How am I goint to pay off all my debt?

[SpiritiualDuck]

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So, I'm finishing psych intern year, but am worried already about my student loan debt of about 220,000 from undergrad/medical.

So, for those that are out, what are my options, are there places that will take on some of that debt? Are there creative ways to find forgiveness for psychiatrist?

It's scary to think about. Are there areas of psych that I could do that pay well, like poor locations, prison, etc, that would be an option?

Should I sell space on the back of white coat?

 

[toby jones]

What is the British pound worth these days?

 

[BobA]

So, I'm finishing psych intern year, but am worried already about my student loan debt of about 220,000 from undergrad/medical.

So, for those that are out, what are my options, are there places that will take on some of that debt? Are there creative ways to find forgiveness for psychiatrist?

It's scary to think about. Are there areas of psych that I could do that pay well, like poor locations, prison, etc, that would be an option?

Should I sell space on the back of white coat?

I'm in the same boat, but my debt is more like 280K from undergrad and med school and it's growing at an aggregate interest rate of 6.25%. That's 15K a year of interest alone.

It terrifies me to the point where I've seriously thought that Psych may not be a viable specialty for me.

But it is. I try to not get terrified by keeping things in perspective. Money helps in life, but the happiest people I know aren't rich. They are people who insist on enjoying life. I think of my income this way - let's say I could get a comfortable job in a location I'd like to live (moderately expensive but not NYC) working 40/hrs a week making 150K. Take away 25K in taxes, and 25K in loan payments and I'm still left with 100K. That's not bad money for 40/wk of work in my particular chosen local. I'll have time to enjoy my life outside of work. I'll have time for the important things in life (family, friends, my health) and enough money that I won't have to worry too much as long as I accept that I'm not rich and live within my means.

My plan?
1) make serious payments during residency (I'm already planning on living with a roommate next year), probably about 1K/month.
2) live like a resident for several years after residency is over
3) delay my retirement investment (I see paying off my 30K of Grad PLUS loans which have an interest rate of 8.5% as equivalent to an investment with guaranteed 8.5% return. So I won't invest until my Grad PLUS loans are paid off. This will of course delay my retirement.
4) plan on working a longer career. One of the nice things about psych (compared to say EM or Heme/Onc is that in psych you can work into your 70's. A part-time private practice shouldn't be too hard to handle then.
5) I'm preparing myself to do a fellowship that will increase my income (Sleep) [personally I couldn't do Child/Adolescent unless I was a researcher which I'm not]
6) Are you familiar with the IBR?
7) Fortunately I'm still single. I plan on checking out the residency programs at my new place of employment for cute single doctors who are on the E-ROAD to happiness.

 

[abcxyz0123]

But it is. I try to not get terrified by keeping things in perspective. Money helps in life, but the happiest people I know aren't rich. They are people who insist on enjoying life. I think of my income this way - let's say I could get a comfortable job in a location I'd like to live (moderately expensive but not NYC) working 40/hrs a week making 150K. Take away 25K in taxes, and 25K in loan payments and I'm still left with 100K.

Uhhh..what makes you think that a 150k salary leads to a 125k net income after taxes? Federal taxes alone on a 150k salary is 35k. Adding in about 8k for state taxes, 6k social security, 2k medicare, leaves you with less than 100k.

 

[Solideliquid]

Are you interested in Geriatrics? We had a grand rounds discussant who told us that there are many places in the SouthEast where when you are hired as a geriatric psychiatrist you are given up to 30k to pay off student loans.

 

[chameleonknight]

Two words:

cut expenses.

Welcome to the new America, where you are punished for going to school and working harder.

 

[notdeadyet]

Welcome to the new America, where you are punished for going to school and working harder.

Making $150K/year with $220K debt is still much better than making $100k/year with $0 debt. So as intimidating as a six figure debt is, it's about as scary as squeeking by on $100k/year, which shouldn't terrify too many of us.

OP- if you practice in less served areas, you can also get NHSC to pay back some of your loans.

 

[ronin12]

if you are willing to move to undeserved areas i.e Midwest, IA, NE, ks,WI etc then you will be eligible for loan repayment. also your starting income will be above 200K and if you work bit extra look at making 250K without problem. i guess you can pay off your loans in 3 to 4 years at this income.

