Financing medical school. Age 34, some savings.

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Financing medical school. Age 34, some savings.

Postby Eavli » Wed Jan 09, 2013 3:40 pm

Hello, I'm new to Bogleheads, and I've spent the last couple of days reading through the many forum posts here having "medical school" returned by a Google search.

I'm 34 years old and was just accepted into a private medical school out of state. The annual tuition is roughly $40k. I've been debating on how I will finance my education. I will be starting Fall 2013, and I am currently working full time. My current financial assets are as follows:

Vanguard non-retirement account
$110k VFIAX
$70k VBLTX
$10k VGPMX (an investment I regret to this day)

Vanguard retirement account Roth IRA
$10k VFIAX
$4.5k VWESX

Thrift Savings Plan
$160k split (70/30 between C and G fund)

Savings account (ING)
$30k

From the forum threads that I have read, most seem to recommend that I should minimize the amount of loans borrowed and instead use my savings to pay for medical school. I would appreciate further confirmation that would be the most sensible approach. Also, since medical school will only gradually deplete me of my savings over the 4 years, are there any recommendations on how to allocate/invest the remainder? Thank you for your help.
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Re: Financing medical school. Age 34, some savings.

Postby am » Wed Jan 09, 2013 6:35 pm

Congratulations? Is is to late to change your mind (: ?

In all seriousness, I would use as much of my assets as possible to pay for living expenses and tuition. Loans can be very expensive- some having far higher interest than expected returns from investments. If you end up in one of the lower paying specialties (increasing in number every year), than you will be paying them into retirement. Having less debt will give you more options as far as specialty choices, practice location, and job options.
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Re: Financing medical school. Age 34, some savings.

Postby awval999 » Wed Jan 09, 2013 6:52 pm

Well you can afford tuition, in cash, from the non-retirement account.

Not trying to be personal, but the answer to this question is quite important--- Do you have a spouse? Is he/she going to make the move with you and be able to pay for the roof over your head, utilties and food?

EDIT: You have $220K in your non-Roth and non-TSP accounts. Subtract $160K for tuition leaves you with $60K for four years of living expenses, or $15K/year regardless of spouse/significant other. You can do it on that.

No loans. Never. No matter what.

You sure you want to be a physician though? :)
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Re: Financing medical school. Age 34, some savings.

Postby Liquid » Wed Jan 09, 2013 7:22 pm

Step 1: Ask yourself if you really, really, REALLY, want to become a physician. Note approximately 50% of physicians are dissatisfied with their career, and there are further headwinds ahead... If health care is a must for you I would seriously consider becoming a NP or PA (similar day to day practice, lop off nearly a decade of training (and lost saving), and end up with similar salary depending on field).

Step 2: Consider a state school.
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Re: Financing medical school. Age 34, some savings.

Postby bigspender » Wed Jan 09, 2013 7:30 pm

First off, congrats on getting into medical school. I actually started med school when I was 20, and am actually 2 years younger than you and I have been practicing for 4 years as an attending physician.

As far as financing it, I think you would be best off to not use your tax advantaged accounts to finance it. I recommend to take out loans and then focus on a specialty that you can pay the loans back as fast as possible. Government loans are about 6.8% and private loans are now 8.4% or so the last time I checked. When you become an intern and resident, try to do them at a 501c hospital so you can do income based repayment. Basically you pay a small monthly fee while you are an intern and resident and continue paying as an attending up to a total of 10 years. The loan is then forgiven. This is the reason to not use your own money. By doing this strategy, you won't be paying back the total loan.

Again, this is called income based repayment. The author whitecoatinvestor has a good review of this on his website. If I were you I would investigate this. Also, minimize your debt.

Best of luck with med school.
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Re: Financing medical school. Age 34, some savings.

Postby zebrafish » Thu Jan 10, 2013 1:16 am

Liquid wrote:Step 1: Ask yourself if you really, really, REALLY, want to become a physician. Note approximately 50% of physicians are dissatisfied with their career, and there are further headwinds ahead... If health care is a must for you I would seriously consider becoming a NP or PA (similar day to day practice, lop off nearly a decade of training (and lost saving), and end up with similar salary depending on field).


Speaking as an MD myself-- I would not listen to this advice. I think most individuals who have made the commitment to applying and getting into medical school have already decided that the MD track is the proper course for them. Someone once said to a nurse who didn't like taking orders from MDs-- If you wanted to fly the plane, why didn't you go to pilot school? If you are a CNRP or PA, your lifestyle will be easier, but you will always be taking orders or be under someone else's supervision-- I think most people that want to go to medical school don't want to be the flight attendant-- they self-select into the proper place. You can make more money as a PA or CNRP in certain areas than some M.D.s, but it comes at the cost of not being your own boss. There are specialties that vary the lifestyle commitment (and salary and clinical interest) within the M.D. spectrum that will fit your wants/needs.

Go to medical school and fulfill your career dream. It is an awesome time-- I made friends and had experiences during that time that I'll never have again. As someone who has worked and been a "real person" for awhile, you'll be a great student/resident/physician. Some of the most committed (and happy) physicians I've known had other short careers first which were non-medical.

Regarding finances-- I would pay as much now and take as little debt as possible. I graduated with 100K in loans and couldn't wait to pay it off (I now have). I hated having that debt, and it was a big financial/emotional burden.

Regarding this 50% unhappiness among physicians-- I'm not sure I believe these surveys. I love my career.
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Re: Financing medical school. Age 34, some savings.

Postby letsgobobby » Thu Jan 10, 2013 1:55 am

After days like today, I believe those surveys.
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Re: Financing medical school. Age 34, some savings.

Postby bertie wooster » Thu Jan 10, 2013 2:34 am

I would use your savings b/c loan rates are so high on the federal loans you will have available. Private school is really pricey - but that's where you got in. You'll have a tough time paying 4 years of tuition and living expenses, depending on where you'll be living. Get a roommate and cut costs and you should be fine. Good luck!
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Re: Financing medical school. Age 34, some savings.

Postby Swampy » Thu Jan 10, 2013 7:31 am

At 34 years of age, you have accumulated a significant amount of savings, specifically $394,500!

Congratulations![b]

Why on earth would you jeopardize your financial future to even consider medical school now?

If you go the medical school (4 years) and spend $160000 for the privilege, you still have, on average, at least 4 more years of residency [b] (where you work and live like a slave)
to complete - unless you plan on becoming highly specialized - in which case it can take another ten years beyond medical school!

Revel and enjoy the fact that you were accepted, now go get your head examined and put these foolish thoughts out of your head - once and for all.

Talk to a trusted financial advisor and life coach about your future potential over the next 10-25 years doing what you are doing now and what you would accomplish as a physician.

A physician's lifestyle is NOT what you think it is. With the advent of socialized medicine on the horizon, I don't know why anyone would even consider it. You will NEVER financially get back out of medicine what you put into it - period.
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Re: Financing medical school. Age 34, some savings.

