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3booodi

Monstrous US dental school debt question

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Hey everyone, I have been researching this topic on several forums and all over the internet for the past two days with no success. Since I am personally considering dentistry, I would like to keep my doors open with schools outside of Canada. My GPA is not that great, but I still have time to recover and maybe have a shot in Canada.

I am curious on how the students that go abroad, specifically the US, manage their debt. Do you have a plan on repayment? If so, mind describing it briefly?

After researching that topic a lot, I concluded that debt can be repaid (in Canada) within 3-10 years depending on where you're practicing, and how aggressive you would want to repay your debt. That makes sense since the average dept of Canadian dental school is ~250k CAD. But looking at a relatively not expensive school like Case Western, one could end up with 300k USD which is around 400K CAD with today's exchange rate.

What are your guys' opinions towards it, strictly from a financial point of view.

Cheers!

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If you’re funding US education primarily with loans and are not well off/have significant funding from bank of mom and dad I don’t think any career is worth that debt (after including living expenses and interest it will be closer to $500k+). Might make more sense if you have a practice to inherit.

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The is an old rule of thumb with student loans - that the total debit shouldn't exceed 10% of your earnings of the first 10 years post graduating (ha, if the income is the same each year you could just say one years gross income, but usually there is ramp up to higher incomes in most fields. That even happens in medicine). 

The US route does cross that line by quite a bit. The US options certainly was a lot more reasonable looking when the dollar was at 1.1 and had loans in can dollars to pay for things. 

Right now the US route looks like it would hurt quite a bit. 

 

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But looking at a relatively not expensive school like Case Western

Case gave me a large scholarship and even then it was still more than going to U of T, where I ended up, both numerically and due to the exchange rate which only got worse over the 4 years I was in school.

A lot of people have been telling me lately the associateship/job market has been pretty shit for the past year as well; the worst they've seen. It will only be worse in 4 years when you graduate.

After researching that topic a lot, I concluded that debt can be repaid (in Canada) within 3-10 years depending on where you're practicing, and how aggressive you would want to repay your debt.

I'm always one to play devil's advocate, but I don't think you quite realize the gravity of spending a decade after school paying off student loans, and how greatly that affects your life.

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On 7/16/2018 at 8:24 AM, rmorelan said:

The is an old rule of thumb with student loans - that the total debit shouldn't exceed 10% of your earnings of the first 10 years post graduating (ha, if the income is the same each year you could just say one years gross income, but usually there is ramp up to higher incomes in most fields. That even happens in medicine). 

The US route does cross that line by quite a bit. The US options certainly was a lot more reasonable looking when the dollar was at 1.1 and had loans in can dollars to pay for things. 

Right now the US route looks like it would hurt quite a bit. 

 

Fair enough. The things that is looking optimistic is the increase of the prime rate in Bank of Canada, which in my understanding, is an indication of good economic standing. Wouldn't that mean that USD: CAD would start to creep up to be even? I am neglecting the fact that interest rates are increasing as well, which applies to student loans, but if that would be the case, why would it still be a problem?

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On 7/16/2018 at 11:59 AM, cleanup said:

A lot of people have been telling me lately the associateship/job market has been pretty shit for the past year as well; the worst they've seen. It will only be worse in 4 years when you graduate.

 

I mean, isn't that the case in almost all professions? 

 

On 7/16/2018 at 11:59 AM, cleanup said:

I'm always one to play devil's advocate, but I don't think you quite realize the gravity of spending a decade after school paying off student loans, and how greatly that affects your life.

 

Well... Shit.

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3 minutes ago, 3booodi said:

Fair enough. The things that is looking optimistic is the increase of the prime rate in Bank of Canada, which in my understanding, is an indication of good economic standing. Wouldn't that mean that USD: CAD would start to creep up to be even? I am neglecting the fact that interest rates are increasing as well, which applies to student loans, but if that would be the case, why would it still be a problem?

It's dangerous to assume that a hike in the overnight rate to be an indication of good economic standing. The BoC has one simple mandate: to keep inflation within the target range of 1-3%. Inflation has been running quite high in the 2.5% region. The general more expensive tuition in the states + rising interest rate will already crush you, even if you assume USD:CAD  is 1:1. 

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31 minutes ago, 3booodi said:

Fair enough. The things that is looking optimistic is the increase of the prime rate in Bank of Canada, which in my understanding, is an indication of good economic standing. Wouldn't that mean that USD: CAD would start to creep up to be even? I am neglecting the fact that interest rates are increasing as well, which applies to student loans, but if that would be the case, why would it still be a problem?

The US has been raising their rates as well so I wouldn’t expect CDN to skyrocket.  

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2 hours ago, 3booodi said:

Fair enough. The things that is looking optimistic is the increase of the prime rate in Bank of Canada, which in my understanding, is an indication of good economic standing. Wouldn't that mean that USD: CAD would start to creep up to be even? I am neglecting the fact that interest rates are increasing as well, which applies to student loans, but if that would be the case, why would it still be a problem?

