Desperate PGY4 psych resident - advice for personal loan while still in residen?

[ericfriedmanmd]

Hi,

I'd like some advice as to a personal loan while still in residency.

I'm a fourth year psych resident, and will be getting out of residency next summer.  I have no debt and $35K net worth, all in a savings account. My wife does not work and we have been subsisting on previous savings (now depleted) and gifts from relatives.

Due to serious unexpected health issues with my wife and one of my three kids, I'm going to have to hire a nanny for at least one year, basically to prevent my household from totally falling apart before I graduate.

I am seriously thinking about taking out a loan for $30-50K, in order to pay for a nanny. Any suggestions as to where is the best place to obtain such a loan?

Thanks!

A desperate PGY-4 on the East Coast 

[The White Coat Investor]

Well, you can use that $35K in the savings account to start. That would allow you to borrow less. But there are a lot of folks who do loans like this including blog sponsor SoFi. Sometimes they're called "transition to practice" loans or similar, but it's all about the same. 0% credit card loans may also work.

Check your mailbox. I feel like I get one of these offers a month. The interest rate is never very good though.

But I'd explore all my other options before doing this including moonlighting and getting family to come help (including paying them if necessary.)

[Dr. Mom]

Could you consider an au pair?  Cheaper than a nanny.  We had far better experiences with au pairs at that stage of our lives than nannies.

[The White Coat Investor]

Excellent idea. I guess that was what I had in mind for a nanny. How much less does an au pair cost?

[Dr. Mom]

The White Coat Investor wrote:

Excellent idea. I guess that was what I had in mind for a nanny. How much less does an au pair cost?

Click to expand...

It has been a long time since we used one.  It was far less than a nanny.  Can't imagine it would be close to $30-50K.  You cover their living expenses plus a small stipend in exchange for child care.  The quality of the people applying through the au pair program was much higher also.

[Anesthesia84]

We have an au pair. It works out to less than 20k per year. Their stipend is about $200 per week for 45 hrs of childcare. There are also agency fees which is where the rest of the money goes. Potential downsides - they need their own bedroom and you have to feed another adult. Our au pair eats what we eat or spends her own money to get her preferred food if she doesn't eat with us and since we are already cooking for 5 it's not that hard to just scale up for one more so I'd say that cost is negligible honestly. (Our main other costs are car insurance since she has to drive the kids, having a third car, and since we bought a house with a guest/ in-law space for her, heating/ electricity for her space.) There are a ton of benefits though and we LOVE having her here!

If you have any questions I'm happy to answer them.

[MrsIMDoc]

Agree with using the savings account first.  Depending on your child's medical issues and which state you live in, you may qualify for some additional state help on a resident's salary as well.  For instance, my brother makes $45,000/year but because his child was born premature he qualifies for WIC because of the increased medical needs.

Likewise, some states have optional pathways (independent of income) to Medicaid for children with certain disabilities or medical needs so that they can then be eligible for other services including for in home help.

[The White Coat Investor]

Sounds like a combination of the savings account and the au pair will keep you from needing to take on debt. I'd do that.