I am just days away from the start of medical school, and of course there is tons of paperwork that I failed to complete over the course of the summer. Soooo...tonight I have been working on filling them out and making sure that I am caught up before the first day of school! Unfortunately, the majority of the night has been spent on StudentLoans.gov. Let me just say it: I hate student loans. I think that debt is scary. It feels like a weight. You have to be damn sure that medicine is the career for you in order to justify the extensive borrowing that the majority of us have to do. A medical education is not cheap.
The news gets worse. Starting back in July of this year, the federal government eliminated subsidized loans for graduate students. Before this, medical students were eligible to take out loans that didn't accrue interest until after graduation. Now, as soon as the loan money is deposited into my bank account (sometime in the next couple of days) it is accruing interest at 6.8%. In layman's terms, every dollar I decide to borrow is now subject to more years of interest than if I had been born 4 years ago. Don't even get me started on loan fees...
I will be real honest, for the Fall 2012 semester I am taking out just over $20,000 in student loans. Remember, this is after I was awarded a merit scholarship to attend medical school. Tuition and fees take up the majority of the $20,000, with rent and utilities coming in second. In college, you never realize how quickly car insurance, cell-phone bills, books, food, gas money, etc. all add up to be hundreds of dollars a month. I started a budget, and have to make this money last until January of next year.
Let's do some math to see what kind of financial whole I will start out in (with an M.D. behind my name at least). This is an extremely simplified calculation, but I am assuming a $2,000 increase in total cost of attendance from one year to the next. I am also using the 6.8% interest rate starting day-1. By my calculations, I will owe just over $202,000 at the end of my 4 years in medical school. Try paying that back on a $50,000-a-year job during residency, it ain't easy!
I am so thankful to my parents for getting me through undergrad with zero debt to my name. In fact, I was able to add to my net worth by working part-time jobs during the school year, and full-time every summer. That is all about to change. However, I am not going to take this $200,000+ debt sitting down. I plan on working jobs, monetizing this website, writing an e-book, and going to Vegas to count cards (OK...maybe not this last one) to help pay down debt whenever I possibly can.
The loans make nervous, but I am so excited to start medical school. I hope that it will be well worth it.