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[financially_nervous]

Long-time lurker, first-time poster.  I will both try to keep this brief and likely fail.  (Looking back: I have failed.)

After graduating from college last year with quite good grades (the lowest was an A-, and that only once), test scores (GRE 1590, writing 6.0), and much encouragement from my professors to go onto a Ph.D. program in my field of the humanities, I instead chose to take a business-related job for a year.  I did this in order to be in the same city with my fiancée and to save money for our marriage this summer.  My fiancée is currently a first-year medical student. 

This fall I applied to a local MA program which also happens to be at a nationally-renowned university with a great history of placing its grads in top Ph.D. programs in the field – furthermore, it offers funding to its MA students on par with Ph.D. programs.  I have not yet been accepted, but I am certainly hopeful that I will be.  If I’m not, well, that will perforce simplify my quandary.

My concerns are financial.  I have no debt, but my fiancée is by necessity taking out loans to finance her medical school education, and by the time she graduates those loans will total around $200,000 (and growing!).  Due to hard work and scrimping and saving, we’ve managed to accumulate a sizable emergency fund that will meet the difference between my stipend and our budget shortfalls until she begins her residency – she will only need to borrow money for tuition and academic fees, not for living expenses or insurance.

I am no fool.  I know that I would have to forgo 7 years (give or take) of income in order even to be eligible to be considered for a poorly-paying job in a random area of the country.  I’ve followed the job market for professors in my field for the past three years and I am fully aware of its limitations.  My fiancée and I would begin our thirties with very little in savings, an enormous debt burden from medical school, and in general an uphill financial road to climb before kids and mortgage payments become a reality.  We’d need to live like graduate students into our mid-thirties, at least, in order to be debt-free.

I have just been offered a promotion where I would make approximately $50,000 next year.  I know that I could take it, buckle down, save for kids and retirement and a house and all that good stuff, and live the so-called good life.  I am all too aware of the power of compound interest and what I will be missing if I start saving for retirement in my mid-thirties instead of my early twenties.  On the one hand, I want to do the responsible thing and safeguard my wife’s and my (and our future children’s!) financial future.  She is the most important thing to me.

On the other hand, I love my field.  I’ve never been happier than when I’ve been studying and researching and writing.  I also love teaching.  I have every reason to expect that I would love graduate school and excel.  My fiancée is extremely supportive and encourages me to follow my dreams; she knows that I’ve given things up for her, and she insists that she is more than willing to sacrifice for me as well.  Furthermore, like any good red-blooded young American, I never grew up wanting to “sell out” to The Man.

I know that the decision ultimately rests with me and her.  We have to determine what we really want in life and what we’re willing to sacrifice to achieve that.  I figure if I want it badly enough and we’re willing to make the sacrifices, then we’ve got to go for it – you only live once, you miss 100% of the shots you never take, etc., etc.  If it doesn’t work out, at least we tried.  And yet, seeing her debt (and I shouldn’t say hers – what’s hers is mine), and knowing the future sacrifices I’d be asking her to make, I have my doubts.  And I think that’s a good thing – anyone who doesn’t have doubts about making this type of decision probably hasn’t thought it through enough.

To anyone who has read this far, if you have any thoughts that you’d like to share, I’d love to hear them.  In any case, writing this has helped crystallize some of what’s been bouncing around in my head. 

[acrimone]

Work now.
Study later.

Make your money first, as much and as early as possible.  Buy a home, invest.

The Ph.D. programs are always going to be there.

Read the "Colleagues with Money" thread and think about how much easier life would be if you were one of the Colleagues with Money.

[shakie]

Keep the job...  take the raise and enjoy both the things that having ok money allows (vacations and travel) and save.  In five years look back and decide what you want... 



I'm in my 30s in a PhD program - and the life experience before school is invaluable.  Even looking back I wish I had taken more time... earned more money... relaxed more.  I love my research and teaching and all - but it will always be there.  Wait till she is done and then decide. 