Postby AnesBH » Thu Jan 10, 2013 8:40 am

SWAMPY wrote:At 34 years of age, you have accumulated a significant amount of savings, specifically $394,500!

Congratulations![b]

Why on earth would you jeopardize your financial future to even consider medical school now?

If you go the medical school (4 years) and spend $160000 for the privilege, you still have, on average, at least 4 more years of residency [b] (where you work and live like a slave)
to complete - unless you plan on becoming highly specialized - in which case it can take another ten years beyond medical school!

Revel and enjoy the fact that you were accepted, now go get your head examined and put these foolish thoughts out of your head - once and for all.

Talk to a trusted financial advisor and life coach about your future potential over the next 10-25 years doing what you are doing now and what you would accomplish as a physician.

A physician's lifestyle is NOT what you think it is. With the advent of socialized medicine on the horizon, I don't know why anyone would even consider it. You will NEVER financially get back out of medicine what you put into it - period.


Wow, strong words! I totally disagree however. It's not easy by any measure but totally doable. Depending on your specialty you'll make enough the first year to pay those loans off (surgery, rheum, cards, GI, radiology, anesthesiology, etc, not FP, peds, general IM though). If you're frugal and wise you absolutely WILL get back financially what you put into it. As far as socialized medicine is concerned (and BH's in general, right?), we can't predict the future so choose your field wisely, be frugal, pay what you can as you go, and follow your heart.
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Re: Financing medical school. Age 34, some savings.

Postby am » Thu Jan 10, 2013 10:07 am

Medicine still has a near guarantee of getting a well paying job somewhere, unlike most other fields these days. It goes downhill from there.

It is a demanding stressful job (400 suicides a year, high rate of burnout/depression/stress). Many fields are getting their reimbursements cut severely and the amount of work you have to do is increasing every year. The popular locations are saturated and to work in one of these places will require some sacrifice. The work becomes very routine and sometimes I have to remind myself why I went into it in the first place.

As a human, you will make mistakes, you will,feel bad, and for which you can be sued for and have to endure years of lawsuit hell. Seeing your paycheck decrease every year while you work harder hurts. Having government control your practice and reimbursements stinks. I get paid less for reading a chest X-ray (for which I can be sued for millions) than many haircuts. And these days, you have students graduating with 6 figure debt.

Having said that, not sure what else I would do in life.
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Re: Financing medical school. Age 34, some savings.

Postby Valuethinker » Thu Jan 10, 2013 11:00 am

SWAMPY wrote:A physician's lifestyle is NOT what you think it is. With the advent of socialized medicine on the horizon, I don't know why anyone would even consider it. You will NEVER financially get back out of medicine what you put into it - period.


Whilst I agree about the pressures on doctors and the profession, I think many people in many countries make happy livings as doctors under socialized medicine. The US Veterans Administration doctors for one. Foreign doctors don't generally make the money US doctors do, but there are compensations.

The peculiar US issue is about malpractice litigation-- not sure how that will play out.
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Re: Financing medical school. Age 34, some savings.

Postby Valuethinker » Thu Jan 10, 2013 11:15 am

Eavli wrote:Hello, I'm new to Bogleheads, and I've spent the last couple of days reading through the many forum posts here having "medical school" returned by a Google search.

I'm 34 years old and was just accepted into a private medical school out of state. The annual tuition is roughly $40k. I've been debating on how I will finance my education. I will be starting Fall 2013, and I am currently working full time. My current financial assets are as follows:

Vanguard non-retirement account
$110k VFIAX
$70k VBLTX
$10k VGPMX (an investment I regret to this day)

Vanguard retirement account Roth IRA
$10k VFIAX
$4.5k VWESX

Thrift Savings Plan
$160k split (70/30 between C and G fund)

Savings account (ING)
$30k

From the forum threads that I have read, most seem to recommend that I should minimize the amount of loans borrowed and instead use my savings to pay for medical school. I would appreciate further confirmation that would be the most sensible approach. Also, since medical school will only gradually deplete me of my savings over the 4 years, are there any recommendations on how to allocate/invest the remainder? Thank you for your help.


OK I don't know your fund tickers but why do you regret that fund?

Your investment process should be moderately risky. With a high equity weighting-- perhaps 70%. If you know you are going to spend that money during your medical school period, then it should be in safe investments: Ibonds, bank guaranteed CDs, ST bond funds (the former 2 preferred to the latter 1 at these interest rates).

Here's my thought:

- keep tax advantaged savings-- the magic power of compounding-- that should be in equities, as long as you are sure you will not draw it down. You want long term gains here

- borrow as much money as you can and repay it as soon as interest comes due. As I understand it (note I don't live in the USA!) your medical student loans only accrue interest once you graduate?

In any case keep *some* liquidity. I would say at least 12 months living expenses as a student at any one time. Until you are earning again.

You could investigate routes (US Army reserve?) that will reduce the total cost of your medical education. The work you would do for the US Army would be tough, but very worthwhile.

A poster here (Emergdoc) has a blog for financial issues for physicians-- well worth consulting.- people here are negative about careers as physicians. If you are motivated to go this far, you probably know a lot about what you are facing-- you have talked to doctors spent time in hospitals etc. In life in the long run, we tend to regret what we DID NOT do, rather than what we did do. If you do not do this now, you will never know whether this was the right thing for you. There are lots of ways to be a doctor besides an affluent specialist in suburban Connecticut, which lead to good, worthy and materially comfortable lives.

Know why you want to do medicine. Make sure it is not just so your Mum can say 'my son the doctor' or because your orthopaedecist drives a BMW (he's one of the lucky ones, and believe me, he's probably borrowed to the hilt). Make sure you know what doctors hate about their jobs (everybody has things about their jobs they hate-- if they think doctors have it rough, they should try lawyers, or the people who clean up in commercial kitchens-- in my office, an elderblack black lady lumps around huge bags of our garbage and wipes up after us).

The day when you are in ER and the battered corpse of someone breathes its last and his wife (my mother, in fact) turns to you and says 'thank you' will be a very special day in your life. As will be the day when you hold a young man's hand in his dying throes of cancer.

There's a scene in the old TV Series 'Homicide: Life on the Street'. A young boy has been shot in the head, the accidental victim of a gangland shooting in a shopping mall, whilst he was looking at toy dinosaurs. The parents make the decision to shut off his life support. And... they must have filmed this for real at Johns Hopkins.., his organs go into refridgerated boxes and onto the helipad, marked 'Chicago Hope' and 'NY General'... on their way to save the lives of other young children, desperately waiting for a donor match. Watch that and tell me doctors don't do important things.

One poster here spent time with the US forces in Afghanistan- -there was an article by a Canadian doc with the Forces out there, if you can google it (I vaguely remember it was in Mother Jones, but I don't remember exactly). Just incredible work. He said it was quite realistic.
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Re: Financing medical school. Age 34, some savings.

