is $400k in student loan worth it?

[nkarma]

We have three pharmacists in my family, no one came anywhere close to owing that after 6 years of college! Heck, the doctor in our family didn't owe that.

What year did they graduate? Tuition has gone up 20-30% every year in my state.

 

[lovebug1031]

Entirely possible. Ridiculous, but possible. If it's a private school with tuition in the $40k-$50k range for undergrad and even more for the pharmacy stuff...$400k would seem on par. That's means minimum payments of about $3,500-$4,000 a month, and with compounding interest... Eek!

ehh...not true, i have almost 100K and i pay about $650/mo!

 

[sonnyjane]

Entirely possible. Ridiculous, but possible. If it's a private school with tuition in the $40k-$50k range for undergrad and even more for the pharmacy stuff...$400k would seem on par. That's means minimum payments of about $3,500-$4,000 a month, and with compounding interest... Eek!

ehh...not true, i have almost 100K and i pay about $650/mo!

So if you multiply that by 4, just using your figure, it would be $2,600. And your rates may be lower than theirs? I think certainly $3,000 would be logical.

 

[lovebug1031]

Entirely possible. Ridiculous, but possible. If it's a private school with tuition in the $40k-$50k range for undergrad and even more for the pharmacy stuff...$400k would seem on par. That's means minimum payments of about $3,500-$4,000 a month, and with compounding interest... Eek!

A lot of student loans do not have that high of an interest rate, and they usually don't make you pay that high of a % of them every month.

but still 400k is 400k that you'll need to pay back no matter how long it takes,and how about buying a nice house? add another 400k in debt?... + don't forget a nice brand new BMW..

and don't forget if they're gov't loans they NEVER go away...if you file bankruptcy, you're still on the hook for em!

 

[lovebug1031]

eh fair enough! it is a crazy amount, i think what I have is a crazy amount! Mine is just undergrad and MBA! BUT both schools were private...

 

[momhappy]

Yes, it's possible. I went to a private school and had a pretty hefty student loan that I paid on for years and years.... The interest rate was quite low though, which made the payments manageable. Truth be told, I could have paid them off years sooner, but with the rate/payment so low, I focused on other bills that made more sense to pay off sooner.

 

[Dancing Fire]

Entirely possible. Ridiculous, but possible. If it's a private school with tuition in the $40k-$50k range for undergrad and even more for the pharmacy stuff...$400k would seem on par. That's means minimum payments of about $3,500-$4,000 a month, and with compounding interest... Eek!

A lot of student loans do not have that high of an interest rate, and they usually don't make you pay that high of a % of them every month.

but still 400k is 400k that you'll need to pay back no matter how long it takes,and how about buying a nice house? add another 400k in debt?... + don't forget a nice brand new BMW..

and don't forget if they're gov't loans they NEVER go away...if you file bankruptcy, you're still on the hook for em!

as it should be!! .why would you expect someone else to pick up your tab? ..

 

[pandabee]

Dear lord!!! I will have under 80,000 in loans when I graduate and I am overwhelmed by that even. Granted, I had 3 years undergrad at a state school with a decent amount of scholarship, and 4 years pharm school at the same school with in-state tuition. Is the 80k worth it? If I can find a job, then it sure as hell is because it's what I love talking about and teaching people about and doing. For 400k? I would probably feel differently.

Someone once told me that you shouldn't take out more in loans for school than you expect to make in one year (even though you obviously would not pay all that back within one year). I think that was pretty solid financial advice to help you budget how much is enough when taking out loans and choosing a career.

 

[Dancing Fire]

Dear lord!!! I will have under 80,000 in loans when I graduate and I am overwhelmed by that even. Granted, I had 3 years undergrad at a state school with a decent amount of scholarship, and 4 years pharm school at the same school with in-state tuition. Is the 80k worth it? If I can find a job, then it sure as hell is because it's what I love talking about and teaching people about and doing. For 400k? I would probably feel differently.

Someone once told me that you shouldn't take out more in loans for school than you expect to make in one year (even though you obviously would not pay all that back within one year). I think that was pretty solid financial advice to help you budget how much is enough when taking out loans and choosing a career.

80K?,definitely but 400k..i don't know...

 

[chrono]

$80K in loans for pharmaceutical school is acceptable and worth it to me, not $400K. It is a debt that I can see paying off in a reasonable amount of time and not financially taxing when starting a new job and still maintaining a decent living and savings.

 

[diamondseeker2006]

I think it is totally and completely nuts. My son-in-law has over a $100k in loans for his grad school, and it is difficult for him to pay that off. I can see if for doctors who will make very high incomes, but the only way I can see a pharmacist make those kind of payments is if they marry someone with a high income so they can afford the loan payments for a few years. I mean, how could you afford a mortgage and a $1600 a month loan payment on a $100k income after taxes???