[aristotelian]

I say go for it.  You sound committed to this career.  The problem with waiting is you will undoubtedly get tied down to a specific location.  This will restrict your choices for grad school, and especially for when you hit the job market.  If you want a shot at a tenure track job in the humanities, you need to be able to do a full national search.

$200k seems like a lot of debt now, but she's going to be a doctor, so who cares, you guys will be rich when she finishes!  As long as each of your careers is able to pay for itself, you will both be o.k. in the long term.  It sounds like you both have a good plan.  If you don't get into a top program with funding, then maybe you stick with your job, but if you are as good as you say you are, I think you will be resenting your wife while she has the career and you have the day job.

[malingered]

I'm with Aristotelian. It sounds like you and your wife both have good plans, and there's no reason you shouldn't both be able to pursue them. It's true that it might be a little hard on your finances for the two of you to be in school at the same time, but don't lose sight of the very real sacrifice you would make in putting off your studies.

If this is really just about finances, I wouldn't worry so much. You have no debt, and your wife is going to make a lot of money. That is a much better situation than most people are in as they look towards applying to grad school. And a lot of people in academe have families. Just how much money do you need?

[sinenomine]

I think acrimone makes a good point.  I had a friend in grad school who had worked for many years at a large corporation, and then resigned to pursue a Ph.D.  He had no money worries, since he had saved while doing the business gig, and now, with degree in hand, he's a very happy liberal arts professor and a published (and respected) poet.  Another friend served in the military to earn and save money, then got his Ph.D., and is now happily working at a SLAC as a professor and department chair.

[acrimone]

$200k seems like a lot of debt now, but she's going to be a doctor, so who cares, you guys will be rich when she finishes!

That's just nonsense talking.  They may be rich 10 years AFTER she finishes, if they play their cards right, but $200,000 earns interest.  It's probably low interest, but even if the wife makes $200,000 a year straight out of med school (which I'm not really sure is a likely scenario -- I know nothing about what starting doctors make, but I assume it's a little more than starting high-end lawyers) that's still only $250,000 combined.  That's a LOT of money, but so is the debt.  Assume 30% taxes across the board (state, SS, fed, but assume you buy a house)that's $175,000 take home.

That's less than the loan balance.

[trentsands]

When does your spouse finish med school?  Assuming she's going full time and has no set backs, then I'm guessing there's a very finite time in which she'll be in school before going out and working.  Once she does begin work, it's your turn.  Medicine is a flexible, high demand job, isn't it?  So she should be able to move where you need to go.  Even with the debt, when she's working, you both will be much more likely to maintain yourselves without incurring more debt to pay for your program.  A few years will go by fast, especially if, maybe, you can fit in a couple graduate level courses in your field and possibly work on a small publication or two before you apply to programs.

This has worked well for my wife and I, who have taken turns earning our degrees.  First my M.A., then hers.  She is now earning an M.Div. and after this year, she'll be done, which means I'm going for my Ph.D.  With one of us working at every point, it's kept the debt down and the living standard high.

[malingered]

A couple points. First, for those who have been relating anecdotes about people who have successfully entered late into the academic career path: that's great, but I don't think anyone doubt that it is possible to compromise, or take turns. The question is whether in this case it is necessary, or desirable.

The point of my last post was that it doesn't sound like it's necessary. He can get funding, she can carry her loans for a while, and it will all get sorted out once they both have jobs a little bit down the line. 200k in debt isn't nothing, to be sure, but the bottom line is this: the system is not set up so that going to medical school is a move that will hurt you financially. It just isn't. The salaries available outweigh the debt burden, and then some. A person with a medical degree and 200k in debt still has better financial prospects than someone with a Humanities PhD and no debt. (This is true even in the short term, since the starting salaries are high, and since of course the debt doesn't have to be paid off right away.) The reason that you can get full funding relatively easily in the Humanities and not for medical school is that a doctor can pay off loans, and a professor can't. Neither side is unfairly penalized here. That's just what the equilibrium is.
 
