Expenses:will I spend my whole LOC?

[lovestruck]

My living expenses are about $24000/yr (Rent:$1000/month. Utilities/Food/Other:$1000/month). Tuition is about $22000/year. So after four years, you've got $192000 worth of debt. My LOC is $200000 so I've just spent most of it. How do people figure that you won't spend most of it?

 

There's OSAP too which for me will $70000/4 years (estimated). But at the end of the day this is still credit which I will eventually put onto my LOC. So either way, I've gotten close to my LOC limit. How are people budgeting to not spend most of it? I've got no savings and my parents can't afford to help.

[tberry3]

One thing - for OSAP, some of what you'll get (based on the number you gave) will be a grant, not a loan. I don't know the exact terms, but I think anything you get above and beyond $10,000 in a given year is non-repayable. So if you're in a 4-year program, the maximum amount of OSAP debt you'll have is $40,000 - everything else will just be free money. (For people who know more about this - please correct me if that's wrong )

EDIT: Just looked it up, the $10,000 thing was for Mac since it's a full-year program. For most schools where you go for 2 semesters at a time, you get up to $7300 in loans, and then anything above that is a grant that you'll never have to pay back.

 

On top of that, most schools have their own grants and bursaries that you can get. It all depends on the school and your personal financial situation, but I think generally you can count on at least a few thousand dollars per year from that. I believe there are also external grants/bursaries/scholarships that you can apply for on top of that.

 

I think the OMA also gives something like a $9000 bursary to final-year medical students, although this is largely because of the added expenses in that year (CaRMS applications, flying to interviews, etc) - so I'm not sure how much of it you'll have left for tuition/living expenses, if any.

 

Sorry for the lack of concrete knowledge! I'm still learning about all of this, but those are a few things that come to mind immediately.

[WtsupDoc?]

Max OSAP is $7,300 so over four years is $29,200.

[rmorelan]

Max OSAP is $7,300 so over four years is $29,200.

 

slightly higher as you will have one year of 12 months, which there is 10500 I think at a max. I know, I know, picky, picky - sorry

[WtsupDoc?]

Thanks rmorelan... no apologies needed! I forgot about the 12 month thing. Thanks for correcting me.

[lovestruck]

I think I'm just freaking out about how much money I'll be spending. I come from a lower middle class family and we've never had anything over $1000 debt so this is really scary! I understand that one day I will make enough money to pay it off but the future is very uncertain. What if I get into a car crash and am paralyzed and can't practice or finish school? What if I develop MS? What if I REALLY suck at med school?

 

I'd like to live alone ($1000/month rent all inc) and continue one of my lifelong hobbies ($265/month) so maybe I'm being too demanding and should lower my expectations?

[Orcamute]

I think I'm just freaking out about how much money I'll be spending. I come from a lower middle class family and we've never had anything over $1000 debt so this is really scary! I understand that one day I will make enough money to pay it off but the future is very uncertain. What if I get into a car crash and am paralyzed and can't practice or finish school? What if I develop MS? What if I REALLY suck at med school?

 

I'd like to live alone ($1000/month rent all inc) and continue one of my lifelong hobbies ($265/month) so maybe I'm being too demanding and should lower my expectations?

 

Shhhh. You can do it . I'll see ya there.

[WtsupDoc?]

I think I'm just freaking out about how much money I'll be spending. I come from a lower middle class family and we've never had anything over $1000 debt so this is really scary! I understand that one day I will make enough money to pay it off but the future is very uncertain. What if I get into a car crash and am paralyzed and can't practice or finish school? What if I develop MS? What if I REALLY suck at med school?

 

I'd like to live alone ($1000/month rent all inc) and continue one of my lifelong hobbies ($265/month) so maybe I'm being too demanding and should lower my expectations?

 

 

I hear you, I'm already loosing sleep about how much debt I'm expecting to be in by the end of the next four years. As far as getting into a car crash, you can get insurance on your LOC. Talk to your banker about it. That should give you some piece of mind there. They can't help you about with sucking at med school though

 

As others have stated, there are opportunities to apply for bursaries through your school. Get in touch with your financial aid office also - they are usually pretty good at working with students.

 

Not sure what your hobby is, that is almost $300/month but you could consider scaling back on that, especially if you end up with a lot less free time that what you are used to having.