 

[rosetta]

Hmm. I've been thinking about this. So if you had a $400k loan, how much would you have to pay back each month?

I would assume that pharmacists have starting salaries of $100k plus. What would be the post-tax salary?

I would assume some sort of mortgage at some point? How much would that be?

Obviously you'd have to start saving for retirement ASAP.

Nursery and school fees?

I dunno. It doesn't seem to add up unless pharmacist salaries are say $200k plus after tax. Is that the norm?

I'd like someone to come up with a salary figure that makes a 400k loan make sense. Not being antagonistic, I would like to understand how this could work out, as I'm really ignorant about American college cost, a topic that keeps coming up and seems to make my head spin every time

 

[qtiekiki]

Our cousin went to USC for his PharmD, and he had a 150K loan just for tuition since he lived at home. He went to UCLA for undergrad. He paid the loan off within months of his graduation. Our other cousin went to UOP, but she either didn't take out loans or the loan was paid back almost immediately after college by her parents.

 

[Dancing Fire]

my nephew and his wife are both pharmacists .i have no idea on how much they owe in student loans,but here's what i'd know and saw in front of my eyes since they got married about 6 yrs ago.

a 3.5ct Ering which he paid $50K (got screwed by a friend) + a 2ct yellow diamond RHR with halo + a 18k WG Rolex and a 18k WG Cartier watch + many other name branded items.

paid 570K for a house during the peak of the market.

bought 2 brand new BMWs one SUV and one convertible.

plus the 1 yr old son rides in a 1k stroller and wears name branded clothes.

and get this...she flies from Ca.to NYC just to go shopping for a couple of days...

i don't know how much 2 pharmacists make but in no F-ing way they can afford this kind of life style... my nephew is not the spender type,but the wife..

 

[rosetta]

my nephew and his wife are both pharmacists .i have no idea on how much they owe in student loans,but here's what i'd know and saw in front of my eyes since they got married about 6 yrs ago.

a 3.5ct Ering which he paid $50K (got screwed by a friend) + a 2ct yellow diamond RHR with halo + a 18k WG Rolex and a 18k WG Cartier watch + many other name branded items.

paid 570K for a house during the peak of the market.

bought 2 brand new BMWs one SUV and one convertible.

plus the 1 yr old son rides in a 1k stroller and wears name branded clothes.

and get this...she flies from Ca.to NYC just to go shopping for a couple of days...

i don't know how much 2 pharmacists make but in no F-ing way they can afford this kind of life style... my nephew is not the spender type,but the wife..

Well, that's very interesting DF. I'm a doctor, married to a doctor in the UK. There's no way we could afford this type of lifestyle. I have a few designer handbags and shoes. No fancy watches, most of my jewellery were given as gifts, I drive a Honda and hubby drives a Volkswagen. I don't even understand the concept of flying anywhere for a just a shopping trip, we rent our home. Sure, we live below our means but that's because we need to save for retirement and a house, not to fund some high roller lifestyle a few years from now. And we don't even have kids yet. K don't understand how this lifestyle is maintained on any less than $500k post tax.

I know there are some US based doctors here, like MTG, ice kid and wildcat. I wonder if they feel differently? Can any US based docs chime in?

 

[chrono]

I have an uncle and aunt in the UK and he's a retired MD and she's a retired nurse. They are very well off but not swimming in money. I wonder if this is because the UK health system (and cost) is more reasonable than in the US?

 

[madelise]

DF, are your nephew and niece just pharmacists, or are they business owners as well? Being a pharmacy owner will bring in buku bucks. Also, I find the living style you're describing to be very descriptive of Californians. We all loooooovvvvveeeee to spend money here, and we all love to buy things that people can SEE (cars, jewelry, clothing, purses, shoes, etc).

We can all share our opinions on whether or not it's "worth it", but I've already provided links to show that yes, it does happen, and is a very real situation. Those schools have full enrollment, so there are plenty of people who find it "worth it".

 

[monarch64]

my nephew and his wife are both pharmacists .i have no idea on how much they owe in student loans,but here's what i'd know and saw in front of my eyes since they got married about 6 yrs ago.

a 3.5ct Ering which he paid $50K (got screwed by a friend) + a 2ct yellow diamond RHR with halo + a 18k WG Rolex and a 18k WG Cartier watch + many other name branded items.

paid 570K for a house during the peak of the market.

bought 2 brand new BMWs one SUV and one convertible.

plus the 1 yr old son rides in a 1k stroller and wears name branded clothes.

and get this...she flies from Ca.to NYC just to go shopping for a couple of days...

i don't know how much 2 pharmacists make but in no F-ing way they can afford this kind of life style... my nephew is not the spender type,but the wife..

