How We Paid Off $662K With No Family Help #475

In this episode, we share our complete story - how we went from $662,000 in medical school debt to completely debt-free in just three years, as first-generation doctors without any family financial blueprint.

You'll hear:

• Why we accrued over $100,000 in interest (and how to avoid it)
• The exact moment we decided to pay off our debt aggressively
• Our real budget: $200/month groceries, $50/month fast food
• The sacrifices we made (and whether they were worth it)
• Why we're creating this podcast specifically for first-gen doctors

If you're the first doctor in your family navigating medicine without the insider knowledge your colleagues inherited, this is your community.

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Transcript

First‑Gen Roots And No Blueprint

Failing Scores To Test Mastery

Mail Piles, Forbearance, And Capitalization

The $662k Shock And Replanning

Building The Three‑Year Payoff Plan

SPEAKER_00 0:51

So during my general surgery residency, I'll tell you a little story. Sally Mae kept calling me multiple times. And they were calling me obviously because of my student loans. And to make a long story short, I couldn't make my payments. And when they would call me, this is usually in between cases. This is, you know, obviously when I'm seeing patients and so forth. So, you know, I just really wanted to get off the phone with them because one, it was a very painful experience to know that I had no idea, I had no control over my student loans, but also at the same time I had to work. You know, I was a resident at the time. So I would say, listen, what do I need to do to get off the phone with you? And the only option that they gave me was something called forbearance. I didn't know what it meant, I didn't know what it was, but I knew that it meant that they would get off the phone with me and I can just move on with my day. I didn't understand quite at the time that when I went into forbearance, that my interest would still be accruing, would still be building up. And you know, I would just go throughout my day. Multiply this by six years. I thought I was handling things. I was wrong. So it wasn't until six years later, I'm married now to Dr. Renee. We start to merge our finances. I get the logins for all of our student loans, and I realized, well, my student loans aren't the same as when I graduated from med school. There's now$100,000 more. And that's when I started to understand the implications of forbearance. That's when I started to realize, oh, I made a big, big mistake. But there is a positive uh twist on the story is, you know, once we found out how much student loans we had, once there was, you know, finding out that, you know, basically for each of us, an additional$100,000 in student loans had accrued, we were still able to pay that off in three years. So on today's episode, what we're gonna cover is what you don't know in student loans and how that cost us$100,000 each, how we fixed it, and why, if you are a first-generation doctor, if you are the first doctor in your family, why you need to listen to this story right here. All right, so listen, let's get started. Let me reintroduce ourselves. Um, my name is Dr. Ni. I am a trauma surgeon, as well as I practice surgical critical care. Dr. Renee, she's an OB Gine doc, and she delivers babies, obviously. We met well over 20 years ago in med school. And although initially uh there was no romance in our relationship, what started off as just being study partners and being friends obviously developed into something more romantic. And you know how it goes. 20 years later now, we're married now. But one of the things that we didn't really talk about, but was always like kind of the things that we thought about in our relationship. And I think that's one of the things that brought us together and made us closer is you know, we were both the first doctors in our families. And as a result, you know, with me, I'm first generation Ghanyan, um, as well as the first doctor in my family, Dr. Renee is the first generation, or is first generation Haitian, as well as the first doctor in her family, also. And what I mean and why I bring that up is look, there's no blueprint for this. There's no blueprint for us becoming doctors and getting to the point where we are right now. Our families gave us everything. They gave us love, support. They even gave us the push for us to be what we wanted to be. But let's be honest, family that has not been in the medical field or in the healthcare field or is not in a professional status, it's it's difficult to go to them to ask for help or to complain or to seek guidance on things like in-service examinations, um, student loan payment, which in essence are in six figures, or even how attending contracts work, right? Because they never had to go through it. So although they had great intentions, there's just a certain point where they have to be like, look, this is on you. And we had to figure it out on our own. I do think that it's time to get a little vulnerable with you all and share that I normally talk about student loans, the struggles that me and Dr. Renee had with our multiple figures of student loan debt. But one thing that I haven't shared is the struggle that I had during my general surgery residency. I did my general surgery residency in Atlanta, Georgia. I don't talk about this at all. Um, but yeah, I was having a hard time in the beginning, and it was mainly with my in-service examinations. If you're not familiar, in-service examinations are tests that you take in your respective residency, whatever specialty you're in, every year you're gonna have to take an in-service examination. And that's the best way, so to speak, for residency programs to tell, well, how well is this resident doing? And what is the likelihood of them being able to pass their board examinations once they finish residency? Um, my first year, I'll just say, in terms of percentiles, I was in the low teens, which ain't good, right? And as a result, like whether or not it was warranted or not, I really worried that I would be dismissed from my program for poor scores. I didn't have anybody leaning over me and saying, Hey, you better worry about this. But I just kind of felt uneasy and I felt tension and I just knew that I needed to improve my scores. And to be honest with you, it was a little bit embarrassing. I had a little bit of shame. You know, having conversations with my parents and letting them know how I