Spoiler alert: Stay tuned to the end for a free cheat sheet!
This week, I’d like to bring you a review of a book I received in the gift bag at WCICON20. I had the pleasure and honor of speaking at the White Coat Investor conference this past year and I walked away with many books that I have been reading over the past months. I particularly enjoyed Dr. Ben White’s Medical Student Loans.
I REALLY wish I had read this book in residency.
As you know, I paid off my loans in a hurry after I took a non-PSLF eligible job. I am immensely glad I did so because less than 5 years out of residency, I have the freedom to work part-time or whatever time I want, whenever and wherever I want.
But, for the resident who is still considering his or her options, I think it’s really important to read this book to learn about all the options of ways student loans can be managed.
Rubbing elbows with the best. Much thanks to Dr. Dahle for this book.
“Medical Student Loans” would be a great book to read during the easier rotations in 4th year of med school, or during electives in the last couple of years of residency. It is clearly written and lays out very difficult to understand financial concepts in practical terms, with ample examples and scenarios.
I know not everyone has time to read a book cover to cover so, I’m going to give you the cliff notes version here. If the information is helpful, go and read the whole book.
Why Learn about Medical Student Loans
Ben starts out with a story of standard repayment. He borrows $40,000 a year in medical school, unsubsidized at 6.8% interest rate.
$160,000 borrowed turned into $187,000 at graduation.
After 6 month grace period, $32,000 interest capitalized and the total turned into $192,000.
He decided to forbear the loans through residency and then became a hospitalist. Forbearance ended, capitalization happened and the new balance was $231,000.
Here is what his repayment looked like.
Total Borrowed: $160,000
Balance at start of repayment: $231,000
Standard repayment: $2,700/month for 120 months
Total paid= $319,000
$88,000 interest paid
Up until the payoff part, this story is very much like my story. Paying $2700 a month for 10 whole years is really unattractive. So is paying $88,000 in non tax-deductible interest. There has to be a better way!
Medical Student Loans Cheat Sheet
There are several better ways. I put together this cheat sheet as I was reading the book. One page summaries were my favorite way to learn in medical school, and I’m carrying the tradition forward. I hope this helps you, too! If you have any questions on the details, they are all in the book.
I’m going to be sending out a downloadable and printable one page PDF to TFP subscribers this week. If you’d like to get a copy, please sign up here.
If this motivated you to refinance your loans, make sure you use the TFP link to Credible to compare rates and get some cash back- $750 if you refinance $100,000 or more of student loans and $200 if you refinance less than $100,000!
Till next time!
Stay frugal, y’all!
Disha
Standard Disclaimer: Not meant as individualized financial or medical advice. This post contains affiliate links.