Are you sinking under the weight of your student loan debt? Just breathe! Let's navigate the murky waters of student loan debt together. We sit down with Brandon Barfield, a student loan advisor from the Student Loan Professors, previously known as Doctors Without Quarters, who takes us through the ins and outs of managing your student loans. We discuss their recent rebranding, their dedication to serving the medical community, and their fervor for spreading financial education.
The cost of education is skyrocketing, and the need for financial literacy is more critical than ever. In our conversation with Brandon, we highlight the importance of understanding student loan options, strategic debt management, and the implications of enrolling in for-profit residency programs. We also dive into the politics surrounding student loan forgiveness programs and how they impact debt levels in the medical field.
Brandon also provides a wealth of advice on managing student loan debt, discussing the differences between federal and private loans, introducing new student loan programs like the SAVE Plan, and shedding light on current legislation. This episode is a treasure trove of insights and strategic advice for anyone looking to better understand and manage their student loans. Don't miss out; let's face the debt dragon together!
https://www.studentloanprofessor.com/
https://studentaid.gov/idr/
Picmonic boosts confidence and grades. Our IRB study proved that with the Picmonic learning system students increase retention and test scores.
Years ago, psychologists and education researchers found mnemonics to be an effective tool in increasing retention and memory recall. Today, lots of different strategies for learning and memorization using mnemonics exist including keyword, phrase, music and image mnemonics.
Use code OFFWHITECOAT for 20% off
Dedicated technology for medical schools, residency and health programs looking to optimize performance on in-service and licensure exams. Students get access to the content, questions, explanations, and all benefits of the SmartBank to help enhance their performances on high-stakes exams. TrueLearn provides national average comparisons, including score, percentile, and category weaknesses according to the exam blueprint.
Use code OFFWHITECOAT for $25 off your purchase.
Are you sinking under the weight of your student loan debt? Just breathe! Let's navigate the murky waters of student loan debt together. We sit down with Brandon Barfield, a student loan advisor from the Student Loan Professors, previously known as Doctors Without Quarters, who takes us through the ins and outs of managing your student loans. We discuss their recent rebranding, their dedication to serving the medical community, and their fervor for spreading financial education.
The cost of education is skyrocketing, and the need for financial literacy is more critical than ever. In our conversation with Brandon, we highlight the importance of understanding student loan options, strategic debt management, and the implications of enrolling in for-profit residency programs. We also dive into the politics surrounding student loan forgiveness programs and how they impact debt levels in the medical field.
Brandon also provides a wealth of advice on managing student loan debt, discussing the differences between federal and private loans, introducing new student loan programs like the SAVE Plan, and shedding light on current legislation. This episode is a treasure trove of insights and strategic advice for anyone looking to better understand and manage their student loans. Don't miss out; let's face the debt dragon together!
https://www.studentloanprofessor.com/
https://studentaid.gov/idr/
Picmonic boosts confidence and grades. Our IRB study proved that with the Picmonic learning system students increase retention and test scores.
Years ago, psychologists and education researchers found mnemonics to be an effective tool in increasing retention and memory recall. Today, lots of different strategies for learning and memorization using mnemonics exist including keyword, phrase, music and image mnemonics.
Use code OFFWHITECOAT for 20% off
Dedicated technology for medical schools, residency and health programs looking to optimize performance on in-service and licensure exams. Students get access to the content, questions, explanations, and all benefits of the SmartBank to help enhance their performances on high-stakes exams. TrueLearn provides national average comparisons, including score, percentile, and category weaknesses according to the exam blueprint.
Use code OFFWHITECOAT for $25 off your purchase.
Hello everybody and welcome to the Off-White Coat podcast. I'm Errol Shortenamny and today we are joined by Brandon Barfield. He is the face of the student loan professors, which is formerly known as Doctors Without Quarters. So without further ado, let's get to it.
Speaker 2:Yeah, thanks a lot. Yeah, it's pretty exciting. Doctors Without Quarters, I mean, we're not as big and popular as we'd certainly like to be with the medical community, but I think we've gotten a pretty decent brand awareness since we started the company. And so changing our name kind of a big deal, and I'm the first one to admit the new name probably isn't as catchy as the old one. I tell people pretty straightforward, you know, creative names are easy to come by, but the ones that are not are not. It is really really hard to find a dot com web domain that's not taken, and so we listed out like six or seven different name ideas that we liked, and student loan professor was the only one, literally, that we could get a clean web address for. And so here we are with the new brand. Yeah, we did rebrand. In fact, the new website went live this past week and currently I just got off a call we're currently working on the redirect from Doctors Without Quarters to student loan professors. We're not taking down the old website and the new one. You'll see if you check it out, it's actually dual branded. We're not doing away with the Doctors Without Quarters brand. It's you know. Again, it's pretty popular and we like it as well.
Speaker 2:But the reason we're doing this is that, you know, even people in the medical community like I went to a hospital HR directors conference a year and a half ago and a few directors even though our signage is all up with the bullets on what we do a couple of them stopped by. They're like oh, doctors Without Quarters, so do you help with housing? Or and they just didn't get it People that if you're not a physician, you just don't get the joke about doctors without quarters. You're not a physician, you absolutely get the joke about being a resident and and our name is always giving us a good laugh and smiles. I love opening presentations but at the end of the day, you know, we want to grow like any other company.
Speaker 2:We want to serve more borrowers and some of the strategies we employ, yes, they're physician specific, but many of them like public service loan forgiveness, they're not there. They reach across all degrees, many profession, and so, yeah, we kind of want a name that's going to be a little more obvious as to the industry that we're in, and we want people to come work with us so we can help them regardless of what they do. So ultimately. That's why we change the brand. We're we're still going to be very much focused on the medical community. That's going to be probably 80 plus percent of our business for who knows how long, and we welcome that. But for that other 20 percent, those other borrowers that we need help. We want we don't want them to feel like second class citizens working with us. And so we're excited about the name change, even though we we're we're under no illusion that some of the medical community probably aren't going to like the new name as much as the old name. And that's just kind of it is what it is.
Speaker 1:Oh yeah, I mean Doctors Without Quarters is a very catchy name, so I can understand where go from going from that. Like I feel like it would be very easy, or it would have been easy, for you to find your domain, like your web domain, with that one. But I have completely understand the change up to the student loan professors, especially with you doing so many other things. I will say, though, you have, you do have a pretty big outreach on the medical community. I mean, we spoke kind of before this, but you've you've done things for my school my medical school was St George's. You've done things for them. A lot of my co residents you gave a lecture at like William Carey and a couple other places, and even on I think I was on Imra the other day, like on the main website, and I clicked on a sidebar and it just had Doctors Without Quarters and I was like, oh my God, he's everywhere.
Speaker 2:Yeah, Literally just yesterday I sent a whole new like page content, layout and text for them to completely redo their resource site, Because you know wording things a little bit better than they had it.
Speaker 2:But yeah, I mean we worked hard over the years to get the brand out there. I mean not not just for our company, but one thing about student loan professor, we love doing education. I love doing webinars and presentations. My partner I founded the company with, I mean, you know, after a decade more than a decade of giving talks, you know he was starting to wear them a little bit and I'm like I'm not there, I still. My favorite part of the job is getting in front of an audience or getting on a webinar and just diving into this stuff and having people say, wow, I feel so much better than I did an hour ago about my student loans, and that that's a pump for me. That's the rewarding part of the job. And so we work hard to get the content out there and the brand kind of goes with the content. So it's worked well.
Speaker 1:Well, I'm hoping that by the end of all this, I will also be happy about my student loans. I am curious, though, like how did you, how did this all get started?
