how much loans is too much?

[doctry23]

hi

i'll be attending an OOS med school where the cost of attendance is about 75k per year (so ~300k), but I got a scholarship that covers 150k so I'll be taking out 150k in loans. I have 0 debt from undergrad (full scholarship) so 150k is all I will have when I start residency. Should I be stressing about this number already? Start paying it off little by little or will 150k debt not be too bad to pay off in 3-5 years of attending salary?

thanks!

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[Dantes]

To put things in perspective, 150k is below the average med school loan debt, and significantly below the average if you only count people who take out loans for aid into account (one source here). It's also less than the yearly salary for any specialty working full-time. Even if interest starts accruing again soon I think you'll be ok.

Do keep in mind that your COA is 75k right now. It goes up every year. Some scholarships are a fixed amount and others are a % of tuition or COA.

 

[Dr. Anonymouss]

Yes you are definitely below the average. Be thankful. I will be graduating with somewhere around 250k (includes undergrad debt)

 

[lanzhou_lamian]

Here’s a good White Coat Investor article on this topic.

TL;DR: A good rule of thumb is that you want to keep your loan balance <1-1.5x of your expected future salary. If you get beyond 2x, you may struggle to pay off the loan while meeting other financial milestones. Your debt burden of $150k is well below 1x salary for every specialty. You’re fine.

 

[BioPsychotic]

To end med school with 150K in debt is an amazing position to be in. For context, I will likely be taking out close to 350K based on my school's COA.

 

[voxveritatisetlucis]

Anything over 400k becomes an albatross imo.

Obviously is situationally dependent. living in New York, Cali afterwards might be tough to swing with those loan amounts but if you’re fine in the Midwest, southwest, southeast would be okay at that amount

Edit: I mean at 400k not the amount you took out. That would be fine anywhere.

150 at 7 for 10 years is 1750 a month

If you make 250, take home would be 12500 at worst (assuming California state income tax)

 

[deleted1139416]

150K is definitely manageable

The best ways to take care of student loan debt is 1) refinance 2) REPAYE through residency and 3) live like a resident in your first couple years as an attending

It also helps if you are married or live in with a working partner (although don’t go into a relationship just to pay your debt off early LOL)

 

[AnonymousDoctorGuyPerson]

hi

i'll be attending an OOS med school where the cost of attendance is about 75k per year (so ~300k), but I got a scholarship that covers 150k so I'll be taking out 150k in loans. I have 0 debt from undergrad (full scholarship) so 150k is all I will have when I start residency. Should I be stressing about this number already? Start paying it off little by little or will 150k debt not be too bad to pay off in 3-5 years of attending salary?

thanks!

I'm graduating with 500k debt and while it sucks ass I'm not concerned. You're graduating with debt that is less than a year of attending salary, you're in a relatively better position than most people who graduate from not only medical school but even just college in general in the US.

You good.

 

[Gilakend]

You could easily pay off 150k in 1 or 2 years depending on specialty. 150k is a steal.

 

[Dr. Anonymouss]

I'm graduating with 500k debt and while it sucks ass I'm not concerned. You're graduating with debt that is less than a year of attending salary, you're in a relatively better position than most people who graduate from not only medical school but even just college in general in the US.

You good.

What specialty are you going for??

 

[AnonymousDoctorGuyPerson]

What specialty are you going for??

No idea yet, I'm interested in a lot of things and have a very competitive application.

Unfortunately I can also see myself going into Peds 😅

 

[Tenk]

150k is easy. Good job. I wouldn’t stress. You can do income based repayments during residency if you want or just defer and when you’re done with residency hit it hard and fast and end it. I paid 330k off in about 4 years. You can easily pay off 150k in 2-5 years depending on the specialty and still live a great life.

 

[jambro]

Surely you can do the math. is this a real question?

 

[TakotsuboOkazaki]

Surely you can do the math. is this a real question?

Pretty much this.

Unless you do academic peds in NY city you can drop $150K in 1-2 years.

 

[jambro]

Pretty much this.

Unless you do academic peds in NY city you can drop $150K in 1-2 years.

If they do academic peds it might be even better since then you can just do PSLF! For doctors especially its almost always possible to make loans work, just maybe not while living the exact life you want

 

[Dr. Anonymouss]

No idea yet, I'm interested in a lot of things and have a very competitive application.

