Medical students complaining about student loan debt

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Forums › Finance and wealth management › Medical students complaining about student loan debt

timmmay

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#215192 16-Jun-2017 10:55

According to this NZ Hearld article a student can end up with $100,000 in debt after doing a degree, and that puts people off. It also says because it's so practical, with time spent in hospitals, they can't get part time jobs to help pay for it. It seems to imply medicine is only for the rich, as student loans can't cover all the fees.

Student allowances and loans not covering the costs of the course is concerning. That should be considered. NZ has a shortage of doctors, though it's not near as bad as the UK, where it can take three weeks to get a GP appointment. My wife is from the UK, she's amazed she can call up and often get a same day appointment. Though having said that, I needed a doctor in the UK for something important but not urgent and was seen within an hour.

Not doing a medical degree because of debt is fairly short term thinking. According to the NZ careers website A doctor earns between $115K and $600K. Let's say $375,000 for a competent doctor, mid career. A GP can earn $400K. Yes it will take some time to get there, but they're going to be very well off compared with the vast majority of the population fairly quickly.

I don't think 10 years to pay student loans off would be particularly unusual for any professional degree. The degree gets you the job, but salary comes with experience and ability. To start with you don't pay much off, but as your salary increases you can pay it off quite rapidly.

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#1802009 16-Jun-2017 11:11

If you specialise even more, you can earn even more. I was under the care of a vascular surgeon who left NZ to go to Dubai because he was offered $2m a year tax free...! You do not need to spend many years earning at that rate to be able to spend the rest of your life doing whatever you like.

Certainly my mother in the UK complains it takes her quite some time - weeks, often - to see her GP. If she is happy to see any GP in the practice, she can usually do so within a few days at most. I find here it is very quick - although I do not live in a heavily populated area.

I would think the largest bar to doing medicine is the level of academic achievement required in some quite challenging subjects more than the eventual debt. I think also that the debt is interest free if they are working in NZ?

I do not know what a starting salary for a doctor is but I read an article a few months ago that good law graduates in London are starting on the equivalent of $100,000 a year and I would imagine a doctor must be heading that way given I know of accounts clerks in Wellington earning $50k.

Pumpedd

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#1802010 16-Jun-2017 11:12

What is the taxpayers contribution to that degree?

I read Doctors earn more than any other graduates after 9 years in the workforce. IMO a course that cost the taxpayers huge sums should not be allowed to work overseas until they have at least repaid something significant back to NZ.

Geektastic

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#1802029 16-Jun-2017 11:27

Pumpedd:

What is the taxpayers contribution to that degree?

I read Doctors earn more than any other graduates after 9 years in the workforce. IMO a course that cost the taxpayers huge sums should not be allowed to work overseas until they have at least repaid something significant back to NZ.

I'm not sure that would increase demand for studying these subjects, if that was desired.

kobiak

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#1802060 16-Jun-2017 11:34

Pumpedd:

IMO a course that cost the taxpayers huge sums should not be allowed to work overseas until they have at least repaid something significant back to NZ.

is not that why there's interest on student loan if someone leaves NZ with a student loan to pay.

A year or 2 ago, IRD started to pursue these people

helping others at evgenyk.nz

invisibleman18

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#1802061 16-Jun-2017 11:35

Geektastic:

I would think the largest bar to doing medicine is the level of academic achievement required in some quite challenging subjects more than the eventual debt. I think also that the debt is interest free if they are working in NZ?

From what I understand from people I know who have done it, there is an interview at the end of the first year to decide who goes through to the 2nd year of study and the numbers are significantly cut down. You can feasibly get straight A's and still not go through if you don't interview well. Seems extremely harsh when there are a shortage of Doctors to tell academically capable students that they cannot go onto to further study because someone on an interview panel didn't like the way they spoke. Personality, speaking, confidence, bedside manner etc are surely all things that can be developed with experience, but to tell someone at age 19 who has got excellent grades that they can't study to be a Doctor because of an interview seems ludicrous.

Jas777

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#1802062 16-Jun-2017 11:35

Must be an election coming up? Herald seems to do these type of articles once every 3 years.

Simple solution, have the ability to get subsidised in return for working in areas with shortage or retention problems?

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#1802072 16-Jun-2017 11:54

invisibleman18:
Geektastic:

I would think the largest bar to doing medicine is the level of academic achievement required in some quite challenging subjects more than the eventual debt. I think also that the debt is interest free if they are working in NZ?

From what I understand from people I know who have done it, there is an interview at the end of the first year to decide who goes through to the 2nd year of study and the numbers are significantly cut down. You can feasibly get straight A's and still not go through if you don't interview well. Seems extremely harsh when there are a shortage of Doctors to tell academically capable students that they cannot go onto to further study because someone on an interview panel didn't like the way they spoke. Personality, speaking, confidence, bedside manner etc are surely all things that can be developed with experience, but to tell someone at age 19 who has got excellent grades that they can't study to be a Doctor because of an interview seems ludicrous.

