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Doctor debt is crazy!

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  • ~bs
    replied
    I think most that become vets do it because they love animals, not to get rich. but sadly, $300k debt to earn 89k salary is quite a sacrifice.

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  • disneysteve
    replied
    Originally posted by TexasHusker View Post

    Veterinarians are a different animal.

    They often don't earn squat.
    I looked it up. Income ranges from about 50K to 160K with a median around 89K. Not a lot at all. Certainly not enough to justify 300K in student loans.

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  • TexasHusker
    replied
    Originally posted by Fishindude77 View Post
    My buddies son recently wrapped up veterinary school with close to $300,000 in student loans.
    He's got a good job now with a plan to work it out, but that amount of debt on the shoulders of an unemployed, unproven young adult would scare me to death at his parent.
    Veterinarians are a different animal.

    They often don't earn squat.

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  • Fishindude77
    replied
    My buddies son recently wrapped up veterinary school with close to $300,000 in student loans.
    He's got a good job now with a plan to work it out, but that amount of debt on the shoulders of an unemployed, unproven young adult would scare me to death at his parent.

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  • TexasHusker
    replied
    Originally posted by disneysteve View Post

    As with pretty much everything in life, this is totally a personal choice. You don't have to buy in to that culture. We've never had a "nice car, fine home, country club membership" etc. Of course, being in family practice, we couldn't afford that stuff anyway, but we could afford a lot more than we have. My current car is a 2006 Camry that I bought in 2012, so going on 13 years old. Yes, it's probably not what most docs are driving but we've always chosen to live below our means.

    I've mentioned this before but our frugality was felt to be unusual enough that my family and I were the subjects of a feature article in a national physicians' financial magazine years ago.

    And just in case you think the "pressure to live in the culture" that TH mentioned all comes from fellow physicians, it doesn't. You'd be surprised how many patients expect their doctors to be living large. I once had a patient ask me why I was driving an old Camry. Why didn't I have a BMW (like my partner) or Mercedes or other luxury car? In his mind, I must not be doing very well if that's all I could have.
    Bravo to you. You would be in the extreme minority.

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  • disneysteve
    replied
    Originally posted by TexasHusker View Post
    When you are a doctor, it's like any other professional. There is a culture that goes with it, and you are under a lot of indirect pressure to live in the culture. Nice cars, fine homes, country club memberships, and so on. It's easy to say "Oh yeah I'll knock down $500K and live like a pauper till the debt is paid off", but in reality that is very hard to do. It sounds like a really good idea to us plebes, but it isn't very realistic.
    As with pretty much everything in life, this is totally a personal choice. You don't have to buy in to that culture. We've never had a "nice car, fine home, country club membership" etc. Of course, being in family practice, we couldn't afford that stuff anyway, but we could afford a lot more than we have. My current car is a 2006 Camry that I bought in 2012, so going on 13 years old. Yes, it's probably not what most docs are driving but we've always chosen to live below our means.

    I've mentioned this before but our frugality was felt to be unusual enough that my family and I were the subjects of a feature article in a national physicians' financial magazine years ago.

    And just in case you think the "pressure to live in the culture" that TH mentioned all comes from fellow physicians, it doesn't. You'd be surprised how many patients expect their doctors to be living large. I once had a patient ask me why I was driving an old Camry. Why didn't I have a BMW (like my partner) or Mercedes or other luxury car? In his mind, I must not be doing very well if that's all I could have.

    Leave a comment:


  • Scallywag
    replied
    Originally posted by TexasHusker View Post
    When you are a doctor, it's like any other professional. There is a culture that goes with it, and you are under a lot of indirect pressure to live in the culture. Nice cars, fine homes, country club memberships, and so on. It's easy to say "Oh yeah I'll knock down $500K and live like a pauper till the debt is paid off", but in reality that is very hard to do. It sounds like a really good idea to us plebes, but it isn't very realistic.
    My brother and his wife are both doctors and also run a medical supplies side business. They use their tight schedules as convenient excuses to avoid things like "country clubs". They are also so tight with $$$$ that they squeak - they each drive a Ford and only recently "splurged" on a Japanese Toyota -- their reasoning ? Their patients don't need to know what they drive - they are also lucky to both be in medical specialities where their interaction with patients is under circumstances where what the doctor is driving is the last thing on patients' minds.

    They own 4 homes and are currently in the market for a large medical offices complex. If they can't get one in the next 2 years they plan to buy land and build one themselves. Their older son and one of their twin daughters are both CPAs. My other niece is an electronics engineer. The youngest son wants to work for NASA and I warned him to be wary of furloughs ! He laughed and nodded - that's my boy !!

