When you start off your pursuit of education and make decisions about what risks you are willing to take to gain more knowledge, you have no full idea of what you are getting yourself into. At 17 years old, I had no real concept of finance. I thought I was making smart decisions, and, in some areas, I did make smart decisions. I was doing great actually until pharmacy school when it came to what choices were available to me.
But let me just rip off the band-aid for everyone quickly. When I graduated from pharmacy school, I not only left with a fancy doctorate degree, but I also left with a whooping debt of $288,014.01. This is a number I will always be able to state from the top of my head. I have obsessed over this number and made it both my enemy and my best friend. I have kind of come to terms with my situation and made plans that may or may not be sustainable, but time will tell. I know I kind of alluded to my loans before in previous posts. But let me start from the beginning.
Undergraduate School: A Not Too Horrible Tale
This is not where my horror story begins. If I only had my undergrad loans, I’d be perfectly happy. I left undergraduate school with around $30k in student loans. I went to a public university in my state and was pretty happy. I had the decision of going to a private university or a public university when choosing schools and when I saw the financial aid available to me, I quickly chose the public school.
From my calculations and my limited funds, I was going to be far better off at a public university and I did. There were still times that my financial aid did not fully cut it and I got loans, did a crazy amount of paid online surveys, sold old textbooks on eBay, received money from nice church ladies whenever I went back home, and when I worked at the university bookstore.
There was one summer that I may have overloaded myself with work, extracurricular activities, and summer classes. Horrible decision by the way. Who takes BioChem and physics in the same summer they work over 30 hours and transition to a higher executive board position in their extracurricular organization? Someone psychotic. I’ve come to realize I may be somewhat psychotic. But I digress. I hustled my way through undergrad the best I could, and my grades may have suffered a bit from some of my psychotic-ness. This would come to bite me in the behind for graduate school.
Applying to Graduate School: Climbing the Social Hierarchy is Only for the Rich or the Slightly Insane
This is where I would come to the realization that it was very hard to not have money. How could you get money without money? The road to a higher socioeconomic class seemed made for us to fail. If you’ve ever applied for any type of post-graduation school or program, I feel like you know what I mean. The cost of just applying and preparing to be in any graduate program is expensive.
If you want to be ahead of the curve, you have to have money or sacrifice some things. Many grad programs require tests, applications, and interviews at the minimum. I spent over $2000 applying to schools and I only happened to have enough money because of my tendency to pocket money in multiple different accounts for a rainy day (I had enough emergencies that I was paranoid).
If I didn’t have this money, my parents probably would have found the money somehow. But I always felt guilty for all the excess money required for these things. But some people don’t even have the blessing of parents willing to sacrifice for the betterment of their child’s education (I’m not talking about re-mortgaging your house for your child. That’s too much).
But when I applied for pharmacy school, I spent $300 on a bootleg study book for the PCAT. I couldn’t afford the real Kaplan classes like some of my other classmates. I ended up re-selling it afterward for ~$200 so, it wasn’t that bad of a loss. Then, I took the PCAT twice. The PCAT was around $200 and some change back when I took it. It was a 4-hour test, but I didn’t have a car so, I took multiple buses to the testing station starting at 6AM to be there by 8AM, and I believe my birthday was the day before and I almost got kidnapped afterward walking to the bus stop. But overall, say no to strangers. It was a whole journey.
Next was the application process. You pay for the application platform. It doesn’t afford you much and then I think it was $43 per added school after that. I applied to 5 or 6 schools for $400 and some change. The horrible part is that all the money you spend does not guarantee a response from the school. Some of the schools did not even send me a rejection letter. To this day, it upsets me. But I digress. After you spend that money, you have to find a way to get to your interview and a place to stay. Most of my schools were local or close so, only one interview required major travel for me.
Oh, I also forgot that some schools had supplemental applications that cost $150. Anyways, after your interview, you have to pay to hold your spot. It literally all feels like a scam. One school’s fee was over $2000 to hold your spot which went to a tablet that everyone got. But who’s going to pull out $2k in less than 2 weeks? Not me. Regardless to say, I did not go there.
Due to the lack of responses from the school and my horrendous GPA, my only choices for pharmacy schools were private schools, the most expensive of them all. A competitive PCAT score would save me but not enough for a public university to be interested in me. But one thing about me is I am not going to give up. No, I’m going down with the sinking ship. That’s part of the reason for my horrendous GPA (I never dropped a class; I saw that disaster to the end).
Graduate School: A Tale of Ignorance
I always thought I knew what I was doing. But hindsight is 20:20. Private school was not my first choice for pharmacy school. But it was the choice that was available to me at the moment that I really wanted to get into pharmacy school. It was the option that would not make me wait in limbo while my other peers moved on with their lives to become doctors, lawyers, real estate agents, and other great things.