Postby Eavli » Thu Jan 10, 2013 12:50 pm

Wow, thanks for all the replies and suggestions.

I know that being a physician isn't the glamorous job that many people imagine it to be, but at my age, I've had a lot of time to reflect on the decision, and I'm certain that it's something that I will enjoy doing into old age.

I don't have the benefit of a working spouse to help pay for expenses, but frugality is something that I've been raised up in. If I borrowed money, interest will accrue throughout medical school, which I guess why many have recommended borrowing as little as possible.

The majority of my non-retirement savings are in VFIAX, which is Vanguard's index fund that tracks the S&P500. The rest is mostly in VBLTX, which is a long term bond fund. Seeing that I will likely use these savings to pay for medical school, is there a better asset allocation strategy?

Again, thanks for all the replies.
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Re: Financing medical school. Age 34, some savings.

Postby finley » Thu Jan 10, 2013 1:36 pm

Valuethinker wrote:
Eavli wrote:Hello, I'm new to Bogleheads, and I've spent the last couple of days reading through the many forum posts here having "medical school" returned by a Google search.

I'm 34 years old and was just accepted into a private medical school out of state. The annual tuition is roughly $40k. I've been debating on how I will finance my education. I will be starting Fall 2013, and I am currently working full time. My current financial assets are as follows:

Vanguard non-retirement account
$110k VFIAX
$70k VBLTX
$10k VGPMX (an investment I regret to this day)

Vanguard retirement account Roth IRA
$10k VFIAX
$4.5k VWESX

Thrift Savings Plan
$160k split (70/30 between C and G fund)

Savings account (ING)
$30k

From the forum threads that I have read, most seem to recommend that I should minimize the amount of loans borrowed and instead use my savings to pay for medical school. I would appreciate further confirmation that would be the most sensible approach. Also, since medical school will only gradually deplete me of my savings over the 4 years, are there any recommendations on how to allocate/invest the remainder? Thank you for your help.


OK I don't know your fund tickers but why do you regret that fund?

Your investment process should be moderately risky. With a high equity weighting-- perhaps 70%. If you know you are going to spend that money during your medical school period, then it should be in safe investments: Ibonds, bank guaranteed CDs, ST bond funds (the former 2 preferred to the latter 1 at these interest rates).

Here's my thought:

- keep tax advantaged savings-- the magic power of compounding-- that should be in equities, as long as you are sure you will not draw it down. You want long term gains here

- borrow as much money as you can and repay it as soon as interest comes due. As I understand it (note I don't live in the USA!) your medical student loans only accrue interest once you graduate?

In any case keep *some* liquidity. I would say at least 12 months living expenses as a student at any one time. Until you are earning again.

You could investigate routes (US Army reserve?) that will reduce the total cost of your medical education. The work you would do for the US Army would be tough, but very worthwhile.

A poster here (Emergdoc) has a blog for financial issues for physicians-- well worth consulting.- people here are negative about careers as physicians. If you are motivated to go this far, you probably know a lot about what you are facing-- you have talked to doctors spent time in hospitals etc. In life in the long run, we tend to regret what we DID NOT do, rather than what we did do. If you do not do this now, you will never know whether this was the right thing for you. There are lots of ways to be a doctor besides an affluent specialist in suburban Connecticut, which lead to good, worthy and materially comfortable lives.

Know why you want to do medicine. Make sure it is not just so your Mum can say 'my son the doctor' or because your orthopaedecist drives a BMW (he's one of the lucky ones, and believe me, he's probably borrowed to the hilt). Make sure you know what doctors hate about their jobs (everybody has things about their jobs they hate-- if they think doctors have it rough, they should try lawyers, or the people who clean up in commercial kitchens-- in my office, an elderblack black lady lumps around huge bags of our garbage and wipes up after us).

The day when you are in ER and the battered corpse of someone breathes its last and his wife (my mother, in fact) turns to you and says 'thank you' will be a very special day in your life. As will be the day when you hold a young man's hand in his dying throes of cancer.

There's a scene in the old TV Series 'Homicide: Life on the Street'. A young boy has been shot in the head, the accidental victim of a gangland shooting in a shopping mall, whilst he was looking at toy dinosaurs. The parents make the decision to shut off his life support. And... they must have filmed this for real at Johns Hopkins.., his organs go into refridgerated boxes and onto the helipad, marked 'Chicago Hope' and 'NY General'... on their way to save the lives of other young children, desperately waiting for a donor match. Watch that and tell me doctors don't do important things.

One poster here spent time with the US forces in Afghanistan- -there was an article by a Canadian doc with the Forces out there, if you can google it (I vaguely remember it was in Mother Jones, but I don't remember exactly). Just incredible work. He said it was quite realistic.


Speaking as a physician, this is the best advice in this thread. Being happy in life is not all about money. And being happy as a physician is definitely not about how much money you make. Yes, I make a good living and it is part of the reason I am physician, but I like what I do the vast majority of the time. It is a noble profession and one that allows you help many others in need. That being said, it is often a challenging profession and one that requires many sacrifices. If you know and understand these sacrifices, you have made the right choice for yourself.

If you have to pay interest throughout school, do not take loans out if you can help it. You will be a minority in medical school in that you can and probably should finish without much debt. This will give you much more flexibility in your decisions about what field you would like to go in and where you live. Lastly, I would also recommending going to whitecoatinvestor.com. The author there has a few articles about ways to deal with student debt that might be helpful to you. Good luck.
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Re: Financing medical school. Age 34, some savings.

Postby Childay » Thu Jan 10, 2013 3:58 pm

You can't qualify for subsidized stafford loans?
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Re: Financing medical school. Age 34, some savings.

Postby am » Thu Jan 10, 2013 4:14 pm

"And being happy as a physician is definitely not about how much money you make."

Agree but only to a point- which is very close to being reached at this time. It does certainly help however.
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Re: Financing medical school. Age 34, some savings.

Postby dhodson » Thu Jan 10, 2013 4:15 pm

those loans now a days arent such a great deal. gone are the days of real low interest rates with the govt paying the interest while in school.

i didnt come from a wealthy background. I joined the military and took out additional loans to get through medical school. I wouldnt change a thing.
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Re: Financing medical school. Age 34, some savings.

Postby finley » Thu Jan 10, 2013 5:40 pm

am wrote:"And being happy as a physician is definitely not about how much money you make."

Agree but only to a point- which is very close to being reached at this time. It does certainly help however.



That is fair to agree only to a point, but I think it depends on your personal situation (i.e. debt level, desired lifestyle, etc.) in regards to how close that point is to being reached. For me, it would take a dramatic drop in income to reach that point.
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Re: Financing medical school. Age 34, some savings.

Postby zebrafish » Thu Jan 10, 2013 5:59 pm

SWAMPY wrote:Why on earth would you jeopardize your financial future to even consider medical school now?