[lovestruck]

Max OSAP is $7,300 so over four years is $29,200.

 

So wait I'm confused once again. Let's say OSAP estimates me for $10500. They will give me $7300 and I need to pay back $3200. That's for this year since I made income last year. Next year, when I make NO income, I'll be getting around $20000 (no savings, no car, no parental contribution, no assets...I am worthless haha), of which the $7300 is non-repayable so I need to pay back $12700. In the 4th year, rmorelan had mentioned you get $105000 that you don't need to pay back, as its 12 months long, so I need to pay back $9500.

 

So my grand total OSAP debt is: $3200 (first year) + $12700 (second) + $12700 (third) + $9500 (fourth year) = $38100. I'll have used $130000 of my loan so my TOTAL debt is $168100, which is still close to $200000.

 

Am I right?

[WtsupDoc?]

So wait I'm confused once again. Let's say OSAP estimates me for $10500. They will give me $7300 and I need to pay back $3200. That's for this year since I made income last year. Next year, when I make NO income, I'll be getting around $20000 (no savings, no car, no parental contribution, no assets...I am worthless haha), of which the $7300 is non-repayable so I need to pay back $12700. In the 4th year, rmorelan had mentioned you get $105000 that you don't need to pay back, as its 12 months long, so I need to pay back $9500.

 

So my grand total OSAP debt is: $3200 (first year) + $12700 (second) + $12700 (third) + $9500 (fourth year) = $38100. I'll have used $130000 of my loan so my TOTAL debt is $168100, which is still close to $200000.

 

Am I right?

 

Other way around - they would give you $3,200 in grant (non-repayable) and $7,300 is a loan that must be repayed. $7,300 is the annual max that they will loan you.

 

4 years X roughly $7,300 = around $30,000

 

But yes, by your math and budget you will be close(ish) to $200,000 by the end of the 4 years. But keep in mind other opportunities for funding - grants, bursaries, OMA funding, etc. etc.

[lovestruck]

I hear you, I'm already loosing sleep about how much debt I'm expecting to be in by the end of the next four years. As far as getting into a car crash, you can get insurance on your LOC. Talk to your banker about it. That should give you some piece of mind there. They can't help you about with sucking at med school though

 

As others have stated, there are opportunities to apply for bursaries through your school. Get in touch with your financial aid office also - they are usually pretty good at working with students.

 

Not sure what your hobby is, that is almost $300/month but you could consider scaling back on that, especially if you end up with a lot less free time that what you are used to having.

 

Hmm I totally forgot about scholarships. My weighted GPA for UOttawa was 3.99 (last 3 years 3.96,3.98,4.00) so maybe that would qualify me for the few they give to the people with the highest marks in the class coming in (I have very little info about this yet)? Would it be realistic to expect $10000 in grants/bursaries? Considering the OMA bursary is $9000?

[lovestruck]

slightly higher as you will have one year of 12 months, which there is 10500 I think at a max. I know, I know, picky, picky - sorry

 

Your pickiness is an awesome source of information! THanks!

 

My other dilemma is this: I live in Ottawa. I could live with my parents and bus/drive to school. However, I live FAR FAR away from campus. I'd put 25000km on my car (he's already at 200k!) or bus for 3 hours round trip. But I'd save THOUSANDS. Maybe I'm selfish or stupid, but waking up at 5:30 am to bus 3 hours seems ridiculous. The car option costs about $300/month less than renting because of parking and expenses associated (my car currently breaks down regularly and I drive it minimally!) but I'm also a self-admitted terrible driver and afraid of winter driving.

 

As for my hobby, I do need to scale down. I can get to about $140 a month which would be much more realistic.

[schmitty]

As other have said, you will get grants and bursaries most likely.

 

However, don't stress it! You WILL be in debt for a while...but that's part of the sacrifice of pursuing medicine. You are not alone (not by a long shot!) and it is much worse in the US. I too will have a very high LOC - I also come from a low-middle class family, no help at all there, and I don't qualify for OSAP or regular bursaries so my LOC is my only source. I plan on working as much as possible (already have a job for during the school year that pays well) and then using the LOC for everything else. You will get used to having the debt. That isn't to say you should start spending like you are already a doctor, but don't add undue stress to you likely already stress-filled 4 years of med school and beyond over your debt.