Speaker 2:Yeah. So I mean, I won't lie. I certainly didn't go to college with dreams of being a student loan advisor Right, I don't know that anyone does, to be candid with you. So I came out of the Army. I did four years in the Army. It taught me one thing Army life is not my style, right. I realized real quick that I was an enlisted soldier in the Army. I didn't have a degree yet, and that taught me real quick the value of having a college degree in general. And so I majored in finance, always liked money and I like talking to people, so I majored in finance with the aspirations of being a financial advisor and planner sitting down helping people.
Speaker 2:I think I was a little naive to how much sales is involved in financial planning. It's about 90% sales and about 10% planning. That's very unfortunate, but that is the industry. But I was lucky. I went right to work for a financial firm that wasn't big into sales. They had some good channels to drive clients and so I was a assistant financial planner with a group based out of Atlanta and for two and a half years all I did was hard core financial planning reweighting people's portfolios and running cash flow projections. It was mostly retirees with a million dollars plus, and it was all about making their retirement strategy and their assets and their investments works of minimum distribution, just all sorts of stuff, and just learned a ton.
Speaker 2:And then 2007, 2008, 2009 came along with the great recession and boy, financial job. They were the first ones that just took a whack and the firm I was at they were all AUM assets under management. That's how they made their money. So literally, they saw their revenue get cut in half in about a year period and, of course, we saw people get let go. So I found myself jobless right in the middle of the great recession, and you couldn't find a job anywhere with the word finance in the title. And the one job I did land upon was working in financial aid for a big online school, and so I took it. They gave me a free MBA. You know, get free tuition when you work for a school. So I think the MBA they gave me was worth more than the actual paycheck.
Speaker 2:It was a pretty modest, pretty humble time in my career, but even that school went through a big audit and they it was a nasty audit, they were for-profit school, unfortunately and so I found myself with, you know, a couple years of financial planning, a couple years of student financial aid. I was like those don't really go together until low and behold, one day I got an email from a company that said hey, we do financial planning for doctors, we primarily focus on their student loans and we're looking for people who kind of understand both worlds. And boom, all of a sudden I had the perfect resume and background, and so they hired me and, as their presenter and your relationships manager, to go out and build relationships with schools, and that really took off. It turned out to be my knack I love giving the presentations and developing the relationships and that went really, really well, until they found out the owner of that company was actually cooking the books he's in jail right now and we were all just like completely sidelined.
Speaker 2:They had nothing to do with the student loan business. The student loan business was very legit, but he was trying to ramp up this other business on the side investments and he was cooking the books for that. And when it finally went down it took down the whole enchilada with it and once again I found myself looking for my next move. But we had developed a great reputation. A lot of the schools that work with us. They wanted me, they liked the presentations I'm giving and the content was it's federal based programs. We're not making up PSLF, it's not some sort of scam. And so my coworker and I, who was also a presenter at that company, we said you know what? It's time to do our own thing. And so we took all the good from the old company. We got rid of all the bad as far as the service model.
Speaker 2:And we shot the big financial firm called Larson Financial. We had bumped into them and a lot of residency programs. They had a really strong reputation with medical residents and young doctors and we said, hey, you guys need to partner with us. And so essentially they gave us the capital we needed to start doctors out quarters and that was early 2015. And the rest is history. This year we passed 10,000 individual barbers, mostly doctors. About 87, 88% doctors is our client base that we've counseled as of this past graduation season. So yeah, we've come a long way of it.
Speaker 1:It's a story.
Speaker 2:It never was planned. Certainly, you know, 20 years ago. This is not where I saw myself, but you can see the smile on my face. I absolutely love what we do. It's not for the faint of heart, especially with these student loan pauses and everything else. It's been a tough three years, but man, I wouldn't trade it for the world. I really love what we do here.
Speaker 1:Yeah, what a glow up. Because you have grown so much it's hard to imagine that it's only eight years. Because it feels like your company for one could not have picked a better demographic to go for. Because people in healthcare do not hunt the debt and have no idea how. I have no idea how I'm going to get rid of mine yet I'm hoping people say get your money to make money. I've yet to figure out how that works, but when I do it's going to be a game changer.
Speaker 1:But it feels like you've kind of got a like you're just part of the medical community now. In general, yeah, everybody kind of comes and listens to your advice. I know a lot of people. I mean, I followed you on Instagram just to figure out all this stuff, like you were saying, over the past three years, with all the loan stuff, like you're one of my good sources of information on current information when it comes to that.
Speaker 2:So, yeah, Young doctors are interesting because you know you're so focused. I mean the amount of study and the amount of information you guys pack into your brain over a four year period, especially that first two year period. Right, when you're on the academic side of things, it boggles my mind I could never do it, but at the same time, yeah. So the most common phrase we hear from any borrower we sit down with well, number one is oh my God, did I really let my dad get that high?
Speaker 1:Yeah.
Speaker 2:But number two, we hear it all the time I'm just not good with finance, I'm just not good with money, or you know, it's just not my thing. And honestly, I get it. You're talking to a guy. I literally thought I wasn't going to graduate high school in time because I could not pass chemistry and I had to retake second semester chemistry my junior and senior year, because the neutrons and the proton, they just didn't click with me, and that's how I think a lot of doctors are. With financial concepts it just doesn't click, especially if you haven't been formally trained in finance, right. And so we very much can we get where people are coming from, and I get exactly where people are coming from, and so it's a neat experience to be able to take obviously very, very smart people but just kind of clue them in to how certain things work. And it's a very niche. We're not trying to make people financial planners. We're just focusing on a very niche area about how student loans and student loan programs work so that people can make better decisions.
Speaker 2:And that's the beauty of the service is. The service is ancillary. Some people take advantage of it, some people don't. The education is what we're all about. The old company was all about. Well, you just pay us and we'll take care of your student loans. And that's not what we do here. We educate people on what their options are. If we went out of business tomorrow, our clients would be fine. They know exactly what's going on with their loaner payment strategy and they just choose to keep us in their back pocket. And that's how it should be.
Speaker 1:You said it best it's like reading two different textbooks. We love one textbook, don't pay attention at all to the other one, and it can just be very difficult because there's a lot of hoops that you have to jump through in medicine and so, especially with the loans and everything that you take out, or just the school I mean schools are so expensive now in general, it feels like give them whatever they want and then I'll focus on what I wanna focus on and then I'll look at that later. Then, when you look at it later, you're like geez, what did I do to myself? I didn't realize I was gonna pass this debt on to my kids.
Speaker 2:Now she's kidding. Yeah, we've started a new financial literacy course now where schools have been asking us for over the years hey, can you speak to my first year, my second year students? I'm like, well, I can, but I don't necessarily have contents. We've finally built out content and the first year session and frankly, I think some students get bored with it because they already kind of get the whole budgeting, saving money concepts, but some don't, and so the whole first year session is just about understanding how interest rates work for different types of loans, but most of it's about budgeting and just really practical tips to save money.
Speaker 2:And you get like this bipolar feedback. Like the feedback's like 50-50, this was boring, I can't believe I had to sit through this. And the other 50% is like wow, I'm so glad I sat through this. You probably just saved me 50 grand on my total student debt tab over the next four years for things I just never thought about. So again, it's trying to get everyone to that same kind of base level of knowledge so they're better off the end of the day.
Speaker 1:I can say for one thing, I at least appreciate all the information and plus, you're very up to date with everything that's happened in the news and everything you try. I mean, I've seen you put up many posts, especially recently, because it seems like every other day the student loan stuff is going. They're either gonna forgive it and then they're not gonna forgive it and then so you've had your work cut out for you over the past couple of years.
Speaker 2:We have, and of course, the recent climate's been challenging, right, because literally stuff's popping up every day. No that I had a rude awakening. I was finding that I wasn't plugged in enough and I was seeing headlines come from different sources and sometimes we'd have borrowers reach out to us saying, hey, what do you think about this? And I hadn't even heard about it yet, and so I made a very conscious decision. About six, eight months ago I said you know what? We have really got to step up our game, especially with this rapid pace.
