The Deceptive Income of a Physician

[Renoir]

Interesting but go easy with the huge wall of text please

 

Everything is simple in the land of simple, isn't it?

[futureGP]

it is actually pretty grim for our colleagues in the south.

 

1. years of education post-grad that can cost up to $60000/annum (x8)

2. more years to spend in residency/fellowship

3. after all done to realize all the paperwork with insurance companies + malpractice insurance + fear of being sued etc

 

some physicians in the US are sooo miserable that I can't even imagine the pain (no matter what medschool you graduated from)

 

I honestly think it's a LOT better in Canada and MD is still a very very good career

 

ugrad of 3-4 years (3000-7000k tuition/annum - scholarships/bursaries)

medschool of 3-4 years (5000-20000k tuition/annum - scholarships/bursaries)

resident salary starting at 50k + good benefits from union

single-payer system -- less worry about paperwork, cheap malpractice insurance, great pay considering a socialized system --- you can really focus on medicine instead of all other junk

 

 

purely financially speaking, i think we have it pretty good. a typical ontario MD student will graduate with ~100-120000$ debt (incl. ugrad/med school) if they managed their finances pretty well (bursaries/scholarships, cook everyday, used car, cheap apartment -<$800/mth, reasonable entertainment)

 

It is probably lower for medical students in other provinces where tuition is cheaper (e.g. Alberta/sask/man/qc/eastern provinces)

 

i am looking forward to paying back all my debt by 2nd-3rd year of residency which isn't that bad.

 

 

 

D-Rock's situation is quite unique imo. He has a family with a stay-home mother plus 2 kids.

 

I would say many medical students aren't like that so have less things to worry about (Even if you get married at pgy1-3, many marry within medicine so probably working)

[thebouque]

Everything is simple in the land of simple, isn't it?

 

I guess it is but I don't live in such a land. Do you?

 

All your reasons to choose medicine are laudable . However those are mostly ''theoretical'' reasons, the reality of clinical practice might seem very different from what you're expecting. I think you should definitely consider pathology as a career eventually!

[Renoir]

...

[fugacity]

Here are some practical stats from experience:

 

Debt is the most stressful situation in my life, despite the long work hours, tests, family issues, etc.

 

The stress does sound awful. As a first year student, the general consensus seems to be that debt is capped at M4, and better days begin after that. This does make me want to be more sensible with my LOC.

[rogerroger]

The stress does sound awful. As a first year student, the general consensus seems to be that debt is capped at M4, and better days begin after that. This does make me want to be more sensible with my LOC.

 

This is not totally true. I know many residents who live in expensive cities and or have dependents and must still dig into their LOC.

[Leon]

This is not totally true. I know many residents who live in expensive cities and or have dependents and must still dig into their LOC.

 

This is kind of concerning. Do you know how long it takes people to pay back everything once they are in practice? (I know there are tons of variables involved but a general idea would be nice). There are people saying they pay everything back in 2 years and then there are others saying it takes them over a decade...

[rmorelan]

This is not totally true. I know many residents who live in expensive cities and or have dependents and must still dig into their LOC.

 

the general rule I hear is if you can prevent your debit from growing further in residency you are doing pretty well. Right now at rock bottom interest rates people are often incurring 400-600 dollars in interest payments a month to their LOC. That can obviously slow down things. You say some math in an earlier thread - it was not unrealistic number wise.

 

The big big issue is what happens when interest rates rise. 3 percent is a record low - even a quite reasonable 5 percent for many would create 600-800+ dollar a month repayment scenario, which is after required expenses a huge part of your disposable income to say the least

 

Right now the government is signalling those rates will remain pretty fixed into the low territory into 2015 or about 1.5 years by some estimates (subject to change of course).

[rogerroger]

The stress does sound awful. As a first year student, the general consensus seems to be that debt is capped at M4, and better days begin after that. This does make me want to be more sensible with my LOC.

 

This is kind of concerning. Do you know how long it takes people to pay back everything once they are in practice? (I know there are tons of variables involved but a general idea would be nice). There are people saying they pay everything back in 2 years and then there are others saying it takes them over a decade...

 

Well if you live like a resident as a newly minted staff you will pay it off in a few years. Just live on 40-50k. This is totally doable if your debt is within the norms reported. The 100-200k range.

 

With all this said, you gotta keep a very close eye on the LOC. If you fail to do this you will make the following old saying come true in undesirable ways:

 

Live like staff as a med student/resident live like a resident when staff.

[ArchEnemy]

Here are some practical stats from experience:

 

PGY-4

Family of four, spouse at home

33 years old

 

Current debt:

NSLC: 86,000

LOC: 190,000

Family loan: 40,000

Total: ~$316,000

 

If you don't mind me asking, how many years of prior education did you receive before gaining admission into medicine? It seems your NSLC debt is way higher than most people. In Ontario, debt for academic years are capped at $7300. I am not sure if other provinces have benefit too.

[NLengr]

This is not totally true. I know many residents who live in expensive cities and or have dependents and must still dig into their LOC.

 

I'll second this.

 

Your number one goal in med school financing should be minimizing debt while not impairing education. Extras can wait. The burden of debt during residency is extremely stressful. I can't emphasize this enough.

 

Way to many med students get suckered by the lure of easy money and spend way way to frivolously.

[obi]

Another key consideration in marital / relational status..Given that they bill the same in any given year a single cardiologist with no long-term SO and a married cardiologist with 2 kids will have massive variation in their ability to pay down their loans.

 

I can't emphasize this enough.

 

Way to many med students get suckered by the lure of easy money and spend way way to frivolously.

 

.... ****.. Time to budget more tightly.

[ubcredfox]

I'm gonna back NL on this one.

 

DEBT IS THE MOST STRESSFUL THING YOU CAN POSSIBLY HAVE.

