Concerned parent - do you let your child take out huge loans for PT school? Need feedback

Discussion in 'Physical Therapy' started by bakes1, 10.29.14.

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  1. bakes1

    bakes1

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    Child applied this cycle - waiting to hear decisions (has one acceptance already). However, I'm having panic attacks about the amount of loans she'll have afterwards. Everyone says go to cheapest state school but here in Michigan that still means about $75,000 - 80,000 for tuition only (plus she'll need additional loan $ to live on for the 3 years of the program). As her parent I want to say don't do it, that $100,000 or over in loans at the age of 25 is going to ruin your life. Looking for some feedback from others on how are you doing paying that much debt back and how are your doing it and making ends meet?
     
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  3. starrsgirl

    starrsgirl 5+ Year Member

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    The first thing I would do is wait until all admission decisions are made. Usually schools send out scholarship info or grant info at around the same time. So, you never know....maybe the tuition will be reduced/scholarship offered somewhere that you aren't expecting now.

    I'm an older student (made a career change to physical therapy and am in school now) so I know my opinion may be a little different than others. Others will tell you that 100K is fine and a "normal" amount of loans to go to PT. I personally think it's a ridiculous amount and the salaries will NEVER support that sort of debt load. I think the field is a little soft in that there are plenty of PTs so no one is desperate for a PT and therefore won't pay for it. Many grads in my area (midwest) are starting at 50K (which is crazy for the level of schooling....I made that much years ago with a bachelors degree) I'm not against school debt...my sister just graduated from pharmacy school. She has about $150K in loans but she is starting at more than 100K per year in salary. I feel that is a more reasonable ratio. I personally put my TOP limit at somewhere between 1- 1.5 years of PT salary should be maximum debt load accepted (for me, total debt no more than $70-80K inclusive)

    I think these times call for students to be a little creative. Can you live with family somehow, someway to cut down on living expenses? Can you reapply the next cycle for cheaper schools? Can you apply for any type of scholarship from outside sources? Are there other careers he/she is interested in? (I know people will disagree with that last one, gasp).

    I guess in the end, your child will probably go to school and take out that much in loans and live very cheaply after school for many years like his/her classmates....but it all just makes me shake my head and gives me a heart attack too. Money isn't everything, but to give half your salary to debt repayment is frustrating. I have kids too, so I understand your fear as a parent. I worked for quite a few years in the military, built up savings and am also using my GI Bill to pay for school now. If I didn't have the GI Bill help and needed to take massive loans, I would not have considered the PT field....I would have targeted fields with higher salary level more in line with debt load (med school, PA, pharmacy). Again, I know that's controversial to say, but when you are a bit older, you understand career isn't simply an emotional passion...it also has to cover practical needs (and in my case support a family).
     
  4. jblil

    jblil 5+ Year Member

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    OP - Your child could apply to the East Carolina University DPT program, if you don't mind having her move to NC. She will have to pay out-of-state tuition for the first year, but it is "only" $9,330/semester or about $20K/year. She should then apply for in-state residency in her second year, and her tuition drops to $3,171/semester or about $6.4K/year. That is the lowest DPT tuition I have seen for any school, anywhere. ECU's DPT program starts in the summer, and not in the Fall. Deadline for apps is mid-November. ECU is not part of PTCAS.

    Tuition numbers here (scroll to p. 3, Graduates & Professional level): http://www.ecu.edu/cs-admin/financial_serv/customcf/fees_main_campus_fall_2014.pdf

    I am also an older student, with a mortgage and a bunch of other bills to pay. I certainly would not recommend borrowing more than the average starting salary for PTs, which is around $55K-$65K currently. You may want to show your child this survey which displays the starting pay for PTs:
    http://dptfinances.wordpress.com/2012/07/10/hello-world/
     
    Last edited: 10.29.14
  5. bakes1

    bakes1

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    Thanks for the feedback so far. She was very interested in going to school in North Carolina (we'd lived there many years ago) but when we'd checked into a while ago it sounded like getting in-state residency after the 1st year was tough to do and not guaranteed. Plus the odds of getting accepted when they only take 1 or 2 out of state students is pretty slim. We do have one school that is 50 minutes away that would enable her to live at home if they accept her. I guess I was under the impression that scholarship and grant money for PT school didn't really exist. Both of you have confirmed my thoughts that $50-60K in debt would probably be ok with a PT salary (it's that extra $40-50K that doesn't). PT has always been her dream since high school but as an older adult that realizes you have to pay the bills in life I couldn't imagine being 25 with $100,000 in student loans and only making $60,000
     
  6. jblil

    jblil 5+ Year Member

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    OP - I have a few out-of-state classmates in my program at UNC. All those who requested residency were successful, so I don't think it's overly hard. ECU, just like UNC, belongs to the Univ. of NC system so I'd imagine the criteria would be the same.
     