Speaker 2:So I've actually got a regimen now and my team does of very particular sites that we are literally checking on a daily basis, just scrubbing them for all the latest student loan news, some of our news outlets, some of them the educational websites, the legislative government websites.
Speaker 2:I mean, we really really try hard to be at the forefront of seeing what comes out and then we try to post it on social media within about 24 to 48 hours. But we try not to send too many emails unless it's something really, really critical, like the Supreme Court decision. We kind of just gather it and then we put it in our monthly student loan updates, because one thing I hear about all the time is just the ridiculous amount of emails medical students and residents get these days, and people are telling me I don't open half my emails anymore, and so we try to send no more than one, maybe two emails a month because we want people to actually read them. So social media is kind of where we try to stay really, really up to date and then let our newsletters and marketplace updates do the rest.
Speaker 1:That makes sense. Yeah, I get so many emails that I actually was notorious. I'm getting better at it the more that my job depends on it, but like I was notorious for just letting emails slip through the cracks every now and then, and because I just got so many, yeah, I am very curious with all the recent news that's coming in and out. Should I even really be focused on paying the loan back immediately when it? Because I guess I have a little bit of federal and private loans and I am curious with everything that's coming out and the new presidencies and everything else. Should we be focused on the paying off the loan immediately, or is it gonna be forgiven one day, or is it?
Speaker 2:Yeah, now you mentioned private debt. That's as you know, that's gonna be on me.
Speaker 1:That one's gonna be on me.
Speaker 2:Right, you're not gonna get those private loans forgiven. Though one thing I will point out there's a difference between loan forgiveness and someone else helping you pay back your student loans, like a military payment or a national health service core repayment or an employer sponsored repayment subsidy. If you find yourself taking advantage of those sort of programs, usually they will pay back private educational debt. So if I had a chunk of private debt, and additional to federal, I'd probably be proactive looking at some of those sort of programs. But of course, the big programs you hear about, like public service loan forgiveness, is really the big, big one that so many physicians are positioning for, and now we're finally starting to see forgiveness happening with PSLF. It's just shot up in the last literally two years. But the answer is and I hate to say it because I like to be conservative with my financial advice, but the truth is that no, you probably shouldn't be rushing to pay back your federal student loans too early in your career because, statistically speaking and I don't have hard stats on this, I'm just telling you what we see with our client base you've generally got a 50, 50 chance of finding a job after training that's either gonna be government or nonprofit and qualify you for public service loan forgiveness. And the cool thing about that program and we can get into the weeds with it if you want, but we don't have to but the cool thing about that program is tax-free at the federal and state level and it completely wipes out all of your debt, including accumulated interest. And so the deal with that. If you think through it strategically, it's like, well, if I think this is a possibility not even a certainty, if I think this is a possibility, the last thing I wanna do is be paying as much as possible or paying ahead on my student loans, because if, lo and behold, I do end up getting them forgiven 10 years down the road, or five years, however long it takes you, I'm gonna look back and I'm gonna be mad at myself because I could have just kept that money in my pocket and had twice as much forgiven right. And so that's one thing that we coach barbers on is if you think any chance that loan forgiveness is gonna be in your future.
Speaker 2:I actually don't recommend paying ahead, but that doesn't mean you have to either. You can always kind of put that let's say you got $1,000 in your monthly budget as a resident, or even 500, and you're only paying maybe 200 as a resident. If you're an income-driven or payment, I tell barbers to take that extra 300 in their budget. Pretend that you're made over payments and maybe open up a special savings account, title it your emergency payment account or whatever, pump those extra dollars into there, and that way you've got that chunk of money sitting there three, four, eight years down the road, when you do inevitably figure out which direction your career is going to take, you, you do have the option to kind of, in a lump sum, pay aggressively on your debt at that time, and so you're not behind the eight ball.
Speaker 2:And so what you're doing is you're kind of and finance, call it hedging your bet, right and so you're kind of hedging your bet there to kind of get the best of both worlds. If I get forgiveness, great, I've maximized that strategy. If I don't get forgiveness and I'm paying back my debt, that's fine too. I've essentially paid ahead in the years that I could afford to, okay that's really good advice.
Speaker 1:Yeah, I definitely want to dive a little bit more and we've got a lot to talk about but I definitely want to dive a little bit more into the public service loan forgiveness, because I think that's a great tool. I'm for one kind of going for it, mainly because medical school and everything can be expensive, and I actually chose a program that I knew that in, because if you're in residency anybody listening that is in residency or like it counts towards those 10 years. One thing I didn't realize is that you had to make a certain amount of payments on the loan I think it's like 20 or something payments straight up on the loan and and have the 10 years and then you can get it forgiven.
Speaker 2:Yeah, it does get confusing because, generally speaking, when we hear young doctors talking about PSLF, they're mainly talking about it being a 10-year program, and Practically it is. But here's what the rules actually state you have to make 120 on time payments While you're on an income-driven or payment plan and While you're working for either a nonprofit or some sort of government institution. Now, government can be federal, state, local, even tribal Calculation, and so they won't let you double up the payments to be nice. If you could like, make two payments a month and make it a five-year strategy, of course they. That's not a. They wrote that in the rules. You can't do that. So it's a minimum 10-year strategy and practically it's a 10-year strategy.
Speaker 2:But I encourage borrowers. The number of payments is what matters at the end of the day, because there's a good chance that maybe you work a couple years in the private sector, maybe you just got some gaps. Rentants we see borrowers all the time. They graduate residency in June, they take the summer off. They don't start practice till, say, september. Right, there, that's three or four months. That's gonna push them past the 10-year mark, right? Because if they were a full-time employee during that four-month period, that does not count for PSLF, and so, again, you have to. You have to understand the rules, but as a general mindset, yeah, it's roughly a 10-year strategy and yes, you've hit the nail on the head, residency does count in about 90% of circumstances.
Speaker 2:I make that statement to say there are a handful of residency programs out there that are in for-profit settings. Most notably your HCA is your hospital corporation of America. That's one of the biggest for-profit hospital chains out there, and they specifically like to buy up hospitals that have residency programs and Start up their own residency programs, because you're their main recruitment pool, and so that's unfortunate from a PSLF standpoint. Not that HCA is a bad company I've never heard really good or bad things about them but if you're in a for-profit residency program, unfortunately your time in training is not going to count toward PSLF, and that catches a lot of bars off-guard. They match, obviously they apply for match at the end of year three, beginning of year four. They don't hear us present about PSLF until a couple of weeks before graduation and they're like, uh-oh, mm-hmm, I wish I would have been seeking out a non-profit training program during my interview process. I wish I'd have had this information a year ago, right, and so that that is unfortunate.
Speaker 1:Yeah, and it's hard to go through all the literature and figure out what programs allow you to do certain things. I remember that I only knew about this because my mom who she had truck she had gone to an organization. She's an ER physician and she was working and she had like six years under her belt for PSLF but then they, the ER that she was working for got bought out by Apollo or one of those for-profit organizations. Yeah, and then it it essentially she never got to a point where she was ever able to. She never went to a different place where she could get that all Paid off or work those other years for a non-profit, so which she got it all paid off. So one way or another it worked out for her. But it was just a funny thing because I never thought that if you worked for a place and then it got bought out, then you would actually lose that because it's not a non-profit organization anymore.
Speaker 2:Yeah, and we saw that happen so. So we've always kind of known if you're for, if your non-profit gets bought out by a for-profit, then that that is gonna change. Pslf looks at who's cutting your paycheck. At the end of the day, what is the tax ID number for that organization of a nonprofit for-profit? I'll tell you the one that shocked me. So I'm in Atlanta.
