding to raise tuition by $10,000 a year (without so much as sending an email or a memo) after she had completed 2 years. Having already undertaken some significant debt at that point, it becomes difficult for us to say: well, I can see that our future careers won't support our principal investment. Instead we say, hmmm, guess we're going to have to continue to live in our dumpy apartment for longer than we thought. The most logical way out of the debt at some point was for us to take more debt and get our degrees rather than quit.

I suppose the only difference between those homeowners and us is that they actually have a house!

 

[Lesley]

http://www.nytimes.com/2008/01/06/f...&ex=1200027600&en=d9ecf7fd36e3fd5b&ei=5087%0A

NYTimes article discussing law and medicine. After 7+ years of education, maybe up to $500,000 worth of debt, not everyone is thrilled.