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New to managing finances, starting medical school this fall

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  • New to managing finances, starting medical school this fall

    Hi all -

    I'll be starting medical school this fall and have taken the last few weeks to try to get an honest look at my current financial position. I'm at a bit of a sticking point and was hoping to get your take.

    My current finances: I was fortunate to be able to pay all of undergrad off last year. As of today, I am at $2500 cash-in-hand, ~$10K in credit card debt, and ~$30K in 401k, IRA, etc. I am 30 years old, soon to be married, very little familial wealth as I am from single parent household, first-gen college student. Obviously, lots of medical school loans to come, but this isn't news to readers here.

    QUESTION: I will be getting married later this summer. My fiancee is an NP and has around ~$140K in student loans. She plans to work full time for at least three years while I am in medical school before we have our first kid. Do I max out my federal loans for medical school to pay all our living expenses while she throws all her income at her student debt? If so, how do I do this in the best way possible while also taking into account our long term financial help? We plan to have 3-4 kids and she hopes to go down to part-time, possibly "retire", when I start residency.

    This blog and forum has been very helpful to me. Thank you all in advance.


  • #2
    The first thing I would do is wait until you are married before combining finances. I would take out all the student loans that you could at this point. Get rid of that credit card debt and make sure whatever the reason for that to accrue has been fixed. Make sure you have an adequate emergency fund. If she's an NP I'm assuming she has a job. She should probably be the one to support the household and work on paying off her debts since you have no job or income. She should also make sure her loans are refinanced at the lowest possible rate.

    Once you're married, the credit card debt is gone, and an EF has been established, I would see who has the higher interest on their student loans. If it's her, you should work on paying that off as fast as possible. If it's going to be you, you should minimize how much you take out.

    PS: I know more goes into the decisions of having a stay at home parent than just finances but I doubt it'll make financial sense when you guys get to that point. If that was her goal then getting an NP degree was a borderline horrible financial decision.

    Comment


    • #3
      There is a lot going on in your post. Take a step back. Your big picture concerns: > 100 k debt, more debt coming, a growing family, and a wife 'retiring'.

      Today, you need to get rid of your credit card debt.

      Tomorrow, you need to figure out your student loan debt and family planning. What is your expected income after residency? (field, practice setting, location) This will help you decide if you can consolidate all of your loans and go after forgiveness.

      Comment


      • #4
        Obviously take this with a grain of salt since I am just a stranger on the internet but getting married and banging out 4 kids in medical school sounds awful. Maybe you are older or in a rush for some other reason but if you can afford to wait and focus on your relationship and career for a few years you will have a much more solid footing going forward.

        I got married in medical school and had our first kid in residency. 3 more quickly after finishing training. My wife was full time until the end of my residency and supported us. She has been part time ever since but we were able to pay down our loans so much during residency that finishing them off on just my salary was trivial. Now she is part time while the kids are young. Financially we were never in trouble and that made a lot of the other stresses much easier to bear.

        Next point stress. Being in medical school is stressful. Being a resident is more stressful. Starting your career after training can be even more stressful then that. However I can honestly say that having 4 little kids is the most stressful of them all. Also the most rewarding but that is of little consequence at 2AM and you are trying to convince a toddler to go back to sleep.

        Just my opinion. Of course do whatever you want it is your life.

        Welcome to the forum. Sorry to be so pessimistic. You caught me in the middle of a pandemic

        Comment


        • #5
          Are you planning to borrow like $400k for med school? So the two of you who have half a million dollars of debt, then wife will quit, and you will have 3-4 kids?

          Comment


          • #6
            Hi all -

            I appreciate the much-needed direct and candid advice. There are some things that tend to sound great in theory, but as most of you pointed out, we need to take a step-back and look at the bigger picture. I'll respond to each of your comments below.

            CordMcNally: I should be able to pay off all credit card debt by the time I start medical school. I made the terrible mistake of putting some charges onto credit cards while I was completing my post-bacc and they are coming back to bite me. Is there an appropriate time to refinance student loans? Is this something she should consider doing before I apply for mine? She will be the sole-breadwinner while I am in medical school and will likely apply for a NHSC scholarship (~$50K for two years) to supplement the income she is able to throw at her student loans. I appreciate your post scriptum. We met after she was already an NP and I was in the middle of the post-bacc. It's becoming clear to me that there is no way she will be able to fully leave the workforce until after my residency.

            oysterblues: Thanks for your 30000 foot view. Credit card debt should be paid by medical school start. I'm leaning heavily toward ortho, EM, or OB/GYN and we hope to settle somewhere in the Ohio area, preferentially Cleveland Clinic system. When would be the right time to consolidate all our loans? I don't think NHSC applies to a wide range of specialities, but there might be more going on at the state level for loan forgiveness. Are there other options I should consider like PAYE or is that a mess for future physicians?