 

[BobA]

Uhhh..what makes you think that a 150k salary leads to a 125k net income after taxes? Federal taxes alone on a 150k salary is 35k. Adding in about 8k for state taxes, 6k social security, 2k medicare, leaves you with less than 100k.

I was painting with broad strokes. Not all states have income tax. Not all starting psychiatrists make 150K/yr. I was just speaking generally for the purpose of discussion.

 

[masterofmonkeys]

I'm stil trying to figure out public service loan repayment.

It sounds way too good to be true. I actually want to be an academic physician. And would end up paying about 100k over 10 years (on an incombe-based repayment plan) on 150k of debt with the remainder forgiven.

 

[whopper]

I'm living life like I'm still a resident.

I'm in a condo, and don't do much other than study for the upcoming boards.

If you really want to get rid of that debt & quickly, work your tail off after you graduate from residency. Take up a few calls. Do moonlighting while a resident. That actually is good training because when you work without the attending safety net, it is a different perspective.

Some places will help you to pay off loans.

The military also has a nice reimbursement program.

 

[kugel]

Moonlighting in residency helps.

A friend worked Locum Tenens for ~ 2 years after C/L fellowship and lived frugally (but took fantastic international vacations b/w jobs) and wiped out all his debt before taking a permanent job.

 

[OldPsychDoc]

Think Toyota, not Lexus.

Defer gratification.

 

[abcxyz0123]

Think Toyota, not Lexus.

Now thats just Crazy. Lets not go out of line here. I'd understand delaying retirement savings, getting your kids new shoes, or some unpaid bills......but TOYOTA?

 

[notdeadyet]

Think Toyota, not Lexus.

Defer gratification.

Good advice.

And sounds nice. I aspire to Japanese-made cars. Not only is my old beater Korean, I'm pretty sure it's North Korean...

 

[BobA]

I'm stil trying to figure out public service loan repayment.

It sounds way too good to be true. I actually want to be an academic physician. And would end up paying about 100k over 10 years (on an incombe-based repayment plan) on 150k of debt with the remainder forgiven.

I feel the same way. I'm meeting with my student loan office tomorrow to go over the details. I have this fear that IBR won't be there 10 years from now and I'll be stuck with a bunch of debt. It seems like a promise without a garuntee. Hopefully the Fin Aid office can make me feel more secure in the IBR program.

And I'm definitely thinking Toyota.

 

[chameleonknight]

Moonlighting in residency helps.

A friend worked Locum Tenens for ~ 2 years after C/L fellowship and lived frugally (but took fantastic international vacations b/w jobs) and wiped out all his debt before taking a permanent job.

Is the pay any higher doing locums or was it more so that his expenses were kept very low?

 

[nancysinatra]

And I'm definitely thinking Toyota.

What's the absolute cheapest car, does anyone know?

 

[billypilgrim37]

Think Toyota, not Lexus.

I prefer "the same bus my patients ride." Literally. Between that, and living across from the church with the AA meetings in the basement, I demonstrate wonderful judgment.

 

[Doctor Bagel]

I need to research this further, but I believe some of the newer financial aid changes made it so pretty no one has to pay more than 15% of their income in student loans. So while you might still be stuck with big loan payments, it really shouldn't be crippling regardless of your field.

As someone mentioned above, moonlighting appears to also be something that most psych residents can do, so you could so some debt reduction there.

And the big thing is just not to worry about it so much. You'll still be able to buy the things you need (and I'm being generous here). If you die, the debt goes away and doesn't haunt your family, and it'll get paid off (or not) someday, so whatever.

So, hmm, researching my first statement. I think it might be closer to 20%, and there are various restrictions.

 

[nancysinatra]

And the big thing is just not to worry about it so much. You'll still be able to buy the things you need (and I'm being generous here). If you die, the debt goes away and doesn't haunt your family, and it'll get paid off (or not) someday, so whatever.

If the New York Times is a correct source, then the statement about death canceling debt is not always true. I posted about this in the "applications to psych" thread, with a quote and a link to the article. I don't know all the details about when this would be true. Suffice it to day, the specter of student debt can haunt a person long after they've applied for bankruptcy or disability or, apparently, died.

