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PSLF Specific Scenario

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  • PSLF Specific Scenario

    I am a current medical student, and I began reading the White Coat Investor as a pre-med. I followed the advice to go to the cheapest medical school possible, which is my state school. Unfortunately, it is one of the most expensive state schools in the country, and from my calculations, my debt burden will be ~280k when I graduate. I was hoping to ask you about my specific situation, as my school’s financial aid office was not of much help.

    I plan on pursuing either interventional radiology or cardiology, which will be 6 years of residency/fellowship. My financial plan is to complete my training at a 501c3 hospital, and make payments through IBR during these 6 years. After that, if I am able to work as an attending at a 501c3 institution for 4 more years, I should be eligible for PSLF which would forgive a substantial amount of debt.

    My main question: The MPNs for my student loans include language that the loans are eligible for PSLF. I understand that congress can revoke PSLF any time within the next 10 years. But if I signed MPNs for 4 years worth of loans that were eligible for PSLF at the time, will I be grandfathered into the program in the event that they stop the PSLF in the future? Is there any way to know this?

  • #2
    There isn't, and everyone else who has these promissory notes is in the same boat. The hope/assumption is that we will all be grandfathered in, but I think anyone who tells you it's guaranteed is oblivious.


    • #3
      From the rumblings coming out of this administration, the early indication is that loans starting July 1, 2018, will be the first set NOT eligible for PSLF. Stay tuned...


      • #4
        You might be grandfathered and you might not.  Don't take a substantially lower paying position just for PSLF.

        If you can make about the same money with a PSLF-eligible position as without, then go with PSLF.  Max out your qualified funds, then pay into a taxable account as if you were paying off your loans.  If PSLF goes away, then you'l have the funds to pay off your loan anyway.  If PSLF doesn't go away, then the money in the taxable account is yours to keep.


        • #5
          Great plan.

          It'll likely change. And that's okay. If the government chips in, great. If not, you'll likely make plenty in primary care or a specialty to pay things back. We'll see how things shake out re: PSLF.

          Live like a student for now, try and not make silly choices like a new car, etc. Keep a spreadsheet of all loans, dates for repayment of them, interest rates, etc. Staying organized will set you up for success!

          And have some fun in school too!