Advice: 400K Loans = Big life decisions

[Basko11]

I have been reading SDN for quite a few years now as I've gone through the process of being accepted into medical school. I am excited to start medical school- MSUCOM- but have some important decisions I need to make… I wasn't selected for different school scholarships and am now looking at the HUGE financial burden of MSUCOM as an OOS. According to the school average debt for OOS student for 2011 was $269k... but at 78k/year tuition + living... I'm imagining closer 400k not adding the interest it will accumulate and my current 20k from undergrad/masters. I've known for a while about the possible debt, but was led to believe that I would be given plenty of scholarships to make the tuition more realistic, I can reapply for them 2nd year however.

I've picked all of my friends/family's brains and would love to hear the opinions of supportive SDN members. Please help!

My options are listed below with the pros/cons for each. A bit of background about me (I know…this isn’t match.com haha)- single 27 years old- considering all residencies as of right now but have especially enjoyed shadowing the orthopedics and sports medicine Drs. I see myself choosing a specialty that's more hands on vs “thinking”. i.e. more surgery than anesthesiology. I also understand that residencies are competitive, that it isn’t just a “pick and receive” process.

Options:
1. Loans only:
Pros: Freedom to choose all types of medical residencies.
Cons:
- 400k in debt at 6.8% with the uncertainty of medicine’s financial future.
- Feeling of having to specialize in order to pay off debt
- This is a frightening number that will effect/guilt my every purchase/decision
- Living even cheaper than an undergrad until I’m 40+
2. Loans + plan of Loan forgiveness program:
Pros:
- Freedom to choose from all medical residencies
- Pay off debt in 10 years
Cons:
- Uncertainty of government program lasting until 2026
- Many stipulations such as non-profit hospitals qualifications
- May still have debt from non-federal loans if I need to take them
3. Service Corps Scholarship:
Pros:
- Tuition covered + stipend
- Practice health care in a community that needs help
Cons:
- Only able to choose from primary care residencies
- 4 year commitment to Health professional shortage area, possibly limiting career growth
4. HPSP: Been considering this for awhile now (Air Force)- best case scenario with this scholarship is amazing… worst case is well the worst
Pros:
- No debt after graduating
- All residencies available (in theory)
- I really enjoyed my time volunteering at the VA hospital- I could see myself enjoying the military atmosphere
Cons:
- 4 years active duty service
- Uncertainty of military demands (residency availability, war, stop-loss, etc)
- Possibility of putting life in danger-- I’d like to hear thoughts on this
- Deployments- especially if I start a family
- At 27- my life can change a lot- how will a possible wife/kid work into this plan
- Lose my EU dual citizenship
- Have to cut my shag
5. Year-off to gain In-State:
Pros:
- Tuition changes from 78k/year to 36k
- Can work to pay off undergrad debt
Cons:
- Lose a professional year of salary (estimated 150k)
- Will have to delay my dream an extra year
- Finding work in Michigan

These are the options as I see them. I can also wait and sign up for these different programs my second year of school, but will miss out on the first year’s tuition. Has anyone else faced this type of debt- any advice? I’m used to living frugally (still in the parents basement- ha) but I don’t know how it would be with this amount. I greatly appreciate your 2 cents! Best of luck to you all as well!

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[FrkyBgStok]

Is msu the only place you got accepted. That is insane. And probably the only time I would do HPSP. The service core would be an option, and many of them not consider general surgery as primary care, so maybe that is a plus not sure what you are currently interested. I thought about it as I am interested a little in primary care, but living in rural iowa gives problems with schools for my kids, so I ultimately decided against it. That sucks and i hope it works out. Good luck.

 

[octupus]

not sure how it works, but if you decline their offer and reapply after 1 year, will they hold it against you? you should check this.

 

[TriagePreMed]

Personally, I'd never lose EU citizenship over debt.

