What would you do?

[rizzmo]

DW has to take a string of sequential science courses before she can apply. She is seeking a pseudo internship (paid or unpaid) with a vet clinic here in town. The program she is looking to apply to wants students to have human resource and business management education. It sounds like they weight pretty heavily on this requirement, and my wife couldn’t be better suited in that respect. So we will keep our fingers crossed. My wife is 27, neither of us wants kids now or in the future. Neither of us feels particularly suited to the task of raising children. We plan on having many animal companions to keep us company.

[Seeker]

Okay, calculation time:

Expenses 3k/month

Mortgage 9 years and 1 month left (currently, and only if you continue your $1282/month payments).

Job security is good especially if your previous employer is willing to take you back.

Savings 2.5K - 5K in checking
+ Auto note for 8k
+ 8k in Prosper.com
+ Stocks 25k

Not really a lot of "liquid" savings for just-in-case-secenarios... and no EF fund?

First thing I'd do if I were you, is setup a CD ladder sequence for an emergency fund savings (3k expenses for a 6 months EF, would mean 18k set aside in rotating cds).

----

You are asking about three different options:
1) Invest
2) Pay off the house
3) Pay off the student loans

----

What is your current income after all deductions? Your "net" paycheck - expenses = extra monies to allocate toward your three obbjectives.

Considering:

1) the fact that the two of you are rather young, means that time is on your side.

2) you are looking forward to a 50% raise with a different company (income will be greater).

3) you really have already starting option 2 in paying an extra $641 toward principle each month.


I'm sort of curious why you wouldn't split up "extra" monies each month and tackle all three of the aforementioned objectives? I think I would try to do all three. Spread the risks associated with any one of them.

[Seeker]

I think we need to start growing up as a society and addressing these issues. You are a woman? Yes, you can be anything you want. That doesn't mean you should be anything you want though.

Scanner, I'm not sure this is really fair.

Both men and women can change their mind.

The fact is that not everyone has a choice about their careers and events that have happened within. There are pluses and minuses to EVERY job.

We make our choices for a career in life based on what we feel about ourselves and also a combination of what we like. Both men and women.

But in reality, life very rarely turns out to be all that any one of us expects.

Sometimes people don't really have a choice. And sometimes people make the wrong choice.

Just because women have the capabilities for bearing children, does not mean that we should be treating them nor their decisions any differently from any other human being.

[markusk]

I misunderstood your post. I thought she was already in vet school.

Your wife is not in vet school yet but is currently taking prerequisite science classes so that she can apply.

There are only something like 27(?) vet schools in the country (in comparison, there are 131 MD medical schools; not sure how many DO med schools there are). Here is California, there is only UC Davis. Alot of states don't have vet schools. Most have state residency requirements; typically, this means non-state residents have higher GPA/test score requirements to get in. In general, I think it's harder getting into vet school than med school. But I think you already know that.

How many years/months before your wife applies to vet school? How many years are the training? Is there residency (post-vet school) requirements, and if so how long? In other words, this is going to be a long process.

Vet medicine is potentially very lucrative: everything is in cash (don't have to deal with insurance companies). Every vet I know is a small business owner so they have all the risks and benefits of being self-employed.

[disneysteve]

not sure how many DO med schools there are

Vet medicine is potentially very lucrative: everything is in cash (don't have to deal with insurance companies).

There are 25 osteopathic medical schools.

The "all cash" thing is gradually changing as more and more people purchase health insurance for their pets. I don't think it represents a big segment of the market yet but it is probably growing and over the next 10-20 years could become more significant.

[LivingAlmostLarge]

Since she isn't in vet school this could all be a moot point. I had a roommate who went to vet school and it as hard. You need like 3000 hours of volunteering or working at a clinic.

So I'd probably focus on paying down the debt and retirement/cash savings.