was doing, I couldn't let them know about this because they don't know anything about going through residency. They don't know nothing about even doing an in-service examination. So for me to share with them that I felt that I might get dismissed or that I was really struggling with something that I didn't want to let them know about because I just felt like it would bring undue stress to them, especially with them being so far away. So, what I would do, particularly when I was on night shift, is I would go on Google. I would go on Google, I would go on Student Doctor Network, shout out to those who still remember what that is. And I would look to see what are their surgery programs in the Atlanta area, what are the other surgery programs in Georgia? Is there any programs that are closer to my home in Jersey, in New York? And just see what's the lay of the land just in case I got dismissed. Um, and that was a very stressful time. But I got to remember, you know, I have to get a little bit personal about this, that, you know, that same moment where I felt like I had no one to ask, um, there were also times when I would look at some of my other classmates, some of my other colleagues, and quite a few of them had families who were physicians who were in the medical field. And although they may not have struggled with my issue with in-service exams, they always seemed to be a step ahead of me. They always seemed to know what to do in difficult situations in residency, mainly because I assumed they were able to get advice. And lo and behold, I'm here trying to figure it out on my own. But I got to give definitely a big thanks to Dr. Leslie Matthews, who has since passed away. But he was a trauma surgical critical care attending at my surgery program, who he really took a lot of pride in understanding how to take board examinations and in-service examinations. And he taught me how to prepare myself, how to train myself to take these examinations by doing multiple loads of questions. I'm talking about there was a point where I was doing close to 300 to 350 questions a night to get ready for the in-service examination. And I went from the low teens in one year to the next year into the 70th percentile, which for me was a big jump. And I'm gonna tell you something right now. Once I made that big jump, it took a whole bunch of pressure off of me. I now understood what it takes to pass these type of examinations. I knew how to study, I knew how to test myself, and I really started to enjoy residency after that. And you know, I'm really proud to be a graduate of my journal surgery residency. I think it's the best surgery residency out there. Um but yeah, it's it's it's amazing for me to look back and realize, man, there was a point where I possibly almost didn't make it, and I made it through. And I'm proud of that. So while I was surviving residency, the one thing that was happening that I didn't know was that I kept getting these student loan papers, these student loan mailings from Sally Mae and other student loan servicers. I just never opened them. I didn't want to know what was in those letters. I was too scared. And I would just put my head in the sand. And these, like every couple of months, I would get these stacks of letters. And most of the time it was, well, your student loans have gotten sold to another servicer, so you're gonna get new letters from this person, blah, blah, blah. This is just a reminder of what your interest rate is, blah, blah, blah. But at the bottom of these letters, it would say what my student loan, like my overall student loan balance was. I just wasn't paying attention to that page. I didn't want to know. So I would just let them pile up. This is a whole stack of them. And, you know, I started getting phone calls from Sally Mae mainly because I I just couldn't make payments between having a house or a mortgage that I probably should not have gotten into. Remember, this is like 2006, 2007 time, and being house poor, not being smart with my money as a resident, um, I didn't have enough to make those payments. Remember also, this is before PSLF. So I had a hard time making these traditional student loan payments. So Salimae would call and I would just be like, you know, I can I get any more deferment? They would say, No, you've used up all your deferment. Then I would say, Well, what uh uh what other options do I have right now? I can't make a payment right now. And they would say, Well, you can forbear. I didn't know what forbearment meant. I didn't know what capitalization meant. Um, I didn't even know that, to be honest with you, to make a long story short, I didn't know that the student loan interest would just keep accruing on the debt. All I know is that they would just stop calling and maybe they will call back several months later and go from there. In between the time, the envelopes are still coming. So, you know, multiple forbearances come through, um, not only to the end of residency, which is five years, but also additionally in fellowship, which I did for a year. The whole time I think I'm handling it. And to be honest with you, if you were to ask anybody in my family or any of my friends, I got I got this on lock. But people didn't know. I it was far from that. I did not have this on lock, and I was really struggling with this. Let's fast forward several years in the future. We're talking six years in the future. Me and Dr. Renee, we get married. She's not here right now, but it's the best decision I ever made in my life. Shout out to her. But at that time, we also decided to merge all of our finances. What she made was mine, what I made was hers. You know how it works, right? What we make together is ours. But that is when I decided, you know what, let me get my logins correct and let me log into SallyMay.com and all the other student loans that my student loans were at, right? All the services, the websites. And I'm gonna tell you something right now. My heart dropped. I thought I was gonna fall out of a chair because I had just realized that I had accrued over$100,000 in additional student loan debt on top of already my student loans I already had. Right. So let me say what happened. I graduated from medical school with$240,000 of student loan debt. Now we're talking about six years later, I'm logging in, and now it's in essence$330,000 of student loan debt just for me. Right. And I go back and I look at all of the entries that are entered into the system, and you can see things from the beginning of my