Is "pharmacist" what they are calling drug dealers these days???

 

[Dancing Fire]

DF, are your nephew and niece just pharmacists, or are they business owners as well? Being a pharmacy owner will bring in buku bucks. Also, I find the living style you're describing to be very descriptive of Californians. We all loooooovvvvveeeee to spend money here, and we all love to buy things that people can SEE (cars, jewelry, clothing, purses, shoes, etc).

We can all share our opinions on whether or not it's "worth it", but I've already provided links to show that yes, it does happen, and is a very real situation. Those schools have full enrollment, so there are plenty of people who find it "worth it".

no they both employed by hospitals.i would guess 99% of the pharmacists here are employed by either a hospitals or work for CVS,Walgreens,b/c in no way a family owned pharmacy can compete with the big boys. 30 yrs ago yes,there were a lot of family owned pharmacy in town,but not today.

 

[Dancing Fire]

my nephew and his wife are both pharmacists .i have no idea on how much they owe in student loans,but here's what i'd know and saw in front of my eyes since they got married about 6 yrs ago.

a 3.5ct Ering which he paid $50K (got screwed by a friend) + a 2ct yellow diamond RHR with halo + a 18k WG Rolex and a 18k WG Cartier watch + many other name branded items.

paid 570K for a house during the peak of the market.

bought 2 brand new BMWs one SUV and one convertible.

plus the 1 yr old son rides in a 1k stroller and wears name branded clothes.

and get this...she flies from Ca.to NYC just to go shopping for a couple of days...

i don't know how much 2 pharmacists make but in no F-ing way they can afford this kind of life style... my nephew is not the spender type,but the wife..

Is "pharmacist" what they are calling drug dealers these days???

yes,but they will need to steal enough drugs to support that kind of life stlye...

 

[ruby59]

my nephew and his wife are both pharmacists .i have no idea on how much they owe in student loans,but here's what i'd know and saw in front of my eyes since they got married about 6 yrs ago.

a 3.5ct Ering which he paid $50K (got screwed by a friend) + a 2ct yellow diamond RHR with halo + a 18k WG Rolex and a 18k WG Cartier watch + many other name branded items.

paid 570K for a house during the peak of the market.

bought 2 brand new BMWs one SUV and one convertible.

plus the 1 yr old son rides in a 1k stroller and wears name branded clothes.

and get this...she flies from Ca.to NYC just to go shopping for a couple of days...

i don't know how much 2 pharmacists make but in no F-ing way they can afford this kind of life style... my nephew is not the spender type,but the wife..

Is "pharmacist" what they are calling drug dealers these days???

yes,but they will need to steal enough drugs to support that kind of life stlye...

Are these items bought and paid for, or bought and put on credit cards? Not saying this applies to your nephew, but some people have all the fancy toys and are also seriously in debt.

 

[madelise]

Are these items bought and paid for, or bought and put on credit cards? Not saying this applies to your nephew, but some people have all the fancy toys and are also seriously in debt.

I was also wondering that. And I was also wondering if they live in a multi-generation family household like most Chinese people do. If they do, that saves a lot of $, too. PS $570K for a house in CA during the peak of the market ain't bad at all A 900 Sq ft "house" near me just sold for that much NOW. Yikes!!

 

[Dancing Fire]

Are these items bought and paid for, or bought and put on credit cards? Not saying this applies to your nephew, but some people have all the fancy toys and are also seriously in debt.

I was also wondering that. And I was also wondering if they live in a multi-generation family household like most Chinese people do. If they do, that saves a lot of $, too. PS $570K for a house in CA during the peak of the market ain't bad at all A 900 Sq ft "house" near me just sold for that much NOW. Yikes!!

they live alone with their baby son. their house will probably sell for about $400k max in today's market. i know the approx value of their home b/c my daughter lives across the street and she paid $278K for her house 1.5 yrs ago.

 

[madelise]

Are these items bought and paid for, or bought and put on credit cards? Not saying this applies to your nephew, but some people have all the fancy toys and are also seriously in debt.

I was also wondering that. And I was also wondering if they live in a multi-generation family household like most Chinese people do. If they do, that saves a lot of $, too. PS $570K for a house in CA during the peak of the market ain't bad at all A 900 Sq ft "house" near me just sold for that much NOW. Yikes!!

they live alone with their baby son. their house will probably sell for about $400k max in today's market. i know the approx value of their home b/c my daughter lives across the street and she paid $278K for her house 1.5 yrs ago.