[gemologist]

Maybe I am missing something, but why would keep the stocks if you have debt at 5.5% I would say that if you don't get better than 6.75% return per year after all fees on investment in the same time period, then it would seem to be a good idea put put the money from the investments into the highest interest loan first, as I recall, the compound interest will outweigh the benefits of the investments in general terms. I paid off my loans asap and now my loans are gone, I have the money to put towards investments that always pay off, sweat equity in my home, and my jewelry business (now also debt free) and for me, no car payment on my vehicles, really helps out with creating disposable income.

Interest is a sucker's game for me, but I suppose that it might be possible that certain investments might outweigh the benefits of paying down debt as quickly.

On the other hand, if you have enough for additional insurance (like aflack) to protect your income in case of accident, then you will be pretty much 100% safe in investing/ vs paying down debt, so if your investments are doing well, there won't be any danger.

Otherwise if you find yourself in the position of being out or work beacause of economy or injury, the small to moderate investments will eventually never outweigh the benefits of the loss of income, which could eventually effect your credit.

Am I off-base here folks?

[feh]

OP, could you explain one thing - if you're making that kind of cash and your expenses are that low, why the huge loans for vet school?

[zetta]

I think we need to start growing up as a society and addressing these issues.

I agree, as a society we should start addressing these issues by making part-time and mommy track work more available.

So many women either soldier through the early years doing the exhausting double shift of work and home/child care just so they can keep their careers going, or take 5-7 years off to be home with the kids and then find it extremely hard to resume their pre-kid careers.

Instead of putting all the burden on women for having babies, businesses should accomodate the fact that they are hiring humans who can't all work 50+ hour weeks for all of the 40+ years they are in the workforce.

[markusk]

There are 25 osteopathic medical schools.

The "all cash" thing is gradually changing as more and more people purchase health insurance for their pets. I don't think it represents a big segment of the market yet but it is probably growing and over the next 10-20 years could become more significant.

I did not know about pet insurance, although it makes sense (we don't have any pets).

My one (2nd hand?) "experience" with vet hospitals is a friend's story of how when he came home from work, his dog was found running around in circles and his movement was all wrong. Took him the vet hospital (Univ of Pennsylvania) where they did a CT scan and got a consult by a "doggy neurologist" who diagnosed the dog with a stroke: one side of the world (from the dog's point of view) was completely "gone" so the dog was runing around in circles. He paid over $250 for that consult by credit card. This was several years ago.

Back to the OP. Getting to your final chosen career can be via the "scenic route" since I've known many who finished grad school late in life. However, because certain fields are more intense than others (cost, time, etc), you really have to be dedicated.

[rizzmo]

Wow, lots of responses here. Seeker, my income is a bit seasonal, but here are my last two checks.

Net 1st (2,369.52) + Net 2nd (2,909.41) = 5,278.93

Net Income – Expenses = Extra Monies
5,278.93 – 3,000 = 2,278.93

The extra mortgage payment is included in expenses. I really haven’t given much thought to attacking all three at once, that may make the most sense for us.

[rizzmo]

Feh, the 80k in student loan debts were acquired prior to us being married. I assume you are asking why not pay future tuition in cash vs taking out loans. That is one option. Others are accelerating house payments or increase our investing; we are trying to figure out which would be the best to do.

[rizzmo]

Update here, things have changed radically. Always seems to happen just after you get a plan mapped out, but maybe that’s just me. My wife has decided not to pursue Vet school after all. She has been in college for 10 years and simply does not want to invest another 7-8 years of her youth in education. I respect her decision and think it will be healthier for our marriage overall (no living apart for 4 years). In any case she hopes to have a job within the next month or so, we are hoping for something 40k or more but in this economy who knows. In any case, the same decision remains pay off student loans, pay off house, invest or all three at once. Soon the loans will be our largest monthly payment ~1,200/m and higher interest than our home 6.8% vs 6.5%, we are leaning towards paying the loans first. Any thoughts?

[creditcardfree]

I'd go with the student loans over the mortgage. You can always sell the house to get out from under that debt. Student loan debt will follow you until you pay it off.

[shibabigk]

On a side note, Pet Insurance means you pay the vet and take the bill to your insurance company. Vets still get paid same day, with or without insurance.