student loan payoff

YFP 331: How One Couple Paid Off $208k of Student Loans

Posted on by Tim U

On this episode, Jackie Boyle, PharmD, MBA and Paul Boyle share their journey paying off $208k of student loans.

Episode Summary

Debt can be an overwhelming weight on one’s shoulders, but imagine paying off an astounding $208,000 of it! This week on the podcast, we are joined by the inspirational duo, Jackie and Paul Boyle. They recount their journey from being neck-deep in student loans to paying them off entirely. This episode delves into their personal and collective strategies, their highs and lows, the financial compromises made, and how they kept the momentum to reach the finish line. From Paul’s decision to be a stay-at-home dad to Jackie’s reflections on missed opportunities with the PSLF program, their experiences provide invaluable insights for anyone navigating their own debt repayment process. We also dive into the emotional and financial challenges they encountered, especially when transitioning to a single-income household. Yet, their story isn’t just about the hurdles; it’s brimming with actionable takeaways and advice for those on similar paths. As Paul and Jackie demonstrate, with determination, strategic financial planning, and mutual support, even the heftiest of student loans can be overcome. So whether you’re struggling with student loans, seeking motivation, or just curious about the Boyles’ debt-free journey, this episode is a must-listen. Join us and discover how you too can rewrite your financial story!

About Today’s Guest

Jackie Boyle is a pharmacy educator by day and coaches pharmacists and pharmacies in a part-time capacity. She received her Doctor of Pharmacy from Northeast Ohio Medical University in 2012, MBA from University of Findlay in 2016, and Master and Bachelor degrees from THE Ohio State University (O-H!) She is highly involved in professional organizations including ASHP and AACP, and also loves spending time with her husband and two daughters, Gianna and Giulia. In her free time, she loves spinning, yoga, and enjoying a warm cup of coffee.

Paul Boyle is a Client Service Associate out of the Cleveland, Ohio area where he has had a diverse career of over 20 years, mostly taking care of customers and clients in various fields of service ranging from manufacturing to professional baseball. He received a Bachelor’s degree in Sport Management from The University of Akron in 2020, while taking time away from the workforce to raise his children. Paul spends most of his free time with his wife, Jackie, and two daughters, Gianna and Giulia. An avid Cleveland sports fan, musician and aspiring podcaster. When not supporting his local teams he likes to enjoy the occasional motorcycle ride, which is another longtime passion.

Key Points From the Episode

Get to know Jackie and Paul, and their student loan debt repayment journey.
The shared decision for Paul to be a stay-at-home dad and finish his degree.
A reminder that you can make mistakes and still achieve your debt repayment goals.
The extensive student loan debt that Paul inherited when he married Jackie.
Having a baby and becoming a single-income household.
How the emotional weight of student loans shifted throughout their debt journey.
Why Paul always maintained confidence in their plan and abilities.
Jackie’s income-based debt repayment strategy during her residency.
Her biggest regret: not using the PSLF program.
The challenge of staying motivated during an aggressive repayment journey.
How Jackie and Paul maintained momentum.
The value of budgeting and breaking repayment down into smaller goals.
Why everyone’s debt repayment journey is different.
Finding the right balance between debt repayment and investing in the future.
How to assess your priorities and allocate your finances.
Using your side hustle to pay for additional expenses.
Refinancing your student loans and taking advantage of lower interest rates.
Advice for new graduates as interest on student loans returns after the pandemic freeze.
What’s next for Jackie and Paul now that they have their student loans behind them.

Episode Highlights

“We ended up paying off earlier than I anticipated due to some choices we’ve made. So, yes, it’s very exciting to be on this journey. That said, I know we definitely made mistakes as well.” — Jackie Boyle [0:05:27]

“I never thought inheriting this much debt comes with the territory of a relationship. So that was all brand new.” — Paul Boyle [0:07:57]

“I was so engulfed in residency life that, honestly, [repaying my debt] took a back burner. I should have been doing things way differently during that time.” — Jackie Boyle [0:09:30]

“If you look at that big number, you could be paralyzed by it. But if you look at those smaller numbers, it’s like, ‘okay, over the course of the next three months, I can achieve this goal, and I know how I’m going to achieve it.’” — Jackie Boyle [0:12:49]

“We never felt strapped or that we had to eat ramen for the next couple [of] years to achieve this. That made things better, and that’s motivating in its own [right]. You could see, ‘Hey, we’re doing great.’ We could keep this up as we’re going.” — Paul Boyle [0:15:52]

“Educate yourself. Find a mentor or a financial planner to work with. Get a budget in line. Those basic tools can be really helpful in giving you the motivation to realize that you can do this with a better understanding of your own personal situation and what’s possible.” — Jackie Boyle [0:26:26]

Links Mentioned in Today’s Episode

Episode Transcript

[INTRODUCTION]

[00:00:00] TU: Hey, everybody. Tim Ulbrich here, and thank you for listening to the YFP Podcast, where each week we strive to inspire and encourage you on your path towards achieving financial freedom.

