I just wanted to share these calculations with you to show you guys a realistic scenario if you decided to go to a PRIVATE SCHOOL.
Total debt: 400k
10 year Loan repayment plan:
$4,603.21/month or
$55,236/ year
http://www.finaid.org/calculators/scripts/loanpayments.cgi
1st year salary:
$100,000
After fede
ral and state income tax e.g in Florida:
$71,804.25
http://www.adp.com/tools-and-resour...l-calculators/salary-paycheck-calculator.aspx
After loan repayment: $71,804- $55,236=
$16, 568
Disability and malpractice insurance estimate:
$500/month or
$6000/year
True take home pay: $16, 568 - $6000= $10, 568
What job takes home $10, 568 after tax?
One that pays $13,000/year or $6.25/hr!
Did you go through 8 years of school to make $6.25/hr at age 26?
2nd year salary: $120,000
After federal and state income tax e.g in Florida: $84,860.25
After loan repayment: $84,860- $55,236= $29, 624
Disability and malpractice insurance estimate: $500/month or $6000/year
True take home pay: $29, 624 - $6000= $23, 624
What job takes home $23, 624 after tax?
One that pays $30, 000/year or $14.42/hr!
3rd year salary: $120, 000 so same situation
4th year salary and remaining years of debt repayment: $150,000
After federal and state income tax e.g in Florida: $106,025.25
After loan repayment: $106, 025.25- $55,236= $50, 789
Disability and malpractice insurance estimate: $500/month or $6000/year
True take home pay: $50, 789 - $6000= $44, 789
What job takes home $44, 789after tax?
One that pays $60, 000/year or $28.84/hr
Jobs that make around that salary range include
http://jobs.aol.com/articles/2012/11/02/30-jobs-that-pay-30-an-hour/
Ok so a few things about the numbers is that
1. They are quite optimistic because
I used 6.8% interest when in actual fact the interest is increasing yearly.
I used the debt after 4years at 400k when it is probably between 450-550k after living costs for those applying this cycle.
This does assumes no undergrad debt.
Also this does not include health insurance for which the average american pays ~$4000/year and MORE if you are paying for an entire family.
Does not include the cost of CE courses required to advance your career e.g Implant courses are $10,000.
Also having kids within the 10 years or loosing your job would totally alter these projections.
And finally this represents a pretty good scenario in regards to the salary climb for a dentist. 150k/year is the average for an ASSOCIATE as stated by the ADA.
2. But this could be better if
You have a spouse that is willing to pay living costs during dental school or willing to help with living costs during loan repayment.
Are one of those lucky associates that are able to make 200k in their first year
Obviously if you go to a 15year loan repayment plan.
Finally you have to remember that there is rent/mortgage, car insurance, electric and water bills to pay. Looking back at the numbers I don't know if a 10year repayment plan is realistic for anybody earning under 130k in their first year. But anyway, if these numbers discourage you then I recommend sticking to in state. I mean ofcourse it is still possible to make a good living in dentistry even with the 400k debt load but these numbers are quite realistic for the average student/dentist. And last but not least, remember that even though things may suck for 10-15 years, after you have repaid your loans things will be good.
EDIT: Ok since everyone was talking about the 15 year plan and a higher starting salary lets see the scenario:
Total debt: 400k
15 year Loan repayment plan: $3,550.74/month or $42,600/ year
1st year salary: $120,000
After federal and state income tax e.g in Florida: $84,860.25
After loan repayment: $84,860- $42,600= $42, 260
Disability and malpractice insurance estimate: $500/month or $6000/year
True take home pay: $42, 260 - $6000= $36, 260
What job takes home $36, 260 after tax?
One that pays $47, 000/year or $22.59/hr!
2nd year salary: $130, 000
After federal and state income tax e.g in Florida: $91, 915.25
After loan repayment: $91, 915- $42,600= $49, 315
Disability and malpractice insurance estimate: $500/month or $6000/year
True take home pay: $49, 315 - $6000= $43, 315
What job takes home $43, 315 after tax?
One that pays $58, 769/year or $28.25/hr!
3rd year salary: $130, 000 so same situation
4th year salary and remaining years of debt repayment: $150,000
After federal and state income tax e.g in Florida: $106,025.25
After loan repayment: $106, 025.25- $42, 600= $63, 425
Disability and malpractice insurance estimate: $500/month or $6000/year
True take home pay: $63, 425 - $6000= $57, 425
What job takes home $57, 425after tax?
One that pays $78, 000/year or $37.50/hr
Jobs that make around that salary range include
http://www.careerbuilder.com/Article/CB-1348-Job-Search-30-Jobs-That-Pay-80000/
Not too bad!
Like I said before, the 400k loan is doable if you land yourself in a good situation but are the above calculations (15 years of a job that really pays you starting from $47, 000 to eventually $78, 000 a year) really what you expected for a dentist? You have to keep in mind that the current cohort of students graduating from private schools is a running experiment, no one really knows if dentistry will be lucrative at these debt amounts for the average graduate.
Also remember: To reach your income potential of 200k/ year you would need to buy a practice, so with a practice loan you have to remember that it will set your income back quite a bit, towards a first year associate's salary usually.
http://forums.studentdoctor.net/threads/lets-buy-a-dental-practice.739665/page-4