[WtsupDoc?]

Your pickiness is an awesome source of information! THanks!

 

My other dilemma is this: I live in Ottawa. I could live with my parents and bus/drive to school. However, I live FAR FAR away from campus. I'd put 25000km on my car (he's already at 200k!) or bus for 3 hours round trip. But I'd save THOUSANDS. Maybe I'm selfish or stupid, but waking up at 5:30 am to bus 3 hours seems ridiculous. The car option costs about $300/month less than renting because of parking and expenses associated (my car currently breaks down regularly and I drive it minimally!) but I'm also a self-admitted terrible driver and afraid of winter driving.

 

As for my hobby, I do need to scale down. I can get to about $140 a month which would be much more realistic.

 

 

I get up at 5AM every day for work and it's terrible. I spent 4 hours a day commuting and wouldn't not suggest that for a med student. How long of a drive would it be? Saving about $300 a month isn't really that much in savings and like you said, if your car breaks down, or you need to buy a more dependable one, the savings are soon eaten up.

 

Speaking from experience (commuted for 5 years during UG/graduate school), it's much better to be close to campus - for involvement in EC's, study groups, other opportunities. Just my two cents though.

[schmitty]

I get up at 5AM every day for work and it's terrible. I spent 4 hours a day commuting and wouldn't not suggest that for a med student. How long of a drive would it be? Saving about $300 a month isn't really that much in savings and like you said, if your car breaks down, or you need to buy a more dependable one, the savings are soon eaten up.

 

Speaking from experience (commuted for 5 years during UG/graduate school), it's much better to be close to campus - for involvement in EC's, study groups, other opportunities. Just my two cents though.

 

I agree....that is too far of a commute for med school - definitely not worth it! I wouldn't want to commute more than MAYBE 45 minutes...

 

BTW, what is your hobby, if you don't mind me asking?

[lovestruck]

I agree....that is too far of a commute for med school - definitely not worth it! I wouldn't want to commute more than MAYBE 45 minutes...

 

BTW, what is your hobby, if you don't mind me asking?

 

According to the schedule planner its 1 hour of busing each way but the bus in Ottawa is on time 60% of the time and the planner assumes you walk off bus #1 and hop on bus #2. I've actually done the commute from home to the campus before and it's about 1hr 20min with wait times each way although once in awhile it'll be just 1 hr!

 

I feel stuck between a rock and a hard place. Convenience vs cost.

 

Do you all think its WORTH $24000 a year?

[Leon]

 

Do you all think its WORTH $24000 a year?

 

Yes.

 

Invest now to maximize your potential while minimizing stress, reap the rewards later.

[schmitty]

According to the schedule planner its 1 hour of busing each way but the bus in Ottawa is on time 60% of the time and the planner assumes you walk off bus #1 and hop on bus #2. I've actually done the commute from home to the campus before and it's about 1hr 20min with wait times each way although once in awhile it'll be just 1 hr!

 

I feel stuck between a rock and a hard place. Convenience vs cost.

 

Do you all think its WORTH $24000 a year?

 

Yes...but the difference is not $24000/year! Your vehicle expenses will be way lower, and all your other costs like cell phone, etc will be similar, so it's really just rent (and perhaps food?). After the car savings and/or bus, it won't be a difference of $24000/year. I, for one, would definitely not be commuting that far for med school. My 30 minute walk is as far as I am willing to go (10 min bike when it's nice out).

[rmorelan]

My living expenses are about $24000/yr (Rent:$1000/month. Utilities/Food/Other:$1000/month). Tuition is about $22000/year. So after four years, you've got $192000 worth of debt. My LOC is $200000 so I've just spent most of it. How do people figure that you won't spend most of it?

 

There's OSAP too which for me will $70000/4 years (estimated). But at the end of the day this is still credit which I will eventually put onto my LOC. So either way, I've gotten close to my LOC limit. How are people budgeting to not spend most of it? I've got no savings and my parents can't afford to help.

 

First for most schools you will be living quite well - my expenses were no where near yours (not 2K a month), but for some locations/people that is probably reasonable.

