<p>Someone asked me when med school grads begin paying back their big loans. Do they begin 6 months after graduation? </p>
<p>Is so, are they paying while they're residents (and not making much money)? If so, I can't imagine making payments on $100k-200k+ loans when making what residents earn.</p>
<p>I'm guessing that residents earn about $50k per year. Is that right?</p>
<p>Yes on the residency salary question. My D starts residency this July. She is not clear yet on repayment. They have a meeting at the med school the day before graduation to get this info. </p>
<p>I think from what I have read and what she has said that the interest on some kinds of loans start accruing during residency and other kinds of loans it is deferred till after residency.</p>
<p>You can defer repayment during residency, or you can do IBR, which is 10% of your pay less a certain government protected amount, which I believe ends up being $400-$500/mo in residency.</p>
<p>Private students loans are not eligible for IBR.</p>
<p>AMCAS has a primer for IBR here:</p>
<p><a href=“https://www.aamc.org/services/first/first_factsheets/166300/incomebasedrpymt_pslf.html[/url]”>https://www.aamc.org/services/first/first_factsheets/166300/incomebasedrpymt_pslf.html</a></p>
<p>And due to changes in the rules, medical residents no longer qualify for EHD (economic hardship deferment) of federal loans. They can request forbearance, but that’s offered only on a case-by-case basis. During forbearance, interest will continue to accrue and capitalize.</p>
<p>D1’s school requires mandatory exit counseling on managing loans.</p>
<p>Here’s the PP from 2011</p>
<p><a href=“http://hsc.unm.edu/som/finaid/docs/2011SOMExitInterview.pdf[/url]”>http://hsc.unm.edu/som/finaid/docs/2011SOMExitInterview.pdf</a></p>
<p>^^^</p>
<p>You can’t consolidate private loans into fed loans. And, fed loans have a max.</p>
<p>I bookmarked this thread:</p>
<p><a href=“http://talk.collegeconfidential.com/pre-med-topics/1414966-explain-loan-repayment.html?highlight=stanford[/url]”>http://talk.collegeconfidential.com/pre-med-topics/1414966-explain-loan-repayment.html?highlight=stanford</a></p>
<p>It might be helpful, I haven’t read through it yet, but I will be soon :eek:!</p>
<p>I cannot imagine that anybody could start repaying loans on resident’s salary. Well, maybe some move in back with parents, then it is possible. However, I would rather pay myself than having my adult S. or D. in my house.</p>
<p>
Why is that? :o I would welcome either of my two children back if they needed to for financial reasons.</p>
<p>Many of my friends have expressed that their goal during residency is to pay enough back that the principal grows very slowly rather than genuinely accelerating away and becoming hopeless.</p>
<p>The goal is one thing the reality is another. I know how much is my D’s living (room and board) so to speak and other expanses because we are paying for them. There is no way under the sky SHE would be able to repay any loans. Her resident salary will be barely enough to support herself (and maybe not). But hopefully she will not have loans (it all depends if we can hold to our jobs).
I do not know how others do it. Getting married to the likes of Facebook guy, my guess is that his pediatrician wife has her loans paid.</p>
<p>MiamiDAP, Thanks for making me feel great :). For years, I not only supported myself but also my child with $50,000 per year (in today’s dollar) and we were doing just fine. No, we were not receiving reduced lunch or living in project housing just in case you are wondering. I was actually a young professional just like your daughter will be (plus a little kid to raise). Sure, there are lots of things in this world we don’t know, but it does not means they don’t exist.</p>
<p>BTW, if you can just stop telling us again and again that a 4.0 is easier than getting passing scores in med school-and kids don’t get 4.0 because they did not aim high or did not work hard enough-that will be very much appreciated. We have not heard anybody in my kid’s school had an 4.0-rumors are there is none in the past 30+ years. We do hear kids won Rhode scholarship quite often-almost every year. Would you believe it yourself that all these Rhode scholars did not achieve a 4.0 because they did not work hard?</p>
<p>For a young single person, a resident’s salary is actually not bad, although it will be hard to save very much. If your spouse works, then even for a family the income is very reasonable.</p>
<p>The problem with residency is twofold. First, many of them are carrying strikingly high debt loads; the national average is something like $150K, meaning a “standard” debt repayment plan will be about $1700/month ($21,000 a year). That’s… a lot of money, especially in after-tax dollars. And that’s just the AVERAGE.</p>
<p>The second issue is that residents are BUSY, and a lot of being frugal takes time: shopping around, tracking a budget, that sort of thing. That can be really hard when you’re at the hospital 80+ hours/week.</p>
<p>I am dealing with the reality of my D’s situation.<br>
I am not dealing with the reality of others’s situation, including any poster on CC.
It is very possible for live on $15K / year (have done on lower for 3 of us).<br>
I know with about certainty close to 100% that my D. would not be able to repay her loans on resident’s salary. So, I am trying my best to make sure that she does not have any loans. There are factor beyond me, but whatever I can possibly do, I will and this includes spending considerable money on making sure that I myself stay as healthy in my ancient age as possible.<br>
Others have to ask themselves what they can and cannot do. Everybody’s reality is very different. One huge reason why I am sticking as much as I can to paying for my D’s Med. School is the future of her FUTURE children. I want her kids to have more opportunities. Having huge loans will definitely limit the finances of the family. We spoiled our kids as much as we could. I want my kids to spoil their as much as they could. It seems to work. the result are very hard working kids who set very high standards for themsleves. I want this to continue…</p>
<p>Thanks for your post happyfit. My son is working really hard too and I’m pleased he’s focused. That’s what matters here, isn’t it? I’m of the belief that grades are important, but that’s not everything. I don’t need to post his gpa at every opportunity.</p>
<p>In regard to repaying the loans in residency.