Now you got me nosey about where in CA you live!

 

[pandabee]

Hospital pharmacists are paid less on average than your CVS/Walgreens etc pharmacists. Owning your own business, small mom and pop pharmacy or not, will earn you the big bucks once you get past the start-up costs. One of my previous preceptors makes 200k and he's only been open for 8 years.

 

[Dancing Fire]

Are these items bought and paid for, or bought and put on credit cards? Not saying this applies to your nephew, but some people have all the fancy toys and are also seriously in debt.

I was also wondering that. And I was also wondering if they live in a multi-generation family household like most Chinese people do. If they do, that saves a lot of $, too. PS $570K for a house in CA during the peak of the market ain't bad at all A 900 Sq ft "house" near me just sold for that much NOW. Yikes!!

they live alone with their baby son. their house will probably sell for about $400k max in today's market. i know the approx value of their home b/c my daughter lives across the street and she paid $278K for her house 1.5 yrs ago.

Now you got me nosey about where in CA you live!

Sacto.

 

[Dancing Fire]

[quote="ruby59|1363718595|

Are these items bought and paid for, or bought and put on credit cards? Not saying this applies to your nephew, but some people have all the fancy toys and are also seriously in debt.[/quote]


that could be true and wouldn't surprise me at all. my nephew and i aren't very close we don't talk to each other much.

 

[justginger]

my nephew and his wife are both pharmacists .i have no idea on how much they owe in student loans,but here's what i'd know and saw in front of my eyes since they got married about 6 yrs ago.

a 3.5ct Ering which he paid $50K (got screwed by a friend) + a 2ct yellow diamond RHR with halo + a 18k WG Rolex and a 18k WG Cartier watch + many other name branded items.

paid 570K for a house during the peak of the market.

bought 2 brand new BMWs one SUV and one convertible.

plus the 1 yr old son rides in a 1k stroller and wears name branded clothes.

and get this...she flies from Ca.to NYC just to go shopping for a couple of days...

i don't know how much 2 pharmacists make but in no F-ing way they can afford this kind of life style... my nephew is not the spender type,but the wife..

Interesting. Here you would find that even on double salaries of $100k+ each, there wouldn't be much left for such frivolity due to the astronomical cost of housing. The AVERAGE house is now $500k - two pharmacists wanting to live in their "social class neighborhood" would be looking at 800+. And they could afford it with their Commonwealth-level uni loans of <$50k with no interest charged!

 

[anners11]

I'm a doctor here in the US. I am 2 years out of residency and have a little over $220,000 in student loans and that is just from medical school. I was very lucky to have had my undergraduate degree paid for by my parents and scholarships. If I pay around $2500/month I will have my loans paid off in about 10 years, which to me is reasonable. When I started medical school I had a vague idea of what it would cost, but I NEVER thought I'd be over $200,000. Even if I knew I think I still would have gone through with it. Primarily because I can honestly say there isn't anything else I'd rather do and I probably wouldn't be very good at many other things. Secondly, I know that no matter what happens I will always have a job. So for me 400k is a whole lot but if I knew I wouldn't be happy doing anything else and there was a solid job market in whatever I was going in to then I could see doing it. BUT, I think you'd have to be pretty committed to paying them down as quickly as possible, which means you probably wouldn't be living an extravagant lifestyle.


It's really all about debt to income potential. It doesn't make any sense to go 400k in to debt to make 60k a year, but if you know you'll make 150-200k+ then it makes sense.

As for the loans NEVER going away. Of course they don't, it's the government. I distinctly remember going to my financial aid officer before starting medical school and asking what happened to my loans if I died. I didn't want my parents to be saddled with my loans if something happened to me. Turns out, the only way the loans are forgiven is if you die. Had it been that my parents would have been held responsible, I probably wouldn't have gone to medical school.


On a lighter note, at my graduation my Dad was standing in the lobby of the hotel and was holding my diploma. There was this group of women standing near us. He walked up to them and said, "Hey ladies, wanna see a piece of paper worth a quarter of a million dollars?" And then proceeded to flash my diploma. Awesome. That was just a little embarrassing

 

[Dancing Fire]

[quote="anners11|1363744341|

On a lighter note, at my graduation my Dad was standing in the lobby of the hotel and was holding my diploma. There was this group of women standing near us. He walked up to them and said, "Hey ladies, wanna see a piece of paper worth a quarter of a million dollars?" And then proceeded to flash my diploma. Awesome. That was just a little embarrassing [/quote]


i'm sure he's a proud daddy...