paying for school later on

[V4viet]

hey guys i was wondering do you know much about paying off your loan once a person finished residencies and etc.. i figure i'll be in a lot of debt once i get out and i was wondering if you guys know of anyone who pay their loan nicely etccc

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[IlizaRob]

hey guys i was wondering do you know much about paying off your loan once a person finished residencies and etc.. i figure i'll be in a lot of debt once i get out and i was wondering if you guys know of anyone who pay their loan nicely etccc

Im not sure I understand your question.

 

[Dr_Feelgood]

I'm going to be about 150-200K in debt when I am done. You can choose to defer you repayment until after your residency. Then you have two roads: the 30 year payment plan or the 10 year. The difference is with the ten year you are paying about 30K per year in repayments. That is significantly lower in the 30 year plan, but you pay a lot more in interest.

 

[V4viet]

I'm going to be about 150-200K in debt when I am done. You can choose to defer you repayment until after your residency. Then you have two roads: the 30 year payment plan or the 10 year. The difference is with the ten year you are paying about 30K per year in repayments. That is significantly lower in the 30 year plan, but you pay a lot more in interest.

Thanks again Dr_Feelgood. I knew I could count on your for answering my questions. However, do you feel that the podiatrist salaries these days are a lot lower and makes it harder to repay your loan etc. I'm just asking these questions so that I know how secure i'll be financially in the futre in paying by my students loans.

 

[efs]

Everyone's situation is a little different, and it will pay to sit down and do the math yourself.

Student loan debt is not "bad" debt like consumer loans (credit cards, etc) are. Neither are mortgages. In other words the financial folks will look at it differently. (You can still qualify for a mortgage pretty easily even with some pretty large student loans.)

Student loan interest rates can be under 2%. In this case it is better to take the longest payback possible. Consider 10 year vs 30 year loans and calculate your monthly payments. Set aside the amount of money it would cost for the 10 year loan, and take out the amount of your 30 year payment. Invest the rest of it. In 10 years you would have more than enough money in your investments to pay off the balance of the 30 year loan and have money left over.

This scenario makes the assumption that you would set aside the money for investing, but it does illustrate a point. At the current interest rates it is to your benefit to take the longest payback time.

 

[Dr_Feelgood]

I don't know where you can get 2% anymore. The Federal Stafford rate is 5.3%.

Viet,
There are a lot of programs that will pay for you school if you are interested. One example is the Native American program, for every year you work on a reservation they pay a year of your schooling. They still give you a salary but it is at a reduced rate (similar to residency). There are similar programs to this if you do some investigating.

Now if you go don't go w/ these can you pay off you loan and make a decent living. Of course, even w/ a low end practice you will be able to pay it off but it will take you the 30 years. If you are lucky enough to get into a strong practice you will pay it off in 10. Think about this fact. If the average Pod makes about 80-100K and it takes 30K to pay off your loan each year (10 year plan), you still make about 50-70K. To me that is a good living but I grew up in a lower middle class family.

I guess some important factors are how much do you spend on "toys?" If you buy a new BMW every year then it may be difficult. They way I look at it though is people invest in the stock market which is a big risk; student loans are very similar but you are investing in yourself, where you control the risk.

 

[ProdPod]

If the average Pod makes about 80-100K and it takes 30K to pay off your loan each year (10 year plan), you still make about 50-70K. To me that is a good living but I grew up in a lower middle class family.


The average pod starts out at this salary but it usually increases over the years!

 

[efs]

I don't know where you can get 2% anymore. The Federal Stafford rate is 5.3%.

Loan consolidation. The low rates are still out there. There are some things that can be done to lower your rates as well.

Consolidation in your grace period often means a lower rate.
Making payments by EFT can mean a lower rate.
Making on-time payments for a certain period of time can mean lower rates.
Consolidation can lock in lower rates.

I consolidated a little over 2 years ago, initially at 3%, dropped to 2.25% after 6 months on time payments. I did not take advantage of the EFT payments. (I just like to see my payments every month, so I know where my money is going.) That rate's not going to change over the life of the loan, so if interest rates shoot up to 10-15%, I've still got a real bargain.

For comparison, the money I have in a 401K type plan is returning >20% interest. There is no question in my mind of whether to put my extra dollar towards paying off the student loans early or putting it into investments.

YMMV, but I see little reason to pay off student loans early.

 

[efs]

I don't know where you can get 2% anymore. The Federal Stafford rate is 5.3%.

Loan consolidation. The low rates are still out there. There are some things that can be done to lower your rates as well.

Consolidation in your grace period often means a lower rate.
Making payments by EFT can mean a lower rate.
Making on-time payments for a certain period of time can mean lower rates.
Consolidation can lock in lower rates.

I consolidated a little over 2 years ago, initially at 3%, dropped to 2.25% after 6 months on time payments. I did not take advantage of the EFT payments. (I just like to see my payments every month, so I know where my money is going.) That rate's not going to change over the life of the loan, so if interest rates shoot up to 10-15%, I've still got a real bargain.

For comparison, the money I have in a 401K type plan is returning >20% interest. There is no question in my mind of whether to put my extra dollar towards paying off the student loans early or putting it into investments.

YMMV, but I see little reason to pay off student loans early.

 

[Dr_Feelgood]

I'm sorry to say w/ the prime rate at 9.5% right now. I still don't think your consolidation loan is going to be that low anymore, the Feds have been pushing that rate higher and higher. But if you can find it, that is great.

