If your family is paying for vet school, you can stop reading this and head over to the How to Be Successful series. For the rest of you, read on!
I was working on a lecture I was planning to present at SAVMA Symposium 2020 about personal finance. The title is “From $250,000 in Debt to Millionaire.” In part of it, I work out an illustration of how the math works to get from $250k in debt to having $1M in assets for an average new graduate. I imagined myself giving this presentation and railing to the attendees that if any of them went to Ross or Midwestern or other non-state schools without their family paying for vet school, that decision is going to affect the entire rest of their life.
So many pre-vet students have the goal of “get to vet school”. But not enough think about after vet school. Do you want to practice in a rural mixed animal practice? Do you want to own a nice house? Do you want to buy new cars? Do you want to have kids and send them to private school or college? Do you want to not have roommates? Guess what? It’s much harder to do ANY of these things if you have more than twice your yearly gross income in debt.
I urge you, sincerely and passionately, to think about what you want from your life. You may not be materialistic- that’s great, neither am I. I’m not talking about you being able to buy a BMW or live in Los Angeles. I’m talking about you being able to buy a new Honda Civic and live anywhere other than rural Iowa. I’m talking about you being able to buy a house less than 10 years after graduation. I’m talking about you being able to go on a trip once a year. I am talking about relatively basic assumptions most people make about their life after getting a professional degree. You won’t be able to have any of these if you go into so much debt because of vet school.
The numbers work out something like this. A debt of $250k paid off over 20 years at a rate of 6% will be a payment of $1,800 (assuming no income-based repayment, because who knows how long that program will be around). Aiming for a $10k contribution to retirement, as well as taxes and saving for a house down payment, provides a budget of around $30k a year for an average new graduate. That’s not a lot of money for life. This amount has to cover insurance, groceries, travel, clothes, utilities, entertainment, and everything else. That’s difficult to do, particularly if you’ve been putting off making any purchases throughout your many years of schooling.
Now, if you’re willing (or eager) to work small animal ER in Phoenix and take extra shifts, or do 4 more years of training to get a specialty, you can earn enough of a salary that the large debt is less of a problem. If you can make $130k, your debt to income ratio is less than 2, which isn’t catastrophic. But not everyone wants that kind of life.
So, before you go to a school which is going to put you massively in debt, please consider the lifetime repercussions. Maybe it would be better to work for another year, get more experience, and re-apply to your state school next year. Maybe it would be better to do a PhD, where you actually get a small stipend during school, rather than a DVM. There are so many paths to a happy, successful life. Don’t paint yourself into a corner obsessing over the DVM at all costs.