My question is, to whom does the debt accrue in cases of death, and in what circumstances? Or say you have a deadbeat who simply refuses to pay at all and lets their debt accumulate interest to the point that it's in the millions, and then they die? Then who's responsible?

 

[diosa428]

If the New York Times is a correct source, then the statement about death canceling debt is not always true. I posted about this in the "applications to psych" thread, with a quote and a link to the article. I don't know all the details about when this would be true. Suffice it to day, the specter of student debt can haunt a person long after they've applied for bankruptcy or disability or, apparently, died.

My question is, to whom does the debt accrue in cases of death, and in what circumstances? Or say you have a deadbeat who simply refuses to pay at all and lets their debt accumulate interest to the point that it's in the millions, and then they die? Then who's responsible?

I think that it's the private loans that don't die... I'm pretty sure the federal loans do. I would imagine the private loans have to be repaid with the deceased's assets or savings before anyone can inherit anything. If no one cosigned the loan, I don't see how they could make someone else pay it off... but I don't really know.

 

[notdeadyet]

I think that it's the private loans that don't die... I'm pretty sure the federal loans do.

You are correct. Federal student loans die with you.

When I decided to go to med school, I made sure to research this. As an (ahem) older individual, it makes an impact on which loans to pay back first. It might be small consolation, but if I'm on my deathbed, the thought of skipping out on a nice chunk of a student loan might bring some consolation.

I would imagine the private loans have to be repaid with the deceased's assets or savings before anyone can inherit anything.

Also correct. If you take out a private loan, it comes out of your estate. I don't know how it works for single folks, but since very few people take much in the way of private debt for med school, it's pretty moot.

For the record, Erasing Student Loan Via Death should be very much the back-up plan.

 

[BobA]

What's the absolute cheapest car, does anyone know?

New? The Chevy Aveo. Although I'm disappointed it's still >10K.

 

[whopper]

TOYOTA?

I'm quite happy with my Prius.

52.5 MPG (well the way I drive it--I hypermile it), no problems, quiet engine.

Happier with that car than I've been vs my past cars--Subaru Outback (which also was a good car), Chrylser Lebaron, Chrysler Sundance, Toyota Camry. The Chryslers were junk.

Wife has a Chevy Cobalt. That's a piece of junk.

 

[psych]

The only reason I sometimes think twice about psych is my huge student loan burden. I'm looking at a little more than 375k when I graduate! Therefore it's difficult for me to have sympathy for people complaining about a lot less than that. I plan to apply to residency programs with a decent cost of living and ample moonlighting opportunities. Plus it helps that I come from a pretty poor family so I'm used to being cheap. Btw, I was wondering if anyone knew what the post-residency starting salary range is in California.
The IBR plan sounds great. It would save me a significant amount of money. Are you able to start during residency? The idea of being debt-free at 51 sounds too good to be true!! I'm curious to see how the payment option works with different loans at different interest rates. I have staffords at 6.8 and plus loans at 7.8. Does the lender consolidate the loans with an average rate, lower, or higher rate?
IBR does seem more reliable than public service loan forgiveness though. I hope both programs work out because pretty soon with rising tuition, the amount of debt I have won't be such a minority.

 

[whopper]

The military pays residents about an extra $10K a year for almost no extra work (forgot the exact amount, don't quote me). You are expected to give about 6 months of service for every year they pay you extra.

And as a military psychiatrist, you will be paid a good competitive salary on the order of a psychiatry attending, be given free room & board, and be open to great military benefits.

Only reason why I didn't do it is because I got married at the end of residency, and my wife & I were sick of having a long distance relationship--which at that time was 5 years. If I were single I probably would've done it.

http://www.goarmy.com/amedd/medical/corps_benefits.jsp

 

[nancysinatra]

The only reason I sometimes think twice about psych is my huge student loan burden. I'm looking at a little more than 375k when I graduate! Therefore it's difficult for me to have sympathy for people complaining about a lot less than that.

psych--how did this happen? Do you have undergrad debt as well? I can understand your lack of sympathy. I don't have the amount of debt you have, but mine's close to the top of what you can incur through med school alone, and a lot of mine is private loans.