Unfortunately I can also see myself going into Peds 😅

Well with 500k debt I don't think anyone needs to tell you that you should consider anything besides peds lol. This is one of those situations where income should definitely be a factor when choosing a specialty otherwise you'll be fighting an uphill battle with loan repayment.

 

[PikminOC]

I'm graduating with 500k debt and while it sucks ass I'm not concerned. You're graduating with debt that is less than a year of attending salary, you're in a relatively better position than most people who graduate from not only medical school but even just college in general in the US.

You good.

You won't be paying taxes on your salary? And there won't be interest on your loans?

 

[Cornfed101]

I’ll have over $500k because my COA is over 100k a year. I’m likely going to do everything I can to get PSLF

 

[workaholic007]

I genuinely cant see how people cannot be taking over 300k+ of loans with the current cost of education. Honestly, 400k+ is more like it if you account interest over the 4 years.

I understand parental help and scholarship, but this is not the norm.

 

[PhD_to_DO]

I recently read about a physician who graduated med school with 450k in student loan debt; I’m not sure if this is all medical school or a combination of her undergrad, grad school, and medical school but if all you will need to take is 150k, it seems to me, you are doing good. The average loan debt for students graduating from the med school my wife teaches at is around 323k and that is close to what graduates at my med school are straddled with (Luckily, I received the VA-HPSP so I’m not paying for anything…)

Redirecting

 

[KnightDoc]

I recently read about a physician who graduated med school with 450k in student loan debt; I’m not sure if this is all medical school or a combination of her undergrad, grad school, and medical school but if all you will need to take is 150k, it seems to me, you are doing good. The average loan debt for students graduating from the med school my wife teaches at is around 323k and that is close to what graduates at my med school are straddled with (Luckily, I received the VA-HPSP so I’m not paying for anything…)

Redirecting

Actually, there is no free lunch, unless we receive scholarships from the school. People with loans will have their future income reduced as they allocate a portion of future income to repay the loans. People with HPSP will have their future income reduced as they repay their service obligation to the VA, at a significantly reduced salary as compared to what they can make in the private sector.

HPSP certainly allows you to attend school without having debt hanging over your head, but, one way or the other, we all pay.

 

[selah778]

hi

i'll be attending an OOS med school where the cost of attendance is about 75k per year (so ~300k), but I got a scholarship that covers 150k so I'll be taking out 150k in loans. I have 0 debt from undergrad (full scholarship) so 150k is all I will have when I start residency. Should I be stressing about this number already? Start paying it off little by little or will 150k debt not be too bad to pay off in 3-5 years of attending salary?

thanks!

You are very fortunate to have a scholarship.

 

[deleted1100659]

After residency was done my loans were about 360 with around 40k of it being interest. The part that is BS is that loans are unsubsidized now, so they accumulate interest when theres no possible way you can work in med school. That should definitely be fixed..

The person that has 450k should be going for PLSF. Usually residency counts for it at most hospitals, so thats around 4 years right there. Im sure its easy to find somewhere that qualifies for emergency med once shes an attending.

To give you an idea OP, I had 360k when I started as an attending (roughly) and paid it down to roughly 320k. Though part of the reason why it wasnt higher was due to rate freeze, which was a huge deal for me. I have five years from loan forgiveness, and roughly on 300k gross salary, i pay about 100k in taxes give or take, and have 200kish net. To pay off my loan in 10 years would be about 40k a year so I would still be left with around 160k net salary.

150k is not only doable, its something you should be ecstatic about.

 

[FarmerToDoctor]

I'll be graduating with about $400k of medical school debt. When I finish IM residency I'll have about $510k (1/2 are private loans).

Right now I am thinking of doing a cardiology fellowship. Over the course of those 3 additional years my debt will grow to ~650k. As a fellow I would be making about 70k, whereas working as a hospitalist I would be making ~260k (I am not sure if this is low or average). So there is an opportunity cost of ~190k/year. After 3 years I would be out 570k in salary and owe an additional ~140k in debt. Pursuing a cardiology fellowship would leave me with a combined total of $710,000 in opportunity costs. Granted, on a cardiologist's salary one could probably recoup that loss in 3-4 years.

