Are your student loans between $300,000 to $500,000? Are you in your late 30s to early 40s, and yet your car is 20 years old? Have you found that you have no money for retirement saved? Well then, you might be a doctor.
Don’t believe doctors really struggle this much? Still think being a doctor is financially sound choice? Are doctors rich? Well then, please read the rest of this article and the 5 reasons why getting that degree might not be such a hot idea.
1University Costs Are Through the Roof
I will be attending Kent State University’s College of Podiatric Medicine; my total cost of attendance is estimated to be roughly $62,000 a year. That’s a base cost of $250,000, and that doesn’t even factor in the cost of interest, living for the summer, initial moving expenses, the fact that tuition increases every year etc. For myself, I will be doing everything possible to keep this debt burden down. I plan on living in a dirt-cheap studio, and carrying most of my expenses on 0% credit cards to avoid interest. Especially since I will likely be carrying over $30,000 of debt from my undergraduate education. It isn’t uncommon for students to leave professional school with $400,000 of debt.
In 2015, the average student loan debt for medical school was $183,000. Think about what that really means though. There are some students who have no debt at all when they graduate because their parents completely funded their education, so they count that statistic as well. It’s no wonder then that there are so many med students with debt up to $400,000.
2Interest Rates Are Expensive
I’m sure you remember when the government bailed out several big banks at 0% interest because they were, and I quote, “too big to fail”. Well, as an aspiring healer, I hate to tell you that you will not be given the same consideration. The price of getting the loan is between 1% to 4% of the loan, and the interest rates are between 7% to 11%. Long story short, it doesn’t matter how noble your goal or how much you will benefit your fellow man or woman, you’re still paying that interest, so let’s hope you didn’t get into this for the perks.
3You’re Middle-Aged Before You Can Start Planning Your Future
The earliest you can expect to be able to retire as, say, a Radiologist is age 38. They have a relatively short residency and are one of the best compensated specialties. That sounds pretty good, right? Well, you could also retire at the same level of security at the age of 31 if you worked as a plumber. And plumbers don’t spend 8 years in university to learn their craft and rack up $400,000 in student loan debt.
Most doctors can’t afford to save money for their retirement until late in their residency. Even at that many decide to wait until they start making money attending, which puts retirement plans well into their mid to late 30s. 4 years from now as a podiatric resident I will make almost the same as I do now working as a high school teacher in a low-income district. Thankfully this residency is relatively short, but podiatrists are one of the lower compensated specialties. Since I am a career changer I will be 35 years old by the time I finish residency.
What about savings?
So, when we get that raise in pay everything’s good, right? Wrong. More money means higher taxes. It can take a long time before we can start putting away money to plan for our future and for other things. That means we must put off not just saving for retirement, but also things like putting money away for our children’s education, buying a home, paying off our student loan debt (which we’ve already established is expensive and annoying), and enjoying ourselves since we’re not constantly studying like we did throughout our 20s.
The problem with working toward a medical degree is time. When you’re in your 20s and going to med school the debt racks up. If you spend that time having your money work for you, then you don’t have to catch up later. Again, you don’t get crushed by student loan debt that’s in the hundreds of thousands of dollars with a minimum of 7% interest.
4Most People Don’t Understand Your Struggle
Society is still under the impression that doctors are rich. They feel justified in overcharging you and lend no ear to your financial struggles. They believe you have money and can afford whatever it is you’re dealing with. However, they don’t see the upfront costs, nor the debt that follows you for years.
5The Pressure to Live Large
People believe doctors are rich. Therefore, many doctors believe they need to hold themselves to a higher standard of living than they really do. When I said, a radiologist could retire at 38, I was talking about a normal lifestyle. But many doctors believe that’s not good enough for them because society told them so. As a result, they work harder and longer than they need to. Well, why do you need a more luxurious lifestyle? Why is it okay for the plumber to retire to a small ranch style house, but the doctor needs a bigger house in a better neighborhood? That’s the real cost. Not being willing to settle for less materially and better yourself in other ways.
6Are doctors rich?
Are doctors rich? Not by a long shot.
After reading this article, the decision is still up to you, but if you’re going to become a doctor, don’t do it for the money. You’ll be sorely disappointed. I am eager to study medicine for the intellectual fulfillment, and to curb my strong desire to help others. I leave the, why med school personal statement for another day.