residency, forbearance, forbearance, forbearance, forbearance, forbearance. And that's where you can see the interest just, you know, build on top of the other interests and compound and compound and compound. And that's where all the damage was done, and that's how I lost so much traction over those six to seven years. Now, some of you may be thinking, well, what do you expect? Yo, I didn't think it was gonna be that bad. But don't forget, Dr. Renee has logins also. We log into her system, boom, it's the same thing, also. And that's how we got to$662,000 of student loan debt, and nobody was happy here. This is a mutual pity party that was going on. Um, we were just flabbergasted, right? Because, you know, when you start to take student loans, for some of you all might be just in medical school. For me, it started in college. I just never thought that I would go from college all the way to the end of residency and fellowship and graduate with$332,000. Now I'm joining my my life and my finances with someone, and now we're at$662,000. It's just something that I never thought would ever get to that point. I was shocked and I was embarrassed, and I didn't even know how to speak to my parents about this. I didn't even know how to speak to anybody else about this, right? And one of the things that I thought in my mind that I didn't that I was thinking, but I never mentioned outlider was like, well, I know people are just gonna say, dude, you're a doctor, like you're smart. Like, how can you not know that your student loans would be this high? Well, look, I didn't think they were gonna be that high. Um, I relied a lot on my colleagues who had family who were in the medical field, those who dealt with student loans, some in other corporate and professional fields who dealt with, you know, taking out 401k loans, investing, and got some advice from them. But, you know, once again, just kind of creating the blueprint on my own, you know, just hearing it for the first time, like two doctors almost in$700,000 of student loan debt was crazy to me. All right. So I'll be honest with you, we were shell-shocked. This didn't just last 24 hours, this last like, you know, two weeks. Um, we just sat with this number and we're like, what are we gonna do with this? I do not know how we're gonna pay off this debt. But we did have a financial advisor who recommended paying it off in about 15 years. But then when we went to a student loan calculator, we found out that following that plan, we would pay close to about an additional$600,000, maybe even$700,000 in just interest alone. So we're talking about in total about$1.4 million expended out just on education student loans. I don't know. I just, it just didn't, I didn't like that. So, you know, we started paying off our student loans. We made a plan that we're gonna do it in about 10 to 15 years, so we're gonna make some additional payments. And then one day I went, I came home from being on shift, about a 12-hour shift, and I come home, Dr. Renee's home, and she calls me and she's like, yo, I figured out how we can pay off our student loans faster. I am mad skeptical at this point. Like, what are you talking about? Like, I'm already disappointed that we got this amount of student loans, and now you're gonna come with me with some type of cockamimi plan to pay it off earlier. There's no way. But what I didn't know is while I was gone, Dr. Renee called Sally Mae. She talked to one of the administrators and she found out, or excuse me, she asked him, okay, how much per month would our payment be to pay off our student loans in one year? Okay, that's impossible. Two years. Yeah, that might be even a little bit impossible. Three years, four years, you get the point. So then she goes back, she looks at our budget. By that point, we're using Excel spreadsheets to figure out how much we're getting paid versus what's coming out, and we're trying to figure out well, how much disposable income do we have? Can we make payments towards our student loans? So by the time she sees me, she has Excel documents, she has the payments, she has the years, and she's like, Look, this is the payments right here. This is what we can do. We can do five years, this is how much it will cost. We can do three years, this is how much it can cost. And at first, like I said, once again, I was skeptical, but then I started looking at the numbers and I started looking at our paycheck. I'm like, hmm. We can do this. The question is, should we do this? Are we allowed to do this? Which is a stupid question, right? Because I'm still in my student mind, like I need permission from someone to teach me how to do this. But it just felt like there's no way that someone pays off their student loans in three years or even five years. We gotta follow the traditional plan. But she showed me the numbers and we said, look, based off of this plan, let's give ourselves between three to five years more on the five-year plan to pay off this debt. So we're gonna pay off$662,000. We're gonna be very aggressive, and this is how we're going to do that. And we started. All right, Charles. So here's the grind. This is how we did it, right? We're gonna be very aggressive with paying off$662,000 of student loan debt. Here's what it actually looked like. So, first things first is Dr. Renee was working halftime as an OB guy and doctor, so she was getting half salary. We lived off of half of her salary, and then we used the other half of her salary, and then we also used my entire salary to start paying off student loans. I'll be very open and honest with y'all. There were months where we were making$15,000 to sometimes even$18,000 student loan payments for an entire month towards our student loans. Right? We also decided, in terms of what was coming out for discretionary funds, to pay for food, to have fun, to go to the movies, all these different things that we wanted to do. We were only going to pay cash for it. We weren't going to use a debit card. We wanted to feel the money leaving our accounts. We wanted to see them feel the money leaving our hands so that we could be really intentional about what we were doing with our money. So we also made a plan that we were not going to create any additional debt during this time, also, right? We said we have enough student loans, we're not creating any more debt, we're going to use cash for everything. And I'll even add another complexity also, which is, for example, we decided that we were only going to spend$200 a month on groceries. That's it.

