Take out as much loans or have spouse help pay?

[skijumpbump]

I am a MS1 and I have a new spouse who earns ~ 35K/year. Before we were married we had agreed to split all expensises 50/50. Now that we are married we are wondering if I should take out less loans and have her pay for as much as she can and then take out what ever we can't pay for in loans. We want to still be comfortable but in my thinking less loans = better (please tell me if I am wrong). Also she has ~ 15K in savings, should we touch this to pay for school, or maybe put that in a CD (she wants to do something low risk with this). I am somewhat clueless on this so any help would be great.

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[southerndoc]

I'm assuming you are talking about loans for medical school?

If you can afford not to take out loans for living expenses, then I definitely wouldn't.

Regarding taking loans out for tuition, it all depends on what your long-term plans are. If you plan to work in a place that might pay off your loans (rural area), or government service, then I would take out the loans. If you are getting incredibly good interest rates and plan to lock in on a good interest rate when you graduate, then I would take out the loans.

My interest rate is locked at 2.625% and will drop to 1.625% after 2 more years of on-time payments. I'm in no rush to pay off my loans. When the economy recovers, I can put the money at ING Direct and make more money than I'm paying in interest.

 

[plauto]

$15,000 in savings? don't touch it. All it takes is one car accident and you need to hire a lawyer and your savings are gone. You need that cushion. In fact, I'd argue it's too little of a cushion for a married couple. In any case, where the heck do you guys live that you can afford to live off of $35,000 and even spare some for the tuition?
I'm all for taking out only tuition loans. I think that in your position that is as reasonable as it gets without starving yourself. You'll also want to take a vacation here and there. Even if you think you don't need it, it's a lot easier and cheaper to do things now (assuming you don't have kids). You might come out with $10,000 more in loans, but you will never get back these years of your life.

 

[FutureInternist]

My bias would be to take out the loan. With this economy no job is truly safe & it would suck to be needing money half-way through the year & not get it.

If you wanted to, you could set aside the money she would be paying towards your education, and the day after you graduate you make a lump sum payment which would put you in a FAR better position than 99% of med school grads.

Good Luck.

 

[skijumpbump]

Thanks for the inforamtion everyone, I plan on paying for my next three years of tuition with loan money, so to clarify I am more asking about cost of living money. I do think it will be nice to have some money saved once I graduate becasue I will most likely be moving for residency and so most likely she wont have a job once we move. So I can see this money coming in handy.

 

[Twitch]

1) Make sure she maxes our her 401k if one is offered to her with matching.

2) Have her contribute $300 per pay period if she is on twice a month pay, or $600 / month. The rest is for her to keep / save as she wishes.

3) Agree with above posters, put the $15k in a money market account. CD's aren't that fluid.

 

[Kibster]

My wife is just finishing up physical therapy school and what we decided to do was that we would try and live like college students (meaning trying to get by on very little income) while she was in school. I had her take out enough loans to cover tuition. Books we would buy without the loans. We could have paid some on her education without taking out loans for the full amount, but I would rather keep a good savings account in case of an emergency. I am starting grad school in the fall and it looks like we are going to be doing the same thing, but with me taking out the loans.