 

[drdoug]

hi

i'll be attending an OOS med school where the cost of attendance is about 75k per year (so ~300k), but I got a scholarship that covers 150k so I'll be taking out 150k in loans. I have 0 debt from undergrad (full scholarship) so 150k is all I will have when I start residency. Should I be stressing about this number already? Start paying it off little by little or will 150k debt not be too bad to pay off in 3-5 years of attending salary?

thanks!

Most of the students I teach come out of medical school with about 350K worth of debt. Because of this high debt, a lot of medical school graduates tend to go into residencies that give rise to high paying jobs in a specialty. The other options are to take a public health service scholarship, go into the military or work in a small town that is willing to help you pay off your medical school debt.

 

[astrobean]

I graduated medical school with 210k federal loans (in state tuition). I made minimum payments through REPAYE through residency (neuro, 4 years) and fellowship (2 years). The REPAYE payments plus COVID zero payments has kept my loan sum essentially flat and it's now at 214k. I will be taking an academic attending job for a lower salary than private (210k, private I could make anywhere from 300-400k but would work ALOT more) I haven't fully run the numbers yet, but considering I am taking my job because I want it and like it and do NOT want to do private, I think it will still pay off for me to continue doing PSLF for the next 4 years.

Unless you are absolutely sure you will be entering a high paying specialty asap you should definitely enroll in PSLF and make minimum payments throughout residency. Since residency salary is so low you get "cheap" payments for the duration of residency. the REPAYE program has some special deal where some portion of the balance of interest accrued is also forgiven, so it's probably still worth doing during residency even if you end up paying off loans in a lump sum asap after getting a job. Atleast the balance won't grow as fast during residency.

 

[drdoug]

I graduated medical school with 210k federal loans (in state tuition). I made minimum payments through REPAYE through residency (neuro, 4 years) and fellowship (2 years). The REPAYE payments plus COVID zero payments has kept my loan sum essentially flat and it's now at 214k. I will be taking an academic attending job for a lower salary than private (210k, private I could make anywhere from 300-400k but would work ALOT more) I haven't fully run the numbers yet, but considering I am taking my job because I want it and like it and do NOT want to do private, I think it will still pay off for me to continue doing PSLF for the next 4 years.

Unless you are absolutely sure you will be entering a high paying specialty asap you should definitely enroll in PSLF and make minimum payments throughout residency. Since residency salary is so low you get "cheap" payments for the duration of residency. the REPAYE program has some special deal where some portion of the balance of interest accrued is also forgiven, so it's probably still worth doing during residency even if you end up paying off loans in a lump sum asap after getting a job. Atleast the balance won't grow as fast during residency.

not a bad idea! Is this "REPAYE" method widely known to residents?

 

[drdoug]

Actually, there is no free lunch, unless we receive scholarships from the school. People with loans will have their future income reduced as they allocate a portion of future income to repay the loans. People with HPSP will have their future income reduced as they repay their service obligation to the VA, at a significantly reduced salary as compared to what they can make in the private sector.

HPSP certainly allows you to attend school without having debt hanging over your head, but, one way or the other, we all pay.

Working for the VA Administration is not all that bad, depending on where you are. At least it gets you out from under the large debt burden. Good luck!

 

[Splenda88]

> 600k

You are in an excellent position where you can pay back loan in < 2 yrs

 

[Slack3r]

Between undergrad, post bacc, and residency, I’m sitting just shy of $400k for total loan balance. However, I’m in private practice and will bring home more that that after tax this year. Between PSLF and the various repayments options (PAYE, RePAYE, etc.), I really don’t think there are too many scenarios where there is “too much” debt for physicians. High earning subspecialists can service the debt on their incomes, and lower paying specialties should be able to utilize PSLF. Just don’t take a private practice peds job making $150k with half a mil in debt.

 

[voxveritatisetlucis]

Keep in mind that high salaries (needed to pay loans) are contingent upon health policy remaining the same. One bill that increases residency spots dramatically or mandates M4A could send salaries tumbling and lead to a wave of defaults

Pretty sure Bernie’s plan called for like a 300% increase in mid levels and reimbursement parity

If salaries stay the same then even 500k could be paid back. But this assumes salaries remain steady which I don’t necessarily think is a given

 

[Dr. Anonymouss]

> 600k

You are in an excellent position where you can pay back loan in < 2 yrs

jesus

 

[astrobean]

not a bad idea! Is this "REPAYE" method widely known to residents?

