Another thread asking for financial advice

[JustinRx]

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First, some background. I am hoping to get into a 3 year pharm school starting in 2015. Cost per year in tuition is 45k. I currently work as a lead tech at an independent for $18/hour. Once i start pharm school i will be able to stay where im at as an intern for around 15-20 hours a week. I have a wife that makes around 1750 a month.

Now the question. By the time pharm school starts in 2015 i will have over $30,000 saved up. What should i do with all of it? Ideally i would like to hit student loans quickly in the beginning but there are a couple ways to go about it. Im in utah and the cost of living is not bad out here, which means i will not need to borrow more for living expenses. Im thinking of putting a down payment on a small house or townhouse but i am unsure if that is wise. I could just invest more into my 401k and roth ira but I dont like the idea that it wouldnt be accessible for student loan debt. Ugh, im unsure.

Any advice or perspective would be appreciated.

 

[MCA2015]

I've seen many that have been pharmacists for a while say that paying off loans early is a bad investment, as you can earn more contributing those extra payments to your investments. However, those people were dealing with lower interest rates on the loans and better returns on their investments. Depending on your age and other life circumstances, it may be best put that money toward paying down your debts.

It sounds like you have a good support system in place and plenty of options. Go with your gut.

 

[oldstock]

First, some background. I am hoping to get into a 3 year pharm school starting in 2015. Cost per year in tuition is 45k. I currently work as a lead tech at an independent for $18/hour. Once i start pharm school i will be able to stay where im at as an intern for around 15-20 hours a week. I have a wife that makes around 1750 a month.

Now the question. By the time pharm school starts in 2015 i will have over $30,000 saved up. What should i do with all of it? Ideally i would like to hit student loans quickly in the beginning but there are a couple ways to go about it. Im in utah and the cost of living is not bad out here, which means i will not need to borrow more for living expenses. Im thinking of putting a down payment on a small house or townhouse but i am unsure if that is wise. I could just invest more into my 401k and roth ira but I dont like the idea that it wouldnt be accessible for student loan debt. Ugh, im unsure.

Any advice or perspective would be appreciated.

1. Assuming your wife would go with you if you had to relocate for school: You should not buy a house now. You still do not know for sure where you wouls end up for pharmacy school.

For now, I would open some cash/margin stock account and invest that 30K in good/solid dividend stocks. With some research, you can earn 5%+ and even more (I am in some with divvy in the 8%+) annually. Way better than putting in a saving account and this would give you the flexibility and liquidity when you need the cash. Not to mention the stock price appreciation if you got some bargains (believe me there are still bargains if you look hard enough and seize the opportunity).

I would also apply to some state / public schools. The in-state tuitions of some state / public pharmacy schools are still just around 20K or even less a year. Some of them even allow you to apply for state residency after a year, jf you could prove your intent to settle in the state, e.g. buying a house there.

If you could do that, you would save at least 1/3 - 1/2 of the 45K tuition you would pay for that 3 yr program (45K / 3 semesters per yr = 15K per semester or 30K a year if it were a 4 yr program with 2 semesters per year). Plus, you would live rent free because you live in your own home and the house payments are not lost in the wind as in the case of renting.

2. If your wife would not go with you in case you need to relocate for school (as she might want to keep that paying job) and you would also want to come back to Utah to work after graduating from pharmacy school, buying a house now is not a bad idea regardless of where you would go for pharmacy school. Interests are still low, but might go up next year.


But you would want to be sure that 45K tuition is the tuition for 3 semesters (Fall, Spring, Summer) and not for only 2 semesters. Call the school up to find out and confirm. If it costs 45K for only 2 semesters, it would make even more sense to go with option #1 I have outlined above. GL 🙂

 

[rxphd]

Sounds like Roseman tuition. The school estimates cost of attendance per year to be 75K :/

 

[JustinRx]

Yeah, Rosemans Utah campus is the one i am shooting for. My stats are above average and I interview extremely well. I would be able to commute to the pharmacy school pretty easily. It is only 20 minutes away from my work. The alternative is the university of utah which is a four year school. Their in-state tuition is 25,000ish a year i think. It would probably take me an extra year to get in and then it would take me an extra year to get out.

Oldstock, Rosemans tuition is for the full year. One reason why im not applying for out of state schools is because i have a lot of connections in utah. I do not want to be in the boat where I cant find a job.

I appreciate all of the input. Thanks everyone.