If you go the medical school (4 years) and spend $160000 for the privilege, you still have, on average, at least 4 more years of residency (where you work and live like a slave) to complete - unless you plan on becoming highly specialized - in which case it can take another ten years beyond medical school!

Revel and enjoy the fact that you were accepted, now go get your head examined and put these foolish thoughts out of your head - once and for all.

Talk to a trusted financial advisor and life coach about your future potential over the next 10-25 years doing what you are doing now and what you would accomplish as a physician.

A physician's lifestyle is NOT what you think it is. With the advent of socialized medicine on the horizon, I don't know why anyone would even consider it. You will NEVER financially get back out of medicine what you put into it - period.


:oops:

This advice is so off it is almost comical. Let's just say that-- for me (and most of the physician colleagues that I know)-- being a physician has been an extremely rewarding career for both the emotional/spiritual AND financial areas of my life. I'm not sure if the person providing the quoted advice is a physician or not (suspect not), but the few physicians I know who do talk like this are simply unhappy people, and I suspect they would be unhappy doing anything, for what it's worth.
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Re: Financing medical school. Age 34, some savings.

Postby gkaplan » Thu Jan 10, 2013 6:13 pm

zebrafish wrote:
SWAMPY wrote:Why on earth would you jeopardize your financial future to even consider medical school now?

If you go the medical school (4 years) and spend $160000 for the privilege, you still have, on average, at least 4 more years of residency (where you work and live like a slave) to complete - unless you plan on becoming highly specialized - in which case it can take another ten years beyond medical school!

Revel and enjoy the fact that you were accepted, now go get your head examined and put these foolish thoughts out of your head - once and for all.

Talk to a trusted financial advisor and life coach about your future potential over the next 10-25 years doing what you are doing now and what you would accomplish as a physician.

A physician's lifestyle is NOT what you think it is. With the advent of socialized medicine on the horizon, I don't know why anyone would even consider it. You will NEVER financially get back out of medicine what you put into it - period.


:oops:

This advice is so off it is almost comical. Let's just say that-- for me (and most of the physician colleagues that I know)-- being a physician has been an extremely rewarding career for both the emotional/spiritual AND financial areas of my life. I'm not sure if the person providing the quoted advice is a physician or not (suspect not), but the few physicians I know who do talk like this are simply unhappy people, and I suspect they would be unhappy doing anything, for what it's worth.


Totally agree, and I'm not a physician.
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Re: Financing medical school. Age 34, some savings.

Postby wshang » Thu Jan 10, 2013 7:25 pm

I am 51 physician, working one day a week and set to fully retire, thanks in part to BH's. I can't tell you how many of my colleagues express envy. Maybe a few of them have said, "I don't know what else I would do." They are usually the ones who don't have too much of a life outside of the hospital and define themselves by the last two letters after their last name.

I've had a varied career in medicine, but honestly, since I can do whatever I want to do when I get up in the morning, I gladly no longer choose to go in. I hope you feel differently when you get to my age, especially after a weekend on call.
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Re: Financing medical school. Age 34, some savings.

Postby bigb » Thu Jan 10, 2013 8:30 pm

Have you considered the military? You would likely get paid full time while in school and get to keep all of your savings. Its a great option for some people and maybe not as much for others. If you havent thought about it before, I'd at least look into it as a possibility and maybe set up a meeting with them to see what you think about it.

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Re: Financing medical school. Age 34, some savings.

Postby am » Thu Jan 10, 2013 8:38 pm

Wshang, congrats. Can you share some more details of what you have done over the years?
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Re: Financing medical school. Age 34, some savings.

Postby Liquid » Thu Jan 10, 2013 8:59 pm

zebrafish wrote:
Liquid wrote:Step 1: Ask yourself if you really, really, REALLY, want to become a physician. Note approximately 50% of physicians are dissatisfied with their career, and there are further headwinds ahead... If health care is a must for you I would seriously consider becoming a NP or PA (similar day to day practice, lop off nearly a decade of training (and lost saving), and end up with similar salary depending on field).


Speaking as an MD myself-- I would not listen to this advice. I think most individuals who have made the commitment to applying and getting into medical school have already decided that the MD track is the proper course for them. Someone once said to a nurse who didn't like taking orders from MDs-- If you wanted to fly the plane, why didn't you go to pilot school? If you are a CNRP or PA, your lifestyle will be easier, but you will always be taking orders or be under someone else's supervision-- I think most people that want to go to medical school don't want to be the flight attendant-- they self-select into the proper place. You can make more money as a PA or CNRP in certain areas than some M.D.s, but it comes at the cost of not being your own boss. There are specialties that vary the lifestyle commitment (and salary and clinical interest) within the M.D. spectrum that will fit your wants/needs.

Go to medical school and fulfill your career dream. It is an awesome time-- I made friends and had experiences during that time that I'll never have again. As someone who has worked and been a "real person" for awhile, you'll be a great student/resident/physician. Some of the most committed (and happy) physicians I've known had other short careers first which were non-medical.

Regarding finances-- I would pay as much now and take as little debt as possible. I graduated with 100K in loans and couldn't wait to pay it off (I now have). I hated having that debt, and it was a big financial/emotional burden.

Regarding this 50% unhappiness among physicians-- I'm not sure I believe these surveys. I love my career.


I know many many unhappy physicians, I tend to believe in evidence of which "surveys" are the best available on this topic, we can respectfully disagree... you may be one of the happy 50% and thats great.
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Re: Financing medical school. Age 34, some savings.

Postby dhodson » Thu Jan 10, 2013 9:39 pm

The only physicians i know who are unhappy with medicine have unrealistic ideas or are unhappy people. Sure it would be nice if i were of the age where i would easily make a fortune, have people treat me like a god, tell insurance companies to pound sound and in essence act like a king. That isnt reality (probably never was) and there are headwinds in medicine but those surverys are pure garbage. Most physicians recognize garbage research when they see it.
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Re: Financing medical school. Age 34, some savings.

Postby Liquid » Thu Jan 10, 2013 10:30 pm

dhodson wrote:The only physicians i know who are unhappy with medicine have unrealistic ideas or are unhappy people.


This is at worst pejorative and at best circular. This is turning into a decidedly unfruitful discussion, there will be nothing more from me, I wish the original poster the best with his career.
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Re: Financing medical school. Age 34, some savings.

Postby czeckers » Thu Jan 10, 2013 10:54 pm

Physician here, 6 years out of residency.

To begin, congratulations! It's not easy getting into medical school this far out of college. That's an achievement in and of itself to be proud of!

To answer your questions.

1) Financing medical school. You are fortunate to have substantial taxable and tax-deferred assets. Given the current environment of high tuition and high interest on educational debt, combined with historically low interest on safe investments, you are better off using up your taxable savings and minimizing your debt as much as possible. I don't remember how interest accumulates under the various loan programs. My recollection is that it accrues but does not compound until you finish, but I could be wrong. If you can qualify for loans where you could pay them off before interest accrues, than that would be the way to go, otherwise, I'd agree with the above recommendations that you spend down your taxable assets to avoid debt. You can guarantee that you won't pay 6-9% in interest, but you can't guarantee that your investments will return that much if left untouched.