My debt was calculated using my parents' income. They have no role in my life financially--haven't in years, and never will again. But my school counts their assets and that's why I had to take out the private loans every year of med school. Some days I regret my entire choice of a career as a result, because of how it sets me apart from other med students. It doesn't seem like a very "humanitarian" start to a career to me.

 

[psych]

psych--how did this happen? Do you have undergrad debt as well? I can understand your lack of sympathy. I don't have the amount of debt you have, but mine's close to the top of what you can incur through med school alone, and a lot of mine is private loans.

My debt was calculated using my parents' income. They have no role in my life financially--haven't in years, and never will again. But my school counts their assets and that's why I had to take out the private loans every year of med school. Some days I regret my entire choice of a career as a result, because of how it sets me apart from other med students. It doesn't seem like a very "humanitarian" start to a career to me.

Yup - went to a private undergrad. My financial need was based on my parents income who haven't supported me since I was 16. Actually an adviser told a lot people from my highschool to go to a private college because they offer more scholarships, grants, ect. What BS!
When I decided to go to medical school, I ended up with a lot of private loans because I realized I couldn't work 30hrs AND still rock all my premed courses. I had to quit working, take out loans, do extracurriculars, and pull a 4.0 for the last 2yrs of college. Anyway, I came to medical school with a lot (a lot) of debt. I was naive and ignorant. High interest rates are evil. I sometime regret things too. I hope I get gradification for all my hard work SOMEday.

 

[OldPsychDoc]

Yup - went to a private undergrad. My financial need was based on my parents income who haven't supported me since I was 16. Actually an adviser told a lot people from my highschool to go to a private college because they offer more scholarships, grants, ect. What BS!
When I decided to go to medical school, I ended up with a lot of private loans because I realized I couldn't work 30hrs AND still rock all my premed courses. I had to quit working, take out loans, do extracurriculars, and pull a 4.0 for the last 2yrs of college. Anyway, I came to medical school with a lot (a lot) of debt. I was naive and ignorant. High interest rates are evil. I sometime regret things too. I hope I get gradification for all my hard work SOMEday.

This is why I tell any high school student I have opportunity to advise to GO TO THEIR STATE UNIVERSITY. If you're motivated enough to go on to medical school, you will be motivated enough to utilize the less expensive university resources to their fullest.

 

[BobA]

The only reason I sometimes think twice about psych is my huge student loan burden. I'm looking at a little more than 375k when I graduate! Therefore it's difficult for me to have sympathy for people complaining about a lot less than that. I plan to apply to residency programs with a decent cost of living and ample moonlighting opportunities. Plus it helps that I come from a pretty poor family so I'm used to being cheap. Btw, I was wondering if anyone knew what the post-residency starting salary range is in California.
The IBR plan sounds great. It would save me a significant amount of money. Are you able to start during residency? The idea of being debt-free at 51 sounds too good to be true!! I'm curious to see how the payment option works with different loans at different interest rates. I have staffords at 6.8 and plus loans at 7.8. Does the lender consolidate the loans with an average rate, lower, or higher rate?
IBR does seem more reliable than public service loan forgiveness though. I hope both programs work out because pretty soon with rising tuition, the amount of debt I have won't be such a minority.

I'm in a similar boat. What really gets me is that I started down this whole road prior to 2006 when interest rates were 2-3%. Then when I was half-way into my plan to go to med school (had already borrowed $$ for an expensive post-bac) they changed the rules and jacked interest rates up.

I think IBR would be a great option for you. I'm looking forward to learning more about it for myself.

I also would look long and hard at the military FAP options. You'd basically get 280K during a psych residency to pay back your loans in addition to your resident's salary. In return, you'd owe 4 years active duty (getting paid about 120K + officer benefits; but could be in Iraq, Gitmo, San Diego, DC who knows?) and 4 years reserves. Personally, I'm too old to give another 4 years. But if I was younger and had your debt I'd seriously think about it. That interest is killer and the longer you wait. . .. .

Also, you have to apply to FAP fairly early.

 

[notdeadyet]

I'm looking at a little more than 375k when I graduate!

Psych- my condolences. That's a huge nut to crack.