Speaker 2:We do a lot of presentations here at Georgia hospitals. One is Memorial Health in Savannah and that was a non-profit system. They got bought out by HCA back in 2018. I think I was shocked to learn that not just did the practitioners get impacted by that, even the residents now found themselves employing through a for-profit and they lost their PSLF eligibility. That program was sponsored by Mercer School of Medicine in Macon, georgia, which is a non-profit, and my understanding was, in most situations You're technically paid through the GME and the GME is Mercer and that was not the case, at least not at this particular System, and so that was kind of an eye-opener for me and, man, I felt certainly bad for those residents because a lot of them We've been speaking there for years and a lot of them were positioning for PSLF.
Speaker 2:So that's the one thing you always do have to kind of be prepared for DSLF is never a guarantee, and when that unexpected change happens with your career or employment, you got a big decision to make there, right. Do I stay with this company and find a different loan or payment strategy, or do I find a different employment To complement my loan forgiveness strategy? And of course, I'm never going to tell a doctor change your career path to get loan forgiveness right that you didn't spend all this time and effort becoming a doctor to let your student loans dictate where you work or how you work. The truth is we see more and more physicians tell us every day that they are making career decisions, at least in part, based off their student loan situation. It's come to that and that's unfortunate. But two, three to four thousand dollars it's a big part of your financial decision points.
Speaker 1:Yeah, and it can be I mean insurmountable trying to get it out, accomplish it all. I mean hopefully by the end of all of it I will be able to. But I do have a question about PSLF. If you have a gap, are you still able, like, let's say, you work five years, your company gets bought out by HCA or you're in a resident, but then you start so you work a year for that profit organization and then you switch to a Non-profit and then you work those other five years. Does that count? Or you do you have to do another 10?
Speaker 2:No, so you'll be happy to know. So PSLF is written fairly generously. You can have as many gaps in your timeline as you need, as long as you hit that total 120 payments with 120 months of working in a non-profit, a government environment. Eventually you're gonna get that forgiveness. Now what I tell borrowers is that there is a point in no return, like if you're out of the nonprofit and you're working in a for-profit sector Three, four, five years. Of course you're making payments on your loans during this entire time. Eventually you hit a point where mathematically, even if you did get back under a non-profit, what would happen is you would end up actually paying off your debt Before you hit that hundred and twenty of qualified payment. And so you do have to kind of think about it mathematically.
Speaker 2:Generally speaking, what we find it's it's that first job post training, 85, 90% of the time. When someone matches to a non-profit, especially if they've got a longer training, say four years, five years under their belt Usually they're gonna say okay, I'm gonna stick with this job. A lot of times that first contract is gonna be four or five years. Anyway, I'm gonna stick with this job at least long enough to lock in my PSLF, become debt-free, then the world is my oyster right. I'm not saddled with debt. I can take my career anywhere and do anything, probably find a job that pays more money.
Speaker 2:They're oftentimes there are discrepancies between non-profit and for-profit compensation. That's just reality. But if they come out of training and they take a for-profit job, more often than not they're gonna abandon the PSLF strategy at that point. But that's not a hard-fashed rule. We do hear, you know physicians tell us you know what. I took this job because I didn't have a lot of great choices. I needed to get something locked in for now. I'm only doing it for a couple of years. I'm definitely not planning to stay here any longer than I have to. Okay, that's a person I'm gonna say let's keep the PSLF door open. Let's keep you on that income driven or payment plan and let's see how. Let's. Let's circle back in a couple of years To see where you're, what direction your career is starting to guide you.
Speaker 1:Okay, I guess it's a person-by-person basis, which I guess it makes your job a little bit difficult, because Every person is gonna have different wants and needs and you've got different borrowers with each one.
Speaker 2:But Jordan, this is probably a good time to tell you. For those who want to dive a little bit deeper in PSLF and hear me present it. You know, formally, educationally, we do try to keep at least one Webinar on our site at any given time, either a recent Webinar for graduating Physicians or one for for residents. We don't keep them up very long because, again, the stuff changes so often. I don't like to keep data information. I just posted a resident webinar. I did it for Johns Hopkins house staff council a couple weeks ago but I intentionally made it kind of generic as an on-demand. That is on our website right now. So thing by wants to formally see how we present this stuff and get into the fine print and the details and the strategy, you're welcome to go check out that webinar. Okay, some of the gaps here, for sure.
Speaker 1:What would the? What's the website domain like it? Is it? It's student loan, professor and doctors without quarters. Either one can get you there.
Speaker 2:The place I'd prefer you find it is student loan professor calm. Okay, google is so new, google's not even like if you punch in student loan professor our website one and come up. It literally just went live this week. But if you type in student loan professor calm, it will come up and there's a resource tab and you'll see webinars. Okay, resource tab and I can see the link to that as well, if you want to post it in some way, yeah, yeah we'll definitely post it when you.
Speaker 1:Now that you've upgraded to like the new website, you've got all this running. Is there any different Functions to the new website that is different than the old one?
Speaker 2:Actually, no so, and even the old website. If you just Google DWOQ, we will pop up. We're gonna keep that live and it's just gonna redirect to the new one. But you almost think you're in the same place. We intentionally duplicated the DWOQ website and we created and then we dual branded. So you see the DWOQ. Internally they call us DWOQ, but doctors without quarters do lumber fast. You see the two logos there side by side. We literally made it a mirror image of the old site. So a lot of barbers there they're, the resources they're looking for are gonna be the exact same place that they're used to finding them.
Speaker 1:That's probably for the best, just so that people don't think it's two different websites, like they can yeah, see it. And then, once people get acclimated, then you can start making it.
Speaker 2:I, literally I did not want to necessarily have to change the name of our company or change our website. The people who know a lot more about Digital marketing than I do, they told me they're like you can't have two sites running with identical or similar Content. You really have to kind of pick a horse and write it. And so they told me you got it, you got to go with one or the other, at least for at least as far as the URL, the domain goes. You don't want both those sites running at the same time.
Speaker 1:So that that was a tough, a tough decision for us, but that, yeah, that's the way we went yeah, I mean it certainly makes sense and you know with if you're trying to get yourself out there and you're, you're trying to reach Other students outside of medicine and there is a lot of other students or there's a lot of other people with student loans that aren't just in medicine. I mean there's probably a lot of debt in the medical field, but it's also all over the place.
Speaker 2:So yeah, well, I Tell you, it's quite shocking how expensive some of the grad help programs are. Getting the PA programs and the nurse practitioner and Just like everything if it's, if it's graduate level and it has anything to do with health care, the prices are getting insane. A lot of things that used to be two and three year programs are now going on to doctoral. You got PhDs now that are having to get four year degrees. I mean, it's getting to that. It's really, and I won't get into the reasons behind it, but there's a lot of suspicions as to why it's going that way. But yeah, I mean, doctors are definitely not the only one struggling with student debt these days. Not, they have long shot 100%.
Speaker 1:There was this whole push, especially in like my generation, to go to college and we all had the federal loans, so it was like you could get into college. If you could get into college, you can go to college. But then it seems like every single year that even since I was in high school up, college has increased. And I'm the oldest of seven, so I have a bunch of little siblings, so I've seen all of them go and do the same thing. And college was expensive when I went, but then it's only increased at every school, even like the public and private institutions have just shot up, and so I think it's got something to do with everybody being allowed to go to school, allowed the colleges to increase their price. Well, now they're just, I mean, they're almost for, they're almost all for profit, I mean, or they make so much money they might not be for profit, but they're making hand over fist.