2) Asset allocation. If you are committed to starting medical school. I would immediately convert the assets in your taxable account to something safe. You'd hate for there to be another 50% drop in the market right after starting school, placing you in a position where you now have to take out high interest student loans to finish medical school. A money market fund or a short-term treasury bond fund (or tax-exempt fund if your tax situation dictates it) are the obvious suggestions. However, given that you have a TSP, you may be eligible to join the PenFed credit union. They have some of the highest CD rates around. Currently 1.25 for 1-year to 1.85 for 3-year CD's. You could keep 1/4 of your medical school money in a cash account for the first tuition payment, then put the remaining quarters into 1-. 2-, and 3-year CDs to gain a little extra interest without sacrificing any safety.

With respect to your tax-deferred savings. They are the seed for your retirement. Assuming you won't be accessing those funds for 30 years, you can be a bit more aggressive with your allocation there as Valuethinker pointed out above. 65-75% equities would be quite reasonable in your situation.

3) Not your question, but the question of whether going to medical school is financially worth it at your age? Only you can answer that question. On one hand, you have amassed a considerable amount of savings at a young age so you probably have had a pretty good career (financially) and/or have been an aggressive saver so far. If you continue on your previous career path and at your previous savings rate, it is quite probable that you'd be able to retire fairly early. Going to medical school, you will give up 4 years of wages, and then spend another 3-9 years in residency/fellowship earning a decent wage to live on (depending on cost of living in your area at the time), but usually not enough to make any significant savings contributions. That will set your retirement plans back 10 years or more as you will lose out on the compounding of your current savings. ($160,000 compounded from 35-65 years of age at 6% = $918,958.59). At this time, there is no way of knowing how much you will earn 7-10 years from now as a physician. You don't know what your specialty will be, and we have no idea what the practice environment will be like in the future.

4) You may consider doing some Roth conversions while in medical school with a minimal to non-existent reportable income. You should focus on maximizing your Roth IRA contributions while in medical school and during residency.

However, this is ultimately not a financial decision, but one of the heart, and if you are confident that you want to be a physician, and you have done enough research, and talked with enough current physicians that you are going into this with both eyes open, then by all means pursue your dreams. Best of luck!

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Re: Financing medical school. Age 34, some savings.

Postby brritscold » Fri Jan 11, 2013 12:00 am

I think some of the older docs here on this board have seen a different financial situation than what current medical students are facing now, in terms of educational loans and how they work interest-wise. All student loans are now fixed rate; gone are the days of variable rate loans which you could refinance (which would be amazing if we could do this in today's low interest rate environment, but alas...).

Sometime within the past year or so, the rules changed so that Stafford loans (the main student loans that you'll likely have as a med student, borrowed from the government) are no longer subsidized for graduate students. This means that they accrue interest (at 6.8%) from the moment they're disbursed. Formerly, subsidized stafford loans were available up to a limited amount which deferred accruing interest until you graduated, but these are no longer available for grad students.

Beyond that, there are also Direct Plus loans, also from the government, which have a 7.9% interest rate and aren't subsidized, and so accrue interest immediately as well.

Private schools may have some other options, such as school-specific institutional loans (often subsidized and with more favorable interest rates), grants/scholarships, etc. There are also federal perkins loans, which are subsidized and have a 5% interest rate, but you have to qualify based on need.

Bottom line: minimize the loan burden that you have, and use your savings liberally. The 5%, 6.8%, 7.9% interest rates are far beyond what you'll get on the market with investments. It's January... maybe there's still time for you to get into a good public school with lower in-state tuition -- this would be the best financial move you could make.

As for the other aspects of whether or not you should go into medicine... like everything, it has pros and cons, and it's a personal choice, and it's something that you've clearly decided already. Keep an open mind, try to keep idealistic but also balance your life. Good luck.
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Re: Financing medical school. Age 34, some savings.

Postby zebrafish » Fri Jan 11, 2013 12:39 am

I got lucky. I had 100K debt at graduation. I consolidated into 2% fixed. I then had about 80% of the loans repaid via loan forgiveness program over the next few years and wrote a check to pay off the last 20K with my signing bonus from a new job. Within 4 years of graduation, I had no student debt.
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Re: Financing medical school. Age 34, some savings.

Postby stoptothink » Fri Jan 11, 2013 1:13 am

zebrafish wrote:I got lucky. I had 100K debt at graduation. I consolidated into 2% fixed. I then had about 80% of the loans repaid via loan forgiveness program over the next few years and wrote a check to pay off the last 20K with my signing bonus from a new job. Within 4 years of graduation, I had no student debt.


Wouldn't you say your great fortune makes you a tad biased?
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Re: Financing medical school. Age 34, some savings.

Postby EmergDoc » Fri Jan 11, 2013 3:15 am

Eavli wrote:Hello, I'm new to Bogleheads, and I've spent the last couple of days reading through the many forum posts here having "medical school" returned by a Google search.

I'm 34 years old and was just accepted into a private medical school out of state. The annual tuition is roughly $40k. I've been debating on how I will finance my education. I will be starting Fall 2013, and I am currently working full time. My current financial assets are as follows:

Vanguard non-retirement account
$110k VFIAX
$70k VBLTX
$10k VGPMX (an investment I regret to this day)

Vanguard retirement account Roth IRA
$10k VFIAX
$4.5k VWESX

Thrift Savings Plan
$160k split (70/30 between C and G fund)

Savings account (ING)
$30k

From the forum threads that I have read, most seem to recommend that I should minimize the amount of loans borrowed and instead use my savings to pay for medical school. I would appreciate further confirmation that would be the most sensible approach. Also, since medical school will only gradually deplete me of my savings over the 4 years, are there any recommendations on how to allocate/invest the remainder? Thank you for your help.


A few tips:

1) Be darn sure this is what you want. You will likely be financially independent sooner NOT going to medical school than going. I went to med school straight out of college, I'm a few years older than you, I save a lot, and yet our portfolios are similar sizes. Medicine certainly isn't an automatic ticket to wealth, especially when you don't get out of training until your 40s. But, presuming you actually want to be a doc into your 60s, let's answer your question.

2) Use the non-investment account to pay for med school for just as long as you can. You might want to max out subsidized loans each year, then use the portfolio for what's left. Either one is reasonable.

3) Use your time in med school with no income to do Roth conversions of the rest of your portfolio. Ideally, by the time you're coming out of med school your entire portfolio is Roth. If the TSP won't let you convert within the TSP, you can always pull a bunch out, convert it at Vanguard, then roll it back (leave $100 or so behind so it doesn't close on you). Remember you only get one partial rollover of the TSP.

