Paying off Dental School Debt?

[fretting]

Sorry if I sound out of the loop here but how do new dental graduate students pay off their debts? I honestly don't know much at all about how debt repayment works but I know interest builds up pretty fast. Is it normal to graduate with $275/300k of debt? How long would it realistically take to pay that off? Do new graduates opt for living frugally and paying it off right away?

I know the answers will depend case by case and lots of variables need to be factored in but I'm only asking generally because I'm pretty panicked right now - just got into dental school with barely any savings and I will not have financial support from my parents which is fine as I know many are on the same boat. 

Thanks!

 

[orgolover]

I wonder what would be the case for people going to US dental school. 

[drown besk]

Is paying off 300k of debt in 3 years reasonable as a dentist working in subdural area in Montreal/Toronto/Saskatchewan?

[Coronaxtra]

30 minutes ago, malkynn said:

I literally don’t know how many ways I can say this: it depends. 

It depends how much you make, it depends what kind of housing you want, it depends on how much you want to prioritize debt repayment over all other places you could put your money, it depends if you are dual income, have kids, want kids, are willing to live with family/ roomates, etc, etc. 

Do some math. 

Look at what you may make as an income, calculate your taxes, look at your take home income and subtract what you think you will need to live on, and then see what’s left over. 

300K in three years on a single income in an expensive city is more than a little insane unless you are really committed to keeping your costs super low. 

I you’re going to pull an Early Retirement Extreme kind of lifestyle, then yeah, it’s very doable if you manage to find work where you are fully booked 5 or more days a week...you just might not like the trade offs.

Again, it depends on how important it is to you and just how little you can manage to live on. 

Personally, it’s not what I would do, that level of frugality is too much for me, but I also wouldn’t buy an 800K home either. We all have our priorities. Figure out yours, work backwards from there. 

I started by crunching the numbers as to what it would take to retire before 50 and I worked backwards from there to see if I could do it working only part time. That included what it would take to pay off our debt and save enough to retire on. Then I looked at what that would allow me to spend and decided if I was okay with that number.

i based my lifestyle on that number, not the other way around  

 

Were you able to budget for vacations during the year or was that something you had to trade off? I'm assuming to pay down your debt quickly and retire by 50, you'd have to drive a used car like a civic, eat home cooked food and cut down on entertainment expenses while working 3 days a week. Or am i wrong?

[Zaandrei.]

^ Nothing wrong with civics

Again the answer to that is: "it depends." If you're making 150k in Windsor it's complete different than if you're making 175k in Toronto. Shared living with a significant other is another big factor: means shared costs of almost everything. "it depends."
 

[rmorelan]

22 minutes ago, Zaandrei. said:

^ Nothing wrong with civics

Again the answer to that is: "it depends." If you're making 150k in Windsor it's complete different than if you're making 175k in Toronto. Shared living with a significant other is another big factor: means shared costs of almost everything. "it depends."
 

ha seems like the common theme - personal finance is personal after all. It will always depend

anyone can retire at 50 - the question is what kind of lifestyle do you want for the following say 30-40 years. 

I know the MD side better than the dental - how many dentists actually retire around then, and how many want to? I know in medicine that is rare because of both not actually saving and also not really a lot of desire to actually retire quickly. 

[rmorelan]

21 minutes ago, malkynn said:

I know A LOT of dentists who want to retire ~50-55. The work is very physically strenuous and a lot of people’s eyes don’t keep up after that age. Whether they actually save enough to do so...that’s another matter.

Obviously not everyone. I also know plenty of dentists happily trucking along at 70. 

Me? There’s no effing way I’m putting my body through this after 50. Nope.

 

ha, figured you would be the expert - relatively short career span but just again reinforces the ideal of everyone has their priorities. 

 

[DDSER]

https://www.amazon.ca/White-Coat-Investor-Personal-Investing/dp/0991433106/ref=sr_1_1?ie=UTF8&qid=1526948028&sr=8-1&keywords=white+coat+investor

Buy this book. 

IMO you have nothing to worry about if you have a plan. Like Malkynn said find what your priorities are and what you want out of your life. If you have ambitions to be a practice owner my advice would be to make minimal payments on your loan until you either acquire or build a practice. Even then, don't forget about the time value of money. If you can make more than prime-0.25 in your investments, put your money in that rather than paying off this loan. With such low interest rates, you can do so much more with your hard earned money than simply paying off this debt. 

[Ostracized]

5 hours ago, drown besk said:

Is paying off 300k of debt in 3 years reasonable as a dentist working in subdural area in Montreal/Toronto/Saskatchewan?

There’s a massive difference between these places.  I recently learned from a presentation on Canadian dental economics that Saskatchewan is the province with the highest GDP-to-dentist ratio.  Saskatchewan doubles Ontario in that Category and nearly Quadruples Toronto.  Basically, Saskatchewanian dentists have access way way more disposable patient income.  

I graduated 6 years ago and my actual debt was somehow lower than 6-figures.  I paid it off in roughly a year by moving back with my parents and not spending any money.  If my debt was $300k I figure it would have taken me 4-5 years of living at home and not being a proper adult.