            Lordosis: We don't plan to have all four kids in medical school, but I do appreciate your story and the stresses you faced. I'm 30 and she's 28 so we are trying to time one every two years. It sounds like we might need to become comfortable with a later start because this could all end in a total trainwreck. I don't see it as pessimism - more as realism! Keep it coming! What was it like during residency when you had your first kid? Did you have family nearby or childcare?

            FIREshrink: Your summary made me laugh out loud. I'm glad I posted to this forum because of comments like yours. Back to the drawing board.

            Comment


            • #7
              Originally posted by ajohnson7290 View Post
              Hi all -

              I appreciate the much-needed direct and candid advice. There are some things that tend to sound great in theory, but as most of you pointed out, we need to take a step-back and look at the bigger picture. I'll respond to each of your comments below.

              CordMcNally: I should be able to pay off all credit card debt by the time I start medical school. I made the terrible mistake of putting some charges onto credit cards while I was completing my post-bacc and they are coming back to bite me. Is there an appropriate time to refinance student loans? Is this something she should consider doing before I apply for mine? She will be the sole-breadwinner while I am in medical school and will likely apply for a NHSC scholarship (~$50K for two years) to supplement the income she is able to throw at her student loans. I appreciate your post scriptum. We met after she was already an NP and I was in the middle of the post-bacc. It's becoming clear to me that there is no way she will be able to fully leave the workforce until after my residency.

              oysterblues: Thanks for your 30000 foot view. Credit card debt should be paid by medical school start. I'm leaning heavily toward ortho, EM, or OB/GYN and we hope to settle somewhere in the Ohio area, preferentially Cleveland Clinic system. When would be the right time to consolidate all our loans? I don't think NHSC applies to a wide range of specialities, but there might be more going on at the state level for loan forgiveness. Are there other options I should consider like PAYE or is that a mess for future physicians?

              Lordosis: We don't plan to have all four kids in medical school, but I do appreciate your story and the stresses you faced. I'm 30 and she's 28 so we are trying to time one every two years. It sounds like we might need to become comfortable with a later start because this could all end in a total trainwreck. I don't see it as pessimism - more as realism! Keep it coming! What was it like during residency when you had your first kid? Did you have family nearby or childcare?

              FIREshrink: Your summary made me laugh out loud. I'm glad I posted to this forum because of comments like yours. Back to the drawing board.
              We did not have family nearby during residency. My wife worked full time and we used daycare. It was difficult when he was Ill. Basically one of us had to miss work. Also I feel that I missed a lot of his first year. My wife did the bulk of the parenting then.

              If you have good family support that would help. Good luck

              Comment


              • #8
                Agree that credit card debt should be destroyed. Heck, may be worth doing a balance transfer and kill it while at a lower rate. Sounds like you have a solid plan to crush that.

                Not sure where you are going to school, but is there a way for the wife to work at the same hospital and you get a tuition discount? I've read other people "hack" med school this way. Sure helps in the long run.

                Sorry if I missed it, but are her loans through the federal govt or private? If federal, things are on a freeze til September, but definitely read the forum for more up to date info on that.

                Comment


                • #9
                  Originally posted by SerrateAndDominate View Post
                  Agree that credit card debt should be destroyed. Heck, may be worth doing a balance transfer and kill it while at a lower rate. Sounds like you have a solid plan to crush that.

                  Not sure where you are going to school, but is there a way for the wife to work at the same hospital and you get a tuition discount? I've read other people "hack" med school this way. Sure helps in the long run.

                  Sorry if I missed it, but are her loans through the federal govt or private? If federal, things are on a freeze til September, but definitely read the forum for more up to date info on that.
                  I was able to work a no-interest deal with Discover until I start med school so should be able to get that gone by August. Unfortunately, no tuition discount for me at medical school - we asked all around but we prioritized my education over any such hacks. Her loans are federal. We have seen that things are on freeze, so will use this as a chance to build up some savings so I don't have to take out quite as much for loans...

                  Comment


                  • #10
                    Congrats on getting accepted into medical school and on your upcoming marriage, exciting times! I agree with all of the comments so far, but just wanted to add a few other lessons I've learned going through medical school with a working spouse. 1. Make sure you and your future wife are 100% on board for this whole journey, especially concerning finances. Medical school and residency can be harder on the spouse in many ways and if you're arguing about money all of the time that won't end well. 2. Even though you won't be earning an income for these next four years, medical school is your job and doing well and ensuring that you are an excellent candidate for whatever field you choose needs to be your priority. 3. Do everything you can to limit the amount of loans you have to take out for medical school (unless as described above her loan interest rate is significantly higher than yours will be). At a minimum it should be feasible for your wife to work full-time as an NP, pay at least the minimum monthly payment on her loans, and provide enough for both of you to live off of. If you "only" have to take out loans for tuition that is better than most medical students. Good luck!

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