I understand your story for undergrad and taking out private loans, but your med school loans are all federal, yes?

In med school, your income and family income may affect your Expected Family Contribution (and I realize it's grating if they look at your parental income as an adult), but that only adjusts how much you can take in subsidized federal loans. You're still eligible to take out the remainder of estimated costs in unsubsidized federal loans.

The reason I ask is that I've seen a few people in med school getting killed by taking out private loans. After they max out the federal loans available, they take out private loans either due to wanting to live a more comfortable life or (and this is a killer) because they have credit card debt or somesuch that requires private loans to keep on top of. Any private loan amounts taken out above the maximum estimated costs set for the med school can be really rough, so if there's any way to keep the belt tight and not live beyond that, you save a lot in interest.

IBR does seem more reliable than public service loan forgiveness though. I hope both programs work out because pretty soon with rising tuition, the amount of debt I have won't be such a minority.

The only drag with IBR is that if the program gets cancelled in 10 years with no grandfather clause, you're SOL and have let a lot of interest accumulate.

For Whopper's point about military service, if you're at all inclined, visit the Military Medicine forums on SDN. There are a lot of programs designed for residents and physicians that have perks of loan repayment. Some require full-time commitment, but the differential in salary between civilian and military physician is not great in psych, so it's not much of a pay sacrifice. There are also reserve and National Guard possibilities in which you get $75K or so in loan repayment while serving one weekend/month, plus 2 weeks/year.
PM me if this is a possible route you'd be interested in.

My condolences. I'm trying to think of outside-the-box ways to kill that kind of debt quick and am coming up blank. Ugly. Hope you find a plan and path that makes sense...

 

[psych]

I just read that after 25yrs (when your debt is erased) in the IBR program you have to pay income tax on the remaining amount... Uh, what is income tax on $275,000?

 

[notdeadyet]

I just read that after 25yrs (when your debt is erased) in the IBR program you have to pay income tax on the remaining amount... Uh, what is income tax on $275,000?

Income tax on that (according to this calculator) is about $76K.

 

[psych]

Since I'm pretty sure I want to go into psych, the only plan I have right now is to live like a buddhist monk until I'm 40. However on sucky days like today, when I actually think about how much I owe, how long its going to take to pay off, anesthesia and radiology become more appealing.

 

[nancysinatra]

This is why I tell any high school student I have opportunity to advise to GO TO THEIR STATE UNIVERSITY. If you're motivated enough to go on to medical school, you will be motivated enough to utilize the less expensive university resources to their fullest.

I can appreciate this advice, although for certain high school kids, a private college can be a great opportunity. And some private schools do offer good financial aid, although who knows nowadays...

I think the real travesty of education today is the exorbitant cost itself. I don't understand where my 30 or 40 grand or whatever per year in tuition alone is going, at all. In undergrad we got a lot of attention from faculty, but med school faculty aren't even paid, and as students we spend relatively little time interacting with them, so where's it all going? We don't DO procedures on patients much as students, so it shouldn't cost that much to insure us... The vast majority of my actual education seems to come from board prep books and things like USMLE World that I pay for separately.

As far as the private loans for med school--you can't take them out to just pay off credit card debt. You can only borrow up to your medical school's budget. Often people take out these loans simply to pay tuition and living expenses, for example to cover gaps left by "parental contributions."

 

[notdeadyet]

I can appreciate this advice, although for certain high school kids, a private college can be a great opportunity. And some private schools do offer good financial aid, although who knows nowadays...

Yeah, I've heard that for most of the privates that don't have the truly great endowments, a lot of the great financial aid has gone the way of the do-do.

As far as the private loans for med school--you can't take them out to just pay off credit card debt. You can only borrow up to your medical school's budget. Often people take out these loans simply to pay tuition and living expenses, for example to cover gaps left by "parental contributions."

But "parental contributions" (or EFC) only affects how much subsidized financial aid you can get. Even if you have rich parents, or are rich yourself, you're entitled to the same federal loan amount as everyone else. The only difference is that you'll have little or no subsidized federal aid; it will only be unsubsidized.