  7. bakes1

    bakes1

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    That's good to know for residency however the ECU application states that the DPT program gives preference to NC state residents and out of state students are rarely accepted so it doesn't look very promising.
     
  8. OneWarrior

    OneWarrior 2+ Year Member

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    A few comments in reference to the ECU DPT program. You have to factor in tuition for the summer semester, which is calculated per credit hour. Skipping all the math for the per credit hour charge, it basically comes to an additional $3,000 (in-state) or $9,000 (out-of-state) per year. Also, there is a $40 per credit hour surcharge for DPT courses. Thus, the per year tuition for in-state students is closer to $10,000 per year and the out-of-state tuition is around $30,000 per year.

    @bakes1, I would say it would be a good option for your daughter, but they do not take very many out-of-state students as you have already discovered. The most recent entering class consists of all in-state students.

    When I graduate from physical therapy school I will owe over $100,000 in student loan debt. I plan for an average salary of $65k per year and to do PRN (as needed) work about 10 hours per week for 2-3 years after I graduate. Based on my own calculations using this projected salary/PRN pay, I will be able to pay off my student loan debt within 10 years. I have also determined, based on these calculations, that I can live comfortably and provide for a 'future' family. I'm not expecting to live in a huge house and drive fancy vehicles, but I have always lived within my means and kept it simple. My debt-to-income ratio is not favorable, but that does not mean it is not manageable. I readily acknowledge the fact that I will have quite a bit of debt after leaving school. However, I also realize my chosen profession affords me the opportunity to find self-fullfillment in my life and that, for me, is more than worth the debt that I will incur.

    As others have stated, I would wait until all admission decisions are made. Once admission decisions have been finalized, I would encourage you both to visit the links below and map out future debt-to-income scenarios. I believe it is important that both of you 'run the numbers' together so that you both have a solid idea of what can be expected if she decides to go to physical therapy school.

    https://studentloans.gov/myDirectLoan/mobile/repayment/repaymentEstimator.action

    http://www.adp.com/tools-and-resour...l-calculators/salary-paycheck-calculator.aspx
     
  9. okramango

    okramango 5+ Year Member

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    I agree that 100k+ is too much debt for a PT salary. I'm also an older student, and I wasn't willing to take out more than 60k or so in loans for my DPT. The state programs in my home state cost around 75-80k in tuition alone, so I chose to move out of state to go to a cheaper program. I chose the programs I applied to based on cost and availability of scholarships and out of state tuition waivers. I found a lot of that information here on these forums, and also by contacting PT programs directly and asking about scholarships. It's really worth putting the time in to research costs for programs.
     
  10. jblil

    jblil 5+ Year Member

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    OP - I noticed you asked the same question over in the pre-PT forum. It's interesting to read the opinions of younger folks on the same question. Most (not all) of them seem to be more accepting of the loans. In this thread, you have several "second-careerers" such as starrsgirl, okramango and myself, who think that such high debt is best avoided. Like us, you know what it's like to have to run a household and handle all the bill payments.
    You could sit down with your child and pull up a loan repayment calculator and simulate his/her budget after graduation. That may make the picture a bit clearer. The key is to make an informed decision, so s/he won't be surprised 3 years from now.

    I also saw a question from another poster about loans:
    http://forums.studentdoctor.net/thr...e-as-a-pt-with-250k-in-debt-possible.1105727/
    250K in loans for a MD degree would be acceptable. For a DPT, it'd be insane.
     
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  11. bakes1

    bakes1

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    Thanks for all the feedback. As someone who has had to make ends meet and pay the bills I know life isn't easy and doesn't always go as planned (if it did I'd be able to help her pay for some of PT school). Reality is life happens. She doesn't seem overly concerned about the amount of loans because as she says "everyone has them" but I don't think she realizes she won't want to be living the poor college student life into her 30's. I'm not criticizing because I remember what it's like to be young and have dreams but I don't think she realizes how difficult this will be (and after the fact when she does it sounds like a long road to getting out of this much debt). Ugh - parenting is hard. Do I try and squash her dream or just offer support knowing she's making a bad decision.
     