This week, I welcome Jackie and Paul Boyle as they share their journey of paying off $208,000 of student loans. We discussed the motivations behind their debt-free journey, how they balanced debt repayment with other financial goals, including investing and buying a home, lessons they learned along the way, strategies they employed to get on the same page, and advice that they have for those that are navigating loan repayment.

Okay, let’s hear a brief message from YFP team member, Justin Woods, and then we’ll hit play on Jackie and Paul Boyle’s debt-free story.

[00:00:40] JW: Hey, Your Financial Pharmacist community. This is Justin Woods here, Director of Business Development at YFP. You may be one of the 13,000 pharmacists that have already signed up for YFP Money Matters, which is our weekly newsletter. But if you’re not, what are you waiting for? I want to invite you to subscribe. We send financial tips, recommendations, the latest podcast episode and money resources, all specifically for pharmacists. It all comes straight to your inbox every Friday morning. So visit yourfinancialpharmacist.com/newsletter, or click the link in the show notes to subscribe today. Again, that’s yourfinancialpharmacist.com/newsletter. See you there.

[INTERVIEW]

[00:01:25] TU: Jackie and Paul, welcome to the show.

[00:01:27] JB: Hello.

[00:01:28] PB: Hey, Tim.

[00:01:29] TU: Well, this is a real treat for me. Many of your listeners may not know. Paul, you are a member of the YFP team, and so we’ve had the opportunity to work with one another here over the last several months. We’re incredibly grateful to have you as a part of the team.

Jackie, you and I have known each other. It’s got to be well over a decade, I think, at this point. I used to be on faculty at NEOMED way back when, and you started there as a student and then a resident. Then we were colleagues. You’re continuing to do great work there, and we’ll talk more about that here in a moment.

So this is a treat to be able to have both of you on as friends, as well as to share with our community your debt-free story. So congratulations to both of you and excited to dig into a little bit of what went behind that, how much debt you paid off, what were the motivations, what worked, what didn’t work, and what lies ahead for you guys now that you’ve got this big milestone achieved.

Paul, let’s start with you. Tell us a little bit more about your background, your career, and the work that you’re doing now.

[00:02:26] PB: Yes. So like you mentioned, I am part of the YFP team now as a client service associate. Love my job. Love the people I work with. It’s great to be a part of this community. But before that, my last paid job was with a company called Lincoln Electric, and I was a warranty service rep there in my last position. So still kind of helping customers out in that realm. But I chose to – well, we as a family made a decision when we had our first daughter that we wanted one of us to stay at home.

So me being the lesser income earner and with this topic, it’s student debt, we decided that my wife was going to continue to work and that I was going to be a stay-at-home dad. I used that time to go back to school, finish my degree in sports management and, yes, never looked back. Since then enjoyed the time with my kids. Being a stay-at-home dad was probably the best job that I’ve ever had so.

[00:03:23] TU: That’s awesome. Jackie, I just scratched the surface on my mention of your training at NEOMED and your residency and your faculty role. But tell us more about your pharmacy journey. What led you into the profession, including the work that you’re doing now?

[00:03:36] JB: Oh, thank you, Tim. This is such an exciting thing to be on your podcast, Tim. My relationship has gone on for so many years and so many different capacities. So I’m just so excited to be talking with you here today. My background is a bit of a mix of ambulatory care practice and education. So I started out my career in practice-based faculty roles and a few different settings in ambulatory care and then actually took a full-time position at the college at Northeast Ohio Medical University here in 2019. So I’ve been here for the past four years.

Around 2017, though, I started getting a little bit of an entrepreneurial itch. Of course, as Tim is one of my greatest mentors, I started talking with him about ideas for part-time work and actually got connected to an awesome entrepreneur, Alex Barker, who was starting a career coaching company at the time and have been career and business coaching pharmacists now for about six years, which plays into our story as well. It’s just been a ton of fun.

