Newly married, starting med school in fall. Looking for advice.

[Rob_Hooke]

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Hi all.

As the title says I recently got married and will be starting medical school next August. I'm just looking for any general financial advice for my wife and I as we embark on the medical school journey.

Quick info about us:
-We're 21. No kids. Low expenses.
-Total current income: ~$60,000 between the two of us (Will drop to ~$40,000 after I quit my job)
-$8,000 in savings. With current budgeting will be ~$15,000 before starting next August.
-Only debt is from my undergrad ($20,000). No credit card debt.
-Wife's job very stable, great benefits with good opportunity for advancement/promotion while I'm in medical school.
-Attending state school (cost: ~$30,000/year) Will be taking out federal loans for nearly the entire amount with the exception of small scholarships/grants.

My wife and I are very good at budgeting and keeping expenses low; however, I'm not very well versed in finance. I wasn't sure if there's anything else we should be doing/can do to lower our debt burden after school. Or if there is anything else we could be doing better financially.

Any advice welcome. Thanks in advance.

 

[mvenus929]

Are your undergrad loans subsidized or unsubsidized? Federal or private?

 

[Rob_Hooke]

All federal Stafford, about 75% is subsidized, 25% unsubsidized.


Sent from my iPhone using SDN mobile

 

[tartesos]

Best advise I can give you is that is cheaper to keep her...
(Congratulations btw!)

 

[ThoracicGuy]

Hi all.

As the title says I recently got married and will be starting medical school next August. I'm just looking for any general financial advice for my wife and I as we embark on the medical school journey.

Quick info about us:
-We're 21. No kids. Low expenses.
-Total current income: ~$60,000 between the two of us (Will drop to ~$40,000 after I quit my job)
-$8,000 in savings. With current budgeting will be ~$15,000 before starting next August.
-Only debt is from my undergrad ($20,000). No credit card debt.
-Wife's job very stable, great benefits with good opportunity for advancement/promotion while I'm in medical school.
-Attending state school (cost: ~$30,000/year) Will be taking out federal loans for nearly the entire amount with the exception of small scholarships/grants.

My wife and I are very good at budgeting and keeping expenses low; however, I'm not very well versed in finance. I wasn't sure if there's anything else we should be doing/can do to lower our debt burden after school. Or if there is anything else we could be doing better financially.

Any advice welcome. Thanks in advance.

Would you be able to take less loans and utilize her salary to help?

 

[RangerBob]

If your wife is making $40k, you should be able to take out less than the max. Your future self (and your future wife's self) will thank you profusely if you live cheaply now.

Remember, it's easy to just continue your current lifestyle. Once you start ramping things up, people tend to want to maintain that or increase it. Being young and poor can be a lot of fun (assuming you have your needs met). Being older, married, with kids, and in debt--not so much fun.

I feel if my wife had a $40k salary while I was a medical student, we could've lived quite well on that, and not had to borrow anything for housing/living expenses (maybe not borrow the full cost of tuition either). In hindsight, I wish the two of us just rented a studio apartment in medical school--it's plenty big for two people (especially if you like each other!). My wife and I lived in a "junior 1-bd" our first year together and it was essentially a studio. It was our favorite place ever that we lived and full of great memories.

Seriously though, smart financial planning starts now, with budgeting and minimizing your loans. I can't tell you how much I wish I let that sink in when I was a medical student. Unfortunately I didn't start getting more serious about finances until I was an intern--it's too late for me to minimize my medical school tuition, but I sure can try and ramp down my lifestyle, budget better, pay down debt where I can. As long as you're not the type who has to keep up with the Jones' or the type who feels "I earned this so I deserve an expensive lifestyle" then it's very doable, and you're learn pretty quickly that the quality of your car, toys, mattress, kitchen utensils, etc., really doesn't have anywhere as much impact on your happiness as your state of mind and the person you're sharing your life with.

If you haven't already, read though WhiteCoatInvestor's website, as well as MrMoneyMoustache. The latter is a bit more relevant for students and those who need to learn how to think about spending and waste, and WhiteCoatInvestor comes in handier for the long-term thinking and financial planning.

 

[mvenus929]

Personally, I'd pay off the unsubsidized loans, and take out the least amount as possible during Med school--your subsidized loans won't gain interest during that time, so it's fine to keep them, and all your Med school loans will be unsubsidized (unless you get something from your school). You should be able to pay some of the tuition in addition to living expenses on 40K per year, as most Med students without families live on less than $20K.

 

[y123]

Pay off previous loan ASAP.
Live a frugal life and take as little loan as possible.
I doubt that you need to take out the full amount COA.

 

[Rob_Hooke]

Thanks for the advice everyone.

If your wife is making $40k, you should be able to take out less than the max. Your future self (and your future wife's self) will thank you profusely if you live cheaply now.

Remember, it's easy to just continue your current lifestyle. Once you start ramping things up, people tend to want to maintain that or increase it. Being young and poor can be a lot of fun (assuming you have your needs met). Being older, married, with kids, and in debt--not so much fun.

I feel if my wife had a $40k salary while I was a medical student, we could've lived quite well on that, and not had to borrow anything for housing/living expenses (maybe not borrow the full cost of tuition either). In hindsight, I wish the two of us just rented a studio apartment in medical school--it's plenty big for two people (especially if you like each other!). My wife and I lived in a "junior 1-bd" our first year together and it was essentially a studio. It was our favorite place ever that we lived and full of great memories.

Seriously though, smart financial planning starts now, with budgeting and minimizing your loans. I can't tell you how much I wish I let that sink in when I was a medical student. Unfortunately I didn't start getting more serious about finances until I was an intern--it's too late for me to minimize my medical school tuition, but I sure can try and ramp down my lifestyle, budget better, pay down debt where I can. As long as you're not the type who has to keep up with the Jones' or the type who feels "I earned this so I deserve an expensive lifestyle" then it's very doable, and you're learn pretty quickly that the quality of your car, toys, mattress, kitchen utensils, etc., really doesn't have anywhere as much impact on your happiness as your state of mind and the person you're sharing your life with.

If you haven't already, read though WhiteCoatInvestor's website, as well as MrMoneyMoustache. The latter is a bit more relevant for students and those who need to learn how to think about spending and waste, and WhiteCoatInvestor comes in handier for the long-term thinking and financial planning.

Thank you. It is very likely we may be able to use part of her salary to not take out the full COA. We've only been married ~1 month so frankly we're still very early in the budgeting process. If we can, then we certainly will. Neither of us is very interested in extravagant lifestyles. I'll read through the two websites you suggested.

Personally, I'd pay off the unsubsidized loans, and take out the least amount as possible during Med school--your subsidized loans won't gain interest during that time, so it's fine to keep them, and all your Med school loans will be unsubsidized (unless you get something from your school). You should be able to pay some of the tuition in addition to living expenses on 40K per year, as most Med students without families live on less than $20K.

How much would you recommend to keep in savings? I've always wanted at least $10,000. And if saving goes as planned for the next 6 months then we will have $15k and can use $5k for the unsubsidized loans.

 

[mvenus929]

How much would you recommend to keep in savings? I've always wanted at least $10,000. And if saving goes as planned for the next 6 months then we will have $15k and can use $5k for the unsubsidized loans.

I kept $7500 in saving until I started applying for licenses and had some unexpected car problems come up. I think $10 is plenty.

 

[dpmd]

Aren't there origination fees associated with taking out loans (been a while so may be wrong)? If so I would advise not paying off the older loans and instead keep that money around to avoid having to take our new loans. Between what you are able to save up between now and starting, and your wife's income you could potentially avoid loans for a while. Don't neglect retirement planning during this time though.