  12. jblil

    jblil 5+ Year Member

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    OP - did your daughter talk to a few practicing PTs, to get their viewpoints? If she hasn't, she certainly should.
     
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  13. markelmarcel

    markelmarcel 5+ Year Member

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    So, I may be slightly different, but I had no undergrad debt and so I only have my debt from PT school (which when I started loan repayment was $75k). My boyfriend and I are *very* comfortable right now. We own a smaller home, but could definitely afford a larger home (and will probably do so in the next 2-4 years) . I am able to pay all of my bills, loan repayment (went with 25 year plan, but pay extra each month) plus my new car payment (thanks to an idiot who crashed into me, my old car was totaled), as well as starting a life insurance policy and I'm about to open a roth IRA that I will contribute to monthly. Beyond all of this, I still have money to live, eat and play (and save). It's not impossible...
     
  14. bakes1

    bakes1

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    In our phone call last night, she agreed that would be a good idea so she was going to reach out to one of the PT's she'd shadowed. I think he graduated in the last five years so he should be a good resource (unless he managed without loans). Also, she only knows 2 other people at her school that are applying to PT school this cycle and one of them has parents paying the full amount.
     
  15. bakes1

    bakes1

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    Thanks markelmercel - that's encouraging. Especially that you're able to save - at this point my freak-out has me worrying that she'll be living out of her car (which with 180,000 miles on it I'm hoping makes it through grad school)
     
  16. jdaniels360

    jdaniels360 2+ Year Member

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    I'm looking at about 130k when all is said and done. Was i worried about it initially? Hell yeah. But i've done the research, and depending on the setting, 75k is possible as a new grad with PRN, overtime etc, which shouldn't be an issue if this is what you love to do. With those numbers in mind, i can give back 30k a year and more than double the standard of living i have now as a first year DPT student (living on 17k/yr).... That's 5 years minimum at that rate to pay back 130k in student loans. Anyone care to tell me i'm delusional? Feel free.
     
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  17. DesertPT

    DesertPT ` 2+ Year Member

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    Sounds totally doable if you don't have a bunch of kids to support!
     
  18. jblil

    jblil 5+ Year Member

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    @ jdaniels: don't forget taxes. Uncle Sam and your state will want their share of your income.
    I put this info into my tax software: gross income of 65K, single, no mortgage, no 401k contribution, using the standard deduction ($6.1K for tax year 2013).
    Results: the federal tax amounts to $9.7K; state tax will depend on where you reside, but if you were in NC like myself, it'd be $4.2K. So your total tax burden will be ~ $14K.
    If you work PRN, that amount will be taxed at a higher rate since you most likely will be paid through a 1099.

    The above numbers are estimates only, since the standard deduction and the exemption amounts are adjusted yearly. But they give you a rough idea of how much the IRS' share is going to be. Of course, if you are married, have kids and/or buy a house, your taxes will change drastically.

    (Disclosure: I moonlight as a tax preparer).
     
  19. Bluecase

    Bluecase 2+ Year Member

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    All of this depends on the cost of living of where you end up living. 65k goes a lot further where I grew up compared to where I live now. But my wife works and we have dual incomes. There is absolutely no way we could afford to live in our apt in a big city on just my salary and we are very fortunate to not have much loans
     
  20. DesertPT

    DesertPT ` 2+ Year Member

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    Filing singly is definitely painful when it comes time for taxes...
     
  21. Azimuthal

    Azimuthal Ninja Zombie Slayer 2+ Year Member

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    Ah hah, my friend...

    I'm looking at $120k myself, with a nest egg of about ~$20k to principle when I'm done. I have to thank my wife for this as she supported our plan for my goals since the start of this whole PT thing. We have two kids. One toddler and one baby. We have always stuck with our budget with the exception of the additional diapers and formula for supplement for baby #2. And maybe some extra baby stuff here and there. My wife has somehow managed to take care of the kids while managing to advance her career. I can only assume how tough that is having to take off work for appointments and maternity leave, etc. She now makes as much as I did before I went back to school, a little over the PT median in our area. We never increased our budget just because of the extra cash flow. It went into the accounts set for their intended purposes, e.g., home down payment, savings, etc.

