Transcript FINANCING YOUR MEDICAL EDUCATION - Welcome

FINANCING YOUR MEDICAL
EDUCATION
TOPICS







THE FINANCIAL AID PROCESS
MEDICAL SCHOOL COSTS & BUDGET
DETERMINING FINANCIAL AID AWARDS
CATEGORIES OF FINANCIAL AID
MEDICAL SCHOOL DEBT
THE IMPORTANCE OF CREDIT RATING
QUESTIONS
FINANCIAL AID
APPLICATION PROCESS
O
C
T
O
B
E
R
J
A
N
U
A
R
Y
M
A
Y
EXPLORE THE FINANCIAL AID APPLICATION PROCEDURES AND DEADLINES
OBTAIN INSTITUTIONAL APPLICATION FORMS
BEGIN RESEARCHING THE WEB FOR SCHOLARSHIPS
FILL OUT THE FAFSA ON THE WEB
OBTAIN ESTIMATES OF FINANCIAL AID OFFERS FROM ALL SCHOOLS
MAKE A DECISION AS TO WHICH MEDICAL SCHOOL YOU WANT TO ATTEND
UCSD MEDICAL SCHOOL
2005-06 BUDGET
DESCRIPTION
O
F
F
C
A
M
P
U
S
FIRST YEAR
BOOKS
$1,976
RENT/UTILITIES
($919/MO)
$8,731
FOOD
($308/MO)
$2,926
MISC./PERSONAL
($307/MO)
2,917
TRANSPORTATION
($307/MO)
$2,917
EQUIPMENT BAG
$925
MICROSCOPE
$150
REGISTRATION FEES
$22,007.50
TOTAL
$42,550
UCSD MEDICAL SCHOOL
2005-06 BUDGET
O
N
C
A
M
P
U
S
DESCRIPTION
FIRST YEAR
BOOKS
$1,976
RENT/UTILITIES
($550/MO)
$5,225
FOOD
($308/MO)
$2,926
MISC./PERSONAL
($307/MO)
2,917
TRANSPORTATION
($307/MO)
$2,917
EQUIPMENT BAG
$925
MICROSCOPE
$150
REGISTRATION FEES
$22,007.50
TOTAL
$39,044
UCSD MEDICAL SCHOOL
2005-06 BUDGET
2nd YEAR
3rd YEAR
4th YEAR
ON
CAMPUS
$44, 970
$44, 636
$31, 361
OFF
CAMPUS
$49, 399
$49, 064
$34, 682
TOTAL FOR 4 YEARS $175,695 OFF CAMPUS
$160,000 ON CAMPUS
PUBLIC VS. PRIVATE
MEDICAL SCHOOL COSTS
PUBLIC
PRIVATE
UCSD
$18, 612
$27, 826
$20, 172
National Average for 2004-05 according to the AAMC
Tuition and Fees only
FINANCIAL AID AWARDS