 

[oldstock]

Yeah, Rosemans Utah campus is the one i am shooting for. My stats are above average and I interview extremely well. I would be able to commute to the pharmacy school pretty easily. It is only 20 minutes away from my work. The alternative is the university of utah which is a four year school. Their in-state tuition is 25,000ish a year i think. It would probably take me an extra year to get in and then it would take me an extra year to get out.

Oldstock, Rosemans tuition is for the full year. One reason why im not applying for out of state schools is because i have a lot of connections in utah. I do not want to be in the boat where I cant find a job.

I appreciate all of the input. Thanks everyone.

I would tend to plan for the worst. Apply for some backup schools just in case. Nothing is 100% certain imho 🙂

 

[rxphd]

I was accepted to Roseman this cycle, there isn't in-state or out of state tuition. I'm actually debating about pulling my acceptance, due to their cost.

 

[JustinRx]

Yes, i will be applying for atleast 3 other schools as well.

rxphd, I am assuming that the 75k is because of living expenses. Will you be in Nevada or Utah? If you decide to pull out, what school would you go to? I have talked to over 15 roseman pharmacy graduates/students and not one of them had debt over 180k. Most were around 150k. Heck, maybe i should bite the bullet and live with my family while in school. They are within driving distance of the school.

 

[Pharm_Advice]

First, some background. I am hoping to get into a 3 year pharm school starting in 2015. Cost per year in tuition is 45k. I currently work as a lead tech at an independent for $18/hour. Once i start pharm school i will be able to stay where im at as an intern for around 15-20 hours a week. I have a wife that makes around 1750 a month.

Now the question. By the time pharm school starts in 2015 i will have over $30,000 saved up. What should i do with all of it? Ideally i would like to hit student loans quickly in the beginning but there are a couple ways to go about it. Im in utah and the cost of living is not bad out here, which means i will not need to borrow more for living expenses. Im thinking of putting a down payment on a small house or townhouse but i am unsure if that is wise. I could just invest more into my 401k and roth ira but I dont like the idea that it wouldnt be accessible for student loan debt. Ugh, im unsure.

Any advice or perspective would be appreciated.

I would advice that you keep at least half of the $30,000 for unexpected expenses. If you're thinking of applying to a 3 year program then most likely you will not have much time for work during the year. From my understanding a 3 year program is year-round since they are trying to squeeze in what most students learn in 4 years into three. So you're basically looking at exams literally every week and classes for at least half of the day every day. Good luck when you apply next year.

 

[JustinRx]

Yeah, the 30,000 wont include my 7,000 emergency fund. Roseman uses a block system. Tests every 2 weeks. 4-6 hours a day of class except on test day. Summer remediation is 6 weeks long. You get spring break, winter break, and the basic holidays.

 

[DrDrugs2012]

If you lean towards purchasing a home, I strongly recommend purchasing one in the vicinity of school so you have the option of renting a room to a classmate. This can also further reduce your monthly outlay making it more possible to live off your wife's income and reducing the amount of loans you need for cost of living and simultaneously building asset wealth.

 

[radio frequency]

If you lean towards purchasing a home, I strongly recommend purchasing one in the vicinity of school so you have the option of renting a room to a classmate. This can also further reduce your monthly outlay making it more possible to live off your wife's income and reducing the amount of loans you need for cost of living and simultaneously building asset wealth.

Best idea I've seen on here, if you're going this route. It wouldn't be my chosen route, though.

I'd allocate most of the $30k toward tuition costs. At $45k/year, you'll be offered both high (like really high) interest loans and "low" (5.41%) interest loans. Take out the maximum amount of your low interest loans each year and use the $30k to avoid the high interest loans, when possible. This will provide you a more guaranteed payback than a home purchase.

I was in a similar position when I started school, but I had a lot more cash than $30k on hand. In retrospect, I'm very glad I didn't purchase a house. I haven't had to take out one high interest loan, and with any luck, I'll completely avoid them. It's a great feeling to look at graduating with less than half of the debt most of your classmates will have.

 

[DrDrugs2012]

It really depends on what prevailing rents vs mortgage is in the vicinity. For example, there are some cities where renting is more affordable than purchasing (e.g. New York City or San Francisco) but in other cities the lack of affordable rental options in desirable locations makes ownership far more viable. This actually changes the financial calculation considerably.

So as an example, say you purchased a 3 bedroom house for 250,000 putting 50K down, your mortgage plus property tax will be around 1500/mo. If you rented to two roommates , your rental income would likely cover your expenses. If you do biweekly payments, your schedule accelerates without paying a single extra dollar. So your equity after 4 years of school is about 65000 AND you will also NOT take out cost of living loans for four years ($750 x 12 x 4 = $36,000) AND because tenants are paying your mortgage, your increased cash flow gives you the flexibility of making additional payments which further accelerates your payoff schedule and builds equity even faster. Additionally, you will have a mortgage interest deduction which will help eliminate your wife's tax liability.