So, yes, a little bit of a few different things. I love being a jack of all trades and kind of exploring what’s out there in pharmacy. So, yes, this journey has been a long one, but I hope that we could share some of our mistakes, some of our wins, maybe inspire a few people along the way.

[00:04:59] TU: So, Jackie, let’s start with the juicy details around the student loans. How much did you end up paying off between the two of you when it was all said and done?

[00:05:09] JB: Yes. I think it was about $208,000. As the CFO of our family, I was keenly keeping an eye on our balances as they went down over time. It’s awesome to think back now how much we started with and where we ended up. We ended up paying off earlier than I anticipated due to some choices we’ve made. So, yes, it’s very exciting to be on this journey. That said, I know we definitely made mistakes as well, and I wish – for example, like PSLF. I probably could have taken advantage of that, but I didn’t even know that was a thing. So I’m here to say that you can make mistakes and still achieve the goal eventually as well.

[00:05:53] TU: Yes. That’s such a good reminder, Jackie. I think there’s so much pressure around this decision. We have the opportunity to talk with pharmacy students, new grads on a regular basis. We talk about the importance of really understanding these loan repayment options and getting that decision that’s best for your personal situation. I think that can feel weighty at times, right? Because it can have big implications, whether it’s a PSLF strategy or another strategy.

But, also, what you shared, I think, is such an important reminder is that mistakes are inevitable part of the financial plan. It’s going to happen. They happen on the regular and giving ourselves some grace and learning from those mistakes. We’re not always going to get it according to the textbook, and that’s okay, right? That’s part of this journey is to learn as well.

Paul, I want to start with you but really a question for both of you. As you think about your journey and the student loans, did your feelings around the student loans change over time? Some people we talk with, when I say give me the 0 to 10 student loan pain scale, where zero is the – no. They are what they are. They’re going to take care of themselves. Ten is the house is on fire, right? No right or wrong answer, but everyone is different on that journey. I’m just curious. Like for you, did that change at all along your journey, right? As you guys grew in terms of a family and your careers, tell us more about the emotions and feelings around the student loan debt.

[00:07:21] PB: Yes, absolutely. It’s intimidating for me at the beginning because when Jackie and I met, she had just graduated. So she went into residency. As everybody knows out there, residency pay is not quite the same as full pharmacist pay. But I was working full-time at the time, too. But just realizing like the massive amount of that compared to mine, I think what Jackie – I don’t know how much mine was at the time. I only had a couple thousand left to pay off on mine, and we paid it off first.

But kind of we got engaged, and I was like okay. I never thought like inheriting this much debt like comes with the territory of a relationship. So that was all kind of brand new.

[00:08:04] JB: I came with a lot of baggage.

[00:08:06] PB: Yes. It’s not bad baggage, but it’s just something that you never thought you had to plan for, right? So before even like our wedding and taking on a mortgage and stuff like that, here’s this amount of debt that amounts to a house. I think I took it pretty seriously, but I don’t think I felt like it was a pain point quite yet because, again, we were both working full-time. We figured, okay, we could come up with a plan to handle this.

But as it progressed and as I left work and we became a single-income household, it kind of went up there to like a seven or an eight maybe, just because of that weight like of all that debt, and like will we get there, and then we started a family and added expenses and stuff. So I wouldn’t say I lost sleep over it because I had kind of confidence in especially Jackie as our CFO and her earning potential that we could kind of navigate it.

[00:09:03] JB: Yes. I think, for me, I was in denial for the first two years. So during residency, I did income-based repayment, which meant that my monthly payments were zero. But the interest was accumulating rapidly, as you all know. So those first two years, I should have been at a seven or eight. But I was at like a zero to one because I’m like, “Oh, this is not – it’s not a problem right now. I don’t need to be paying attention to it.” I was so engulfed in residency life that, honestly, it took a back burner. I should have been doing things way differently during that time.

Like Paul said, during like the year of our engagement and then leading up to marriage and our first child, that’s when it became more of like a house on fire seven or eight-plus for me. I was so determined to start attacking this thing. Once I realized that I should have been doing things way differently, and I had already made a few big mistakes with not going to the PSLF program. So, yes, definitely changed for me over time and perhaps that denial factor didn’t help us for the first two years.

[00:10:07] PB: It was kind of out of sight, out of mind type of thing. We had, like I said, paid off mine, and we’re like, “Oh, hey. That’s a great feeling.” So we kind of did in our minds know, hey, with us, with the DINK lifestyle, right? Like we can kind of tackle some of these other debts that we had, and I knew Jackie wasn’t a fan of debt to begin with. So we had a couple small wins there. But still, like I wasn’t thinking about the big one quite yet.