I'm sure of this because I came to med school from working full-time and was worried that I wouldn't qualify for fin aid. I got the same max amount of loans as everyone else; I just had all of my unsubsidized. The only folks I know who took out private loans took them out because the school budget wasn't enough for them. Some due to credit cards, one due to lots o' kids.

If someone is told they can't get federal financial aid because of parental income, they need to speak to a different financial aid officer. Everyone is entitled to the med school budget with federal financial aid. If they're being steered to private loans, there's something fishy.

 

[nancysinatra]

Yeah, I've heard that for most of the privates that don't have the truly great endowments, a lot of the great financial aid has gone the way of the do-do.

But "parental contributions" (or EFC) only affects how much subsidized financial aid you can get. Even if you have rich parents, or are rich yourself, you're entitled to the same federal loan amount as everyone else. The only difference is that you'll have little or no subsidized federal aid; it will only be unsubsidized.

I'm sure of this because I came to med school from working full-time and was worried that I wouldn't qualify for fin aid. I got the same max amount of loans as everyone else; I just had all of my unsubsidized. The only folks I know who took out private loans took them out because the school budget wasn't enough for them. Some due to credit cards, one due to lots o' kids.

If someone is told they can't get federal financial aid because of parental income, they need to speak to a different financial aid officer. Everyone is entitled to the med school budget with federal financial aid. If they're being steered to private loans, there's something fishy.

This might be a wording issue? The former "private loans" changed about 2 years ago and are now referred to as a certain type of "federal unsubsidized loans." Before that, there were "private loans" that I had to take out just for tuition and out of habit I keep calling them that. I'm not personally familiar with the private loans you've mentioned (where people can pay off credit cards). Ugh, it's complicated. A lot has changed in 4 years.

The med school can increase a student's budget on account of certain things, and perhaps having children to take care of is one of them, but I'm pretty sure they can't increase a student's budget to accommodate credit card debt. I didn't know about loans for that purpose--which I'm glad because I'd hate to be doing that! In any case, high interest loans are an albatross, especially when you know your classmates who lived at the same or lesser lifestyle didn't have to take them out.

It's going to be me and my bike these next few years...

 

[notdeadyet]

Since I'm pretty sure I want to go into psych, the only plan I have right now is to live like a buddhist monk until I'm 40. However on sucky days like today, when I actually think about how much I owe, how long its going to take to pay off, anesthesia and radiology become more appealing.

Makes sense. Though if you hate staring at x-rays, if you go the radiology route, you might find yourself at 40 saying, "If I'd gone into what I loved, psychiatry, I'd be debt free and happy right now." Unhappy from 26-40 is better than unhappy from 40-70.

How married are you to the idea of psychiatry in California? If you're willing to practice in underserved areas, there are federal (NHSC?) and state loan repayment benefits at some places.

 

[surftheiop]

This is why I tell any high school student I have opportunity to advise to GO TO THEIR STATE UNIVERSITY. If you're motivated enough to go on to medical school, you will be motivated enough to utilize the less expensive university resources to their fullest.

while definately true if someone is 100% on med school I think going to a big name/competitive university gives you the best ability to decide what sort of career your really truly want to go into.

(Take me for example, Im almost positive if I went to my state school I would not be planning on going to medical school (god and adcom willing))

I think going to a really competive school forces you to find something that your intellectually passionate about or else your going to get steamrolled. If I had gone to my state school I could have slid through engineering even though I don't particularly like it. But as it is I had to really step back and figure out what I was truly interested in doing for the rest of my life.

Another example, majors like psych/sociologyat alot of state schools might be mostly populated by people who are just looking for a fairly easy major so they can get a college degree (not that there is anything wrong with that, its just to get alot of jobs today you just need to show you can graduate from college). If you go to more competitive school your going to have alot of future PhD's sitting around you in psych/soc so you might have a greater respect for the field and decide its something you want to persue. ( I feel like there are alot of pre-med's ive talked to or read about on SDN who would really be better suited/more happy with a PhD in some other field, but they feel like those fields aren't "respectable" enough or something. )

So thats my thoughts, If you absolutely are decided on a certain career definately go to your state school. But if your still trying to figure things out going somewhere else might have a big impact on you.

And to pull it back to the money discussion, I get really good financial aid from my school (and its gotten alot better since economy tanked) so its really important to evaluate each school individually when talking about money.

