How a Doctor Piled up Half a Million Dollars in Student-Loan Debt

Avoid Student Loan Debt!

By Mary Pilon


Toni Martello, a student at Wesleyan University, talks about saving after college.

When you reach the end of your college career, your path once again opens in front of you. Many low- and middle-income students feel pressured to immediately get a job in order to help support their family and to begin paying off their debt. But that’s not the only post-grad option available. With planning and financial savvy, there are just as many opportunities for students on a budget as for their big-bucks peers:

Work: Those who had to sling library books or dining hall trays have the advantage of entering the workforce with some actual experience under their belts. Even if you haven’t figured out your true calling or landed the ideal position, a few years in the workforce can help flesh out your resume and replenish your bank account while you figure out what you want to do when you grow up. And there’s nothing like bringing home the bacon after years spent shelling it out.

Internships: Most student lenders establish a grace period, between six months and a year, before recent grads have to start making their monthly payments. Internships, paid or unpaid, could be a great way to capitalize on that grace period while gaining invaluable job experience. If you’re not quite ready to settle into the 9-5 routine, internships are a way to test the career waters while keeping long-term plans flexible. They also provide an opportunity to network, so when Sallie Mae comes a-calling, you may have a full-time job (and salary) waiting.

Living abroad: You may never again get the chance to just pack it all up and move across the pond, without nagging responsibilities like a family or career to consider. And hey—getting paid to wait tables in euros might just be more lucrative than it would be in dollars. But be careful about the flip side of currency conversion rates. Make sure you’ve always got enough in your bank account for a plane ticket home.

Graduate/professional school: An advanced degree could boost your expertise—and your eventual earning potential. Make sure you get as much preparation as you possibly can out of your undergrad school before moving on, whether that means taking the right classes or getting a resume once-over at the career center. You paid your tuition, so get your money’s worth before leaving. Check for combined or accelerated programs to get you closer to your advanced degree while cutting back on accumulated debt. And again, it doesn’t hurt to parlay a working-class background into an excellent essay that better-off applicants can’t always match.

Service opportunities: Teach for America, AmeriCorps, and the Peace Corps are all well-respected organizations that allow you to give back to various communities while making (modest) bank. These programs are designed for recent, debt-saddled grads like yourself, and may offer loan forgiveness or deferment options to keep you afloat.

Low- and middle-income students are used to adapting, using their resources creatively, and working hard to get where they want to be. Says one such student at Wesleyan University, “People [who haven’t had to support themselves] will have a harder time when they get out of college. I mean, I have no idea what I’m doing right now, but I know I’ll be okay, because I’ve always been okay.” Compared to students from families with higher incomes, students on a budget have valuable experiences that make them uniquely prepared to get out there and conquer the post-college world. And they know they’ll be okay—which is probably the best advantage of all.

Sanyika Calloway Boyce from Young Money discusses whether a post-graduate degree is really worth it.

Question: With the grim economic outlook and a job market steeped in uncertainty, is graduate school the next phase in your career or are you better off taking your undergrad degree and grabbing the first job offer that comes your way?

Answer: maybe…

Ok, so I know that’s not the profound answer you were looking for. The truth is I don’t know the best answer for you, but I can give you some guidance in how to answer that not-so-easy question for yourself. Consider me your “Grad School Guidance Counselor.”

What’s your why?

First, let’s tackle your emotional reasons for considering grad school before looking at the practical side of things. Start by asking yourself these two questions to identify your “why.”

1. Has graduate school always been on my “to-do” list or am I reacting to fear or something else?

Maybe you have a well-crafted plan for your career and have always known that graduate school was in your future, but maybe it just popped up as something you “should” do but you don’t have a clear idea why.

Without a clear objective you could not only waste precious time but valuable money as well. Sure getting a graduate degree will place you in the “elite” 95th percentile of educated people in the country. But if you are among the more than 30% that never finish your graduate studies you’ll just be stuck with paying an extra $400 per month in student loans.