[00:10:37] TU: Jackie, remind me. Year of residency completed was what?

[00:10:42] JB: So two years and it was done in 2014.

[00:10:45] TU: 2014. Okay. So when we think about that journey, 2014, obviously, you mentioned the income-based repayment. Paul, you mentioned your loan. But 2014 to 2023, that’s a period of time where you’re waiting through this. You’ve got a young family. Other expenses are creeping up. Many of our listeners can relate to this feeling. Momentum can be very hard to sustain for a long period of time, right? We had a pharmacist on recently that paid off a little over $345,000 of debt in five years. Very, very aggressive repayment journey. I asked her the same question I’m going to ask you, which is when you think about paying off over $200,000 of debt over a sustained period of time, it’s hard to keep the motivation and the momentum going.

For you, Jackie, let’s start with you. For the two of you, for your family, like how were you able to keep that momentum and motivation going? What was the why that was fueling you guys as you were trying to really make sure you persisted through this over that period of time?

[00:11:47] JB: Well, before starting to dive into financial topics, our one session about this topic, student loans, was the last day of our P4 year. We had an hour-and-a-half session about what our debt was, our repayment options. Again, it was just so overwhelming at that time that it got shoved back away. Once we got oriented towards like what our life goals were and that we wanted to not only gain financial freedom but set up our kids for success, be able to do things like giving, pay off things as quickly as possible, then I think breaking it down into smaller goals was the only way that it felt achievable.

I actually started writing down small goals every morning in the increments of like $5,000 to say, okay, if I can get the loan balance under this, like I’ve achieved another goal. As achievement-oriented person, like that felt really good to do. It might sound silly, but it also made the overall goal feel manageable because if you look at that big number, you could be paralyzed by it. But if you look at those smaller numbers, it’s like, okay, over the course of the next three months, I can achieve this goal, and I know how I’m going to achieve it.

I think the other helpful thing we started doing once we got married was to start budgeting and just to even have a handle around what are our finances, what our expenses, how much money do we have left over at the end of the month that’s not left with a purpose, and starting to really allocate like, okay, where are all of our dollars going. Where does this extra money contribute to the financial plan or not?

Thankfully, with all the resources that your team has developed, Tim, and all the education you were providing, we were able to start learning about different options, different ideas, how we can start tackling it.

[00:13:37] TU: A couple things I heard there which are really good. You mentioned, obviously, the budget being an important part for the two of you. I suggest if you are like most couples, right? Budgeting is a process that takes time to make sure that you’re in alignment with the bigger vision and the goals. But such an important part of, hey, this is the shared vision that we have for our financial plan. I think that was really key.

The other thing you mentioned which I thought is really important is breaking it down into smaller goals, right? So $208,000, that’s big. It’s scary. It’s overwhelming. We talk about the same thing when it comes to saving for retirement 20, 30, 40 years in the future. If you punch numbers in the calculator that show you’re going to have to save two, three, four, five million dollars, whoa, like what do I need to do? What does that actually mean today, right?

So that $5,000 milestone, these goals that are along the way can really help with making it not only realistic but also providing some of the momentum along the way of, hey, we accomplish that. Let’s take a moment to pause, stop, celebrate. Maybe there’s even something that’s planned in there. Maybe there’s not. But just to realize that, yes, this is going to take some time. But we are making progress towards this journey.

Paul, what about for you? Anything else here to add as it relates to the motivation and the momentum?

[00:14:51] PB: Yes. Everything that Jackie said was great. The small wins. I was not the one who was looking at the number quite a lot because she is the bill payer for us. So I would check in every once in a while and be like, “Where are we at,” and kind of provide emotional support throughout that part of the journey because I never wanted her to feel like – and, again, as the person who kind of inherited this debt with her, like, well, it’s not her fault or anything like that. That I want to feel like it was hers. It was ours together. Yes. But seeing those numbers kind of go down.

It was nice throughout the whole process, at least for me, to realize, okay, we have a budget. It’s not a very serious budget. We’re not always letting that hang over our heads like, “Oh, we’re out somewhere doing this. Is this in the budget or not?” We never really had that pop up for us. So throughout this whole time, reaching many milestones, while also kind of living the life that we wanted to at that time, we never felt strapped or that we had to eat ramen for the next couple years to achieve this. That made things better, and that’s motivating in its own. Well, you could see, hey, we’re doing great. We could kind of keep this up as we’re going, right?