 

[whiskers]

zzz

 

[whiskers]

Debt is debt. But unlike consumer debt that is fairly easy to shed ones self of, educational debt is like a tatoo of a heart with mom in it.

For those who blow off this issue, so be it, you'll be at the whim of whomever will pay you x dollars to make your payments. I hope they're generous.

Don't pretend that pods don't settle for low pay to make their loan payments....

There is no such thing as good debt, because in the end you are at the mercy of another human being.

Ask yourself....

If you had 200K in cash in you hand, would you quickly run off and go to podiatry school?

Make sure you're getting the best education possible for your money! It's your money they're gladly taking!

everyone cheering on the debt seems to ignore the fact that many things can go wrong with the perfect podiatry plan....

imagine taking out the loan and getting sued big time and not being able to get on ins plans..... Who's going to pay those loans back??????

Ask yourself

1. Why am I taking out this huge loan
2. What do I want for my money.

Don't settle for less than your standards!

If you're at a school that isn't cutting the mustard for you, see about

transfering and rewarding both yourself and a school that does!

 

[IlizaRob]

Debt is debt. But unlike consumer debt that is fairly easy to shed ones self of, educational debt is like a tatoo of a heart with mom in it.

For those who blow off this issue, so be it, you'll be at the whim of whomever will pay you x dollars to make your payments. I hope they're generous.

Don't pretend that pods don't settle for low pay to make their loan payments....

There is no such thing as good debt, because in the end you are at the mercy of another human being.

Ask yourself....

If you had 200K in cash in you hand, would you quickly run off and go to podiatry school?

Make sure you're getting the best education possible for your money! It's your money they're gladly taking!

everyone cheering on the debt seems to ignore the fact that many things can go wrong with the perfect podiatry plan....

imagine taking out the loan and getting sued big time and not being able to get on ins plans..... Who's going to pay those loans back??????

Ask yourself

1. Why am I taking out this huge loan
2. What do I want for my money.

Don't settle for less than your standards!

If you're at a school that isn't cutting the mustard for you, see about

transfering and rewarding both yourself and a school that does!

Whiskers, you never cease to amaze me at how you always portray the exception as the rule. Let me just say the cliche and get it out of the way so you can be at ease. "Life is not always fair, and everything doesnt always go as planned". There, with that said. Student loan is a good debt depending on how serious you are about what you are investing in. Feelawesome is right. You are investing in yourself, so the return can be much greater than the expense. My father began investing very early in his life, and with those investments came a lot of debt. He stretched paying off his house as long as he could because he could take the money he would normally use to pay off the house in 10 years and invest it instead making much more off of it than the interest that accrued. Needless to say he is very wealthy. Debt is not bad if you know how to use it and it is for the right reasons, like your education. Dont listen to Whiskers. He absolutely does not know what he is talking about.

 

[N4658H]

Debt is debt. But unlike consumer debt that is fairly easy to shed ones self of, educational debt is like a tatoo of a heart with mom in it.

For those who blow off this issue, so be it, you'll be at the whim of whomever will pay you x dollars to make your payments. I hope they're generous.

Don't pretend that pods don't settle for low pay to make their loan payments....

There is no such thing as good debt, because in the end you are at the mercy of another human being.

Ask yourself....

If you had 200K in cash in you hand, would you quickly run off and go to podiatry school?

Make sure you're getting the best education possible for your money! It's your money they're gladly taking!

everyone cheering on the debt seems to ignore the fact that many things can go wrong with the perfect podiatry plan....

imagine taking out the loan and getting sued big time and not being able to get on ins plans..... Who's going to pay those loans back??????

Ask yourself

1. Why am I taking out this huge loan
2. What do I want for my money.

Don't settle for less than your standards!

If you're at a school that isn't cutting the mustard for you, see about

transfering and rewarding both yourself and a school that does!

No. There is such a thing as good debt, and if managed properly will not ever be a problem. Do not get divorced, do not declare bankruptcy, and get a good financial advisor and tax person. I will not comment on whisker's other negative statements and questions. By the way, did you know that there is a cat circus in Moscow?

http://www.moscowcatstheatre.com/

 

[Dr_Feelgood]

One of the greatest leaders in American history, Thomas Jefferson was a major supporter of controlled debt. Investment is ones self is controlled debt. What is controlled debt Whiskers asks? Well Whiskers controlled debt involves borrowing money to pay for things will increase your chances of monetary return AKA an investment. For example, a person who goes to medical school is more likely to have a higher earning power than someone who doesn't. Yes debt is debt, but student loans are investments. Its basic accounting and business, very few companies, let alone people, have the assets to take major steps in building up assets. Therefore, under John Locke and Thomas Jefferson's theories, a controlled operating debt is necessary. This theory is what this great country was built upon, a national debt. And if you notice every country since has been built upon this principle called Keynesian economics. Yes, lately our national debt is out of control, but that is b/c they are no longer using as it should be. A $2000 hammer is not controlled debt and neither is 5 ply toilet paper for the president’s dog, even though the dog might get a chaffed behind.

I will not comment on whisker's other negative statements and questions. By the way, did you know that there is a cat circus in Moscow?

http://www.moscowcatstheatre.com/

I've figured it out! This is why Whiskers is so pissed at the world. He was force to join the circus as a small kitten and has been scarred since.