2. Are you a good student? Do you enjoy the learning style of the traditional education system?

Graduate school is intense. It requires self-motivation and self-discipline because there is a lot of information to read, retain, and regurgitate in a very short period of time. If you have found major challenges with this type of learning (introduced to you in undergrad) then grad school may be very difficult.

Level of difficulty is never a reason to shy away from a challenge, but it should give you cause for pause when you also factor in the stress of academic success, countless hours of isolation due to heavy study loads, and the pressure to graduate on time.

What’s the cost?

Graduate school is a big commitment and you need to factor in both the fees you’ll pay for your advanced education as well as the investment of time.

The average cost spent for a Master’s degree varies by many factors including the area of study, the school you choose, the length of the program and the demand for the degree. In general expect to invest between $20,000 and $60,000 for this extra helping of educational pie.

Unlike undergrad which offers several funding options like financial aid, scholarships and grants, less than a fifth of all graduate and professional students receive scholarships, fellowships, or assistantships. And generally your parents will be less likely to foot the bill, so you’ll need to rely heavily on loans to cover the costs.

That said, with a graduate degree you also have the potential to make more money, so student loan payback may not be an issue. In fact, according to a study conducted by the US Census Bureau, “A master’s degree holder tops a bachelor’s degree holder at $2.5 million [in lifetime earning income] Doctoral ($3.4 million) and professional degree holders ($4.4 million) do even better financially.” To follow-up on that point Kevin Murphy, an economics professor at the University of Chicago who has studied the economic benefits of higher education says, “Educated people do so much better in so many aspects because they deepen their minds and improve their appreciation of life…You should go for a master's in poetry if you enjoy it," he says.

Whoa…hold on a minute. Before you take Mr. Murphy literally, I wouldn’t be a very responsible “Grad School Guidance Counselor” if I didn’t tell you that an MA in English doesn't get you very much in additional pay relative to the investment of the degree.

Individuals with Master’s degrees in technical fields, computer science, engineering, or math earn about 50 percent more than those with bachelor's degrees. That’s not to say there isn’t a big payoff with other advanced degrees, but before you commit to a program, or a loan to cover it, be sure you’ve researched the following:

• What salaries people in your intended field are earning and what is the difference with an advanced degree vs. without
• What (if any) are the funding options for this program/degree
• What will your monthly student loan payments be and how soon will you have to start paying them upon completion of the program
• How readily available are jobs in your field and is it a field poised for growth and expansion
• What other career options are available to you with the specific degree you’re pursuing
• Is an advanced degree even necessary for entry or advancement in this field

The other cost worth calculating is that of time. An advanced degree program could take you anywhere from one to six years to successfully complete it depending on your choice of attending full-time vs. part-time.

Of course there are pros and cons to both scenarios. You must decide if you can afford to focus solely on completing the program in the shortest time possible to reap the financial rewards sooner, or divide your interests between full-time employment and part-time education which will (obviously) take longer.

So, is graduate school worth the cost? If you’re still not sure how to answer that question than take the time to do the research so you can make the best decision for you.

And at the risk of leaving you with more questions than answers consider this final point. Education is at its core a business. Colleges regularly create and market new graduate programs to boost their bottom lines; albeit while delivering a quality service to students. So if you’re determined enough to get an advanced degree, be prudent enough to consider all costs and choose a program (and price point) that will expand your career options and earning potential rather than lock you into a slow growth industry and limit you with debt.

Sanyika Calloway Boyce is the author of four books. She travels nationwide to educate, empower, entertain and enlighten students about money, credit and debt. This former debt-strapped college student shares real and relevant money messages that young adults can relate to and understand. Visit her online today at

Article provided courtesy of Young Money, a leading national money, business and lifestyle magazine written primarily by student journalists and dedicated to changing the way young adults earn, manage, invest and spend money.