 

[Wolverines83]

4. HPSP: Been considering this for awhile now (Air Force)- best case scenario with this scholarship is amazing… worst case is well the worst
Pros:
- No debt after graduating
- All residencies available (in theory)
- I really enjoyed my time volunteering at the VA hospital- I could see myself enjoying the military atmosphere
Cons:
- 4 years active duty service
- Uncertainty of military demands (residency availability, war, stop-loss, etc)
- Possibility of putting life in danger-- I'd like to hear thoughts on this
- Deployments- especially if I start a family
- At 27- my life can change a lot- how will a possible wife/kid work into this plan
- Lose my EU dual citizenship
- Have to cut my shag

I'm not HPSP but I'm a former Army officer. Since most of your cons involve military life, I can comment pretty effectively. One note on your pros: You need to weight the reduced military salary vs the potential loan payments.

For many people, the HPSP scholarships are not a good financial deal once the military salary is considered for 4 years (after residency I believe...but confirm that with someone). $400k @ 6.8% over 30 years would be 2600/month. That's over 30 years. O-3 (captain) pay is currently $5031/month plus $1224 for housing allowance (at pope air force base in north carolina...varies by zip code) equals total take home pay of about $5000 after federal tax (housing isn't taxable) You'd need to bring in about $7600/month as a private physician to break even (meaning pay off that 2600/month and still make as much as the military counterpart). That number is pretty damn low...so it's something to consider. It's also based on 30 years of repayment. Make of that what you will but I just want to give you the other end of the spectrum. There are other benefits like sign on bonuses and monthly living allowances during school but you also factored living expenses into your $400k so I didn't consider them.

Anyway, your cons are normal for anyone considering the military:
1) I loved my time active duty. Aside from some incompetents above me, it was great.
2, 3, 4, 5) Can't speak to med residencies but you need to be honest with yourself and realize you'd be joining the military during a time of war.

You are going to be deployed somewhere and probably to a combat zone. Then again maybe you'll luck out and end up in Germany. Stop-loss is nothing like the movies/media make it out to be. Basically if your unit is deploying within 90 (or 120?) days of you getting out, they don't let you out. It sounds terrible but it's to ensure units aren't gutted before they go. Know it going in and don't whine if it happens.

With that said, during my deployment, right in the middle of a combat zone, the physicians were as much out of harm's way as possible. They (Army, not Air Force docs) were on the base, working in a hospital/hospital tent. But, during our time there, mortars and rockets routinely hit the base and could have just as easily hit the hospital as any other part of the base. But then again, during my year+ on that base, nothing ever hit the hospital. Not trying to spook you, just don't want to sugar coat it.

One mighty difference for you is that you're talking about the Air Force. That probably takes almost everything I said about danger and throws it right out the window. Without trying to insult my buddies in the Air Force, let's just say they have it MUCH easier than the other branches and you'll probably live a relatively cush life compared to my experience in the Army.

Wife and kids....yeah I hear ya bud, big concern. Military life is hard on families and the last 12 years (!) have been absolutely horrendous for them. This country seems to be willing to start wars with no idea of how to end them and then tuck these wars into the back page of the newspaper with almost no regard to how a decade affects these families. Maybe that's changing now but if it's continuing, it will make it very very difficult for a family. Personally that is the reason I left the Army. Everything else I loved but I wanted to get married. Again, I don't mean to be negative but you'll get plenty of sugar coating from the recruiters!

6) Losing EU dual citizenship? Now you won't be a communist! (I kid...sort of....)
7) Kiss the shag goodbye...trust me, it's less work in the end!

All the analysis above doesn't consider the fact that the military is, in fact, an incredibly rewarding career that will pay dividends for the rest of your life. I'm glad I did it but also glad I got out when I did. Make your own decision with as much information as possible. Good luck!

EDIT: Bears mentioning that there are several incentive pays that are variable such as specialty pay, board cert pay, etc that would change the numbers above although I doubt they close the gap significantly, especially in the higher paying specialties.