I didn't work that hard to find it so it wasn't hidden by any means. It was like one of the three major repayment plans to opt in to, I was not married at the time, I don't remember if that played into this or not. But I basically read the descriptions and opted for the one that also provided interest forgiveness as opposed to the one that didn't?

Ok this link has a good breakdown- PAYE does NOT take in to account spouses money but also only forgives interested on subsidized loans. REPAYE DOES take into account spouse money, but because I had no spouse this was not a down side, and DOES forgive 50% of interest accrued for subsidized AND unsubsidized loans.

PAYE vs. SAVE: Which Is Better? | Bankrate

The choice of PAYE versus SAVE comes down to your level of financial hardship and your desired repayment period.

www.bankrate.com

 

[jambro]

Keep in mind that high salaries (needed to pay loans) are contingent upon health policy remaining the same. One bill that increases residency spots dramatically or mandates M4A could send salaries tumbling and lead to a wave of defaults

Pretty sure Bernie’s plan called for like a 300% increase in mid levels and reimbursement parity

If salaries stay the same then even 500k could be paid back. But this assumes salaries remain steady which I don’t necessarily think is a given

what link do you have to this?

btw you might be thinking of trump for reimbursement parity (somehow never hear people talk about that tho)

"It’s time for physicians to answer the call for comment on the effect of Section 5 in President Trump’s Executive Order (EO), “Protecting and Strengthening Medicare,” of October 3, 2019.
Section 5 of this order calls for eliminating supervision by physicians of mid-level providers of medical care—nurse practitioners (NPs) and physician assistants (PAs).
More than that, it calls for pay parity (more accurately, “reimbursement parity”) among the same groups by Medicare.
Eventually all third-party payments for care would be leveled (flattened) across physicians, NPs, and PAs, regardless of their clinical training.


Speak by Jan. 17 on Pres. Trump’s Executive Order Regarding NP and PA Unsupervised Practice"

 

[PhD_to_DO]

Actually, there is no free lunch, unless we receive scholarships from the school. People with loans will have their future income reduced as they allocate a portion of future income to repay the loans. People with HPSP will have their future income reduced as they repay their service obligation to the VA, at a significantly reduced salary as compared to what they can make in the private sector.

HPSP certainly allows you to attend school without having debt hanging over your head, but, one way or the other, we all pay.

I guess it depends on how you look at it. While I won’t earn as much as a private practice physician, I’m still going to earn far more than I did in my previous career (clinical assistant professor) and from what I understand, as a VA physician, the govt. will foot the bill for my malpractice insurance (not an insignificant cost) and my time in the military will count towards my pension. I’ll also be able to take advantage of up to 240k in student loan repayment; I’m in PSLF for my undergrad and grad school loans but if I need to access the VA money, its nice to know that its there… Plus, the VA has lenient rules on moonlighting if should ever decide to go that way. For me, at my age, this is far more about doing something that I’ll enjoy while having a decent work-life balance as opposed to what I could make as a private practice physician.

 

[KnightDoc]

I guess it depends on how you look at it. While I won’t earn as much as a private practice physician, I’m still going to earn far more than I did in my previous career (clinical assistant professor) and from what I understand, as a VA physician, the govt. will foot the bill for my malpractice insurance (not an insignificant cost) and my time in the military will count towards my pension. I’ll also be able to take advantage of up to 240k in student loan repayment; I’m in PSLF for my undergrad and grad school loans but if I need to access the VA money, its nice to know that its there… Plus, the VA has lenient rules on moonlighting if should ever decide to go that way. For me, at my age, this is far more about doing something that I’ll enjoy while having a decent work-life balance as opposed to what I could make as a private practice physician.

No doubt it's a very decent deal. I was just pointing out that it is not free. ("(Luckily, I received the VA-HPSP so I’m not paying for anything…)").

FWIW, I'm pretty sure that you will be a civilian federal employee, not part of the military, with respect to your pension. Also, I'm pretty sure they do not allow you to double dip with respect to benefits (i.e., you will not be receiving any student loan forgiveness while you are paying back your HPSP service commitment).

I might be wrong about that, but, in general, they only allow you one benefit at a time. VA money for loan forgiveness will only be available if you stay after your 6 years. In the meantime, you'll have to make payments, although they will count towards your PSLF.