Speaker 2:Yeah, and I don't tend to know the finances that go on behind the scenes, but I do find and your listeners that are osteopathic doctors will appreciate well, maybe they won't appreciate this, but at least appreciate that we understand what's going on. We do find that most of the medical programs that are popping up are osteopathic schools. It's a lot of smaller, private schools that launch an osteopathic program. We see a massive new building get built and obviously that's expensive. A lot of these schools, because they are private nonprofits, they don't get the federal funding in and the state funding like your more traditional state medical universities do.
Speaker 2:And so I'll put it this way when I'm talking to, say, a UNC, a University of North Carolina School of Medicine, in my presentations I'm showing debt levels of like 250. I used to say 200, but of course those are gone up as well. When I go into most osteopathic schools, like an LMU or a Pikeville or whatever it happens to be, I'm showing debt levels between three and 400, because on average osteopathic schools the cost of attendance and the resulting debt levels they cost about 100 grand more, about 50% more, than their corresponding allopathic programs, and that's unfortunate, especially when you see that, by definition, most osteopathic doctors are going into primary care, right. They're not doing as many anesthesias and plastic surgery and things of that nature. We are seeing more that are going into higher pain specialties and certainly emergency medicine. You're not living too frugally, right?
Speaker 2:Yeah, we've got plenty of yeah yeah. But it is unfortunate when we see that your family practitioners and your pediatricians are often coming out with the highest debt levels. But that's the beauty of PSLF, it's an obvious solution to that. But again, now everybody's going to get it. But those same schools we then, a few years later, we see them launch the PA program and the other complimentary grad help programs. They tend to be a little pricier as well. So I have to bite my tongue on some of that stuff. I mean, we, like the schools, bring us in. You'll never catch me bad-mouthing a school or anything like that, but when it comes to the plight of borrowers, we certainly see what's going on and we certainly get it. It's not for the faint of heart and you have to have a plan to deal with it for sure.
Speaker 1:Well, to protect your connections with the schools. I won't rant and rave too much, no, but I went to an international medical school, so I definitely understand that huge jump, because those are also very expensive. They may even be more expensive than the DOs, but not by much. So it's a lot, it's just a lot to deal with. I've also noticed that loan forgiveness to be one student loan programs have become very politicized in the news recently too, so it's like one place has a stance, one doesn't, and so I was interested if you could speak more on that, because that seems more the general topic of discussion.
Speaker 2:Yeah, and it's kind of a pet peeve of mine. I'll keep it professional and neutral today for sure, but I mean I've been doing this since 2011. Ok, so I've seen programs come and go. As I get older, I do get more into politics. I pay a lot more to not just presidential elections but congressional stuff that's going on, things people propose, and I've certainly noticed that student loans have become a major podium stump, whatever you want to call it topic. Ok, they are not a secondary issue anymore and regardless of what side of the aisle that you're on, or even if you're in the middle, there's one thing that has become very, very clear, I think, to everyone who follows politics these days there is a very clear stance where the Democratic platform stands on student loans and repayment of those loans, and where the Republican conservative platform is and it's this simple the Republicans slash.
Speaker 2:Conservatives basically have a mindset you took out this debt, you need to pay it back. Yes, there are some barbers who have financial circumstances. They need different types of relief and they generally seem to be for that, but when it comes to this notion of mass loan forgiveness or these newer income driven payment plans with the ultra low payments and the rising poverty levels thresholds. They are definitely pushing back on that stuff. They feel like a lot of the newer programs are too generous and that they're basically letting barbers off the hook too easy and not making up people essentially pay back the debts that they signed up for. And again, I'm not saying that's necessarily my opinion, but that it's very clear. That's where that party stands on the issue. Now on the Democratic slash liberal side, if I'm allowed to say it that way, some people get offended when you say liberal. I'm just kind of grouping those two. In general they're not always the same, of course, but on that side of the aisle you see a very opposite mindset and approach to student loans and that they take the approach that, generally speaking, college has become too expensive.
Speaker 2:Generally speaking, college graduates don't make what they should be making. Generally speaking, as many people as possible should go to college. It should be part of the American dream. You shouldn't have to sacrifice your firstborn child to pay for it and it should be affordable on the front end and the back end and of course the front end. It's getting harder and harder. They can't force the schools to do this or that. You know looking for solutions to force the schools to bring down tuition, but one thing they can affect is what it cost you to pay back the loans, or should you even pay back the loans? And so what we've seen progressively over the years, with each new control of Congress or any time we see a new Democratic president in the White House such that we saw it with Obama and then we've seen it now with President Biden we see more and more progressive student loan programs roll out that, generally speaking, are more generous to borrowers, and so things like bringing down the amount of payment, how much of your income?
Speaker 2:If you're on an income-driven payment plan, well, how much of your income should your payment be based off? How much should your payment be? Should you have to pay back all of your debt, or should you only pay it back for 20 years and have it forgiven 25 years, or 20, 25, and then 20. Now, with this latest save plan for undergrad borrowers who don't have graduate level debt, they've got a range forgiveness between 10 and 20 years based off how much debt they've got. If you've got $12,000 or less in student loans on the new save plan starting next year, you're going to get loan forgiveness in 10 years, not working in the public sector. All undergrad borrowers with $12,000 will have their remaining balance forgiven after 10 years under this new plan, and so we've never seen anything like 100% interest subsidy. This is a big deal for residents, One of the big things about residents going through training.
Speaker 2:Yes, the income-driven payment program is helpful. They help you position for public service loan forgiveness, but on average, your resident would rack up $20, $30, $40,000 in additional interest. They come out of training four years later with an extra $50,000 on their student loan tab. Well, they introduced repay six years ago, seven years ago, and they had a 50% interest subsidy. This new save plan has a 100% interest subsidy. So what that means is I can now go through training, keep my payment between zero and maybe 200 bucks a month is all it climbs to one of these new payment rules. I'm not going to accumulate a dime in interest.
Speaker 2:This new save plan is probably going to save the average resident 30 to 40 grand over a four year training program. I mean it's really, really generous what they're doing with student loans. Now, of course, all that in theory, depending on how you look at it comes from the taxpayers right or an adage to the national debt. So that's why that's why it's such a huge debate. It's not that people don't be generous for borrowers. It's just that some parties are focused more on the cost of programs or how you're paying for programs than they are whether or not the programs are reasonable or even justified. It's a hot debate. Honestly, I don't like to get into it. Our policy around here is hey, we look at what's available, we help borrowers maximize the programs available. Our opinion on it, frankly, is irrelevant.
Speaker 1:Yeah, it's almost better to just have an objective view as opposed to like a sentimental view, because it's very tough, because I personally with me having the skin in the game of the lungs hearing about all the different payment plans and everything like every time I hear about a better one, I'm like, oh hallelujah, because the last thing you want to be doing is, I mean, as a medical student, you are paying to work in a hospital, You're paying to go to the school, which is in due, you're accruing debt to work like 80 hours a week, if you can, which it feels like you shouldn't have that the adding interest on top of that. But at the same time, the money's got to come from somewhere and so it's a real. It's just so hot. My uncles always told me never to talk about politics at a party, and it's such that issue because it feels like even if the Democratic side chose to give loan forgiveness, the thing about politics is the other side has to choose the other stance, even if you know.
Speaker 2:And that's why it's important for your listeners to understand, regardless of where people stand on the issue once again is irrelevant. You have to work with what you've got right. So my best advice to your listeners and to all borrowers, especially physicians out there you got to think a couple years ahead and you need to pay attention to who's in control. Who's in control of the White House, who's in control of Congress. So right now we've essentially got to split Congress. That's a good and a bad thing. It stops either side from getting doing things too extreme, but it also means nothing's really getting passed.
Speaker 2:So in the last several years we've seen very little come out of Congress. They are doing things like improving the student aidgov and some other stuff, but when it comes to big policies, congress hasn't done much. But what we have seen is right now we've got a Democrat obviously in the White House and we've seen that they are doing as much as they can unilaterally to make things like better, generally speaking, for borrowers. Now they're getting challenged for that. So I'm sure I don't need to bring your readers up to speed on the Supreme Court decision, right.