    Even though there were some surprises, we managed because of careful planning. We are lucky. Most of our expenses would have gone to child care if it were not for family support. Not everyone has that.

    Planning is what non-career changers tend not to do. It's also the cause for much of their heartaches post graduation. I guess my point is that for the most part, having kids should not be an excuse for excessive expenditures. We have friends that have purchased baby Jordan's in every color of the rainbow for their babies. Our priorities are just different.

    My plans post graduation is to work two per diem roles if possible, just for the first year or so. Weekends and evenings I'll take for the differentials. This is so I can strengthen the financial security for my family and concentrate on the more important things I see in life, my two kids that I have been neglecting while away in PT school. Piano, swim, soccer, taekwondo, you name it. Age does change the perspective in life. You tend to ramble and write longer posts, also.
     
  22. jdaniels360

    jdaniels360 2+ Year Member

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    Love it Azi. Great stuff from everyone... Would someone please explain how filing when married is different from being single? Sound like its majorly beneficial. Thoughts?
     
  23. NewDPT31

    NewDPT31 2+ Year Member

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    TAXES TAXES TAXES. As well as insurance and unplanned expenses. I keep trying to tell people this. You can't look at things in a vacuum.
     
  24. jdaniels360

    jdaniels360 2+ Year Member

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    I hear ya about TAXES, believe me LOL hopefully i can live in another state (like FL) without state tax. I'm well aware there's only a few though. Any thoughts on the "filing married vs filing single?"
     
  25. jblil

    jblil 5+ Year Member

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    Having more than yourself on your 1040 allows you to claim additional deductions to your gross income, and this would make your taxable income smaller.

    Your taxable income is = (gross income) - ("itemized" or "standard" deduction) - (personal exemptions)

    - Gross income: the number on your job offer letter; never high enough, alas...

    - Itemized deductions: if you have lots of interest payments (mortgage, student loans), medical bills, state taxes, etc to pay, you can claim them (= itemize them). However, folks who don't have a mortgage or medical bills or state taxes are still allowed to deduct $6.1k if they file singly, or $12.2K if they file jointly with a spouse. That is called the "standard deduction", and the IRS increases it a bit every year.
    If you do have mortgage + student loan interest payments but their sum is less than $6.1K, you'd be better off taking the standard deduction rather than itemize, if you're filing singly.
    If you are filing jointly, then the sum of those should be more than $12.2K, otherwise it'd be more advantageous for you to take the "standard deduction."

    - Personal exemptions: currently the IRS allows you to deduct $3.9k per person. So if you are married and have 1 child, you can deduct $3.9x3= $11.7K from your gross income. The personal exemption also increases a tiny bit every year.

    So if you make $100K, are married to a non-working spouse and file jointly, your taxable income would be
    $100K - $12.2K (standard deduction) - ($3.9K x 2) = $80K

    @ jmdaniels: if you make $75K, file singly and don't contribute to a 401k, your federal taxes will be $16.2K; if you reside in NC, state taxes would be $5K. Some localities also have city or county taxes.
    Actually, your taxes would be even higher than that, because the PRN portion that you make will be taxed at a higher rate.
     
  26. Bluecase

    Bluecase 2+ Year Member

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    Disclaimer: in states with no state income tax the other taxes (housing, sales, etc...) tend to be much higher. So they get there money one way or the other.
     
  27. DesertPT

    DesertPT ` 2+ Year Member

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    This was not the point I was trying to make. I was just replying to jdaniels (who was talking about the possibility of living off ~$35k/year after loans/taxes) and saying that is fine if you are single but is a very tight budget if you have kids.

    And just because I am not a career changer doesn't mean I don't know how much kids cost and how much it takes each year to support a family.

    :thumbup: lol
     
  28. NewTestament

    NewTestament 5+ Year Member

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    Some states are cheaper than others. Are you suggesting that Tennessee and Texas are no cheaper than California and Massachusetts? For the record, Florida is in the middle of the pack in terms of cost of living.

    If you're going to have $250 in loans, then you need to consider cost of living after graduation. DO NOT live in San Francisco, New York, or Washington DC. Consider a cheap county in a cheap state. You might not have the lifestyle you really want, but you don't have to live there forever.
     

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