As always, I did my calculations and chose the private school that would leave me with the least student loans. Yes, I could have ended up with more, crazy. But here is where I realized that I had no clue about how money worked and continued to have no clue until I was almost about to graduate. I calculated that I would leave with around $265k in loans from pharmacy school and looking back, that was pretty accurate. And when you take the supposed pay of a pharmacist which most people like to pretend is about $120k, that doesn’t seem like a bad deal.
But I had no knowledge of how interest worked or amortization, and I barely even registered income taxes in my mind. These two things have been the main issue for those terrorized by student debt. Not to mention, the pay for pharmacists is not what pharmacy schools would like to make you think. They are still living in the early 2000s where you could really make money as a pharmacist. But this is what was used to justify the cost of schooling and even google searching the average pharmacist’s pay doesn’t really give you an accurate outlook of what the market actually looks like. But I digress. Taxes and interest were the 2 things I did not think about that should have been my main concern.
Let’s Do the Math: A Tale of Delusion(And Not the Good Kind)
Here is what my non-sophisticated brain was thinking from high school until around 2019. I will pay $265k over 10 years because I don’t know where my $30k from undergrad went magically. Maybe I got a rich benefactor for a one-time deal. That’s $26,500 per year. That’s $2,208.33 per month. I’m making $120k per year. (No taxes. I was such a joke.) That’s $10,000 per month. Heck, I can even pay $4500 a month and be done quickly. I’m good!
This is why we need to bring financial literacy back into schools. I am proud to say that I have read a lot of finance books since I graduated from Pharmacy school. But yes, I was an idiot. It’s actually embarrassing. Disclaimer: I knew income taxes existed, but I didn’t realize how much of my income would be given to the government.
So, let’s talk real math. We’ll keep the numbers similar, but this time let’s add in real life: taxes and interest. I live in Florida. Assuming I’m not contributing to a 401k, HSA, insurance, or anything else (the delusions continue but for simplicity), my take-home pay would be $91,292 according to SmartAsset (we work smart not hard around here) with a gross income of $120k. That is $7,607 per month. Let’s use my actual loan number $288k and add interest.
My current interest rate after consolidating my loans is 6.375%. Let’s round up to 6.38% for nicer numbers. In order to actually finish paying within 10 years, my payment would be $3,252.78 per month with a total repayment of around $390k (calculator.net). That actually does not sound bad. That leaves $4,354.22 per month. Meaning you are actually living on $52,250.64 a year. This does not include saving for retirement, insurance, car payments, etc. Not bad.
But starting pay for pharmacists did not start that high. So, all that math to falsely inflate hopes. You’re more likely to be around $100k a year or lower ($77,582 after taxes) around my geographic area. After all the math, you end up living on $38,548.64 a year for rent, food, insurance, etc. I live in Miami. So, those numbers are not cute. You are making 6 figures but not really. This is where I realized how delusional I was really being, especially when I realized that I needed to start saving for retirement and just be able to enjoy life.
Graduation: Reluctant Acceptance
Some people may say screw student loans! I’m not paying at all! Or they say only the bare minimum for me! But I can’t bring myself to be one of those people. After I got down to $276k, I consolidated my loans because I thought the student loan pause was going to end and with the consolidation, they sent me a letter. If I paid the bare minimum ($1731ish) for 30 years (that’s a mortgage), I’d pay over $660k.
Over my dead body. That’s a whole house, a really nice house in some places. So, I decided that I would not pay the bare minimum and I researched the different repayment plans, you know the ones where they “forgive you” after a certain amount of time, and I learned that they suck. They, too, seem like a trap. “Forgiveness” is not even guaranteed.
So, I’ve resigned myself to suffering for the next 10 years and kind of staying in that limbo I was avoiding earlier. I’ve read and listened to a lot of financial books. I’ve educated myself a bit in finance to become more informed. So, while I obsess over my loans and mourn the loss of potential houses, I’ve gained an excellent credit score and whittled my loan down little by little. Currently, I’m at around $218k. The student loan pause has been a fortunate event for my progress because I’m not racking up interest.
At one point my projected payment date was age 58 and now it’s age 46 if I only pay the minimum. Of course, I’m not settling for that 30-year minimum if I can help it. But life happens, so while I can afford to, I’m making the impossible happen. I’m working towards paying double the 30-year minimum eventually (not there yet).
I have the privilege of not paying rent and using that money to cut my student loans. But many do not have that opportunity. I jokingly tell everyone that I will finish in 2030 but, it’s low-key, high-key not a joke and I’m okay with that. Based on my initial projections, it could have been worse.
So, I’ve mourned the loss of my money to go on vacation to cool places or buy a house. I’ve gotten angry and then sad. I think I’ve gone through all the stages of grief. But I’ve come to terms with it, and I think the future Shika will thank me. Imagine my take-home pay actually going all to me. I can’t even imagine that day and I’m excited for that day to come. From there, I can build actual wealth and financial security for my family. Until then, I will continue to be extreme with my payment plan and side hustle when I can. But this has been the story of my stages of grief, ignorance, and denial. Do you have student loans? If so, what are your plans for repaying?
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