It’s not always great to be tops among your peers.
, according to Medscape Medical News’ 2023 Residents Salary and Debt Report.
I’m smack in that upper percentile. I amassed nearly a half million dollars in student debt and currently stand at roughly $400,000. Yay me.
As a naive twentysomething making a major life decision, I never thought my loans would amount to this inconceivable figure, the proverbial “mortgage without a roof” you hear student debt experts talk about.
This isn’t a story about how the student loan industry needs to be reformed or how education has become increasingly expensive or regrets about going to medical school.
It’s also not a story about how you should be handling basics like consolidating and refinancing and paying extra toward your principal.
It’s about my experience as a physician 13 years after signing that first promissory note. In short: I completely miscalculated the impact loans would have on my life.
I bought money to go to school. I can’t undo that. But over the past decade, I have learned a lot, particularly how those with their own mountain of debt — or who will inevitably wind up with one — can manage things better than I have.
Mistake #1: Loan Forgiveness Is More Complicated Than it Seems
My parents and I were aware of the Public Service Loan Forgiveness (PSLF) program which began in 2007 shortly before I started exploring medical school options. I wanted to help people, so working in the nonprofit sector sounded like a no-brainer. Making 120 payments while practicing at a qualifying institution didn’t sound hard.
Newsflash: Not all healthcare organizations are 501(c)3 programs that qualify as nonprofit for the PSLF program. You can’t just snap your fingers and land at one. I graduated from fellowship just as the COVID-19 pandemic began, which meant I was launching my medical career in the midst of hiring freezes and an overnight disappearance of job opportunities.
I had to take a 2-year hiatus from the nonprofit sector and found a part-time position with a local private practice group. It still stings. Had I been working for a qualified employer, I could have benefited from the student loan payment pause and been closer to applying for loan forgiveness.
Avoid it: Be brutally honest with yourself about what kind of medicine you want to practice — especially within the opportunities you have on hand. Private practice is very different from working for the nonprofit sector. I didn›t know that. When weighing career choices, immediately ask, “How will this impact how I pay my loans?” You may not like the answer, but you›ll always know where you stand financially.
Mistake #2: I Forgot to Factor in Life Goals
To be fair, some things were out of my control: Not getting into a state school with cheaper tuition rates, graduating at the start of a once-in-a-lifetime global pandemic. I wasn’t prepared for a changing job landscape. But there were also “expected” life events like getting married, developing a geographical preference, and having a child. I didn’t consider those either.
How about the “expected” goal of buying a home? For years I didn’t feel financially comfortable enough to take on a mortgage. For so long, my attitude has been don’t take on any more debt. (A special shout-out to my 6.8% interest rate which has contributed over a third of my total loan amount.)
This even affected how my husband and I would talk about what a future home might look like. There’s always a giant unwelcome guest casting a shadow over my thoughts.
Avoid it: Don’t compartmentalize your personal and professional lives. Your student loans will hang over both, and you need to be honest with yourself about what “upward mobility” really means to you while in debt. There’s a reason people say “live like a resident” until your loans are paid off. My husband and I finally worked our numbers to where we bought our first home this past year — a moment years in the making. I still drive around in my beloved Honda CR-V like it’s a Mercedes G-Wagon.
Mistake #3: I Didn’t Ask Questions
I regret not talking to a practicing physician about their experience with student loans. I didn’t know any. There weren’t any physicians in my extended family or my community network. I was a first-generation Pakistani American kid trying to figure it out.
It’s difficult because even today, many physicians aren’t comfortable discussing their financial circumstances. The lack of financial transparency and even financial literacy is astounding among young medical professionals. We live in a medical culture where no one talks about the money. I was too diffident and nervous to even try.
Avoid it: Don’t be afraid to have uncomfortable conversations about money. Don’t allow yourself to make even one passive decision. It’s your life.
If you can’t find someone in medicine to talk to about their financial journey, there are plenty of credible resources. Medscape Medical News has a Physician Business Academy with hot topics like personal finance. The White Coat Investor is literally bookmarked on all my electronic devices. KevinMD.com has a ton of resources and articles answering common financial questions about retirement, savings, and house buying. And Travis Hornsby with www.studentloanplanner.com has wonderful advice on all kinds of different loans.
There are no stupid questions. Just ask. You might be surprised by what people are willing to share.
Mistake #4: Playing it Casual With My Lenders
If $400,000 in debt doesn’t sound bad enough, imagine lots more. It turns out my loan carrier had me at a much higher loan balance because they’d inadvertently duplicated one of my loans in the total. I didn’t know that until I transferred my loans to another handler and it came to light.
Imagine my relief at having a lower total. Imagine my anger at myself for not checking sooner.
Avoid it: Do a thorough self-audit on all your loans more than once a year. Pretend they’re a patient with odd symptoms you can’t pin down and you have the luxury of doing every diagnostic test available. It’s not fun studying your own debt, but it’s the only way to really know how much you have.