4) I'd be very cautious joining the military to pay for school.

5) Stop by my blog some time. http://whitecoatinvestor.com
1) Invest you must 2) Time is your friend 3) Impulse is your enemy | 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course
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Re: Financing medical school. Age 34, some savings.

Postby Valuethinker » Fri Jan 11, 2013 6:23 am

brritscold wrote:Sometime within the past year or so, the rules changed so that Stafford loans (the main student loans that you'll likely have as a med student, borrowed from the government) are no longer subsidized for graduate students. This means that they accrue interest (at 6.8%) from the moment they're disbursed. Formerly, subsidized stafford loans were available up to a limited amount which deferred accruing interest until you graduated, but these are no longer available for grad students.


OK this change is utterly key.

Do they accrue and also compound? If the latter is true then it is almost certain to be better to use cash rather than debt. Keep perhaps 6 months living expenses in cash and the rest use to pay tuition and other costs. If the former is true (as you say) it is still better to use cash than to take on debt. (guaranteed 6.8% pa savings).

Question: is student loan interest tax deductible? (sorry for naive non USian questions)


Beyond that, there are also Direct Plus loans, also from the government, which have a 7.9% interest rate and aren't subsidized, and so accrue interest immediately as well.


And so should be avoided.

Private schools may have some other options, such as school-specific institutional loans (often subsidized and with more favorable interest rates), grants/scholarships, etc. There are also federal perkins loans, which are subsidized and have a 5% interest rate, but you have to qualify based on need.

Bottom line: minimize the loan burden that you have, and use your savings liberally. The 5%, 6.8%, 7.9% interest rates are far beyond what you'll get on the market with investments. It's January... maybe there's still time for you to get into a good public school with lower in-state tuition -- this would be the best financial move you could make.


All good advice.

As for the other aspects of whether or not you should go into medicine... like everything, it has pros and cons, and it's a personal choice, and it's something that you've clearly decided already. Keep an open mind, try to keep idealistic but also balance your life. Good luck.


From watching my friends and classmates who became doctors, it is an all consuming career, for good or for ill. Increasingly it is about being in an institutional environment- -a large group practice or hospital. You cannot avoid the issues of management and big corporate politics. The doctor patient relationship is heavily regulated. It is a litigation heavy environment (even now in the UK).

It can still be a very rewarding career.
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Re: Financing medical school. Age 34, some savings.

Postby Valuethinker » Fri Jan 11, 2013 6:25 am

EmergDoc wrote:4) I'd be very cautious joining the military to pay for school.

5) Stop by my blog some time. http://whitecoatinvestor.com



All of ED's advice is good and based on first hand knowledge-- he is one of the wisest thinkers around here.

Point 4 is 'straight from the horse's mouth', and therefore particular attention should be paid.

Point 5 also.
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Re: Financing medical school. Age 34, some savings.

Postby Valuethinker » Fri Jan 11, 2013 6:31 am

Liquid wrote:I know many many unhappy physicians, I tend to believe in evidence of which "surveys" are the best available on this topic, we can respectfully disagree... you may be one of the happy 50% and thats great.


Liquid. Unfortunately in just about any high powered profession 50% unhappiness is not uncommon. You should see the figures (if anyone publishes them) for Associates (and even Partners) in 'Big Law'. And in 'small law' you have the same pressures but not as much money!

Believe it or not investment bankers on $500k+ pa are often pretty unhappy and financially stretched. Paul Bettany's little soliliquy in 'Margin Call' about how to spend $1.25m a year is not quite right (I think he overestimates his tax) but I knew people like that (the movie, btw, is excellent on the insecurity and cultures of big investment banks-- lines that could have come straight out of the mouths of some of my friends). Lots of people in ibanking think they will be retired at 40, or working for big bucks and shorter hours in a hedge fund or Private Equity, and at 50 they are sitting behind a desk in an 'eat what you kill' context (ie unpaid) trying to pay for the tuition of the kids from the second marriage whilst paying for the college of the kids for the first marriage.

Downstairs from me I had an alcoholic ex IBer -- they had lost the firm capital in Long Term Capital Management's blowup. He was always talking about getting 'back in the game' whilst trying to borrow £20 from you ;-).

This is not to question what you say, but just to note that other professions, also, have their costs.
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Re: Financing medical school. Age 34, some savings.

Postby Valuethinker » Fri Jan 11, 2013 6:43 am

Eavli wrote:Wow, thanks for all the replies and suggestions.

I know that being a physician isn't the glamorous job that many people imagine it to be, but at my age, I've had a lot of time to reflect on the decision, and I'm certain that it's something that I will enjoy doing into old age.

I don't have the benefit of a working spouse to help pay for expenses, but frugality is something that I've been raised up in. If I borrowed money, interest will accrue throughout medical school, which I guess why many have recommended borrowing as little as possible.

The majority of my non-retirement savings are in VFIAX, which is Vanguard's index fund that tracks the S&P500. The rest is mostly in VBLTX, which is a long term bond fund. Seeing that I will likely use these savings to pay for medical school, is there a better asset allocation strategy?

Again, thanks for all the replies.


Ok you have made peace with yourself about the sacrifices.

yes borrow as little as possible if interest compounds. Keep at least 6 months living expenses out.

On asset allocation:

- you want your future tuition money safe and accessible-- basically that means CDs + ST bond funds. At current interest rates, CDs (within FDIC limits!) are probably the best strategy-- a ladder of CDs say maturing every 6 months for the next 4 years?

- I would not hold equities for this money. Markets have rallied a long way since 2008 so you are not leaving obvious equity gains 'on the table'. Conversely bonds have done really well too. Maybe markets go up 50% from here in the next 4 years, but they could just as well go down 50%

If you do decide to hold equities (gambling) then 20% of total non retirement assets would be my view.

Retirement assets you can afford to be equity heavy-- something like 30% US G Fund or other bond equivalents, 70% equities. You could go to 100% equities but most of us don't have the stomache to see our retirement savings drop -50% in a few months (the standard risk assumption for equities, and I can find you a UK case from the 1970s when they dropped over 80% in 12-18 months). You gain surprisingly little in expected returns with 100% equities vs. 70% equities and rebalance and if we are in the next Japan (-2/3rds over 20 years) you'll be very grateful.

By owning CDs you have security of principal-- matching liabilities (future) to assets. By laddering CDs you have given yourself protection against future interest rate spikes (and therefore, to an extent, inflation). Your biggest unhedged risk will be rises in tuition or other costs due to inflation-- if your school offers a prepayment of tuition scheme, you want to think about that (particularly after first year, you know how it is going, you are committed).

Your biggest risk is actually disability-- not being able to practice your new profession. You want to insure that as soon as you can (probably not until residency?).
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Re: Financing medical school. Age 34, some savings.

