$300,000 in Student Loans?

How is that even possible? On September 14th, the Minneapolis StarTribune ran a front page article in the Sunday paper with the following headline: “Graduation Day and $300,000 In Debt”. As a financial planner, college planning expert and father of two young girls who expect to go to college one day, I did a major double take.

My first thought, “What the heck?!” Followed by, “That ain’t ever happening to me!” Then, soon after, “One of my daughters wants to be a vet… I better look into this”.

It could happen to you

After all, why wouldn’t it happen to me or my daughter? Or yours? The price of the University of MN College of Veterinary Medicine isn’t going down over the next 15 years. Truth is it could happen to any of us, if we are set on pursuing a dream.

I am not passing judgment on the young veterinary student in the StarTribune article, or anyone else who has found it necessary to take on a large amount of debt to pay for college. In fact, my heart goes out to her. Student loan debt will change her life forever in ways she can’t even imagine.

I have done more than one college planning workshop where a parent (usually a doctor or attorney) comes up to me and discloses that she is still paying off her student loans even as her children are about to start their own college careers.

I also agree with the premise of the article: college costs have gotten WAY out of hand. The average college student incurs about $30,000 in student loans before they finish their undergraduate degree. Add to that another $188,500 in student loans for the average MN veterinary student. The numbers are staggering.

Below are four strategies to avoid getting buried underneath a mountain of student loan debt.

Strategy #1: Get resident tuition rates. Veterinary school is expensive. There’s no way around it, but tuition rates for non-residents are nearly double that of residents. At the University of MN CVM residents pay $30,828 for tuition and fees. Non-residents pay $55,160. The difference adds up to over $100,000 by the time graduation comes around. As Minnesotans, we are lucky to have one of the top veterinary schools in the country right here in our own home state.

Strategy #2: Join the Army. Or the Air Force. I know some readers are wincing at that, but it’s an option that should be considered.

Many people have gotten medical degrees, law degrees, even become Doctor’s of Veterinary Medicine while serving in the military. As a veterinarian serving in the military you may be eligible for up to $120,000 in tuition reimbursements. If you are already in school, you may be able to apply for the Armed Forces Health Professionals Scholarship. This scholarship pays for full-tuition for a variety of professional degrees and provides a monthly stipend of $2,000.

And yes, I would support my daughter if she decided to join the military to pursue her dreams.

Strategy #3: Loan Forgiveness Programs. If you have to take out loans, it may be wise to consider looking into various loan forgiveness programs. The Veterinary Medicine Loan Repayment Program offers up to $25,000 a year in loan forgiveness for qualified candidates who agree to serve 3 years in designated areas that have a shortage of veterinarians.

Minnesota’s veterinary loan forgiveness program provides relief for large animal vets who work in underserved rural areas and work in a practice that focuses on food animals. The MN program is very competitive. They only offer a handful of grants each year. More information can be found at the MN Department of Health.

Getting someone else to pay off your loans isn’t easy, but if you can qualify for a loan forgiveness program it can put a big dent in the student loan debt.

Strategy #4: Pay less for the undergraduate degree. If you are hoping to get a professional degree like Doctor of Veterinary Medicine, manage your undergraduate college expenses VERY carefully.

How can a student afford $50,000 a year for veterinary school when they have already spent everything you have and they’ve borrowed $30,000 or more in student loans before they even graduate from college?

Paying less for college is on every parent’s mind. However, if your student wants to be a veterinarian (or a doctor, dentist, attorney, etc.) it’s especially important to keep the undergraduate college expenses as low as possible. Some private schools charge up to $60,000 a year or more for the total cost of attendance. Maybe there is a less expensive alternative.

If your student wants to be a veterinarian, consider keeping her college expenses to $25,000 a year or less. Incidentally, that’s about what it costs to attend the University of MN as an undergrad. And if she wants to become a vet or a doctor or a dentist, guess where she will end up. At the “U”.

If there is anything I can do to help you pay less for college, just ASK MIKE.

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