The Auckland interview process way brought in 1990's to try to broaden the make up of the class as pure academic performance was potentially a group of people that were decreasingly reflecting society. IE less socially able Asian nerds.

The debt sounds frightening at the start but if you graduate you will pay off your debt unlike an arts degree or some poly courses.

If the fear of debt is putting off students doing medicine, I would wonder how much those students really understand what a career in medicine involves. IE if they speak to someone who had graduated they would get better idea of what the job entails, salaries want and over what time frame.

The debt is large but you will gain a quality qualification that is a starting point to a career that can go in various directions in several countries.

100k sounds like slot but those graduating in late 1990's had similar debt but with starting salaries half to 2/3 of current starting salary.

frankv

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#1802074 16-Jun-2017 11:55

$100K debt is probably not a big deal for a doctor. But it would be very bad if you didn't actually become a doctor. I wonder what the dropout/failure rate is?

I believe that junior doctors start at about $70K. Bear in mind though, that there are some onerous work levels required... 12hr shifts, 2 days off/ fortnight, etc.

I don't know if it's still the case, but it used to be that the Govt paid 85% of tuition costs, student paid about 15%. I don't know how much of a doctor's $100K debt would be for tuition though.

afe66

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#1802079 16-Jun-2017 12:00

There are also more than one way of getting in.

First year grades, grades obtained over the course of a degree, mature entrance.

This is an attempt to broaden the types of people and backgrounds of the class and hence graduating doctors.

Geektastic

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#1802080 16-Jun-2017 12:00

Also, bear in mind that the qualification opens the door for you to work anywhere in the world, more or less - it's as good as a free passport in many ways.

My childhood dentist in the UK was a Kiwi who moved there permanently and looked after our entire family for over 25 years.

mattrix

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#1802082 16-Jun-2017 12:02

I think life comes down to: risk vs reward.

If you take a risk of a large student loan, your (hopefully) rewarded with a high paying job.

If studying to be a doctor was free - I'd give it a shot - why not.

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afe66

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#1802085 16-Jun-2017 12:05

Drop out rate isn't as high as you would expect.

A number drop out after the first year or so when they discover that actually they don't enjoy it and a few can't cope with the work load but it's much less than for other degrees because of the entrance requirements.

The real hard stuff doesn't start until specialty training when you are competing with your peers from medicine for limited slots vrs other first year students trying to get into medicine. IE 60% pass rates

(studying for exams while holding down full time jobs with shift work)

Geektastic

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#1802098 16-Jun-2017 12:43

mattrix:

I think life comes down to: risk vs reward.

If you take a risk of a large student loan, your (hopefully) rewarded with a high paying job.

If studying to be a doctor was free - I'd give it a shot - why not.

No way I could give it a shot. My understanding of the necessary subjects, especially chemistry, is nowhere near good enough.

I was fine with chemistry when it was just blowing stuff up in the lab. As soon as we got to chemical equations, I am afraid I had no idea what they were talking about and dropped the subject as fast as I could.

sen8or

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#1802106 16-Jun-2017 12:57

My heart was bleeding as I read that article, the poor dears having to spend some money and invest in themselves at the prospect of earning six figure sums!

Assume the debt is $100k.

At the lower end of the pay scale, $70k, your after tax income is around $56k or $1076 per week in the hand, after tax and student debt repayments $ 47.6k or $915 per week in the hand. If they continue to earn only the "minimum salary" of $70k, it will take 12 years.

At the higher end of the scale, $116k, your after tax income is around $87k or $ 1670 per week in the hand, after tax and student debt repayments $72,880 or $ 1400 per week in the hand. If they continue to earn at this level, the student loan will take around 7 years to repay.

At just $ 915-1400 per week in the hand after tax and student loan repayments, how can the poor dotes afford to live? We should start a give a little page to prop them up.........

Even at the lower end (which lets face it, none of them are likely to be on that level for particularly long), it is still well above "average earnings".

Now, ofcourse, it is far more likely that after a year or 3, they would be earning in excess of even the $116k and as pointed out above, $400k pa is possible.This would ofcourse rapidly reduce the time to repay the debt.

If someone said "borrow $100,000 now, you can repay it over 7-12 years interest free, you will earn at least low six figures to start with and then up to $400kpa for the rest of your working life" is that seriously not a good investment to make in your own future?

Self entitled whinging brats.....

afe66

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#1802127 16-Jun-2017 13:52

Yes, I would have kept my head down on this issue if I was the medical students. Yes costs lots but you will be able to pay this on starting salaries much higher than the average person...

Also amuses me about the junior doc complaining about night shifts and weekends.

Do they think that when they become senior docs they won't be coming in to work in the middle of the night? You know the seniors who come in for the hard stuff yet still have to be back first thing in morning....

If you think it's hard doing this in your late 20's, it's no picnic doing it in your 40's, 50's, 60's...

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