Speaker 2:I know every person with student debt was following that case very closely. What they probably weren't following was when they heard the SCOTUS shot down Biden's cancel. I call it forgiveness, I call it his cancellation plan. Yeah, essentially what most people didn't bother doing was reading the actual opinion by Chief Justice Roberts. Go look that up and read it. They did not mince words. They didn't just strike down this particular plan based off this particular piece of language in the law they broadly made comments about.
Speaker 2:Generally speaking, we don't think you've got the power to do this. We don't think this is what Congress intended in the Higher Education Act or the Heroes Act. We think that it should be Congress that forgives student loans. Even Nancy Pelosi came out. I'm sure she regrets it now, but even Nancy Pelosi came out a couple of years ago and said no, the Congress, the president, doesn't have the power to do this. Right, but that's not going to stop this administration, and probably future administrations, from doing everything that they think is in their power and maybe even a little stretch beyond their power. They're going to roll the dice and they're going to try their best to push some of this legislation through. Now we've got already hints.
Speaker 2:The Biden administration came right out at the Supreme Court decision. They knew it was coming. Obviously, I think it was within 90 minutes of the Supreme Court decision being public. They were holding a press conference rolling out the three part what the media is dubbed as Biden's plan B. But first thing on that agenda we are coming with another broad based loan forgiveness cancellation plan.
Speaker 2:Now, of course, they're paying attention to the opinion. They're trying their best to find more legal ways to make it more subject to scrutiny and push through that scrutiny the next time around. Things like negotiated rulemaking, some procedural stuff they're going through. This time they didn't go through before. I think we're going to see the same. There's going to be a lawsuit filed. Someone's going to find a way to bring it to the court. It's going to go back through the whole appeals process. It's going to end up probably right back before the Supreme Court. Now, I'm not an attorney. I'm not an expert when it comes to the legality of stuff. Obviously, the White House is going to think through this. They're going to try their best to make it pass the court scrutiny.
Speaker 2:At the same time, the court made a very broad statement when they made their opinion. Who knows how it's going to go. The court may not even be the same. Makeup Adjustus could come and go between now and then, but one thing that's very obvious this administration and probably future Democratic administrations they are not going to stop pushing. They are very serious about providing debt relief for borrowers in ways that we've never seen before. So it's going to continue to be a hot button topic on both sides.
Speaker 2:And so back my original statement you need to pay attention to who's in control. So if you're graduating and all of a sudden you see a Republican wins the White House next year or the right side of the aisle takes over Congress, you better take advantage of whatever plans you can get into and get grandfathered into. There's a good chance. Some recisions are coming right. They're going to do their best to claw back the more generous plans that are out there to make them a little bit more let's call fiscally conservative, for lack of a better term and just less generous as far as borrowers go.
Speaker 2:And man, I can't empathize with your audience enough how frustrating that is right. When you're making student loan decisions, you're deciding how I'm going to manage my debt. Can I afford to take out this much debt? Can I afford to take this job, I'm counting on loan forgiveness. How freaking difficult is it to know that every four years or two years or whatever, that program may be in jeopardy or the program is going to change dramatically.
Speaker 2:The only sunny side to this is that there is a precedent for grandfathering. Like they're doing away with the pay as you're in plan next year. If they're not kicking anyone out of it, they're simply saying hey, we're giving you a one year full notice. You can't sign up for the pay as you were in plan 12 months from now. So if you want to get into it, you better get into it now. Never once in the 12, I guess I'll go on 13 years I've been doing this. Never once have I seen even proposed that the rug somehow be pulled out from under existing borrowers trying to pursue loan forgiveness or income driven payment plans or anything like that. No one is trying to be unfair to borrowers and so like when the Trump administration and their budget proposal tried to do away with PSLF that's never going to happen.
Speaker 2:But even if it did, there was an extremely generous. It was like a year and a half on ramp for that new provision to go through Anyone who had ever taken out one loan, even one year in undergrad. They were going to be grandfathered in all the way through school and they could pursue PSLF beyond school. That's pretty generous, and so I wouldn't stress too much about changing legislation If you're already, once you're graduated, if you lock in certain programs, you're fairly safe at that point. But yes, while you're a student, changing legislation, it is what it is. When you graduate and you look at your menu of options, that's where you got to think about what's available to me now. Lock in the best option. If things get better, sure I can switch over to a better plan. If things get worse, you just write out the plan that you're on. Okay, that's kind of the mindset.
Speaker 1:It certainly is a lot to consider, but you actually had a lot of really good advice there, especially about you know it's all about the timing and who is technically in office. Now I know as a student going into a resident you don't really get to choose. Oh okay, I want the Democrats in office while I'm in residency, but when I get out, bring on the Republicans. You know you don't get to choose that option. But the advice of picking and choosing your battles and paying attention to who's in what office, that's actually really important, especially with it changing so much. I don't know if you've heard about this and I may be a little off, but I heard that a Michigan or a Michigan judge had actually over or he ruled in favor of the loan thing as opposed to the Supreme Court, which made no sense how Michigan could agree to. I don't know if you've heard about this.
Speaker 2:Like the Michigan, I don't know if it's Michigan specifically. The big headline from the last two weeks was that there was another lawsuit file to block mass loan forgiveness and that confused a lot of people, so that's probably the one you're talking about, I'm sure it is.
Speaker 2:What specifically the Republicans are trying to block right now is called the the income driven payment, one time account adjustment. Now, this has essentially no bearing on current students and very few residents. What's happening right now is they did the PSLF waiver for a year and on the heels of that they announced what's called the the one time account adjustment. It's basically the same thing. What they're doing is the administration basically came out a year and a half, two years ago and they said you know what? We recognize these programs are complex. A lot of people. They were on an income driven payment plan but they didn't have direct loans. They had the older fell loans or they were working for a nonprofit, thinking they were pursuing loan forgiveness. But lo and behold, eight years later they found out they weren't on the right payment plan to qualify for forgiveness.
Speaker 2:And so what the administration did? They came out. They said you know what? We want? To basically go back and give people back credit, regardless of the type of loan you have and the type of payment plan. Maybe have some short payments or late payments. If you've been in payment 20 years, we think that's long enough. We think you deserve pay as you earn 20 year forgiveness or whatever program applies, and that's what they're doing right now.
Speaker 2:And so right after the Supreme Court decision within I think it was a week the first big chunk of forgiveness resulted from that one time account adjustment. These bars all of a sudden got back credit and for many of them it didn't just get them closer, it put them over the hub to get either PSLF or income driven or payment forgiveness. And boom, the initial number of the Barley House rolled out was like 800 million or 400 million I can't remember the numbers off the top of my head. We put a blog up there on it to cover it and of course it made all the headlines and it caught the Republicans attention and then that's when they filed the lawsuit and it took a little while to work its way through. Honestly, that cat's out of the bag, that genie's out of the bottle, whatever you want to call it.
Speaker 2:You can't go back to so many 800,000, whatever barbers and say, no, we're reinstating your loans at this point. That's done and, in fairness, the administration announced this initiative a year ago and so if someone had issue with it they should have moved much quicker to take that to the courts, not wait until people actually got forgiveness. We knew the forgiveness was coming, but, candidly, even a financial advisor we got a lot of financial advisors that send clients to us and ask questions of us and a guy emailed me yesterday is like hey, my client is a doctor, just got this email saying their loans have been forgiven under the one time account adjustment. Is this legit? It looks like a scam. And I said, no, it is legit. But the first batch of forgiveness I think the second batch of forgiveness actually just happened last week is why they just got that letter and even he made the comment he goes well, it seems very interesting that a person making nearly a million dollars a year Is getting their loans forgiven just because they've been in repayment for 20 years.