    My brother & his wife paid off their medical school debt in 4 years and then just went on a real estate investing binge that has yielded hefty profits. Their side "gig" also seems to be making mucho moolah so they're set for life and all that hard work in medical school h​​​​​as more than handsomely paid off. Their only regret is that none of their 4 children are doctors.. oh well. I wish I had their worries / regrets.
    ​​​
    Last edited by Scallywag; 01-29-2019, 11:28 PM.

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  • TexasHusker
    replied
    When you are a doctor, it's like any other professional. There is a culture that goes with it, and you are under a lot of indirect pressure to live in the culture. Nice cars, fine homes, country club memberships, and so on. It's easy to say "Oh yeah I'll knock down $500K and live like a pauper till the debt is paid off", but in reality that is very hard to do. It sounds like a really good idea to us plebes, but it isn't very realistic.

    Leave a comment:


  • Gailete
    replied
    "It's a lot easier to live below your means when you're making 300K than when you're making 30K."

    I would think so. Just by being careful for a few months on the $300K income, you could pay that $10K back in a couple of months. On $30K a year, paying that $10K back is going to take you years usually to pay it back simply because the take home from that pay is so small. One reason kids taking a degree in Philosophy with no plans for it might be better off flipping burgers for 4 years instead of spending money on college. Seems like philosophy could be studied on your own time by reading the great philosophers from over the years, and going off in the tangents that seem interesting. Philosophy was a required course in my major in college -thankfully only one semester. I hated it. and it didn't help that it was held during the second semester and I had to have that class daily before the sun was up in Canada! Extremely hard to pay attention, boring and taught by a teacher with an oriental accent didn't improve it at all.

    Leave a comment:


  • disneysteve
    replied
    Originally posted by james.hendrickson View Post
    What I do wonder is...does your debt payoff strategy change if you're working with a larger amount of debt vs. a smaller amount of debt. So, lets say you have $200,000 in student loan debt. Would you take a different approach to paying it off than you would $10,000 worth of credit card debt?
    I'd say no, the approach is pretty much the same. Live below your means and throw all the extra income at the debt. But as I said earlier, the person with the 6-figure med school debt likely has a much bigger shovel to dig themselves out of the hole than the person who racked up 10K in CC debt at the mall. It's a lot easier to live below your means when you're making 300K than when you're making 30K.

    Leave a comment:


  • disneysteve
    replied
    I can attest that I have never had any trouble getting a loan, though I don't know how much of that is due to being a doctor, how much is due to my income, and how much is due to my 850 FICO score.

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  • TexasHusker
    replied
    Originally posted by LivingAlmostLarge View Post
    Yep pretty much every doctor I've seen has special Dr loans for getting homes with mortgages and still carrying debt. It's a guaranteed income and it usually goes up. But I didn't know about residencies. But I know many people who are scraping to get in will go wherever they get in and they often don't get too many choices.
    In the residency programs, you earn a salary though it is very meager. Like cars, neighborhoods, and clothing lines, there are different tiers of medical schools. In Texas, tier one would be UT Southwestern , UT Houston, Baylor. A&M might be considered tier one by some. Then you have tier two - UT Galveston, UTSA. Then you have tier three - Texas Tech and North Texas.

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  • LivingAlmostLarge
    replied
    Yep pretty much every doctor I've seen has special Dr loans for getting homes with mortgages and still carrying debt. It's a guaranteed income and it usually goes up. But I didn't know about residencies. But I know many people who are scraping to get in will go wherever they get in and they often don't get too many choices.

    Leave a comment:


  • TexasHusker
    replied
    Originally posted by james.hendrickson View Post

    Ummm...so basically you're saying that because physicians have high incomes banks consider them less risky and therefore lend more at more favorable interest rates?

    Absolutely, and their incomes are stable and grow substantially. I used to do physician recruitment, and local banks LOVE doctors. A couple here will lend them pretty much on the spot - cars, houses, boats, without going through all the hoops and qualifying that the rest of us do. Zero down, you name it. You show the bank your contract and you're golden.

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  • TexasHusker
    replied
    Where I live, the medical school and residency programs matter a great deal. A local surgical group here will not accept a surgeon except from a handful of residency programs. In Texas, a surgeon from UT Southwestern or Baylor is going to command a much better gig than someone from say UT Galveston.

    Also, physician salaries vary substantially based upon the specialty. Where I live it looks something like this:

    PCP - $200-250K guaranteed
    General Surgery - $400-500K gtd
    Neurosurgery - $700K gtd and up
    Ortho - $1 mil and up
    ENT - $700K and up
    Psych - 200-250K
    Hospitalist- $250K and up

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