Hopefully a current attending could comment or maybe you could throw a link into a military med forum?

 

[MT Headed]

1. Loans only:
Pros: Freedom to choose all types of medical residencies.
Cons:
- 400k in debt at 6.8% with the uncertainty of medicine’s financial future.

You won't be able to get the full 78K per year on 6.8% staffords... they have a limit of about 40K per year. So the other approximately 40K is going to have to come from another source. If your credit is reasonable, there is a second federal program called GradPlus which loans money at 7.9% and has a 4% convenience fee, i.e. for every $40,000 you borrow, they only give you $38,400 towards your schooling (they keep the rest).

I don't have any answers to your questions, but I just wanted to point out that your debt will be much higher (in both interest rate and total debt) than you originally thought.

 

[Brachyury]

Options:
3. Service Corps Scholarship:
Pros:
- Tuition covered + stipend
- Practice health care in a community that needs help
Cons:
- Only able to choose from primary care residencies
- 4 year commitment to Health professional shortage area, possibly limiting career growth

Unlike the military, the NHSC scholarship is NOT a sure thing: only about 10-15% of applicants receive the scholarship. I know many, many people from underserved rural areas who intend to go into FP that have been passed over for the scholarship year after year

 

[Postictal Raiden]

I have been reading SDN for quite a few years now as I've gone through the process of being accepted into medical school. I am excited to start medical school- MSUCOM- but have some important decisions I need to make… I wasn't selected for different school scholarships and am now looking at the HUGE financial burden of MSUCOM as an OOS. According to the school average debt for OOS student for 2011 was $269k... but at 78k/year tuition + living... I'm imagining closer 400k not adding the interest it will accumulate and my current 20k from undergrad/masters. I've known for a while about the possible debt, but was led to believe that I would be given plenty of scholarships to make the tuition more realistic, I can reapply for them 2nd year however.

I've picked all of my friends/family's brains and would love to hear the opinions of supportive SDN members. Please help!

My options are listed below with the pros/cons for each. A bit of background about me (I know…this isn’t match.com haha)- single 27 years old- considering all residencies as of right now but have especially enjoyed shadowing the orthopedics and sports medicine Drs. I see myself choosing a specialty that's more hands on vs “thinking”. i.e. more surgery than anesthesiology. I also understand that residencies are competitive, that it isn’t just a “pick and receive” process.

Options:
1. Loans only:
Pros: Freedom to choose all types of medical residencies.
Cons:
- 400k in debt at 6.8% with the uncertainty of medicine’s financial future.
- Feeling of having to specialize in order to pay off debt
- This is a frightening number that will effect/guilt my every purchase/decision
- Living even cheaper than an undergrad until I’m 40+
2. Loans + plan of Loan forgiveness program:
Pros:
- Freedom to choose from all medical residencies
- Pay off debt in 10 years
Cons:
- Uncertainty of government program lasting until 2026
- Many stipulations such as non-profit hospitals qualifications
- May still have debt from non-federal loans if I need to take them
3. Service Corps Scholarship:
Pros:
- Tuition covered + stipend
- Practice health care in a community that needs help
Cons:
- Only able to choose from primary care residencies
- 4 year commitment to Health professional shortage area, possibly limiting career growth
4. HPSP: Been considering this for awhile now (Air Force)- best case scenario with this scholarship is amazing… worst case is well the worst
Pros:
- No debt after graduating
- All residencies available (in theory)
- I really enjoyed my time volunteering at the VA hospital- I could see myself enjoying the military atmosphere
Cons:
- 4 years active duty service
- Uncertainty of military demands (residency availability, war, stop-loss, etc)
- Possibility of putting life in danger-- I’d like to hear thoughts on this
- Deployments- especially if I start a family
- At 27- my life can change a lot- how will a possible wife/kid work into this plan
- Lose my EU dual citizenship
- Have to cut my shag
5. Year-off to gain In-State:
Pros:
- Tuition changes from 78k/year to 36k
- Can work to pay off undergrad debt
Cons:
- Lose a professional year of salary (estimated 150k)
- Will have to delay my dream an extra year
- Finding work in Michigan

These are the options as I see them. I can also wait and sign up for these different programs my second year of school, but will miss out on the first year’s tuition. Has anyone else faced this type of debt- any advice? I’m used to living frugally (still in the parents basement- ha) but I don’t know how it would be with this amount. I greatly appreciate your 2 cents! Best of luck to you all as well!