Postby retinasurgeon » Fri Jan 11, 2013 8:30 am

I definitely think medicine is a worthwhile, but very long road. One option to consider, but perhaps it may be a bit too long for you, is the Medical Scientist Training Program funded by the NIH. It is designed to encourage translational medicine, and trains the dedicated student in both medicine and basic science research leading to a combined M.D., and Ph.D. The MSTP will pay for medical school tuition and living expenses. The only caveat is that it usually takes about 8 years, but nowadays many students graduate from medical school in 5 years, so for an extra 3 years, you will have full funding throughout the 8 years. I went through such a program, and I must tell you that it was the best 8 years of my life. This is just another alternative to funding your medical education without loans, military service, or serving at a poorly served geographic area.
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Re: Financing medical school. Age 34, some savings.

Postby ventjockey » Wed Jan 23, 2013 5:52 pm

Medical training as many have said will be long. I did 4 years med school, 3 residency and 5 years fellowship and got a PhD along the way. Still there are many opportunities which are only available to physicians...you just need to decide if thats what you are trying to pursue. There are plenty of other great healthcare professions, but I assume you already did your soul searching. While the path is long and medicine is definitely changing...I love what I do.

I would definitely separate how you are going to finance medical school from your choice about programs like MSTP. While the MSTP will pay your tuition, the additional time and effort to get a PhD during your pre-clinical training will significantly delay your time to practicing and it also is a bit of an archaic model even to prepare academic physician scientists. Unless you are absolutely sure about what you want to do, committing to MSTP programs or the National Health Service Corps may be shortsighted. I think until you start experiencing medicine its very hard to know what specialty and type of practice will excite you.

On the flip side, you are likely to lose money (beyond tuition...i.e. have your living expenses exceed your income) annually for the next 8 or so years. If you dont want to have to work until your late sixties, then you will need to give serious consideration to which specialty you might practice, where you will live and what lifestyle you expect (frequency of night and weekend call, etc). Its way early to consider such choices but it will be hard being an academic general pediatrician when you finish and expecting to be able to retire comfortably without working an addition 25+ years (depending on benefits of course). While ageism is illegal, some intense subspecilialties do seem to shy away from older trainees (e.g. neurosurgery); however, I would not put you in that age category. I have seen 40+ year old students with kids struggle to balance the intense time demands of training.

Good luck.
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Re: Financing medical school. Age 34, some savings.

Postby zebrafish » Wed Jan 23, 2013 8:52 pm

MSTP funding is extremely competitive. They can sniff out in about 2 seconds those interested in getting a free ride from those with a true passion for research. And on a pure financial standpoint, you lose financially by doing a PhD with MSTP funding versus going straight through and working as an MD sooner. The PhD will take at least 3-4 years and they cover the full medical tuition, of course, but you will make much more in that three years practicing as a physician that you would have spent doing a PhD.

Definitely agree about looking very carefully at desired specialty and lifestyle (and salary) that comes with this.
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Re: Financing medical school. Age 34, some savings.

Postby Artsdoctor » Thu Jan 24, 2013 12:36 pm

Eavli,

Valuethinker echoes everything I'd recommend. The road ahead will be extremely long so liquidity is the name of the game. The retirement accounts can definitely go heavy on the equities if you've proven yourself to have the stomach for a significant bear market. A 70-30 split is as good as anything although that's a separate conversation entirely. If you're a student and won't have much earned income you'll be able to sell your equity funds in the taxable account without paying capital gains. In general, your tax bracket will be extremely low and interest rates will be low, so there's no reason to do anything but principle protection with the money you'll need to finance tuition. I wouldn't be overly concerned about borrowing a little money from time to time; if you keep your emergency fund stocked, you can always re-pay the loans soon after graduation/residency. Yes, it'll be a little more expensive but you don't want to give up too much liquidity. And disability insurance is, unfortunately, a must, at least for now.

I'm a physician in my 50s and have enjoyed my career unequivocally. I wake up nearly every morning looking forward to my day ahead. There have been changes in medicine to be sure, and the rate of change is head-spinning. But I can't think of anything better-suited to my personality and needs than medicine. This board is dedicated to helping people meet their goals, not trying to make them bail out of an extensively thought-out decision regarding career (especially if someone doesn't even ask for it). Some of the posters here are out of line: you're not 12 and you've clearly put some thought into your career choice. Getting into medical school requires a lot of work and you just don't wake up one morning to find your admission letter. I would strongly recommend that you ignore people outside of medicine making ill-informed judgments about your future; exceptionally negative comments made by physicians may indicate burn-out on their parts, so take that into consideration. Keep your eyes wide open, be extremely flexible, and stay involved. The chances are quite good that you'll enjoy your career immensely. The money should be secondary, not primary.

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Re: Financing medical school. Age 34, some savings.

Postby zebrafish » Thu Jan 24, 2013 11:29 pm

stoptothink wrote:
zebrafish wrote:I got lucky. I had 100K debt at graduation. I consolidated into 2% fixed. I then had about 80% of the loans repaid via loan forgiveness program over the next few years and wrote a check to pay off the last 20K with my signing bonus from a new job. Within 4 years of graduation, I had no student debt.


Wouldn't you say your great fortune makes you a tad biased?


No. Generally loan forgiveness is only an option for those who are working in conditions where they are making less compensation (even with loan forgiveness added) than they could make if they took a job based purely on salary. For me, I was making about 50% what I could make on the open market, but I was doing something I felt was important (pediatric basic science research). This is also generally true for people working in underserved areas, etc.
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Re: Financing medical school. Age 34, some savings.

Postby Eavli » Fri Jan 25, 2013 12:13 pm

Thank you all for your comments. I am especially inspired by those who love the practice of medicine despite the many personal challenges that such a lifestyle involves.

For the remaining 5-6 months left in 2013 before I start school, I am trying to balance between liquidity to pay for expenses and medical school and investing in my Roth IRA and tax-deferred TSP accounts. I have currently set my contributions to the TSP account to equal my employer's matched contribution amounts, and I intend to max my Roth IRA contributions for 2013. Beyond that, I'll have to see how much I have available before putting more into the TSP up to the $17.5k limit for this year. Is this a good strategy?
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Re: Financing medical school. Age 34, some savings.

Postby kenyan » Fri Jan 25, 2013 12:59 pm

My brother, who is an MD, very easily came out ahead financially versus my career path as a PhD in engineering, and we're still relatively young. I had one more year of schooling (5 years for the PhD), and came out debt-free. He had debt, and 4 years of subpar residency wages vs. my first 3 years of salary. Ignoring the time value of money, as well as taxes, it took less than 2 years of physician vs. engineer pay for him to make up the difference (salary + debt considered). Considering those important factors, his career choice paid for itself in less than 4 years. Perhaps a PhD in engineering isn't the best choice financially, but that's a real world comparison to a different advanced degree.

