Many MDs will have sweet exit packages included as part of their contract, so letting them go often costs a company a LOT of money.
@FinalYear , you might think about refinancing the loans and getting them all into your name. There are companies that will allow you to do so even with the parent plus loans. This way they are out of your parents name but obviously they sound like they would help out if needed.
My son did this with his loans. His story is similar to yours, he has been out now and just passed his two year anniversary at his place of employment. Was fortunate enough to get a job in Finance in NYC and is having no problems with paying his loans and still has a social life.
Yes, betting on yourself like this is a bold move and not for everyone. Congrats on getting hired and good luck going forward.
@adavis89 âBased off of the students that entered into the Alt. Assets Management Programwith you, how hard is it to get into (I have read the requirements on the SMU website)? Also, can you be an incoming Sophmore or Junior and get into the program?â
The program is very competitive, but it has no cutoff and if you are qualified, you should have a spot. The last dean of the business school has made this a priority, and as such, our class size was 50 last year (around 25 when program first started 10 years ago).
What they generally want to see: 2 carefully chosen rec letters, 3.7 GPA average in all Finance and Accounting classes youâve taken so far, evidence of professional work experience, and campus involvement. The program heads want to make sure students can work well in teams and handle the rigor of the program. For interviews you must do well in a behavioral portion, demonstrate your interest in learning about IB, and answer a slew of IB questions (all memorization/practice. There are are lots of guides on what these questions are and how to answer them online). Your major doesnât matter but like 97% of applicants are finance.
Hereâs what the process looks like currently: 1) Spring of Sophomore year, we host an info session. This is attended by around 150 business school students to give you idea of applicant pool
2) Later Sophomore year, we host mock interviews. At this point, we are already making notes about who performs well, but these typically wouldnât harm anyone.
3) Like 3 weeks into Junior Year Fall we host more mocks and then several rounds of interviews with current and former Alts, as well as the program head, Maxwell. You hear back a few weeks after!
4) For those admitted, Maxwell will send a flurry of emails for various banks, PE firms, and other Finance firms in his expansive network that are hiring. Often but not always at SMU, firms go straight to him to fill their positions because they know the students admitted to the program have already undergone rigorous interviews - behavioral and IB questions.
4) The actual courses are in the Spring and then Fall of Senior year. Spend 15-20 hours a week learning DCFs, LBOs, NAVs in Excel and other IB/PE/HF related work.
Since investment banks are recruiting earlier every year (now interviewing JUNIORS for FULL TIME POSITIONS and SOPHOMORES for post-JUNIOR YEAR INTERNSHIPS), this process may be moved up or changed by the time youâre in school. And yes, you can apply to get in as a Sophomore, but you ought to have a good grasp of the IB concepts and have internship experience post-freshman year. 2 students in the previous class were sophomores.
Let me know if there are any questions on any of this and Iâd be happy to answer them!
Is it feasible to double major in finance & accounting ?
What is the overall average beginning salary at SMU? If you are suggesting it is no big deal to borrow $120k because everyone at SMU has starting salaries of $75k, with signing and yearly bonuses, do the reported numbers support that?
@fleishmo6 Congrats to your son and thanks for chiming in. Agreed, this method is not for everyone.
And good point, actually, Iâve already looked into refinancing/taking my parents off the loan a few weeks ago. For readers wondering, companies such as SoFi and Earnest will allow you to refinance your loan, add or remove a cosigner, and change your maturity date. Unfortunately for me, the rate quoted from all 4 of the sites I price shopped at actually had a HIGHER interest rate. A higher salary wouldnât have helped, and it appears I was benefitted by 1) lower interest rates a few years ago and 2) possibly a slightly subsidized rate since I live in Texas?? I got mine through a Texas resident-only lender that works with the education board.
Long story short, my parents and I decided it was worth keeping things as-is for now. But recommend looking into refinancing for anyone whoâs just left college.
@Publisher Not at SMU. You can only have one business major unfortunately.
@twoinanddone Starting salaries differ by major. Overall SMU starting salary will be much less than the 70k and 60k pre-bonus reported in the Finance and Accounting placement data, and similar for the business school overall which I was a direct admit to via BBA scholar program. Iâm sure starting salary for SMU overall can be found online and would not support taking out nearly as much in loans compared to cheaper schools from a purely mathematical standpoint.
Also, unrelated but important to note- there are many non-financial benefits not visible in salary data between schools, such as the network, as my parents coming from lesser known schools always reminded me.
Do you work for SMU admissions ?