 

[notdeadyet]

This might be a wording issue? The former "private loans" changed about 2 years ago and are now referred to as a certain type of "federal unsubsidized loans."

Ah, gotcha. You're referring to federal unsubsidized loans, they're just offered through private banks. These are loans with federally set interest rates. These are preferable to true private loans, where they can charge you 13-15% (which I foolishly agreed to for a postbac).

I'm not personally familiar with the private loans you've mentioned (where people can pay off credit cards).

You're better off. These are no different than loans you ask the bank for to build a pool. The interest is set by the bank, based largely on credit score, and you have no deferment or other bennies. Bad road to go down.

The med school can increase a student's budget on account of certain things, and perhaps having children to take care of is one of them, but I'm pretty sure they can't increase a student's budget to accommodate credit card debt.

You're right, they can't. That's why some folks take private loans for them, which is sort of robbing peter to pay paul, but I'm editorializing.

It's going to be me and my bike these next few years...

At least you'll be in great shape!

 

[psych]

Makes sense. Though if you hate staring at x-rays, if you go the radiology route, you might find yourself at 40 saying, "If I'd gone into what I loved, psychiatry, I'd be debt free and happy right now." Unhappy from 26-40 is better than unhappy from 40-70.

How married are you to the idea of psychiatry in California? If you're willing to practice in underserved areas, there are federal (NHSC?) and state loan repayment benefits at some places.

I applied to the NHSC this year to cover my last 3yrs of medschool. Haha, it's competitive so wish me LUCK!!

Yes, I am married to psychiatry in Cali. Luckily there are quite a few NHSC designated health shortage areas in central cali (where I'm from). It's actully a rural farming region.
I know I won't go into something just for the $$$. It's hard for me to picture myself enjoying anything as much as I enjoy psych.

I asked this question elsewhere but can you negotiate your salary such that your employer pays 50k+/yr toward loan repayment? I am told this is taxable income but wouldn't it lessedn the interest that accrues if payed out sooner than later.

 

[notdeadyet]

I applied to the NHSC this year to cover my last 3yrs of medschool. Haha, it's competitive so wish me LUCK!!

Good luck. If you're only a first year, NHSC is money in the bank. You're obligated to primary care, but if you know psych is in the cards and you like treating the underserved, there's no better game in town. Fingers crossed for you. It looks like a great program...

 

[BobA]

Just met with my fin aid office. My plan all along has been to try and pay the interest on my loans during residency (about $1,000/month). However, I think I'm going to enroll in IBR Public Service Loan Forgiveness. I'll be obligated to pay about $400/month towards my IBR - which won't cover my interest. In order to hedge my bets in the event that IBR isn't there when I'm done with residency, or in case I want to go into private practice, I'm going to invest that extra $600/month that I would've been paying towards my loans (maybe invest it into the 30K private loan I have. I can't decide). If IBR is there when I graduate, then that's great for me but if not at least I've paid off my private loan (or starting saving for retirement).

How does this sound?

 

[diosa428]

Yeah, I've heard that for most of the privates that don't have the truly great endowments, a lot of the great financial aid has gone the way of the do-do.

But "parental contributions" (or EFC) only affects how much subsidized financial aid you can get. Even if you have rich parents, or are rich yourself, you're entitled to the same federal loan amount as everyone else. The only difference is that you'll have little or no subsidized federal aid; it will only be unsubsidized.

I'm sure of this because I came to med school from working full-time and was worried that I wouldn't qualify for fin aid. I got the same max amount of loans as everyone else; I just had all of my unsubsidized. The only folks I know who took out private loans took them out because the school budget wasn't enough for them. Some due to credit cards, one due to lots o' kids.

If someone is told they can't get federal financial aid because of parental income, they need to speak to a different financial aid officer. Everyone is entitled to the med school budget with federal financial aid. If they're being steered to private loans, there's something fishy.

Actually, the federal loans (I'm assuming you're talking about Stafford loans) cap at $8500 for subsidized and $32,000 for unsubsidized. So if your cost of tuition + living expenses is >$40,500, you DO end up having to take out additional loans (they are called GRADPLUS loans or something, not sure if they are technically federal or private, but the interest rate is around 8% instead of 6.8%). This is now common at private medical schools and for those attending out-of-state state schools, where tuition alone is close to $40k.