[00:16:07] TU: Yes. I’m really glad you mention that, Paul, because I think that’s a good segue into everyone’s journey is different, right? So there’s a spectrum of how you can tackle these loans. You could be very aggressive. It could even be more aggressive, right? Someone could pay off $208,000 of debt in three, four, five years. Maybe in that case they say, “Hey, debt is the only thing I’m focused on. I’m not buying a home. I’m not investing. I’m not saving. I’m not doing other things.” We could debate like what are the pros, what are the cons of that approach.

There’s the other end of the spectrum. You can take federal loans out 25 years, right? It could be a longer period of time. For some people, that is the pathway they choose, whether it’s a forgiveness pathway or not, so that their monthly payment is as low as possible, and they’re able to allocate dollars towards other parts of the financial plan. It sounds like for the two of you, it was somewhat in the middle, right? It was a fairly short timeline. That’s a large chunk of money in a 9, 10-year period.

But, Paul, to your point, it sounds like, hey, there was also still the life that you were living, and there was some sacrifice, obviously. Otherwise, you wouldn’t have gotten to this point in time. But you were able to do some other things that you wanted to do, whether that be buy a home, whether that be investing, saving for the future, going on vacation, investing in experiences as a family. If I heard you right, Paul, it really felt like you were able to do both of those at once. Is that fair?

[00:17:30] PB: Yes, absolutely. I think it never reached the point at any moment for me like where we would have to make any kind of major lifestyle change or change up what we were doing throughout the whole process.

[00:17:42] TU: Jackie, and this is one of the most common questions I get from new grads is should I pay off the debt or should I invest in the future. Then you add on top of that a home purchase is often a common thing, very challenging right now with what’s happening with home prices and interest rates. I think there’s this or mentality. Should I do this? Or should I do that? Or should I do this? Typically, as is the case in your journey, it’s more of an and often. So tell us about your feelings surrounding the aggressiveness or the length of time for the debt repayment.

[00:18:15] JB: Yes. I think to your point, Tim, like the and and trying to make some financial compromises could help you set up your situation to be what you want it to be. So for example, like we got approved for a home loan of like $445,000 when we were looking at houses. Paul and I were like, “Wow, that’s a lot of money.” Then looking at homes at that time in 2014, the market was a bit different for houses. The houses that were at that value, we’re like, “We don’t need a home that’s $445,000. We can look for homes maybe around half that level and still get a really nice place to live and grow our family and everything.”

So we ended up finding our house. Our purchase price was 225. So that alone was huge savings, compromising with we wanted discretionary funds to be able to go out and do things. Just we love like going out to eat, and hanging out with friends and family, and spending a little bit of money on things for vacation. That’s really important for us to have experiences with our family as well. So I think it’s talking with your partner. Or if you don’t have a partner, like thinking for yourself and your priorities in your life and where you want to allocate your finances.

I think, for me, because I was so interested in like still getting this paid off quickly on a single income for most of the time, honestly, was to think of other outside-of-the-box ways to be able to make those extra payments happen. So picking up that side hustle of coaching, which, honestly, doesn’t feel like a job to me. It’s really fun. But all of the extra income we earn from that went towards typically our student loans.

There are things we could have done differently with that as well with contract work and taxes and tax planning. There’s still so much that I have to learn that, thankfully, again, the YFP team is going to be helping us with. But thinking of how can you increase that income dollar for yourself and your family to work more aggressively if you want to or if you’re motivated by that as well.

[00:20:32] TU: Yes I’m. glad you mentioned the extra income, right? We see that often where people are going through a debt repayment journey, and it will be a side hustle, extra shifts, extra income maybe for a long period of time, maybe for a short period of time. But that can really be a boost to, wow, we feel like we’re making some more progress, and maybe this is now a 9 or 8 or 7-year instead of a 10, 11, 12-year. Sometimes, the extra 100 or 200 bucks or 300 bucks, whatever the dollar amount is, may not seem significant. But we tend to forget the momentum that that can provide behaviorally, as well as a part of the plan.

I just love what you guys shared about for you, for the two of you, for your family, you decided on that this was best, right? This approach of, hey, we’re going to pay off the debt. It’s pretty big payments. But we’re also going to find this balance of living our life. There’s no right or wrong answer here, and I think it’s so easy to fall into the trap of, hey, what’s the right way to do this.

