Is $40k in Undergrad Debt Manageable for a Future PhD Student?

[Ritzycat]

Hi friends

I am a high school student and I'll be going into college next year. I will likely be attending Grinnell College, with the initial intent of majoring in physics. (I do not need the talk of possibly changing interests, I realize that; I am planning for all possible outcomes) It is of comparable price to the other schools I have been accepted to (after need-based financial aid and scholarships are applied). I am looking at around 40k debt by the time I graduate from undergrad. 23k of those loans will be subsidized federal ones that I can defer interest accumulation until I finish school altogether.

If I am possibly considering getting a PhD at some point, is this too much debt? Is it doable or possible? The only major concern I have with doing this is that it may be hard to pay off on a post-doc salary if I decide to go that route.

 

[ZapperZ]

A large number of physics graduate students receive some form of assistantships for either part or their whole graduate program. Read Part IV of this essay:

https://www.physicsforums.com/threads/so-you-want-to-be-a-physicist.240792/

Zz.

 

[Ritzycat]

Thanks for your response. I read Part 4. I understand that most PhD students receive assistantships for the duration of the program. However, I am more concerned about how having 40k in student debt from undergrad will affect my quality of life as a post-doc researcher making a fairly low salary.

Are the assistantships usually big enough so that you can pay some loans off while you are still in graduate school?

 

[radium]

Yes, you can definitely start to pay off your debt in grad school. When I was admitted to grad school the stipends I was offered ranged from ~$22,000 (University of Illinois where it's very cheap to live) to over $35,000. If you get the NSF fellowship, the stipend will be going up to $34,000 starting this summer. So if you were to live frugally, which quite honestly is not hard as a grad student if you find cheap housing, you may be able to set aside a considerable amount.

 

[Ritzycat]

Alright--I had heard elsewhere that I shouldn't expect to pay off any loans on a grad school stipend, but now that I think about it, 'twas not the most accurate source.

That being said, is 40k undergrad debt something that can be doable?

 

[donpacino]

40k is doable. Something to think about, as long as your are attending school and taking 6 credits per semester you can defer your student loan payments.

 

[jtbell]

So if you were to live frugally, which quite honestly is not hard as a grad student if you find cheap housing,

In particular, share an apartment near campus and don't own a car. When I was in grad school, I shared an apartment with another physics grad student, and didn't own a car until my last year there. I bicycled a lot, walked, and used public transportation occasionally. It helped a little that my roommate had a car so we could do a big grocery-shopping trip once a week, but I also bought groceries using the panniers on my bicycle.

Fortunately, I didn't have any debts to deal with because this was back in the days when a firefighter and a secretary could afford to send a kid to a small private college. I had enough money left over from my stipend for a couple of trips to Europe.

 

[Ritzycat]

Thanks for the responses, guys. What is the absolute MOST one should reasonably take out in loans if they are considering a PhD?

 

[Vanadium 50]

What is the absolute MOST one should reasonably take out in loans if they are considering a PhD?

Nobody can answer that but you. Understand that postdocs do not make a ton of money, and that by that time in one's life one often has a spouse and maybe a child or two, and there are corresponding expenses. Grinnell is a factor of ~2 more expensive that Iowa State in-state tuition. I think you need to ask yourself if this is worth it to you or not. And nobody else can answer this but you.

 

[Ritzycat]

Grinnell meets 100% of demonstrated financial need. I also received a scholarship. They offered me 45k/year in grants, loans, and work-study. This reduces the cost to 13k/year. Only those who do not apply for financial aid pay the sticker price on Grinnell's website.

I am also not an Iowa resident.

In contrast, an in-state school I applied to, Missouri University of Science and Technology, offered me 8k in scholarships and grants. Thus my cost there is 10k/yr with the Federal Direct loans. It is a difference of about 9k over 4 years compared to Grinnell. I personally believe 9k more is worth it over 4 years because Grinnell has many other facets and opportunities I am interested in.

The reason I ask that question is because I have no idea what type of lifestyle I can life on certain debt and income as a graduate student. I am asking for insight from people who have been through this process before, because my mother did not go to a 4-year college and my dad was paid for completely by grandfather, and he didn't go to graduate school after. Thus I cannot reasonably answer my own question on what would be the maximum amount one can feasibly take out and not die.

 

[Vanadium 50]

Grinnell meets 100% of demonstrated financial need.

And yet you still need to take out $40K in loans.

The point is that you are paying more to go to Grinnell than the alternatives. Up to $40k more. You need to determine if that is a good idea. In some cases, you think it is - although the point could be made that if you don't understand the lifestyle tradeoffs you will be making on the payback end that this decision is not as informed as it might be.

$40K at 4.66% with interest for 6 years of graduate school works out to $52,571. Paying this back over 10 years is $6587 per year, for a total interest on the loan of $25,868. You should already have these, or equivalent, numbers calculated before even thinking about a loan. Any loan. The average postdoctoral salary is $44,000 or so, so you are looking at the equivalent of a 15% pay cut.

Only you can decide if this is worth it or even acceptable.

 

[Ritzycat]

Grinnell is only marginally more expensive than the other schools I have been accepted to. It is certainly not 40k more. It is 9k more than my cheapest option that I've been accepted to. If I will not starve with 9k extra loans I believe it is worth it. Grinnell even requires research projects of all science majors, you get a $3,500 stipend for doing one !

Although the point could be made that if you don't understand the lifestyle tradeoffs you will be making on the payback end that this decision is not as informed as it might be.

Hence why I am asking here. Part of my misunderstanding is that I do not know how much one needs to live. I know little to nothing about what it costs to rent an apartment, buy food for myself, pay for internet, especially in areas of varying costs of living. I really do not know how much I should take out if I want to have enough money to not die (before anyone jumps on this--the last sentence is a hyperbole).

Thank you for your number analysis. If it makes any difference, the part of those loans that are Federal Direct Subsidized Loans, (amounting to 19000) interest accumulation can be deferred until I am done with school altogether. So I can hope to dent into 21k of those loans before I am done with grad school. That is, if I am understanding this all correctly. Those who have been through the process before may be able to offer more accurate and valuable insight than I can.

 

[ModusPwnd]

And yet you still need to take out $40K in loans.
$40K at 4.66% with interest for 6 years of graduate school works out to $52,571. Paying this back over 10 years is $6587 per year, for a total interest on the loan of $25,868. You should already have these, or equivalent, numbers calculated before even thinking about a loan. Any loan. The average postdoctoral salary is $44,000 or so, so you are looking at the equivalent of a 15% pay cut.

With that kind of pay he would likely qualify for income based repayment and would not have to pay back the full amount until he made quite a bit more than that. A large number or loans will never be repaid in full. I have less loans, make more money than that and get a huge cut on my monthly payment due to income based repayment.

 

[radium]

The cost of living totally depends on the area. In my area, rent is pretty expensive so they have to give us a much higher stipend than say, Illinois where housing is very cheap. Stanford and Columbia have the highest base stipends of pretty much anywhere (over $35,000) since Palo Alto and NYC are incredibly expensive places to live. I would have to say that UChicago has the best stipend/cost of living ratio of any of the schools I visited. You get a pretty comparable stipend to Harvard and MIT expect Hyde Park is much less expensive than Cambridge. Actually, if they really want you to come, they have the highest departmental fellowships I have heard of. The top one, the Nambu fellowship pays almost as much as a postdoc salary for the first three years (but of course they only offer those to like 3-5 accepted students).

In general, the top private schools pay the most.