The OP's situation is quite different, but to suggest that MDs are somehow hard off and/or that it's a poor choice financially is pretty ludicrous IMO. There are far worse paths to take.
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Re: Financing medical school. Age 34, some savings.

Postby Artsdoctor » Fri Jan 25, 2013 9:07 pm

Eavli,

You should never, ever pass up an opportunity to have an employer match. It's like finding money on the street so go for it. Given what you have to look forward to, I would (1) contribute as much as your employer will match and then stop for the tax-deferred account; and, (2) contribute the maximum to your Roth IRA for 2013. In my opinion, Roths are second only to employer-matching when it comes to the best retirement options. Take the rest of your 2013 income which you're not spending and keep it liquid for now.

Don't forget to view your retirement investment portfolio as a whole and define which accounts are included in the portfolio. Obviously, all tax-advantaged accounts will be generally viewed as retirement vehicles. But if you're going to start liquidating your taxable accounts for tuition purposes, take that taxable account out of your asset allocation calculation (at least for now). There are posters here who make a terrific effort to weight asset allocations according to location (for example, a Roth's assets are worth "more" than a 401k's because you'll have to pay income tax when taking money out of the 401k and not for the Roth). They have great points but I find those calculations just too difficult.

You are in a terrific financial position right now. You'll be fine.

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Re: Financing medical school. Age 34, some savings.

Postby PoeticalDeportment » Sat Jan 26, 2013 12:22 am

In addition to retirement planning, maximizing contributions to IRA/Roth IRA/401k/403b during training is beneficial for asset protection. Unfortunately, it is possible (though rare) in medicine to be sued beyond the limits of your malpractice coverage. Even residents can be named in lawsuits. IRA's, 401k/403b's have creditor protections that might help protect you if you had a large judgement against you.

If I were you my #1 priority for my taxable investments would be to ensure that I could still maximize my annual Roth IRA and 401k contributions while I was a resident, even if I were in a place like NYC, DC, Boston, SF or some other expensive place. Even if you are frugal by nature, it might be hard to hit the $5500 + $17500 mark each year on a resident's salary if you are living in one of those cities. Having additional funds available during that time could help you avoid missing out on maximizing retirement contributions during the years of your residency.

If you complete a fellowship after your residency, that might be at a different location than your residency. If that is the case, you could do a rollover IRA from your residency 401k and convert it to a Roth IRA spread over your lower-income fellowship years. Note: bad idea to do a rollover IRA if not committed to paying taxes for ROTH conversion during fellowship as this would interfere with future backdoor Roth contributions.

After making sure you can maximize your retirement contributions, only then would I use the taxable to avoid (or pay off) educational debt. This obviously involves planning your cash flows several years in advance. This advice is in contrast to others who have said avoid debt at all costs.

Others have given you good advice about converting some (or even a lot) of your S&P500 or long term bond fund to cash equivalents (or at least much less volatile investments). I know we aren't supposed to time the market, but it seems like there have been worse times than the present for making such a move. It would be unfortunate if you decide to attend medical school based on your current financial situation and then realize that you feel differently if there was a market crash or bond bubble burst and you need to incur much greater debt to complete your education. I don't think you would feel that way, but just something to consider.
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Re: Financing medical school. Age 34, some savings.

Postby lovenox11 » Sat Jan 26, 2013 2:40 pm

I'm currently a resident and here is some useful advise (from the front-lines so to speak)

Medicine is THE BEST FIELD IN USA. Why?
1. Guaranteed 6-figure salary
2. Best loan repayment options
-PSLF vs Underserved area work vs Private hospital contracts with repayment terms vs Military
-It is quite ironic that those that need options for loan repayment the least get the most lucrative options.
-There is no other professional field (law, engineering, business) that will have such loan repayment options.
3. Flexibility
want to work 4 days per week? Or Two-weeks on and two weeks off and get paid $200k?
-in other professional fields you will be forced to do the 8-5 grind day in and day out
-the poster who said he works 1day per week is a perfect example of the flexibility
4. Jobs everywhere
-I don't know of a more portable field. You are not constrained by anything; you can work in any corner of united states.

Residents are NOT Poor
-you get at least 50k with full benefits
-don't forget moonlightling. We have a gig that pays $3k to work for a weekend.
-many residents double their salaries moonlighting
-find a residency with good in-house moonlighting

If I were in your shoes
1. Spend your savings on tuition/living so you are debt free
2. Don't go into primary care (choose a specialty such as anesthesia/rads/ophtalmology/etc)
3. In residency aggressively moonlight
4. As an attending find a job in some small town that will pay you 2-3x metropolitan area salary.
5. Later move to an area you like the most (you will change your first job within 2years anyway.

I'm surprised there are so many nay-sayers on here. Because of your high income potential you will come out on top no matter what.
In other fields you will be kicked out once you appear aged and making too much money for the employer. I saw that when I was in engineering (very briefly).
Very sad to see people laid off all the time just when they thought they were safe and thought their company loved and appreciated them for all the years of hard work.

Medicine is a great field; pays very well; allows for much flexibility; has a lot of stability.
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Re: Financing medical school. Age 34, some savings.

Postby am » Sat Jan 26, 2013 3:06 pm

You may change your tune when you become an attending. Visit back in 5-10 years and you may get a huge kick out of your post!
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Re: Financing medical school. Age 34, some savings.

Postby DAK » Sat Jan 26, 2013 3:31 pm

I agree with taking out the loans...and then paying them off as soon as you graduate so as not to have to pay interest.
Youre lucky in the sense that you have a nice portfolio already...unlike those going to med school right out of college. Also in that med school sounds like that is what you want to do.
My experience is that many who go right to med school from undergrad may not know what they are getting into....I thought med school sucked. I hated it.
Residency was OK but the new work limits just started my last year. Fellowship was good. My first year after fellowship I lived at home and paid off my loans in one year. I moved out after that.
In general, I would not recommend med school to kids anymore. Going forward the costs of the schooling are more and ridiculous, and the reimbursements will start tanking by 2016 and beyond. Despite making less and less $...the liability will remain the same (unlike other countries with government funded healthcare).
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Re: Financing medical school. Age 34, some savings.

Postby Valuethinker » Sun Jan 27, 2013 4:42 am

lovenox11 wrote:I'm currently a resident and here is some useful advise (from the front-lines so to speak)
Flexibility
-in other professional fields you will be forced to do the 8-5 grind day in and day out
.


Burst out laughing. What professions work 8 - 5? Civil servants?

Lawyer friends of mine typically work 9.30-7.00 then a couple of hours in the evening after the kids are in bed. Younger lawyers work all hours God sends.

I really don't know too many professionals who don't work 55 hours+ a week.
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Re: Financing medical school. Age 34, some savings.

Postby ks289 » Sun Jan 27, 2013 7:20 am

Nothing wrong with having a positive outlook and strategic planning early on in your medical career - choices made during and right out of medical school can have an impact for decades. There is plenty of time to get burnt out later of course! :happy
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