unknown 22:06

Right?

Extreme Budgeting And Extra Shifts

SPEAKER_00 22:07

I'm going to say it again.$200 a month on groceries. Now, when we were at work, you know, with my schedule, I was working 24-hour shifts. There are times when you want to buy or you have to buy something at work or you bring something from home, but you want to get a little snack. Basically, for the entire month, we both had$50 allowances to do that. So, in essence, basically what we did is we became very intentional with all the money that was coming out, even down to the very cent, and said, well, if we can be very tight with groceries and food and how much we spend on discretionary funds, we can push more of that into our student loans. Right? So basically, the$50 was basically the equivalent of two Chipotle runs. That's the joke that we have is that's all that we could afford. But in essence, we really shouldn't have been eating that much fast food. So basically, it kind of kept us healthy. Um, the other thing, too, that we did is, you know, we were like I picked up additional work as a locum tenants 1099 contractor. So all the additional work that I would do, even after, on top of my working as an employee doctor, I would do additional work. All the income from that I would put towards student loans. So anything with extra shifts, I would put towards student loans. Um, we were grinding. We were really grinding. And was it hard? Yes. Like who wants to spend$200 a month on groceries? Who wants to really be known as that cheap doctor when people consider doctors to be these are high-income people? Like, why are you so cheap? Why are you always deferring to your husband to ask for um uh if you can spend this amount of money, and vice versa, and so forth. But ultimately, we came down to like nobody else is really struggling with student loan, or nobody's outright being open with struggling with student loans like we are. So as a result, we're gonna have to do what other people can't do, right? We made a pact. Three to five years, no matter what, we're gonna take care of it. And lo and below. Behold January of 2017, bingo, three years, we had paid off$662,000 in student loan debt. We made our final payment. Here's the picture to show that off. Um, it was amazing. It was, I felt like a huge monkey was off my back. There was no, you know, fireworks, there was no champagne or anything like that. But just off my spirit, I just felt like a new person. And I'm sure Dr. Renee can describe that she felt something similar. So basically, zero dollars in student loan debt in three years. And that in essence is how we did it. So why are we telling you this story? Um, because if you're the first doctor in your family, if you are specifically first generation and the first doctor in your family, you're probably um navigating medicine without family knowledge that your colleagues had inherited. And that's the plain truth. So when I was Googling general surgery programs that I could transfer in at 2 a.m. in the morning, I was alone. When um I didn't understand what forbearance meant and accrual of$100,000 of student loan interest, I felt stupid. Um when we were staring at$662,000 of student loan debt, I felt overwhelmed. And the feelings really weren't my fault, but still action needed to be taken, right? So although it wasn't our fault, we also didn't have a blueprint. So what we decided to do is look, this is our time now. We want to create the blueprint for you all. We want to create the blueprint we wish someone had given to us back in residency, as well as when we started to have those major shell shock feelings with our student loans. Overall, we wish we had the money as well as the career moves that med school never covered. I'm talking about things like student loans, how they actually work, not just making payments, but like the real options, forbearance, PSLF, save, IBR, right? How do you negotiate an attending contract when you have no one to ask? What's a good salary? What do you look for in benefits? How do you get in a contract? How do you get out of a contract? How do you make career decisions without a family mentor, without the professional advice from possibly family members? So we're not financial advisors, we're not career coaches, we're just first gen docs who learned this stuff the hard way. And now we're teaching you so you don't have to make the same mistakes that we did. So if you are the first doctor in your family, if you're also first generation, then this is the community for you. So please subscribe to this channel. We drop episodes consistently on the topics of debt payoff strategy, contract negotiations, as well as career decisions. In essence, everything that we figured out or are still figuring out, we're gonna go ahead and share with you. So I want to welcome you to the community and um let's build this blueprint together. Catch you guys on the next one, all right? Peace.