If I were you I would rule out:

Option 3) After all these years of education and sacrifice, I don't want to have my freedom of specialty choice restricted to only primary care.

Option 4) From reading few posts and talking to people, I can tell you that you should only consider the military only if you are actually interested in the military. Many would say that this option isn't financially worth it in the long run.

Option 5) Definitely, the worst option. You are not only losing a potential year of physician income (150k-400k depends on specialty), you are also sacrificing the certainty of starting med school for the uncertainty of being accepted to your local school.

Bottom line: You are not alone. Almost everyone in here will graduate with similar magnitude of debts (for me 300k is similar to 400k). MSUCOM is a great school, and graduating from there, will open for you many doors. Personally, I would go with stafford and gradplus loans, sign up for the 25-year IBR during residency, and make extra payments to finish paying early (once I become a spine surgeon ).

Good luck with whatever option you go with.

 

[Postictal Raiden]

Unlike the military, the NHSC scholarship is NOT a sure thing: only about 10-15% of applicants receive the scholarship. I know many, many people from underserved rural areas who intend to go into FP that have been passed over for the scholarship year after year

That's true, but the military scholarship isn't a shoe-in either. From reading the military forum, I learned that you need to have 3.5GPA and upper 20's on the MCAT to be automatically accepted. Due to the rise of tuition and the potential in reduction of physician's reimbursements, more students are considering the military route than before. This causes the military to be more selective about granting applicants the scholarship.


P.S. when I read your name, I remembered I had to drag myself away from SDN and start studying for my Developmental Biology exam.

 

[Cooperd0g]

4. HPSP

After a total of 17 years in uniform and coming from someone who is taking the military route for med school you should never do it for the money, EVER! I cannot stress this enough. There are so many things out of your control in the military. You can temper this by being bad ass in everything you do ranking top of your class or performance evals against your peers, but that is still no guarantee. Me, I like the military, but I'm also cool with getting **** thrown my way and figuring out how to handle it.

- Possibility of putting life in danger-- I’d like to hear thoughts on this

People need to get over the "I might die as a doctor in the military." USUHS has stats that show military doctors are more likely to die riding their bicycle for recreation or commuting than they are in combat. No docs are on the front line and very, very few are even close. Those that are close choose to be there. Read that as you are just as likely to die as a civilian doctor as you are a military doctor.

 

[COMedic2Doc]

People need to get over the "I might die as a doctor in the military." USUHS has stats that show military doctors are more likely to die riding their bicycle for recreation or commuting than they are in combat. No docs are on the front line and very, very few are even close. Those that are close choose to be there. Read that as you are just as likely to die as a civilian doctor as you are a military doctor.

+1. As a Military Medical Officer, you are far removed from combat situations even in a war zone. Being in a combat zone can still mean rockets flying over head but the majority missing the base, hours spent in the bunkers, and seeing people you know brought into the CSH or TMC with wounds that you cannot hope to remedy fast enough to save their life. This is faced by you and everyone in your unit, so there are people to help you get through the blackest of nights. However, as Cooper pointed out get used to just about anything imaginable being thrown your way and overcoming that aspect with improvisation and perseverance.

All of us have to decide on the debt issue in our own way, so you are not alone.

 

[Dharma]

EDIT: moved to another forum...