 

Given the current structure of society, if you own other people large sums of money, you can rest assured that they own you.

 

Minimizing debt through med school and paying it off through residency ensures that you will have both career and personal flexibility when you graduate from residency. This provides you with immeasurably valuable time and breathing space to decide where you want to work, and under what conditions you want to work. Part time or 3/4 time isn't an option of if you've got a debt burden of 300G's.

[leviathan]

Debt sucks. Especially when you're barely keeping your head above water with the current 3% interest rate and you know that isn't going to last forever.

[rmorelan]

Debt sucks. Especially when you're barely keeping your head above water with the current 3% interest rate and you know that isn't going to last forever.

 

yup. I mean this is the main issue.

 

The fact that banks will up your loc during residency (scotia for instance wiill do it 15K a year) shows that there is at least enough residents getting into trouble that they are responding. Imaging having 275K in the hole prior to becoming staff.

 

it is easy to say you just have to live poor for a "few more years" post residency to pay all this down. That is completely true and probably the way it should be. I have heard that for many they just cannot keep that up though - 15 years of reigning it in already, plus family pressures can really have an impact.

 

If you lived like a resident of last year in a 5 year program you would earn about 75K. If you are instantly earning 300K after overhead etc (which is for many really on the high side) as a staff somewhere (which would be nice) and took it all out as salary to pay things off you would have a scenario like 300K is 180K post taxes (assuming no really tax credits etc, just base rates). You need 60K after tax to equal 75K in salary pretax so you get 120K in hand just to stay where you are. You could pay off at best then your 250K LOC including interest in about 2.5 years.

 

There are a lot of really positive assumptions in all of that - your insurance costs will rise, immediate job, moving expenses, it ignores the 3 month lag in getting money from the government, that salary after overhead etc is really good, interest is really, really incredibly low, added costs of potentially a family....and so on. After to do all this in theory you might want a house etc and for many that means you may need to keep going on for a year or so more to get a low downpayment (potentially).

 

Now you really are 35-40 after all that

 

I did go over on another thread why doing this that quickly is probably a bit dumb as the interest savings compared to tax costs have to be considered. Still as a thought exercise it is good to go through!

[futuredoctors]

It's really not high....you can't come into medicine for the money...

[rmorelan]

It's really not high....you can't come into medicine for the money...

 

I will add one point to that - compared to other areas perhaps medicine is not that great. Compared to this you can do with a strong interest in science though medicine probably is extremely good.

 

There is an assumption often given that anyone that is good at medicine could be good at business. Some cases absolutely true. For others I just don't think so. I don't think there is a really strong overlapping skill set there

[D-Rock]

If you don't mind me asking, how many years of prior education did you receive before gaining admission into medicine? It seems your NSLC debt is way higher than most people. In Ontario, debt for academic years are capped at $7300. I am not sure if other provinces have benefit too.

 

It's because I have dependents, and you get additional funds in those cases. After completing undergrad and premed, I think I only had about $6000 in student loans and no LOC.

 

As people say, you have to be realistic and sensible with your spending and financial plan while in med school and residency. It's true that I have a larger debt than average, but I know a number of residents who are not far behind because of regular trips to Hawaii/Vegas, weekends out, ski passes, new car, etc. There many reasons why it can escalate quickly.

 

Still, I anticipate paying it off about 3-4 years into practice, at which point I'll hopefully be in the same city, living in the same house, driving the same cars. If that doesn't pan out, at least I'll have the equity from my house (~$140,000) to use against the debt.

[D-Rock]

i am looking forward to paying back all my debt by 2nd-3rd year of residency which isn't that bad.

 

Hopefully you can, because that would be ideal. However, it is probably not likely if you carry in $100,000 once starting residency.

 

If you treat it like a mortgage, assuming you can pay $2000/month and use your entire tax refund each year ($10,000, but often less), it will take 38 months to pay it back. If you drop your monthly payment down to $1000/month, then that increases to 58 months.

 

That's why the aim of many people in residency is to stop the hemorrhaging and come out the same or (hopefully) lower than coming in. Life is expensive in many cities, and it's a tough battle to win.

[D-Rock]

I'm gonna back NL on this one.

 

DEBT IS THE MOST STRESSFUL THING YOU CAN POSSIBLY HAVE.

 

So true.

 

But on a side note, I saw your change in path (no pun intended) and hope things are good. Miss you out west. If you come out, give me a call and we'll climb a mountain.

 

DR

[ArchEnemy]

I'm envious of my fellow friends in Quebec who have significantly less debt

[rmorelan]

I'm envious of my fellow friends in Quebec who have significantly less debt

 

probably as much as they envy our increased salaries

 

I just heard from an attending last week that they cannot get a discounted parking cost either - meaning to own a car requires an insane amount to actually park each day.

[fugacity]

The stress does sound awful. As a first year student, the general consensus seems to be that debt is capped at M4, and better days begin after that. This does make me want to be more sensible with my LOC.

 

Looking back at my post now, I realize I had meant to say that the consensus among M1's seemed to be light at the end of the tunnel that is R1. Clearly the tunnel is a lot darker and longer than previously imagined.

[rmorelan]

Looking back at my post now, I realize I had meant to say that the consensus among M1's seemed to be light at the end of the tunnel that is R1. Clearly the tunnel is a lot darker and longer than previously imagined.

 

Maybe R2 (?) I mean there is a lot of moving, setting up a place, settling etc that happens in R1 with a comparatively low salary. There is a nice 8K+ a year bump in R2 that looks useful

 

I am about 1/2 way through R1 now and am well on the saving path at this point. Just getting into the routine etc.

[aaronjw]

Unless you have family, how does someone spend into their LOC as a resident? Arent you working or sleeping all the friggin time? Lol