 

People are very right about that OSAP debit being reduced to about 33K or so. That is a big drop of course. Then for many there is significant bursaries - for me say 15-20K or so. You get 9K in 4th year to cover all the extra CARMS expenses you didn't mention so lets say that is revenue neutral. We are already knocking off 55K or so. Since you are using full OSAP you are also reducing your interest payments effectively as well which helps (you didn't factor in paying interesting in your model).

 

You also have added in the cost of a bunch of months there (school end in April of your last year. That is 4-8K less than you are factoring in depending on when you move etc. Every bit counts

[future_doc]

Convenience is far more important to you.

 

I live w/i a stones throw from med school. I would not consider such a commute.

[rmorelan]

I think I'm just freaking out about how much money I'll be spending. I come from a lower middle class family and we've never had anything over $1000 debt so this is really scary! I understand that one day I will make enough money to pay it off but the future is very uncertain. What if I get into a car crash and am paralyzed and can't practice or finish school? What if I develop MS? What if I REALLY suck at med school?

 

I'd like to live alone ($1000/month rent all inc) and continue one of my lifelong hobbies ($265/month) so maybe I'm being too demanding and should lower my expectations?

 

Disability insurance

 

In a sense this is a wake up call the real world for all incoming medical students Things do happen to people all the time but there are always ways of minimizing the damage. Insurance is an extremely cheap way to protect yourself and the problems you mention are not unique to medical school - anyone with a mortgage should have the same fears.

 

Not to be melodramatic but I am covered 6 ways to Sunday on things like this.

 

and you are not too demanding, you are making a choice. We should always be debit adverse - that is logical and if you look around you see what happens when people aren't. I have seen people in and outside of medical school doing some really stupid things and have to pay for it. Your concern is useful, don't ignore it, but don't let it lead you to act irrationally either. I am from a family that could only be called lower class - first person to graduate high school actually. It is probably this background that got me thinking about financial matters in the first place

 

You will have significant room left over in your LOC when you are done. Literally thousands have gone down the path you are starting out and done fine. You will earn a good income, more than enough to pay of the loan in a logical time frame. The highest priority for medical school has to be figuring out what type of doctor you want to be, and match into that field. Figure out what the impact of a 3 hour daily commute would be on that.

[future_doc]

As a non smoking 25 year old, $1M of 10 year term insurance is about $325 in annual premium; insurance for $100,000 or $200,000 is less. Of course, this only covers you for death. I believe disability insurance only covers you if you have an income, so one would not be able to obtain cover I believe before residency.

[deadlybutterfly]

GL. I am in a similar situation, but have managed to save up 20k to give me some breathing room. The advice in this thread has been great so far. it's helped me out a lot too.

[rmorelan]

As a non smoking 25 year old, $1M of 10 year term insurance is about $325 in annual premium; insurance for $100,000 or $200,000 is less. Of course, this only covers you for death. I believe disability insurance only covers you if you have an income, so one would not be able to obtain cover I believe before residency.

 

Actually as a medical student you can get it immediately, and can also get an amount that is higher than you are supposed to based on future income.

 

Now as a resident I have it at a rate even higher than you are supposed to have again as income

[future_doc]

Actually as a medical student you can get it immediately, and can also get an amount that is higher than you are supposed to based on future income.

 

Now as a resident I have it at a rate even higher than you are supposed to have again as income

 

Yes. The broker was recommending even before I get my MD, now, I sign up for $2M of 10 year term life insurance @ $650 annual premium, and once I start practice, I convert the $2M to universal life at about $7,100/annual premium, paid by the company. This is on the basis that at the time of my death the coroporation will have millions and there will be a tax to be paid to remove the funds from the corporation. The death benefit would ease the tax burden and can be paid out tax free as a capital dividend. He suggested that I would eventually want more life insurance. We ran the numbers and for sure, there would be a saving compared to waiting to take out universal life say in 8 years.

 

We also discussed disability insurance. He explained that disability insurance is based upon "personal" income, i.e., not the payments that go into my corporation but rather what I take from the corporation as salary (and dividends I believe). If I take out $100,000 gross, or $62,000 after tax, the annual premium would be about $2,100 and if disabled, the insurance company would pay me $62,000 annually. So, it comes down to how much in after tax dollars does one need to live, and that is the amount of disability insurance cover we would want (provided we actually receive personally these funds as income (and dividends?).

 

And then there is critical care insurance which we did not discuss.