 

[notbobtrustme]

Financially, nothing beats just taking the loans and riding that pony until it dies. Most of those programs require sacrifice after you start making the boku bucks. Even the public service committment is usually not a good deal.

Go with IBR, specialize in something smart (or live smartly if you want to do primary care) and pay off your loans. That makes the most finanicial sense.


And who knows, student loan might be the next big bubble and basically wipe out everyone's balance sheets. It's all monopoly money as far as I'm concerned.

 

[COMedic2Doc]

Financially, nothing beats just taking the loans and riding that pony until it dies. Most of those programs require sacrifice after you start making the boku bucks. Even the public service committment is usually not a good deal.

Go with IBR, specialize in something smart (or live smartly if you want to do primary care) and pay off your loans. That makes the most finanicial sense.


And who knows, student loan might be the next big bubble and basically wipe out everyone's balance sheets. It's all monopoly money as far as I'm concerned.

Hmmmmm this sounds really familiar, oh yes the White House and Congress' current view of the budget.....

 

[Wolverines83]

Hmmmmm this sounds really familiar, oh yes the White House and Congress' current view of the budget.....

Oh boy, that's another thread entirely...lol

I wanted to clarify something in my post above. I just realized I kinda made it sound like you'll be screaming "scalpel" over the sound of gunfire...which I didn't intend at all. I was on a large base, one that actually had a CSH on it so we had physicians. And although they were on the base, they were surrounded by barriers (Hescos for any of those who fondly remember that name...) and well away from the edges of the base so anything aside from a mortar literally landing in the CSH wouldn't have affected them. And the chances of that are basically like winning the lottery considering most of them were launched at night from the bed of a little white bongo truck driving 45mph...lol, certainly not the most accurate way to do it.

For a lot of the smaller OPs in the cities, there were certainly no physicians there (at least that I know of) and I didn't mean to imply that.

Again, I want you to confront reality and realize this is time of war when you will certainly be deployed....whether it's to a dangerous zone or not...who knows. In the end they'll do everything they can to keep you as safe as possible. But just know that you'll probably get a few "paid vacations" during your stint.

Good luck and hey, congrats on getting into med school. A lot of people would kill to have the chance, regardless of debt...so good for you.

 

[COMedic2Doc]

Oh boy, that's another thread entirely...lol

I wanted to clarify something in my post above. I just realized I kinda made it sound like you'll be screaming "scalpel" over the sound of gunfire...which I didn't intend at all. I was on a large base, one that actually had a CSH on it so we had physicians. And although they were on the base, they were surrounded by barriers (Hescos for any of those who fondly remember that name...) and well away from the edges of the base so anything aside from a mortar literally landing in the CSH wouldn't have affected them. And the chances of that are basically like winning the lottery considering most of them were launched at night from the bed of a little white bongo truck driving 45mph...lol, certainly not the most accurate way to do it.

For a lot of the smaller OPs in the cities, there were certainly no physicians there (at least that I know of) and I didn't mean to imply that.

Again, I want you to confront reality and realize this is time of war when you will certainly be deployed....whether it's to a dangerous zone or not...who knows. In the end they'll do everything they can to keep you as safe as possible. But just know that you'll probably get a few "paid vacations" during your stint.

Good luck and hey, congrats on getting into med school. A lot of people would kill to have the chance, regardless of debt...so good for you.

Ahhh yes, the land of hescos and T-walls.... despite being on a very small base we were fortunate enough to also have the Forward Surgical Team (FST) on our base. I loved one of the groups there, and really enjoyed working with my colleagues there. A lot of inspiring conversations and positive reinforcement came from discussions there about my getting into Medical School myself. OP, definitely congrats on getting in!

 

[Basko11]

I just wanted to say thanks to everyone on your responses and posts! I started the application process for the Air Force HPSP and hope for the best. I will keep you all posted if you're interested in how it goes. If it doesn't work out, then it's meant to be and I'll take out the loans and live frugally. Best of luck to you all as well!