Here is my realistic calculation. Please, dismiss if it is not applicable to you.
Say that some mysterious way will allow you to re-pay $1000 every month. After one year of this repayment schedule, you will re-pay $12k. It is not even a dent in your Med. School loan. You will need your favorite tool - microscope to see this $12k in the see of couple hundreds of thousands.<br>
OK, now remove the mystery as I have no idea how in a world one can pay back $1000 every month on $50k salary, assuming that nobody is supporting the person.<br>
If you consider repayment of one/couple hundreds / month, you might as well not even think about it as a repayment, even your microscope will not see this drop in the ocean of your loan.</p>
<p>I think the ability to repay one’s med school loan while in residency is dependent on two variables. One being the total amount of the outstanding loan and second is the cost of living where the residency is located.</p>
<p>Son tracks his loan amounts and his expenses on an app on his phone he moved over from his laptop app. His med school financial aid office meets with the students every semester to discuss loan amounts and ways to save money. They also are already encouraging to apply in-house for residency since the COL is so very low in their/our area. And yet they pay their residents similar to most other hospital networks.</p>
<p>He says they meet with everyone early to start the “recruiting” early! For their third and fourth years their clerkships are scattered over 20 different locations across the state. If your “home” (Chapel Hill) is more than 50 miles from one of the 20 locations the school pays for your housing while “away.” Students put in a wish list for what residencies at what locations. Like a lottery. Students then get issued their “calender”.</p>
<p>I assume many want Wilmington and OBX in May and June! Others want Asheville in Jan and Feb!! Once one receives their schedule they can switch with others. Son received just 2 aways and his interests all remained at “home”. Some get all aways or just a few at homes. I think it has to do with want you want and your mentors and advisors play a part. Also something to do with the recruiting that is on-going.</p>
<p>But it gives students an idea of how much things cost all across the state and the different locations within the state that are open for residencies. If son ends up in his same location for residency his costs will remain low. His rent is under $400 with utilities and his townhouse is on the free bus line that runs 24 hours. He shops at Sam’s, local farmer’s market and the school feeds them at 3 to 4 times a week. His food cost is extremely low. He has projected how much he will be able to repay and when. He hopes to have it gone in under 4 years. He knows the loan accruals with interst and each year he continues to take less in loans.</p>
<p>He wants to have enough in reserves for interviews for residency and the exams. I am unable to help him financially so he has had to figure this all out on his own. Well, really the school as helped out tremendously. And not just with his scholarships but in other areas as well. How much to take, what to buy and when and if there are opportunities to earn some extra money, research, surveys, etc…they always notify. The alumni in the area are also extremely helpful. </p>
<p>So son does think it is possible to repay his loans during residency but again this is based upon his loan amounts and his cost of living. I am sure it varies for each student.</p>
<p>Kat</p>
<p>Exactly the point.
Cost of living might be zero if you are completely supported by somebody else (parents, spouse) and your loan might be in a range $0 - $10k. I can see that you repay rrather quickly.
Cost of living might be $35k / year which is about what you will have left after paying the taxes. How you repay anything at all?
Cost of living mingt be about $60k / year. You will have to borrow even more.
Keep in mind that the place of residency is NOT always in the cheapest location. Keep in mind that you do not want to worry all the time about being criminilized while having very strange and somewhat unpredictable hours of coming and living your home. Yes, you will need to live in a better place, so you know that coming in the middle of the night is not an issue. Also, keep in mind that you will not be able to afford commuting for 1.5 hrs one way as many regular working people do. These all add up to the cost of living.
Stating that single mom with income of $50k was able to re-pay tenths of thousands of loans every year for many years is misleading. I do not see how it is possible.</p>
<p>@Limabeans, exactly :). What year will your son be applying? My kid is a freshman in college thinking about doing premed, and I am very thankful for parents and current med students here for their thoughtful and very helpful posts. I don’t appreciate posts that constantly putting down others.</p>
<p>@MiamiDAP, how you come up with the money to pay for your daughter’s med school is exactly how these kids will be paying off their loans -live under one’s means, no mystery here. </p>
<p>Like BlueDevilMike said, perhaps not saving/paying down debt very much during residency, but it is perfectly doable to make a budget and pay as much as you can so the debt don’t grow out of control during residency. Once finishing training, it may be a good idea to pretend and live like you are still in residency for a few years to aggressively pay off the loans asap.</p>
<p>Also, where did you see statement “that single mom with income of $50k was able to re-pay tenths of thousands of loans every year for many years”?</p>
<p>If you never seen a single mom raising kids alone with 50k income, again, it merely means you never seen that, it does not mean this does not happen. I assume you know raising kid is not lesser a financial burden than paying debt.</p>
<p>Each family’s situation is unique. Each med student’s situation is unique. While we can learn from others what they do or plan to do under their unique circumstances, it would be unwise to try to draw any universal truths. </p>
<p>That being said, my family is just 3 people. Me, esposa, nina. That’s it. We don’t see finances the same way as others. It’s really just “our money” (family joke ;)). Chances are that (as long as we are able) we will continue to contribute all we can to make our daughter’s life easier, better, even more fun. It is our hope that we will be able to keep her interest from accumulating during residency by transferring the amount we give her now to interest payments. Maybe even a little principal. </p>
<p>Right now, that money goes to make her life better while in med school. Better apartment. Car. Trips home. Trips to visit friends. Some spending cash. Frugal? No. Not really. Extravagant? No. Not really. (O.K… Maybe that trip to Europe this summer is a bit over the top but everyone needs something to look forward to ;).) </p>
<p>Interest will be several hundreds of dollars a month. If we can pay that during her 3-5 year residency and specialization that would be a great use of “our money”.</p>
<p>I sure hope we can do it.</p>