60% OF THE ENTIRE CLASS WILL RECEIVE
SCHOOL BASED FINANCIAL AID PACKAGE.
THE NEEDIEST SCHOOL PACKAGE FOR
2005-06 IS $24,273
($19,980 GRANT & $4293 SCHOOL LOAN)
THE LOWEST NEED SCHOOL-BASED
PACKAGE FOR 2005-06 IS $20,673
($10,301 GRANT AND $10,372 LOAN)
HOW YOUR AWARDS ARE DETERMINED
2005-06
SINGLE STUDENTS
PARENTS’ CONTRIBUTION
NEED CATEGORY
STUDENT IS SINGLE & PARENT’S
CONTRIBUTION IS > $23,887
STUDENT IS SINGLE & PARENT’S
CONTRIBUTION IS < $23,887
NEED CATEGORY 1
NEED CATEGORY 2 -- 5
STUDENT IS ELIGIBLE FOR
FEDERAL STAFFORD LOAN
ONLY
STUDENT IS ELIGIBLE FOR
INSTITUTIONAL GRANTS &
LOANS
WHY USE PARENTS’
INCOME AND ASSET INFO?
1.
STUDENTS FROM LOW-INCOME BACKGROUNDS USUALLY
ENTER MEDICAL SCHOOL WITH A SUBSTANTIALLY
HIGHER DEBT THAN STUDENTS FROM MORE AFFLUENT
FAMILIES.
2.
IN GENERAL, STUDENTS FROM AFFLUENT
BACKGROUNDS ARE ABLE TO CALL ON THEIR PARENTS
FOR FINANCIAL HELP, WHEREAS STUDENTS FROM
LOWER INCOME FAMILIES DO NOT HAVE ACCESS TO
THIS RESOURCE.
3.
IF LIMITED SCHOOL-BASED FUNDS WERE DISTRIBUTED
EVENLY AMONG ALL STUDENTS IN THE SCHOOL,
REGARDLESS OF PARENT INCOME, THE AMOUNT OF
GRANT AND LOW-INTEREST LOAN MONEY AVAILABLE
TO EACH STUDENT WOULD BE SUBSTANTIALLY
REDUCED.
HOW YOUR AWARDS ARE DETERMINED
2005-06
MARRIED STUDENTS WITHOUT CHILDREN
SPOUSE’S NET MONTHLY INCOME
NEED CATEGORY
STUDENT IS MARRIED & SPOUSE’S
INCOME IS > $1926/MONTH
STUDENT IS MARRIED, SPOUSE’S NET
INCOME < $1926/MONTH
NEED CATEGORY 1
NEED CATEGORY 2
STUDENT IS ELIGIBLE FOR
FEDERAL STAFFORD LOANS
ONLY
STUDENT IS ELIGIBLE FOR
INSTITUTIONAL GRANTS &
LOANS
FINANCIAL AWARD SAMPLE
Single student without children
EFC = $2083 (Estimated Family/Parent Contribution)
Need Category 5
Budget
Student Contribution
Financial Need
School Aid
Unmet Need
eligible for school aid
$19, 980 – School Grant
$4293 – School Loan
TOTAL $24,273
$42,550
- $1000
$41, 550
- $24, 273
$17, 277
Federal Loans
$8,500
Subsidized Stafford ($8500 max)
Unsubsidized Stafford ($30,000 max)
Unmet Need
$8,777
$0
FINANCIAL AWARD SAMPLE
Single student without children
EFC = $23,900 (Estimated Family/Parent Contribution)
Need Category 1
Budget
Student Contribution
Financial Need
School Aid
Unmet Need
Federal Loans
Unmet Need
Not Eligible for School Aid
$42,550
- $1000
$41,550
$0
$41,550
- $8,500 Subsidized Stafford
- $30,000 Unsubsidized Stafford
$3020 Alternative Loans
$0
CATEGORIES OF FINANCIAL AID

INSTITUTIONAL AID
– BASED ON STUDENT’S & PARENTS’ INCOME AND ASSETS
– INCLUDES GRANTS, SCHOLARSHIPS, FELLOWSHIPS AND LOANS

OUTSIDE GRANTS AND SCHOLARSHIPS
– USUALLY RESTRICTIVE IN NATURE
– BASED ON FACTORS SUCH AS THE AREA OF RESIDENCE, ETHNICITY,
RELIGIOUS AFFILIATION, ETC.
– EXAMPLES: NATIONAL MEDICAL FELLOWSHIPS, BECA SCHOLARSHIP,
NATIONAL HISPANIC SCHOLARSHIP, THE CHINESE AMERICAN MEDICAL
SOCIETY SCHOLARSHIP
CATEGORIES OF FINANCIAL AID

OUTSIDE LOANS
– FEDERAL LOANS (SUBSIDIZED AND UNSUBSIDIZED)



HAVE BETTER TERMS THAN THE ALTERNATIVE LOANS
INTEREST CAP AT 8.25%
DON’T REQUIRE CREDIT CHECK
– PRIVATE LOANS (THROUGH OUTSIDE LENDERS)



ALTERNATIVE LOANS - REQUIRE CREDIT CHECK
OTHER OUTSIDE AGENCY LOANS - MAY OR MAY NOT REQURE
CREDIT CHECKS
CAN’T BE CONSOLIDATED WITH YOUR FEDERAL LOANS
CATEGORIES OF FINANCIAL AID