Speaker 1:Some people call it interesting.
Speaker 2:Some people call it unfair, some people call it justified. You know, again, our opinions don't really matter here, yeah, but yeah, it's a big deal, but it's all a matter of perspective. It's a big deal for all call it older borrowers that have been in repayment for quite some time. It has almost no impact at all on any of your listeners that are currently in school or recently graduated.
Speaker 1:Yeah, All of the listeners. You're still going to pay your loans. You know what I'm saying?
Speaker 2:Yeah, but again, there's so much going on it's hard to just differentiate this stuff, right? It's so and that's why we tried our best to put stuff out on the blog. That breaks it all down and even our blog says if you're a student or a resident, you can ignore most of this. Don't even keep reading from here down. I think I put something along those lines in that blog article.
Speaker 1:Now you've been. It's been super helpful, like you just said, it is so there's so much to take in. And it feels like because you're very focused or at least me personally and a lot of my colleagues and everything you're so focused on medicine and it feels like you're drinking the description is drinking from a water hose or a fire hydrant. Essentially, you feel like you either can't get enough medicine or you are just flailing around to begin with and you don't want to. You want. You've got so much to learn that it feels like these things just pass by like as little tickers and you're like oh crap, I still have to, I still have a loan to pay back. And then you're like okay, maybe it's forgiven, maybe it's not, maybe. And if somebody sent me an email that said my loan was forgiven, I would have thought it was like a Nigerian print scam or something.
Speaker 1:But the information that you've been putting out and everything actually has been very, very helpful. I mean even your company and like the information that was given was how I got my information to like sign up, knowing that I could do the public loan or public service loan forgiveness while I was in residency, and everything which was very, very beneficial. So I guess, yeah for one thank you. But I was really curious, like for some of the listeners that because I'm already in residency, but if they're about to like begin their medical journey, we'll take it at base level, like if you're about to begin like college and or grad school in general, what would the tip be from you, like, what would one of your biggest tips be for them starting that journey, financial at least speaking?
Speaker 2:Yeah, and we'll let the underlying condition there be they can't pay for school, right, they have to take out some sort of debt to fund school. I do recommend the federal direct loans. A lot of people are asking questions right now because interest rates are so high. This year I think it's 7.04 for unsubsidized loans. For graduate school, I think it's one 1.5% lower for undergrad we don't do too much undergrad, but for grad plus loans, which I'm sure you're familiar with, they are always 1% higher than unsub loans. So for this year, for the 23-24 academic year, interest rates for medical students, for instance, are 7.04 and 8.04. And a lot of people are like whoa, that seems really really high. They are high. They're unprecedented high.
Speaker 2:In the history of the direct loan program we have not seen them that high. Is that fair or unfair? Or shall I shop around different loans? Well, first of all, if you shop around different loans, you're probably gonna find your private rates are even higher. Okay, so just figure that out for yourself, shop it out. See if I'm correct on that. I don't spend any time shopping out front-end loans. We shop out refinance loans, which are even better than the front-end loans typically, and I can tell you they're higher. But generally speaking, the federal loans are competitive.
Speaker 2:But as far as whether or not it's fair, when I was first starting this in 2011, student loan interest rates were fixed 6.8 for unsubs, 7.9 for grad plus and 8.5 for the older fell grad plus, which they phased out that same year and a lot of students that was in 2010s, early 20s interest rates were super low in the marketplace.
Speaker 2:A lot of students were complaining, right, that this isn't fair, and so the department then looked at it and said you know what you're right. Let's take a standard the 10-year T-bill, which goes up and down with market conditions, and every May, with the T-bill auction, what do T-bill rates go at in the month of May? We're gonna set student loan rates based off that rate. Of course, there's a fixed spread well, basically a markup in there for administrative fees and well, I don't know, it's just a markup at the end of the day, but there is a markup and that way we'll use that as the standard to set student loan rates for the following July for that academic year. And that way, if market rates are low, student loan rates are low. If market rates are high, student loan rates are high. Well, guess what Market rates right now are sky high? Because the Fed is trying to fight inflation. It is what it is. Hopefully they come down next year.
Speaker 2:Okay and we predict that they will. But even with rates being relatively high, I still recommend the federal loans. You've got these generous subsidies, such as the new save plan 100% interest subsidy. That's crazy. I still can't get over that. You've got loan forgiveness. You've got income-driven payment. You got flexibility If you're not making a ton of money after school, you're not gonna be drowning in student debt. And just generally speaking, the federal loans have a lot more provisions and flexibility. Even the interest accrual. It's simple interest accruing. It's not compounding every year, every month, like a credit card. The rates aren't variable. They're not going up and down, which that can be a good thing sometimes, but generally speaking, fixed rates tend to be better than variable in most situations. And so there's origination fees. The origination fees are catching some hot water. Your unsub-origination fees will over 1%, your grad plus origination fees like four and some change. A lot of people are asking why does the government need to charge me an origination fee? Right, I don't even know what origination fee is that seems, that makes sense.
Speaker 2:Origination fee is if I borrow 100 grand for this semester. If it's, you can't borrow 100 grand unsub. But just for example, if I borrow 100 grand unsub, they're gonna tack on a little over $1,000. Oh, if I borrow 100 grand and grad plus, they're gonna tack on $4,000. It's just a straight up fee that goes right on top of the loan balance as soon as that loan gets originated.
Speaker 1:It's a little time fee yeah. That makes sense.
Speaker 2:But generally speaking, we I do still recommend borrowers, good or bad. I think that the federal loans have the best overall potential and of course, it's the only debt you have any chance of maybe getting forgiveness one day. So I think it it needs to be a pretty extreme circumstance If you're funding your medical school, especially with something other than federal debt, because you do have that forgiveness potential kind of floating around out there. Whether your chances are lower or high, it's still a chance right, you know it's been done more than 20 years ago.
Speaker 2:You're telling me, there's a chance right, yeah exactly, and so so we I do recommend the federal loans. Aside from that, borrow as less as you have to. You know, I made my opening statement the number one thing we hear from borrowers when we sit down on our consultations man, did I really get let my debt get up that high? I wish I would have done this. I wish I would have lived more frugally the number one regret for graduating medical students. They look back and they didn't live as frugally. There is a phrase you need to learn right now live like a resident. I'm sure you've heard that point. Oh, yeah, right, george. What does that mean? It means I'm basically poor right now. I need to.
Speaker 2:I need to act my wage, if you've heard that a lot of medical students I'm not trying to lecture people a lot of medical students living on borrowed money need to act. Their wage Okay, your wage is zero, and just embrace it. You're talking to a guy that came from the army. I went through basic training. I made like $25,000 a year as a private in the army back in the day.
Speaker 2:You wanna talk about living frugally and being basically poor. You just embrace it, right. Everyone around you's in the same boat. So you look for cheap stuff to do and cheap stuff to eat and you just embrace that time of your life and you know, eventually you're gonna make great money. But if you will have that mentality going through school, borrow as little as you have to and of course that's a result of living you know a certain way. I promise you you will be so much happier when you graduate. Even if the number is 350,000, you know you're like you know what that number was gonna be 400,000, but I did this and I did that and I brought that bar and I brought that total down. I'm happy with that number, relatively speaking, within the things that I could control, I'm happy with that number.
Speaker 1:Yeah, that's very good advice because the living like a resident is very true, because even after the first couple of years out of your residency, or even when I'm in residency, we can like moonlight, where we can go work as the physician and actually get paid. You know, kind of like what a physician would actually make at these other hospitals. And to do that, you know, all of a sudden your income shoots up Like I make my monthly income in one shift if I do a moonlight shift but also use that money. Still live like a resident. Don't use that money to buy a new car, because it's really hard not to keep up with the Joneses. If you work in the ER and you've got there's a spot and all the spots are Lexuses or all these fancy cars and you've got this surgeon that parks beside you with a big old Corvette, yeah, and you know you don't want your rinky dink car there, well, you should just embrace it in a way, but it's coming right those days.