See, here is the problem. We see a LOT of cocky students out here who arenât maybe as good as they think they are. And there are plenty of stories of kids who go to college, and find that when they get into a more competitive environment, they arenât really top students any more. Or they get into their planned high paying major, and discover that they donât really like it. Even if they decide to transfer or drop out, a couple year of big debt is a big burden to carry in those cases. For every student who is able to pay off those loans, there are many who struggle with their student debt. I personally see a lot parents out here who are starry eyed about how great their kids are, when in fact they are good but not world beaters. And lots of boys posting who are sure they are going to make it big, too, but many likely wonât. And if they all take out $120K in loans, most are going to be sorry.
Warren Buffet didnât go into debt like this for college, and look where he is. Here is another way to âbet on yourselfâ â go to a college you can afford. If you are such hot stuff, you can graduate from the top of your class there. Tippy top students get interviews from many schools that donât require that type of debt. Sure, firms might hire a smaller number from those schools. But a great student will stand out anywhere.
If you can pay for SMU with limited debt, then by all means go there. Or if you have relatives who will backstop your debt without risking their own retirement/comfort, go ahead and borrow. But otherwise, this isnât a smart path to take.
@Publisher No, Iâm not in admissions. Just thought Iâd come on here and share my story and try to answer questions. I have been and continue to be involved in mentorship around the Dallas and NYC community and wanted to extend myself as a resource to CC since I used it and WSO so much during my time before/during college. SMUâs page looked more inactive than I feel it deserved so wanted to help out too to help others understand the opportunities/options all on one page. If prospective students for this next class need help, Iâm sure theyâll continue to find this at some point or another. I am very thankful for the opportunities SMU afforded me and wish to give back as well.
@intparent Valid points and your additional perspective will help other students as well regarding weighing how much is appropriate to pay for school.
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Where else were you accepted?
^ That is a very good question. For those looking for these types of opportunities, certain schools have an advantage. Important to consider that in the admissions process. One might gain admission to several comparable schools (reputation, ranking, financial, etc.) yet one might be a better target for certain industries. The program OP was accepted to made SMU a real plus for accessing his job. Had he gone elsewhere, albeit a superb school, it might have been harder to realize the opportunity.
I see this with my own son. He was accepted to a few very good peer schools. Although not a perfect science by any means, sifting through Linkedin to see where many kids end up, his school does quite well in his areas of interest. And the older folks (20 yrs out or so) seem to have done quite well from a career perspective (as in more senior positions) so the trajectory was pretty impressive. Does that mean it will happen for S? No. He still has to do the work, but the evidence shows others (many, many) have âmade itâ (whatever that means) .
@FinalYear, I think you have useful information to impart but I think this would have been better as two separate threads, âWhy I chose SMUâ and âWhy I think it was worth it to take out $120K in loansâ. Not everyone at SMU is going to be pulling down $80K in salary out of the gate and not everyone who is going to make that kind of money attends SMU. Iâd also like to see you come back in 3 or 4 years to report how things went for you. Maybe youâll have paid it all off and can tell students following you how to do it. Your plan seems to be working but as others have pointed out, at this point itâs just a plan.
For the OP borrowing heavily for an undergraduate degree may have made sense, but IMHO because of a few particular circumstances.
For students reading this, it makes sense IF:
-You are able to be admitted to the right program(s) and maintain the GPA needed to get the plum jobs. You have some control over this but things do happen. A bad breakup, a dying parent, a few harder than expected classes, a discovery that you hate what youâve signed up for.
-You have parents able to take on that debt load. Many families just donât qualify for loans that high.
-Your family doesnât have obligations that will take them beyond their borrowing limit. It thereâs a second kid coming along or if the parents need to refinance the home or business having extra debt may hurt their credit rating and make more borrowing more expensive, or even impossible.
-You stay healthy. Keep your fingers crossed.
-You donât burn out in what can be a stressful or competitive industry.
-You have a financial backup plan in the event anything goes badly wrong. In the OPâs case that seems to be help from the parents and grandparents, something many students donât have at this level.
-You wonât need to borrow for grad school. IME, MC firms will pay for many, but not all students to return for an MBA. If you need to make a lateral move you may want borrowing capacity to pay for school so you donât get stuck at a relatively entry level job.
-You are willing to put off some things, like saving for a house or maxing out your 401K.
-Youâre okay with a little less ability to be flexible. You might have to put off moving to Vermont with the love of your life for a year or two or forgo joining your college roommate in his cool new startup.
FinalYear, I wish you all the best. It sounds like youâve worked very hard to made your plan work and it IS working for you!
@Sue22: Great post. I think that you should moderate this thread as there are clearly posters who focus on one topic or the other.