 

[notdeadyet]

Actually, the federal loans (I'm assuming you're talking about Stafford loans) cap at $8500 for subsidized and $32,000 for unsubsidized. So if your cost of tuition + living expenses is >$40,500, you DO end up having to take out additional loans (they are called GRADPLUS loans or something, not sure if they are technically federal or private, but the interest rate is around 8% instead of 6.8%).

Right. But the GRADPLUS loans are still federal loans. The $40K cap is for the total federal Stafford at 6.8%, then you can take the federal GRADPLUS at 8%.

But they're all still federal. If you go into a job that reimburses on federal loans, they all qualify. They disappear when you die. And all are set percentages, rather than being tied to your credit rating (key for lots of med students).

Staffords are only synonymous with "federal loans" if you're going to a relatively cheap med school. Everyone else uses GRADPLUS too. Which is slightly higher percentage, but still much preferable to private loans.

 

[nancysinatra]

Actually, the federal loans (I'm assuming you're talking about Stafford loans) cap at $8500 for subsidized and $32,000 for unsubsidized. So if your cost of tuition + living expenses is >$40,500, you DO end up having to take out additional loans (they are called GRADPLUS loans or something, not sure if they are technically federal or private, but the interest rate is around 8% instead of 6.8%). This is now common at private medical schools and for those attending out-of-state state schools, where tuition alone is close to $40k.

diosa, those are the loans I was talking about. Our budget, especially for 4th year, is way over 40K. Not to mention the costs of board exams and residency interviews.

I'm going to check on IBR now too. Thanks for informing us of this. Moonlighting in residency seems like a good way to increase salary too.

 

[Tours2]

This is why I tell any high school student I have opportunity to advise to GO TO THEIR STATE UNIVERSITY. If you're motivated enough to go on to medical school, you will be motivated enough to utilize the less expensive university resources to their fullest.

I couldn't agree more. Private schools have become a massive rip-off, which is a shame, really. They offer the most diversity in education, as you can still find a Catholic, Presbyterian, southern, northeastern, western, agricultural or even a Buddhist school. That said, seeing the rates of tuition hikes disgusts me. When my private alma mater doubled their tuition in the span of eight years, I sent them a letter stating they'd never again receive a dime of my contributions. There's no reason for that absurdity.

Sadly, state school tuition is shooting up, as well.

 

[CielloStelatto]

What's the absolute cheapest car, does anyone know?

the one that doesn't work / is missing an engine / the steering wheel falls off.

a step up: a new toyota

a step up: a used honda

two steps up: a lexus / bmw / etc

😛

 

[nancysinatra]

So here's a question--can debt EVER roll over to a relative who has not cosigned on a loan? I know everyone will say no, don't worry about this, but if not, then what's the basis for this in American law? People are saying the GRADPLUS loans go away with death, which is nice, but some private loans don't, and my question is, who then gets stuck with them? Does it just come out of the debtor's estate? What if the debtor has no estate? Do the debtor's spouse, parents, children, siblings, etc. have to deal with it? Does anyone know, factually, what the answer is? It would seem like indentured servitude for an heir to be forcibly involved, but is that actually illegal in America?? Was there a Supreme Court case or something where this was settled? I believe in other countries people sometimes have to deal with debts for generations! How horrible is that?

I happen to know someone who recently graduated with a similar amount of student debt as what we're talking about here, who was stricken with a catastrophic illness, and can't pay the debt which is now amassing considerable interest, but also simply cannot get it discharged. Left unpaid, a debt that does not die with the borrower could potentially grow exponentially, could it not? After all, there is NO cap on the interest that can accrue, and bankruptcy is not an option. This is frightening. There MUST be something in US law about these loan terms whereby this problem is addressed.

A similar thing would be, I guess, if a hospital sent a very small bill to a patient in a vegitative state on a ventilator and started charging compound interest, but never put the bill into collections or alerted the patient's family, and merely let it grow and grow and grow, until one day, bam! Don't scoff--I have heard of hospitals sending bills to infants and deceased people, so I'm sure it's been done.