College can be really expensive, and sometimes when you consider the expenses, it can seem impossible to pay for college and continue to live your life. But, as you consider the amazing benefits a college education can provide, the initial costs of college will become insignificant.
It's Okay to Have Fun
But, even with the future benefits in mind, coming up with the funds now, may seem impossible. As you look to finance your education, it is important to remember the many types of financial aid opportunities that are available to help college students be more successful, and accomplish all of their goals. By understanding the usefulness and purpose of different types of financial aid, you will be able to improve your college experience, and take advantage of the financial aid options available to you at your college.
We will tack on to this tuition a modest living expense of $25,000 (with a family you may need more). We will assume four years of medical school before residency and we are looking at an average total cost for tuition and living expenses of $276,000. Of course there will be costs higher and lower than this and if you are lucky and have done well in undergrad work you may find yourself with scholarships or living grants. We will assume that you are not that lucky but you are lucky enough to have eliminated any debt from undergraduate studies (although that is probably not the case).
In order to afford medical school you will need to take out some loans. Federal loans are limited to thirty thousand a year meaning that you will need to take out private loans at higher interest rates. The federal loan rate has fluctuated and can be anywhere from 3.5-7 percent. Private loans are a usually a few points higher if not more. For simplicity in the math we will take say that our total loans have an average interest rate of 8 percent (make adjustments for your own rates). After the four years (assuming you have not made payments) your total debt will be ~$350,000 if compounded annually. We do the same process again through the three years of residency that you will be going through. At the end of your education, again assuming no payments as well as no undergraduate debt you will have a total debt of ~ $438,000. Compounding interest can be terrible when it is not on your side.
After college and residency we will say you are making $170,000 a year (rough average from the different medical specialties you can choose from). After federal and state taxes of around 35 percent combined leaving you end up with $110,500 for each year which is not a bad yearly salary. If you plan on paying off your debt over ten years expect to pay $5,314 monthly and if stretched over 20 years $ 3,663.61. If you opt for the ten year plan your monthly income minus debt will be $3894 for a yearly income of 46, 732. If you do the same thing for the twenty year plan your yearly income would be $66,544. Quite a difference from the 100k+ you may have been anticipating.
The last kind of aid available is loans. Loans are different from scholarships and grants because they do need to be repaid. As you consider taking out loans, remember to take into account how much you will be paid in your future career so you can be sure you do not take out more than you will be able to repay.
Attempting to balance your college life can seem impossible, but it will work if you put forth the effort. Whether you're going to college in Miami or Idaho Falls, these principles will help you to have the best college experience you can ask for.
It's Okay to Have Fun
But, even with the future benefits in mind, coming up with the funds now, may seem impossible. As you look to finance your education, it is important to remember the many types of financial aid opportunities that are available to help college students be more successful, and accomplish all of their goals. By understanding the usefulness and purpose of different types of financial aid, you will be able to improve your college experience, and take advantage of the financial aid options available to you at your college.
We will tack on to this tuition a modest living expense of $25,000 (with a family you may need more). We will assume four years of medical school before residency and we are looking at an average total cost for tuition and living expenses of $276,000. Of course there will be costs higher and lower than this and if you are lucky and have done well in undergrad work you may find yourself with scholarships or living grants. We will assume that you are not that lucky but you are lucky enough to have eliminated any debt from undergraduate studies (although that is probably not the case).
In order to afford medical school you will need to take out some loans. Federal loans are limited to thirty thousand a year meaning that you will need to take out private loans at higher interest rates. The federal loan rate has fluctuated and can be anywhere from 3.5-7 percent. Private loans are a usually a few points higher if not more. For simplicity in the math we will take say that our total loans have an average interest rate of 8 percent (make adjustments for your own rates). After the four years (assuming you have not made payments) your total debt will be ~$350,000 if compounded annually. We do the same process again through the three years of residency that you will be going through. At the end of your education, again assuming no payments as well as no undergraduate debt you will have a total debt of ~ $438,000. Compounding interest can be terrible when it is not on your side.
After college and residency we will say you are making $170,000 a year (rough average from the different medical specialties you can choose from). After federal and state taxes of around 35 percent combined leaving you end up with $110,500 for each year which is not a bad yearly salary. If you plan on paying off your debt over ten years expect to pay $5,314 monthly and if stretched over 20 years $ 3,663.61. If you opt for the ten year plan your monthly income minus debt will be $3894 for a yearly income of 46, 732. If you do the same thing for the twenty year plan your yearly income would be $66,544. Quite a difference from the 100k+ you may have been anticipating.
The last kind of aid available is loans. Loans are different from scholarships and grants because they do need to be repaid. As you consider taking out loans, remember to take into account how much you will be paid in your future career so you can be sure you do not take out more than you will be able to repay.
Attempting to balance your college life can seem impossible, but it will work if you put forth the effort. Whether you're going to college in Miami or Idaho Falls, these principles will help you to have the best college experience you can ask for.
About the Author:
The Stevens Henager Idaho Falls branch campus was created to facilitate educational activities, social events, and career services. This location offers Internet access, tutors, and a supportive staff to assist students.