 

[JustinRx]

Thanks for all the replies. You guys/gals are awesome.

 

[DrDrugs2012]

Oh, I forgot to add the best part. Once you have greater equity in the home four years later, you can take out a home equity loan to pay down the high interest student loans because a home equity loan will almost certainly be at a substantially lower rate than unsecured student loans. So my best advice if you choose the home ownership path is to work hard for the next year, sacrifice much so you can put as much down on a house to reduce your monthly mortgage cost, select biweekly payments, try and negotiate that additional advance payments hit principal and dont just count against your next scheduled payment, and then follow the other stuff I mentioned above

 

[oldstock]

Oh, I forgot to add the best part. Once you have greater equity in the home four years later, you can take out a home equity loan to pay down the high interest student loans because a home equity loan will almost certainly be at a substantially lower rate than unsecured student loans. So my best advice if you choose the home ownership path is to work hard for the next year, sacrifice much so you can put as much down on a house to reduce your monthly mortgage cost, select biweekly payments, try and negotiate that additional advance payments hit principal and dont just count against your next scheduled payment, and then follow the other stuff I mentioned above

excellent advice !! 🙂

 

[molyhelp]

Any advice or perspective would be appreciated.
I am hoping to get into a 3 year pharm school starting in 2015.

That is intense future. You need to have time to study.

I currently work as a lead tech at an independent for $18/hour. Once i start pharm school i will be able to stay where im at as an intern for around 15-20 hours a week. I have a wife that makes around 1750 a month.

In intense 3 year program, you want to maximize your learning time and minimize disruptions.
Roseman has been proven to have failure rate of 1 failed in 5 that got in.
How? On the last day of P2 exam, there will be a seating chart outside of exam room. Count the number of students seating for that last exam, count the number of students that got admitted.
Roseman has been proven to have failure rate of 1 failed in 5 that got in.
Be ready for intense training in a loving environment. All yours classmates will have good reasons to help you pass.

Now the question. By the time pharm school starts in 2015 i will have over $30,000 saved up. What should i do with all of it?

Let me quote the words from my friend:
"Save as much as you can that for rainy day when you can not work or lose your job or sick, or failed a few exams. Do you know the heartache of crying and hugging your teammates goodbye, every single month in P2? And then you try harder to not be the goodbye? That's when I realized I need all the time you can to maximize your studying. When friends failed school in P2 with over 100 thousands in debt, I know the few dollars I make at work may not be the best dollars during P2, I better spend that time studying."

You see, money may seem to be easy now...wait until failing exams in pharmacy school happen...then, we will value the time we have by the hour.

Roseman pharmacy school is a good pharmacy school where you have all the love from friends you can ask and get. Why? simple, by design of this school, each student will be the same like the next student: you are either ranked as Passed Student or Failed Student. No top of the class, second of the class or valedictorian. All equal. So all will help all.

Still, I heard of class of 2011 where near the end of P2, these seasoned and experienced exam takers were shocked to see almost half of the class failed an exam, even the top notch students that never ever failed any exam for the past 30 exams. That's when reality shock really strikes home. That's when you need all the time you can beg. Job will come second. But bills are still here. You need savings to survive during those hard times. You will have plenty of chances to invest in the future.

Remember, on average, a pharmacist makes 60 dollars an hour, that means 1 minute is 1 dollar. A day means almost 500 dollars for a pharmacist. You really want to save time during school to pass and get out there and earn 60 dollars an hour. 1 month of delay means 10 thousand dollars gone. You will want to focus in school and live on savings. Failing exam and retaking the class next year with next batch of student means losing 120 thousands a year of income.

With that clearly presented, I emphasize on saving the money so you can work minimal hour to keep your job and senority while maximizing your studying time to pass assessments with great confidence. Imagine the day when you walk out of that school and you passed all exams because drew you power from your hard earned savings and therefore managed your time excellently like a master....That wonderful feeling is yours to see and keep and the inherent power depends on your wise action today as being the start of this journey....

 

[VegasPharm]

Sounds like Roseman tuition. The school estimates cost of attendance per year to be 75K :/

I don't think Roseman tuition is horrible.. when i joined i compared with california schools and tuition is probably less slightly and it is a 3 year program..