The reason I emphasized this is that the original poster was talking as if his wife's situation were worse than normal, financially speaking. If it were, he would do well to take pause before deciding to enter into the path of a relatively illucrative career. But it isn't. In fact, her prospects are better than normal. So why should her financial situation dictate his career choices?

Now, whether it would be desirable to take turns is another question. Perhaps the original poster really likes his job, or is interested to see where that might lead. That might be a reason to keep it for a while. Or perhaps he thinks it would foster a stronger sense of fairness within their relationship. That, too, seems possible. And there are many others.

I think there are a lot of important considerations at play here, as is always the case when two people are trying to plan for their future together. It just doesn't seem like finances are a particularly pressing one in this case.

 

[acrimone]

There is only one real thing to consider here: time value of money.

$10,000/year in the retirement account now, for even five years, before going to grad school and getting essentially 0 income for 5-7 years, is roughly equivalent to eight or nine years of the same retirement savings post-graduation if you go right away.

Plus you get to buy cool stuff to keep you entertained and happy while you study.

[financially_nervous]

Thanks for all the replies!  I really appreciate hearing your thoughts.

To answer a few questions:

1.  How much money do we need?  (This question may have been rhetorical.)

We would like to have enough money to own a house, send 2 or 3 as-yet-nonexistent children to college, and retire comfortably when we so decide.  We also want to be able to deal with any serious emergencies that may arise and maybe travel a bit.  These are all long-term goals, obviously.  Over the next 5-10 years we'd be content with full bellies and a roof over our heads - but clearly our choices now will have an impact on the options available to us down the road.

2.  When does she finish medical school?

This is an important question.  She will graduate medical school in three and a half years, and then she will need to choose a residency program.  In our current ideal universe, I would do the MA program beginning in the fall and then leave for a Ph.D. program in her fourth and final year of medical school.  She would then apply to residency programs in whatever city I am in for my Ph.D.  The length of the residency program varies depending on what specialty she chooses, but four years is a good bet based on what her interests are today.

The difficulty is that if I wait a year, for example, to do the MA program, we would be applying to a Ph.D. program and residencies at the same time.  Because of the nature of the residency-matching process, this can be very difficult to coordinate.  Essentially she is looking at three and a half years in our current location, followed by four at another.  I can more or less determine our next location, so long as it is in the vicinity of a city with a few residency programs, but once we pick then we're "stuck." 

There are various permutations of what years I could try to apply for things, but applying for the MA this year and the Ph.D. two years hence seems to give us the best possibility of (a) my ending up in a top Ph.D. program and (b) the two of us ending up in the same location. 

We could live with being apart for a year (or 8 months), but being separated for multiple years is not acceptable to either of us.  She comes first; I'd be unhappy away from her even if I were in the World's Greatest Ph.D. Program. 

3.  Her ("our") debt and ability to repay it.

As a doctor she will indeed be able to repay her debt over time.  The length of time it takes depends on a wide variety of factors, but making projections to the best of my current ability, if I go to a Ph.D. program we are probably looking at debt until our mid-thirties.  There are really far too many variables in play to make a better estimate, and it's certainly quite possible that we could be in debt even longer.

I know that if I worked for the next 7 years, she would be able to repay her debt easily within a relatively short time frame and we would be on extremely secure financial ground.  We would have no difficulty achieving the financial goals described above. 

Life's not just about making money though.  I really do love what I studied in college.  It makes me happy in a deep and profound way.  I'm afraid I can't say that about my job.

[malingered]

There is only one real thing to consider here: time value of money.

I completely agree with you, so long as we accept the notion that life's just about making money.

Life's not just about making money though.  I really do love what I studied in college.  It makes me happy in a deep and profound way.  I'm afraid I can't say that about my job.