SERVICE OBLIGATION PROGRAMS
– REQUIRE A COMMITMENT TO PRACTICE IN A PARTICULAR FIELD OF
MEDICINE OR IN A SPECIFIC GEOGRAPHIC LOCATION
– HAVE STIFF PENALTIES FOR DEFAULTING ON THE SERVICE
COMMITMENT
– EXAMPLES: ARMED FORCES SCHOLARSHIP PROGRAMS, THE
NATIONAL HEALTH SERVICE CORPS AND THE PRIMARY CARE LOAN

LOAN REPAYMENT PROGRAMS
– PROVIDE BACK-END HELP AFTER GRADUATION FROM MED SCHOOL
BY REPAYING ALL OR A PORTION OF A STUDENT’S OUTSTANDING
EDUCATIONAL DEBT
– MOST ARE TIED TO PRACTICING IN A PARTICULAR AREA OF
MEDICINE OR SPECIFIED GEOGRAPHIC LOCATION
– EXAMPLES: NATIONAL HEALTH SERVICE CORPS LOAN REPAYMENT
PROGRAM, THE CALIFORNIA STATE LOAN REPAYMENT PROGRAM,
ETC.
MEDICAL SCHOOL DEBT
AVERAGE ALL
SCHOOLS
AVERAGE PUBLIC
SCHOOLS
AVERAGE PRIVATE
SCHOOLS
AVERAGE UCSD
*ACCORDING TO THE AAMC FOR 2004
**INCLUDES PRE-MATRICULATION DEBT
$115,218
$104,385
$133,357
$75,126
ESTIMATE OF REPAYMENT
REPAYMENT TOTAL PAID IN
PERIOD
FORBEARANCE
TOTAL PAID
IN
REPAYMENT
TOTAL
PAID
OVERALL
MONTHLY
PAYMENT IN
REPAYMENT
10 YEARS
PAYMENT BEGINS
AFTER
GRADUATION
$147,183
$147,183
$1,227
15 YEARS
$33,000 OR
$688/MO
$174,625
$207,625
$970
25 YEARS
$33,000 OR
$688/MO
$236,535
$269,535
$788
LOAN AMOUNT OF $100,000 AT 8.25% INTEREST RATE
CAN I AFFORD THE MONTHLY
PAYMENT ON MY SALARY ?
AVERAGE ANNUAL SALARY
OF FAMILY PRACTITIONER
$142,000
GROSS MONTHLY PAY FOR
A SALARY OF $142,000/YEAR
$11,833/MO
MONTHLY LOAN PAYMENT
BASED ON 30-40% OF SALARY
$3550 - $4733/MO
THE IMPORTANCE OF
CREDIT RATING


ALTERNATIVE LOAN PROGRAMS
REQUIRE A CREDIT CHECK
LENDER WILL LOOK AT:
– DEROGATORY CREDIT
– EDUCATIONAL LOAN DEFAULTS
– HISTORY OF LATE PAYMENTS ON
CONSUMER DEBT
WHAT’S A GOOD CREDIT
SCORE?






800 +
750-799
700-749
650-699
600-649
BELOW 600
EXCELLENT
VERY GOOD TO EXCELLENT
GOOD TO VERY GOOD
FAIR TO GOOD
POOR TO FAIR
VERY POOR TO POOR
HOW TO MAINTAIN
GOOD CREDIT?




RETIRE CREDIT CARD DEBT BEFORE
ENTERING MEDICAL SCHOOL
OBTAIN A COPY OF YOUR CREDIT REPORT
AND CLEAN UP ANY NEGATIVE CREDIT
THAT YOU CAN
DON’T BORROW MORE THAN YOU NEED
ALWAYS KNOW EXACTLY HOW YOU WILL
REPAY THE DEBT AND HOW IT WILL
AFFECT YOUR MONTHLY BUDGET
WHAT TO DO IF DENIED?




OBTAIN AND REVIEW CREDIT REPORT
USED IN DECISION PROCESS BY LENDER
CORRECT ANY ERRORS CONTAINED IN
REPORT
APPEAL CREDIT DECISION, IF
APPROPRIATE
CONSIDER CO-SIGNER OR NON-STUDENT
BORROWER AS OPTION, IF AVAILABLE
Contact the
Financial Aid Office
QUESTIONS???