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Run like hell and don't look back. 300K is not 200-300 for life, it's 2000-3000 for life. This person is a mess and if you don't leave, they are going to take you down with them.
My student loans were $400 a month for only $30k in loans averaging a 5% rate.
I can't even begin to imagine what they are for a balance 10 times that.
Now arguably. $2,000 a month for a doctor earning $300k a year is nothing. But for anyone making under $200k that is going to be a debilitating amount of money.
Now arguably. $2,000 a month for a doctor earning $300k a year is nothing. But for anyone making under $200k that is going to be a debilitating amount of money.
It be one thing if they finished the program and got a job earning that much in salary, but to take on $300K and not complete the program just creates a bad situation
$2,000 a month is only $24k a year. When you're earning $300k a year that leaves plenty of $ left over.
Would you rather make $100k a year with $200 a month in student loans
or $300k a year with $2000 a month in student loans?
its not a matter of "would you rather." 2,000 a month is still more than all of most people's individual expenses except their mortgage. its not really an important point but i bet someone earning 300k doesnt see it as "nothing."
$2,000 a month is only $24k a year. When you're earning $300k a year that leaves plenty of $ left over.
Would you rather make $100k a year with $200 a month in student loans
or $300k a year with $2000 a month in student loans?
You are aware that most doctors don't earn $300k/year? Especially not those in primary care.
Student loans are indeed a significant burden to young physicians (who, let's remember, are generally also a decade behind in saving for retirement compared to their peers who didn't go through medical school and residency). They are not an insurmountable burden, but they are a a significant issue.
As for the OP's friend, he or she is totally hosed financially. He or she is going to have a $300K "education mortgage" which may well preclude ever having a real mortgage (or any significant retirement savings, etc.) I see no happy outcome here, sadly.
You are aware that most doctors don't earn $300k/year? Especially not those in primary care.
Student loans are indeed a significant burden to young physicians (who, let's remember, are generally also a decade behind in saving for retirement compared to their peers who didn't go through medical school and residency). They are not an insurmountable burden, but they are a a significant issue.
As for the OP's friend, he or she is totally hosed financially. He or she is going to have a $300K "education mortgage" which may well preclude ever having a real mortgage (or any significant retirement savings, etc.) I see no happy outcome here, sadly.
Agree - they definitely don't make 300K - I have two relatives that are doctors - successful ones - one makes 250K and that's considered really good, and the other, who is actually a really well-known specialist, makes less than that. They don't have trouble paying off loans, which they have a lot of, but when they had kids staying home was not an option, and one of them spent some time working at a job they didn't really care for because there was loan repayment for it. So it's not nothing for doctors, but it is doable if the career works out.
I am with someone who is no longer interested in pursuing medicine and has accumulated 300k of student debt.
The person is not working and if the individual continues the program, the school had noted they may have to dismiss the individual due to lack of grades, performance, etc. I understand med school is not for everyone, I don't think I could ever do it-- but what is the outlook on this person's life?
The person is currently not working and not yet interested in working, likely because there is ~50k-100k of student loan money that is available to this person in the bank (I believe).
I have tried to explain the gravity of the situation to the individual but the person responds "all you care about is money." This seems like a no-win situation, am I wrong?
The problem is that, that $300K is quickly going to increase to much more with interest, and the longer you wait to pay it off, the more the interest will compound. Especially if he/she (your SO) hasn't finished med school yet; if he has already accumulated $300K then by the time he actually finishes (if he does finish), I would guess with added loans and interest, you are probably looking at closer to $500K.
I guess it really depends on what year your SO is in Med School. If (s)he's in the clinical years (3rd or 4th), and is being held back is due to clinical knowledge as opposed to more serious academic issues; I would probably suggest that he's in too deep to jump ship. It would probably be best financially to tough it out at that point.
Although if he really hates medicine, it's a tough call, because I have a couple close buddies who are MDs and without at least having an internship you can't even be licensed. So, if he has an MD without being licensed, and he tries to apply to any other job, he's looking at an uphill battle because "alternate" medical jobs are not very common, and if there ever are opportunities, they tend to look at licensed MDs with years of clinical experiences. Unfortunately, if your SO doesn't have any prior work experience, he'll find in the corporate world his medical skills (while impressive) are not very transferable.
From a financial standpoint, the best course of action would probably be for your SO to suck it up and try to finish medical school AND residency. Then work for a few years to pay off loans and gain the valuable experience. Then it will be much easier to start to transition out.
I normally don't advise to do something you are miserable in, but in this case financially, I'm just not sure there is an easy way out because a "partially-completed MD" won't open any doors in the corporate world. If you start over (PhD, other program), the opportunity costs would be huge (in addition to actual school costs for PhD programs), and the interest on loans as big as that grow like crazy if you don't start to pay them back soon.
I'm seeing a lot of misinformation in this thread, and I wanted to highlight a couple of them:
#1 "The OP's partner is screwed, they'll be paying off those loans for life"
I just ran the numbers -- assuming 5.25% for $300k, 30 year term, that's $1,656.61/mo. The OP mentioned their partner has $50k-$100k in unused loans, which could be immediately returned. That turns the payment into $1,380.51/mo or $1,104.41/mo respectively.
#2 "your partner should just finish schooling"
This may not be an option if they were on academic probation, which is pretty likely given the OP's talk about the dept head recommending they drop out.
#4 "the OP is writing about themselves"
It's another pretty good bet the OP works in the tech sector.
BOOM roasted.
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