It's definitely a solid plan if you want to spend 20 years working for the VA. At the end of 20 years of VA service, you'll have a great pension, will have gone to med school for free, and will have received some loan forgiveness. But, if money matters, the hit you'll have taken to your income over that period (even including the value of the pension) will dwarf what you saved by going to med school for free and not having to repay all of your loans.

As I said before, one way or the other, we all pay. NOTHING is free. The HPSP is so generous because it has to be to get people to bite. And, even so, it's only a great deal for people who are very debt averse. Over the course of the payback period, which increases if you do a fellowship, it's not a great financial deal. You are just trading current debt plus interest accrual for future income, and most people give up more than they receive back.

 

[voxveritatisetlucis]

what link do you have to this?

btw you might be thinking of trump for reimbursement parity (somehow never hear people talk about that tho)

"It’s time for physicians to answer the call for comment on the effect of Section 5 in President Trump’s Executive Order (EO), “Protecting and Strengthening Medicare,” of October 3, 2019.
Section 5 of this order calls for eliminating supervision by physicians of mid-level providers of medical care—nurse practitioners (NPs) and physician assistants (PAs).
More than that, it calls for pay parity (more accurately, “reimbursement parity”) among the same groups by Medicare.
Eventually all third-party payments for care would be leveled (flattened) across physicians, NPs, and PAs, regardless of their clinical training.


Speak by Jan. 17 on Pres. Trump’s Executive Order Regarding NP and PA Unsupervised Practice"

Yes both are bad for doctors because one is beholden to nurses unions (Bernie) and the other is beholden to his private equity, Wall Street buddies (Trump)

the point being that it is hard to tell what salaries are going to be in 10 years and therefore it is advisable to take on debt that could be paid even if salaries were cut substantially

 

[AnonymousDoctorGuyPerson]

You won't be paying taxes on your salary? And there won't be interest on your loans?

Did... Did I say i wasn't?

 

[Choсolate]

hi

i'll be attending an OOS med school where the cost of attendance is about 75k per year (so ~300k), but I got a scholarship that covers 150k so I'll be taking out 150k in loans. I have 0 debt from undergrad (full scholarship) so 150k is all I will have when I start residency. Should I be stressing about this number already? Start paying it off little by little or will 150k debt not be too bad to pay off in 3-5 years of attending salary?

thanks!

What did you have to do in order to obtain such a generous scholarship?

 

[voxveritatisetlucis]

What did you have to do in order to obtain such a generous scholarship?

Get a high MCAT and gpa. ECs help at this stage but less so than stats imo.

Most of these scholarships will be from high tier schools as they have higher endowments but I got a full tuition one from a pretty low tier school so anything is possible.

Also higher tier schools tend to also offer need based aid

 

[Choсolate]

Get a high MCAT and gpa. ECs help at this stage but less so than stats imo.

Most of these scholarships will be from high tier schools as they have higher endowments but I got a full tuition one from a pretty low tier school so anything is possible.

Also higher tier schools tend to also offer need based aid

And would you know if obtaining such scholarships are an anomaly among medical students even among those who have very good stats?

 

[AnonymousDoctorGuyPerson]

And would you know if obtaining such scholarships are an anomaly among medical students even among those who have very good stats?

You can have a perfect MCAT and GPA and still not get a scholarship - they are still rare. There are few merit based scholarships, most are for X Y Z other reasons. Also as someone personally with a 100th percentile MCAT, the best money you get from it is from tutoring baha

Technically the best way to get a full scholarship via high stats is getting into a medical school that has free tuition like NYU

 

[voxveritatisetlucis]

And would you know if obtaining such scholarships are an anomaly among medical students even among those who have very good stats?

I think that they are becoming more and more common but they’re still not typical. Perhaps the record bull market that has been juicing up endowments makes schools more willing to part with money (or at least attract more donors who are also sitting on record wealth)

 

[AnonymousDoctorGuyPerson]

I think that they are becoming more and more common but they’re still not typical. Perhaps the record bull market that has been juicing up endowments makes schools more willing to part with money (or at least attract more donors who are also sitting on record wealth)

To add to this, and in contrary to my previous comment, there have been some large endowments to universities with stipulations in the last few years (as in saying X must go to tuition in Y years).

However to the asker, getting perfect metrics won't necessarily nail you those so don't bank on it however they certainly don't hurt and absolutely open doors.