Grad school financial planning with my daughter

[grossklw]

Different field but similar schooling and overall terrible ROI for the debt and salary.

I am/was a physical therapist. I graduated 12 years ago and I paid 100k for tuition only in the 3 years I was in graduate school, the cost has nearly doubled since then. I was fortunate my wife was a nurse so we lived on her salary and used loans to pay for tuition during grad school. The starting initial salary for a PT is in the 80k range, so good, but not life altering.

My one key advice I give any undergrad student when job shadowing was apply to as many as you can, and go to the cheapest one if you’re footing the bill. As others have said, once you graduate nobody cares where you went, and I mean nobody. Probably different in the finance or law world, but for the most part in most any medical degree nobody really cares where you went.

 

[Bigred323]

She really wants to be a large animal vet but has little experience with large animals. She has done some training at an few equine farms but that’s about it as far as I know. And not exactly sure why she’s interested in that path specifically. Maybe it’s financial?

Besides finances that’s another one of my biggest concerns with her. She does NOT have thick skin and more often is hypersensitive. You need thick skin in life no matter what career path she takes but she’s an only child, gorgeous, super healthy, hard worker, a 3.9 gpa student and currently single so she doesn’t get much criticism from anyone. Working at a local vet clinic for the last few years has helped her some but she definitely doesn’t not do well with criticism. I’m not exactly sure how to help her with that but will definitely bring it up more often.

I may take you up on that offer at some point. Really appreciate your input

The money unfortunately is not in the large animal business. It’s sad because that is the portion that takes care of our food supply, but people will pay an arm and a leg for fluffy vs a cow that will bring in more at the sale barn than the cost of treatment. A lot of people go into large animal right out of school to get that “itch” but after a few years of lower pay, potential for catastrophic injury, on call hours, and late nights pulling calves, a lot make the switch over to small. It requires a different breed to stay in large animal long term. There can be money on the equine side but you have to get into the right places and big operations and not just work on people’s backyard ornaments. But, equine med is stressful because (sorry to any horse people here) but the horse people are crazy and they love their horses just as much as the small animal side but you’re working on an animal that can be worth a big chunk of change and mistakes can be pretty significant.

And just keep in mind, although she will graduate with a good chunk of debt, it can absolutely be paid back if she makes the right choices. Pay for vets has gone up significantly over the last few years and then starting salary is no longer 75-80k like it was 9-10 years ago. As long as she negotiates the right contract, doesn’t get sucked into the “doctor lifestyle” and lives well below her means for the first few years out of school, the debt can be paid off in a couple of years if the person is willing to do sacrifice.

 

[yfarm]

My son went to college out of state where my family lived, immediately as a freshman he changed his home address to my fathers’ and had a drivers license in that state. He spent the summers in that state during college. Three and a half years later he was accepted into medical school in that state where my father was a professor at that university. He was denied in state tuition, was told he had to work full time for a year and file a tax return before qualifying all because my residence was in a neighboring state.
Few years ago the average educational debt for a finishing medical student in the US was $400,000.

 

[waspocrew]

When I was applying to medical school, there was a guide (MSAR) that showed all available medical schools and the ability to see acceptance data (mean GPA, MCAT scores, etc), along with info on % of out of state students accepted into the class, tuition cost, etc.

Not sure if there's a similar program for Vet schools, but I'd take a look. I used the MSAR to filter and create a list that accepted at least 40% of out of state students into their classes. Try to stack the odds of admission in her favor - apply to as many programs as she can afford. Getting accepted to a program is the first step, then if she has multiple acceptances, she can decide where to go based on tuition, possible scholarships, etc).

Having debt is just part of the process unfortunately. If there are scholarships available, even better. My medical school didn't really offer scholarships, so I came out with ~ 220k in student loans. I just recently paid off my loans (graduated in July 2023).

 

[ben h]

I've heard a good rule of thumb is a 1:1 debt to starting salary is a healthy number, i.e. $100,000 of student loan debt is a good borrowing level for a position that yields a $100,000 salary. If you can beat that ratio with either less debt, or higher income, you're doing great. Conversely taking on $200,000 (or more) of debt for a $100,000 job can leave you financially strained.

It's been a little over 20 years since I graduated and these were reasonable ratios then, but costs have probably increased at a faster rate than salaries making 1:1 less acheivable. On the other hand Waspocrew paid off $220k in 3 years, so maybe salaries are that high?

 

[bbckfh]

I grew up broke. My parents weren’t nearly as well-off as you.
I ended up doing human medicine, but the parallels are pretty similar.
I ended up taking a scholarship from the DoD, in return for years of service. By far one of the smartest decisions I’ve ever made after picking the right wife. The Army is the only military branch with Vets, but might be an option for her?


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[jayhawk]

Look at residency requirements/cost of living in the various schools she has been accepted to. If she moves to the state and waits a couple years and works and saves, she can save tens of thousands and largely offset that debt.

I’m a big advocate of no debt. But as long as it’s managed and the risk is mitigated, it can be useful to get where you want to go. I knew a girl who saddled $300k in loans to become a vet tech making $60k/yr. That didn’t make sense. But $20-30k when you will make $100k+ is doable. As with all things, there’s risk that must be managed.

 

[dr.mooseknuckles]

Also a Veterinarian and don't have much to add to what arrow and big red said.
I'm one of the fortunate few that took out nominal loans and paid off as soon as I graduated. Got some inheritance from my paternal grandmother that covered one year of in state tuition at UGA. My father passed away as well right before I started vet school and his life insurance helped open things up for my mother to help out.

If either you or your wife own your own business, you could potentially pay your daughter in some capacity to help with living expenses. My mother owned a couple of automated car washes, so I was on the books as a carwash consultant. Talked with my mother about the business for 2 hours a week and that paid for my rent and majority of my food.

Playing devil's advocate, and because of your response to bigred, I would try to steer your daughter away from this profession. I don't think I would want any of my children to do it. I'm good at what I do, and am never bored, but the mental toll can be a lot. You can do everything right within the owner's budget and expectations, only to have things go to crap, and have pissed off owners. The equine world would be worse too. Horse folks are nuts.

Her debt to income ratio will be bad, especially if she goes into large animal/equine field, adding to the stress level. I'd tell her to go to medical school and work toward being an anesthesiologist.

The Army does have a loan forgiveness program for Veterinarians. You have to join up for 2-4 years after graduation. There's also programs for working in underserved areas, particularly large animal, where you can get full loan forgiveness after working in that area for a certain period of time.