Speaker 2:your time is coming. You just have to be patient. But my goodness, you guys spend so much time in training. I couldn't imagine spending so many years waiting for your real payday. So I get the struggle is real. I get it for sure.
Speaker 1:I'm curious of like what for the people you know that are still in school, like what their forgiveness will look like in two to three to four years from now? I'd heard things about like the save program and stuff, but so two things.
Speaker 2:back to PSLF. That continues to be the greatest opportunity for physicians, especially now if I'm talking to IT professionals or dentists. I did a webinar just last night for the American Student Dental Association. Maybe 5% of them will get PSLF. That is not the forefront of our conversation when I'm talking to dentists, but for physicians, because of how the hospitals and other health systems are set up, it's still a big deal. By the way, when I say hospital health system is the greater terminology to use. There's so much consolidation going on in the healthcare these days that they're going like I'm in Atlanta. We've got four big systems here. They're all nonprofit and they're buying out all these private practices and their other hospitals. So what we're seeing is more and more physicians are finding themselves working for these big entities, which may or may not be a good thing, but one thing good about it we find more and more providers in different specialties that are employed now through a nonprofit who maybe 20 years ago would have been employed in a for-profit private practice setting. So PSLF is gonna be on the rise. I see more providers, generally speaking, especially physicians, getting PSLF five or 10 years from now than I do right now, and that's a good thing. The numbers have already gone. Before at the start of COVID it was like just over one billion or less than one billion had been forgiven. In three years time it's gone up. I don't know what the latest number is. It's like $40 billion that's been forgiven under PSLF. Like it just boom because people finally hit that 10-year mark where they've been these income-driven or payment plans. Now, aside from that, like I said, the SAIT plan really is a game changer and so probably will be programmed that come behind it.
Speaker 2:Normally speaking we see physicians use income-driven or payment plans short-term during training because you need that budget relief, even if you're not positioning for forgiveness. And then they decide whether or not they're gonna pursue PSLF. And if you do, you need that IDR, that income-driven payment plan, to kind of get you that's your vehicle to get you to PSLF. So those two things kind of go hand in hand. Again, if you check out the webinar it explains that better.
Speaker 2:But most physicians, if they don't end up going down a nonprofit, they usually abandon the loan forgiveness and the income-driven or payment plan. At that time they do something like a refinance hey, let me just drop the interest rate on my loan, do a SOFI or Laurel Road or Credible. There's lots of different refinances Something we helped with for free, by the way. Let me just drop my interest rate and pick a pay down a 10 year, a 15 year, a five year, whatever works in my budget, and that's gonna be my loan strategy, and you just check the box, like it's kind of like a mortgage. Right, I don't look at the balance on my mortgage most months. It's just part of my budget for the next 20 years. That's kind of your mindset on your student loans when you refinance. Here's what I'm getting to, though.
Speaker 2:As the income-driven or payment plans become more generous, we've been modeling these things out, like the save plan or what they call IBR for new borrowers. Some of those plans actually model out pretty good long term. If you've got $350,000 and you're going into, say, primary care, if I were to model that out for 20 years, it actually has you paying back less than you would pay on, say, a traditional 10 year pay down. The question is weighing the math savings versus the practicality Is having to deal with changing legislation and married filing separate tax returns and unknown income. Like I don't know my income is gonna be 10 years from now I'm gonna forecast it, but you know what's gonna change. There's a lot more work and variables and uncertainty that goes into that long-term 20 plus year forgiveness strategy as compared to, say, a refinance and just set it and forget it strategy.
Speaker 2:Right now most physicians choose the set it and forget it strategy. They say you know what, even if I'm a pediatrician, I'm still making a fairly comfortable salary. I can afford to pick a loaner payment strategy. Even if it's not the cheapest strategy, in theory it's affordable. I've saved some money by cutting my interest rate and I can afford. That's one of life's conveniences, basically that I can afford and I'm gonna choose to go that route. Is that mindset gonna change as the IDR programs become more and more generous? Maybe, I don't know. I'm the first one to tell barbers it's not all about the math. Right, you have to have a repayment strategy you're comfortable with, that's gonna be good for you long-term, that fits your financial goals and values and just kind of where you wanna be. And again, that's a personal decision.
Speaker 1:Yeah, it's definitely hard weighing all of the factors that go into it. I'm certainly glad that we have people like you that can actually that understand it a lot better, that can kind of spread it, spread the information well and understandable. I hope everybody listening today has been able to get something from this conversation, because I mean I certainly have. I feel like I've learned a lot and you've been very well-spoken on the topic. I know you're a very busy man, brandon, so we won't keep you much longer, but I just wanted to say for one, thank you. Anybody that was listening please go check out studentaloneprofessorcom. Was that correct?
Speaker 2:That's it, or again, you can go to dwqcom too, and that'll get you the right place when we're another. So either way, use both names. They'll both keep working for the foreseeable future.
Speaker 1:And you're on Instagram and all the social media. It's under the new name though studentaloneprofessor, right.
Speaker 2:Yeah, most of our social media handles are SL Professor, if you wanna search for that. And one thing I learned this week is when you first search, you have a lot of the search platforms. They've got like a category people, companies, videos you have to search where it says company or organization and boom, that's when we'll pop up. So I'm not super social media savvy. I've had to step away outside my box because obviously if you're growing any company these days, you have to be good on social media and if I had my way, I would delete it all from my phone, just to be honest with you, because it's such a distraction. So I've had to learn a lot along the way. We got a good marketing team so they keep me, they tell me. What I need to know and that was one of the lessons I learned about social media this week is those categories make a big difference when you're searching for stuff.
Speaker 1:No, it's a lot to take in, especially, I mean, with me. I feel like I would delete it all as well, but people like you, though, that understand the knowledge should be on there spreading it. So there's a lot of other misinformation or things that are being passed around.
Speaker 2:So we're doing more TikTok these days and that's something like I was never on TikTok, but the demographics show that more and more of you and your peers are on TikTok. They're saying young doctors specifically are spending a lot more time on TikTok and so they told us to get on there. Frankly, it's been a lot of fun. It's a lot more fun to just create a casual three, four, five minute video than it is to type some blog and have it edited. So we've been trying to post up videos at least once a week on recent topics.
Speaker 1:Yeah, and I mean my wife specifically, if she wants to look up something, or even if we were, like when we visited Italy, places to go, she looks that stuff up on TikTok and they're like or you know, and if I type in student loan forgiveness, I'm sure on TikTok it will, your face will pop up, but I hope so.
Speaker 2:I need to try that.
Speaker 1:But, brian, it was so good speaking to you. Thank you so much for coming, sharing the wealth and just being an overall good sport today.
Speaker 2:Thank you, yeah, thanks so much for having me. You know I do so many webinars. Honestly, this is one of the first interview podcasts. It's been nice just to have a conversation about student loans and the environment and the plight of young doctors these days and other borrowers, so this has been wonderful for me. I've enjoyed the experience and I wish you and all your listeners the best of luck Again. I know you know large. You know six-figure loan debt is not for the faint of heart. But there's good programs out there if you just take the time to learn them. Whether it's through us or the government resources, studentloansgov is becoming more and more robust. They put a lot of effort into making that a better resource for borrowers. So just do your research, get the knowledge out there. It's out there and I think you'll find that your student loans don't have to be a big burden not during school, not after school.
Speaker 1:I love it and go check out student loan professors. Thank you everybody.
Speaker 2:Take care Jordan break.