Debt

[thesupreme]

I am starting residency with a net debt of $81K (LOC and student loans altogether). I am quite worried as my parents are ageing and they have already signalled that I will need to help contribute financially (which I gladly will do.) 

I am debt averse and would really like to dig myself out of this hole. 

Any suggestions on saving money? 

I am planning on taking public transport to the hospital/work to save on gas. Avoiding to buy coffee/teas. Any other tips and tricks? 

Should I invest a portion of my take-home pay or have all of it go to my LOC/student loans?

[Bambi]

Actually, your total debt is quite reasonable and entirely manageable. I strongly recommend that you pay down your debt as your priority as opposed to investing. The stock market is in turmoil, there are all sorts of geopolitical and economic risks that affect your potential return on investment, so look after your parents as needed, budget wisely and pay down your loan. When in practice, you may employ one or both your parents at the front desk to greet patients, make appointments, field and filter phone calls and you will be keeping them busy and involved, paying them a tax deductible wage for you which is taxable for them at a lower tax bracket. Be frugal but live a life and find yourself a significant other. 

[JohnGrisham]

50 minutes ago, thesupreme said:

I am starting residency with a net debt of $81K (LOC and student loans altogether). I am quite worried as my parents are ageing and they have already signalled that I will need to help contribute financially (which I gladly will do.) 

I am debt averse and would really like to dig myself out of this hole. 

Any suggestions on saving money? 

I am planning on taking public transport to the hospital/work to save on gas. Avoiding to buy coffee/teas. Any other tips and tricks? 

Should I invest a portion of my take-home pay or have all of it go to my LOC/student loans?

Don't do this in bold. Just make your goal of residency to not add extra debt. Your residency salary should be more than enough to maintain your current debt without adding more(even if you are in a HCOL area like toronto or vancouver), and still have a decent quality of life (for the minimal free hours you have). Please don't go barebones for no reason. Obviously, don't go buy a brand new car - drive a used car under 20k, and make it last as long as you can. Your time is valuable and saving a few bucks on gas to take the bus, but add ++ time to your commute might not be worth it. Unless of course you live in an area where transit is actually convenient, and you may actually save time and its not a stressful feat? Then go for it!

Also assuming you have gov't student loans too, that are probably at 0% interest depending on your province?

I assume you have a professional medical LOC? Just put your resident income straight to that, and then use your LOC to pay for whatever bills you have and ongoing expenses. 

No point investing, as you are debt adverse. In theory, you could come ahead if you did...but its small peanuts in the grand scheme once you become staff and make a bigger income.

[JohnGrisham]

Likewise 81k in debt is not bad at all for a Canadian medical graduate, certainly well below average - im guessing  you either had savings/worked or family support or scholarships/bursaries...or are in Quebec haha.

[GH0ST]

1 hour ago, thesupreme said:

I am starting residency with a net debt of $81K (LOC and student loans altogether). I am quite worried as my parents are ageing and they have already signalled that I will need to help contribute financially (which I gladly will do.) 

I am debt averse and would really like to dig myself out of this hole. 

Any suggestions on saving money? 

I am planning on taking public transport to the hospital/work to save on gas. Avoiding to buy coffee/teas. Any other tips and tricks? 

Should I invest a portion of my take-home pay or have all of it go to my LOC/student loans?

I echo @JohnGrisham when you need to value your limited time. Take transit if it's actually convenient but don't go out of your way to do it just to save a few dollars. 

 

Honestly... if you wanted to make some extra dollars consider moonlighting. 

- G

[JTFW]

Chill man... I had 150 K worth of debt when I finished med. Still 150 K worth of debt as a staff in LOC. You will know once you are a staff, you will be fine. 

[shikimate]

You should join some FB groups like canadian physician independence and white coat investors. You'll get a lot of answers just by searching through the posts, I think just last week there were like 2 posts from people with similar question as you had.

[becomingmd]

Are you in FM or 5 year specialty? If you're in FM there's this student loan forgiveness program for $8000 for every year you serve 400 hours in a rural community. I found it helpful personally as family med programs have some sort of rural rotation that meet the requirement. I'm also in the same situation with the aging parents. I suggest you check out breaking bad debt on youtube, I remember there's a good video there about supporting parents financially and paying back LOC and student loans