I am fascinated by the opportunities OP had as a student in SMUâs undergraduate business program. In fact, although I do not have all the necessary data, it seems as though SMU Cox is a better option for an undergraduate business degree than for an MBA based upon internship placement & employment results. But I do acknowledge that each situation should be evaluated on a case-by-case basis.
As for the amount of loans taken out by OP to finance his undergraduate education, it was a calculated risk that remains risky until we learn what the situation is 6 or 7 years from now. I do not advocate for anyone taking out loans for any degree in excess of one yearâs reasonably expected base salary.
@jym626: Great question in an attempt to put OPâs decision in context.
The suggestion that this should have been two separate posts, one in the SMU forum to answer questions and one in the FA forum about the big loan has been made as far back as post #37 - maybe earlier.
@Publisher, those numbers are skewed. Thatâs an average salary. In order for it to be accurate, you need a median salary based on specific areas. A lot of new graduates from Wharton boast a $100k starting salary with these companiesâŠbut Wharton is on the east coast. $100,000 is barely paycheck to paycheck. If you deflate the cost of living to Texas standards, it would be around $50k-$60k a year, which is exactly market rate. Expecting an entry level salary any higher than that in Texas is simply unrealistic.
The median salary of a financial consultant is less than an electrical engineer but slightly more than a software developer. Both of those careers have lower pay than an attorney, which has the highest debt to salary ratio. The OPâs debt to salary is about average for an attorney.
My advice still stands. Thereâs going to be a big uphill battle getting these debts paid down. Try to be aggressive as you can, and donât be afraid to consolidate the loans to perhaps 30 years. You can still make large payments when you can, but you can also save back some money for other contingencies as well. Paying down debt is never as easy as it looks on paper. Been there, done that, in fact still doing that. Thereâs a big unforseen contingency called life, and it works like a big government conspiracy 
@FinalYear I have a feeling the OP will be just fineâŠ
@Sue22 Great points and I think you did a better job defining some things to consider than I was able to.
@jym626 & Sue, In retrospect, two posts may have been better in order to focus the conversations, as this one has turned into a âwhen should someone take out loans thread.â I guess thatâs what happens when thereâs sensationalism in your thread title. And yes, making a similar thread 5 years later when Iâve really made a ding would be better, but I could also see a lot of students thinking my logic and experiences are no longer applicable because âthings changed too muchâ (I know I wouldâve thought that at least when I was younger looking at schools). Definitely have a long way to go but will continue to keep everyone updated! Not as much credibility right now, I know, and life happens.
@coolguy40: I am confused about the first paragraph in your post #135. Not sure to what numbers you are referring.
Post #48 above by jym626 clearly shows that the 2016 average starting salary for Financial Consultants from the Cox business school for a bachelorâs degree was $77,333. That figure does not include the year end bonus, but may include the $5,000 signing bonus. Cox MBA grads who entered consulting in 2016 earned a starting base salary of $108,333 according to SMU Cox published data in post #48 above.
As I wrote earlier, I think that you are confusing OPâs position with that of someone in the much lower paying retail end of the finance industry. Signs that you are confused about the type of firm for which OP works is that you mentioned that for a salary that high they could just hire one with 10 years experience (they could not for a variety of reasons) & you indicated that you didnât believe that OP had a written contract which included his base salary of $75,000 or so (and you insist incorrectly that it is $60,000). (Folks who remain in this industry for 10 years are making a base salary of $400,000 plus profit sharing & sometimes both profit sharing & bonus.)
Also, everyone should realize that cost of living can & does vary by region. So what relevance does that have to OPâs contract ? None.
I just think that you are confused about OPâs type of employer & OPâs position.
The second paragraph of your post #135 is nice, but has nothing to do with this thread. OP has an employment agreement with a set base salary, signing bonus, potential year end bonus maximum expressed as a percentage of his base salaryâwhich is in the mid 70s.
If you do a diligent web search, you can uncover multiple sites which verify the salary, signing bonus & year end bonus potential.
With respect to Wharton grads, I have never heard a Wharton grad complain about their base salary. The IB bonuses are frequently so large that I will not state it here as I find it difficult to believe even though I have been told & read it many times.
Back to OPâs salary & bonus. He is not in the retail end of the finance industry. And he is not an accountant. He is a Financial Consultant working for a national Management Consulting firm. The salaries & bonus structure & amounts are well known throughout the finance industry & throughout the country. If you have no other resource, than just use SMU Cox school of business numbers from 2 years ago.
Please do not direct any more responses to me without doing some research beforehand as you are clearly confused about OPâs position & OPâs type of firm in the finance industry.
@coolguy: Just the fact that you reference median salaries for financial consultants shows that you are unfamiliar with the type of employer for which OP works. This type of discussion should focus on MBB.
I hope that this helps clarify things for you.