I mean.....sort of ha. Of course it is complex but really the canadian dollar's value is based on how much other countries want our goods relative to how much we want theirs. The key is to buy something from a Canadian supplier you need Canadian dollars and Canadian dollars are limited in supply. It takes a bit to get your head around (well it did for me) but dollars are just another limited commodity that is affected by supply and demand. So when our interest rate goes up for instance IF everyone else's was lower then people would want to buy our bonds, which requires Canadian dollars, which would drive up the cost of those dollars (more demand, same supply) and cause a relative increase in value of our dollar to other countries. 

If however all the countries the world - or at least the ones that are at our level in terms of stability - have the same interest rate then nothing changes from an increase directly. If people want something we have - in many cases that is oil as an example- then our dollar will raise. If someone - say the middle east for instance increases production though, people don't want our oil as much as they can get it elsewhere, and our dollar can falls. It is very complex interaction of a ton of forces. 

That all being said, and I will say it again, NO ONE has any clue what is going to happen in the short term with the economy, interest rates and so on. It is just because the markets are not ruled solely by logic - people are "dumb panicky animals" and behave irrationally. That causes things to move in all kinds of ways that even the best experts cannot follow (which is why most mutual fund companies by a landslide underperform the market with costs considered - it isn't a problem you can solve by doing math)

The best you can do is the long term average which we are actually not that far from - say 1.25 US to Can since 1990. The swings are dramatic through. Still when you are sitting exactly at around the average point you cannot be too optimistic things are going to dramatically rise. 

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1 hour ago, rmorelan said:

I mean.....sort of ha. Of course it is complex but really the canadian dollar's value is based on how much other countries want our goods relative to how much we want theirs. The key is to buy something from a Canadian supplier you need Canadian dollars and Canadian dollars are limited in supply. It takes a bit to get your head around (well it did for me) but dollars are just another limited commodity that is affected by supply and demand. So when our interest rate goes up for instance IF everyone else's was lower then people would want to buy our bonds, which requires Canadian dollars, which would drive up the cost of those dollars (more demand, same supply) and cause a relative increase in value of our dollar to other countries. 

If however all the countries the world - or at least the ones that are at our level in terms of stability - have the same interest rate then nothing changes from an increase directly. If people want something we have - in many cases that is oil as an example- then our dollar will raise. If someone - say the middle east for instance increases production though, people don't want our oil as much as they can get it elsewhere, and our dollar can falls. It is very complex interaction of a ton of forces. 

That all being said, and I will say it again, NO ONE has any clue what is going to happen in the short term with the economy, interest rates and so on. It is just because the markets are not ruled solely by logic - people are "dumb panicky animals" and behave irrationally. That causes things to move in all kinds of ways that even the best experts cannot follow (which is why most mutual fund companies by a landslide underperform the market with costs considered - it isn't a problem you can solve by doing math)

The best you can do is the long term average which we are actually not that far from - say 1.25 US to Can since 1990. The swings are dramatic through. Still when you are sitting exactly at around the average point you cannot be too optimistic things are going to dramatically rise. 

That made sense. By the looks of it, going for any health care profession in fact, is somewhat of a financial suicide if one is coming back here. The reason that I asked this question is me being curious on how Canadian students that want to come back to Canada deal with this debt. I am also asking this because I had a chat with a D4 who stated that few of his colleagues made from 150-180K USD, so after taxes that would be 100-130K$ USD, which in relative terms can be comparable to a Canadian student's debt from a Canadian school.

It seems if one goes that route, he will end up having a total in assets that's comparable to a starting engineer, for example. Really puts things in perspective.

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On 7/16/2018 at 8:59 AM, cleanup said:

Case gave me a large scholarship and even then it was still more than going to U of T, where I ended up, both numerically and due to the exchange rate which only got worse over the 4 years I was in school.

A lot of people have been telling me lately the associateship/job market has been pretty shit for the past year as well; the worst they've seen. It will only be worse in 4 years when you graduate.

 

I'm always one to play devil's advocate, but I don't think you quite realize the gravity of spending a decade after school paying off student loans, and how greatly that affects your life.

I thought Canadian students aren't able to get scholarships from U.S. schools? 

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On 7/19/2018 at 5:22 PM, cleanup said:

Why wouldn't they be?

State schools maybe. But Case Western is a private school.

 

On 7/21/2018 at 8:37 AM, Starburst said:

They definitely can based on academic merits and awards.

 

Ah ok, I think I might have misread from somewhere. Do you know approximately what type of grades/DAT score you need in order to receive a scholarship?

if you don't mind me asking cleanup, what were your stats and how much of a scholarship did case offer you? I'm also planning to apply there.

Thanks!

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20 hours ago, themuffinman11 said:

 

 

Ah ok, I think I might have misread from somewhere. Do you know approximately what type of grades/DAT score you need in order to receive a scholarship?

if you don't mind me asking cleanup, what were your stats and how much of a scholarship did case offer you? I'm also planning to apply there.

Thanks!

I can't remember my AADSAS GPA exactly but it was around 3.9. I had a 23AA, 26RC, 26PAT. The scholarship was $15k USD a year. It may have gone up since then due to rising costs.

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