I think you should do what makes you deeply, profoundly happy. I think that is what people should do in life, if they can. And you can. You guys might be more comfortable if you worked for the next 7 years before going to school, but I think you'll still be pretty comfortable. If you can be pretty comfortable, and do what makes you deeply, profoundly happy, that's a pretty good deal.

And really, if a doctor's husband can't afford to go into academe, who can?

[acrimone]

There is only one real thing to consider here: time value of money.

I completely agree with you, so long as we accept the notion that life's just about making money.

Life's not just about making money though.  I really do love what I studied in college.  It makes me happy in a deep and profound way.  I'm afraid I can't say that about my job.

I think you should do what makes you deeply, profoundly happy. I think that is what people should do in life, if they can. And you can. You guys might be more comfortable if you worked for the next 7 years before going to school, but I think you'll still be pretty comfortable. If you can be pretty comfortable, and do what makes you deeply, profoundly happy, that's a pretty good deal.

And really, if a doctor's husband can't afford to go into academe, who can?

There are two problems with this "do what makes you happy" philosophy.

First -- who gets to decide what makes you happy?  You now, or you in twenty years?  You in twenty years will probably be happier to have some financial stability, a little variety of work experience, and still be an academic.  Obviously this isn't something that can be known with any scientific certainty, but it's certainly worth thinking about.

Second -- your happiness is not all that matters.  Creating a financial stable home for your family is worth some effort -- even at the cost of some happiness in the short term.

[aristotelian]

So going into debt for education is irresponsible and dooms you to long term unhappiness?  Yes 200k is a lot.  But they will have that debt and will take a long time to pay off regardless of whether he goes to school now or later.   They have a plan to pay it back.  She will have a lucrative career, at which point it will not be a problem to spend say $25k per year on loans.  I don't see why she gets to have the career she wants and he has to put his on hold indefinitely--and possibly forever. 

If your plan is to go back later, she should be clear that this may involve moving the family several times, once for school, once or twice for visiting jobs coming out of school, and again for that tenure track job.   

[malingered]

Acrimone: If your principles are just that (1) we ought not always act purely with an eye to short-term happiness, and (2) we ought to think about people other than ourselves when making important decisions, I think we're actually pretty close to agreeing. I wasn't urging the original poster not to consider the future, or his wife and (potential) children. I was just saying that on balance it sounds like he can go to school now and end up in a good, stable financial situation.

So given that it is perfectly possible for him to go to school now, and given that it seems like that is what will make him really happy (both now and in the long term) it seems like a good course of action. If I thought that it would sabotage his long-term happiness, or that it would be unfair to his wife, I wouldn't advise it. But as far as I can tell, it's a perfectly fine plan.

I suppose you will say that, even so, they might be even happier with the other plan. Well, maybe. But I sort of doubt it in this case. It seems that the original poster is facing a conflict between a very strong positive impulse (his love for doing scholarly work in his field) and an equally imposing negative impulse (anxiety about being able to provide for his family in the future.) As you say, it is difficult to predict with any certainty what will make us happy in 20 years. I just think that it's generally a better bet -- provided you are rational enough to distinguish between your short- and long-term interests -- to follow strong positive impulses than to allow your decisions to be dictated by your fears. Especially when your fears are sort of ill-founded.

In any case, your argument seems odd to me. Wouldn't it entail that _everyone_ should take a substantial amount of time off after undergrad to earn money? After all, who wouldn't benefit from a stash of interest-earning cash while in grad school? But I think there are good reasons for the fact that everyone does not do this. Working just for money can be a huge emotional and intellectual drain. For many, the amount of momentum lost in seven years would make it difficult to get back on track.

And for those who are really passionate -- how could they bare to wait? Especially in this situation it seems like he would be sacrificing a lot now for an incrementally better financial situation later on. I suppose that is really my greatest difficulty with your advice: of all possible cases, it seems to apply least well to the one actually at hand.