There’s a mathematical quote right answer, but we don’t live our lives according to just mathematically correct answers, right? So we’ve got to run the math, true. But we also have to think about what does it mean to live a rich life, and how do we find the balance between these two things? That’s true not only for debt repayment, but that’s true for all parts of the financial plan.

[00:21:46] PB: If I could add to that, for me, kind of the extra money, the side hustle type of thing, we’ve always kind of thought of our income kind of separating those things. So before I left work, in my job, we had a bonus structure that we had a pretty hefty bonus that came at the end of the year. So what I found a lot of people running into trouble is that they relied on that bonus to pay for their regular everyday every year budget. For me, you take that mentality. Okay, here’s my salary. That’s my salary for the year. Let’s pretend that the bonus doesn’t exist, right?

The same thing with side hustle money, then when that becomes extra like, okay, that’s all of our goal money, right? It’s stuff to – like we paid for our wedding from my bonus. So any of those extra things that we know they’re going to cost a little bit extra more, that’s where kind of that side hustle, the extra income goes straight to that stuff.

[00:22:41] JB: One other thing I wanted to mention here was that we refinanced our loan twice throughout the journey. So that savings on interest rate declined, which I know that interest rates are not great right now. But when we refinanced, well, I basically just kept checking every two years or so to see, okay, are there better interest rates available. Can we decrease that if possible? Because over time, that interest just adds up. Oh, there’s nothing that could make you more fired up than extra interest on your student loan. That was something that was also a great change to the process.

[00:23:19] PB: Yes. Her last refinance. Sorry, Tim. Her last refinance was a big motivator, at least for me, because when she said, “Hey, look how much we knocked off,” and we looked at like the saving that we got through there, and I’m like, “Holy cow.” It was a significant amount. We’ve always kind of –

[00:23:35] JB: I think it was $33,000.

[00:23:37] PB: Yes. It was crazy. So that was a big, big win, again, extra motivation to say, “Hey, we’re on the way. We’re going to do this.” Yes. Because I’m a big fan of paying off higher interest stuff first and kind of – she hates debt no matter what, so I always try to have that conversation like, “Well, if it’s a low, like we got 0.9 on our car right now. It’s like, hey, being ultra-aggressive may not be the best way, but we like to kick it out. But, yes, I mean, seeing lower interest rates is huge.

[00:24:08] TU: Yes. Hopefully, we see those interest rates come back down. Right now, it’s – especially for those that only have federal loans, that’s probably the best place to be for most people, just because of some of the benefits that come with federal loans. But I’m guessing your first refinance was way before the pandemic. Is that correct?

[00:24:24] JB: Oh, yes. Yes.

[00:24:25] TU: Okay. So you already kind of had pulled yourself out of that where you weren’t negatively impacted in any significant way through the freeze because that decision was already made. Then at that point, it was really about, hey, how can we get the best interest rate that we can. It sounds like that led to some significant savings.

At the time of this recording, we’re at the time period where student loan interest is turning back on. Payments are going to start back up after three and a half years, right? Dating back to March of 2020. I do really feel for the graduates [inaudible 00:24:59] classes that really haven’t yet had to make student loan payments, and this is going to be a somewhat of an abrupt transition. I’m hearing a lot of things like, “Tim, I’m overwhelmed. I’m confused. I’m frustrated. I’m anxious.” Not just about the student loans but also because of things we’ve already talked about. “I want to buy a home. I’ve got other goals I want to achieve. The six-figure income just isn’t really going to go as far as I thought it had.”

I’m just curious to hear from both of you. Jackie, let’s start with you. As you look back on your own journey and things that you’ve either said, “Hey, we did this really well, or maybe these are some things that we’ve done differently,” what advice would you have for these new graduates coming out?

[00:25:40] JB: Oh, so many things. I wish I would have done differently. Just get your budget in line first. I think knowing where you are spending and where you can cut back on expenses and even getting a wrap around that is really helpful and can maybe dismantle some of the doubts that you have about the fact that you can do this, I think. No, I didn’t get – I have no in incentive to say this. But like working with a financial planner like the team at YFP and like the resources that you all have, just even on your website, to check out.

I remember looking at the student loan calculator and the change in interest rate and just playing around with the tools that are on there on your website. Just educate yourself. Find a mentor or a financial planner to work with. Get a budget in line. Those basic tools can be really helpful in giving you the motivation to realize that you can do this with a better understanding of your own personal situation and what’s possible.

[00:26:43] TU: Paul, how about for you?

[00:26:45] PB: Yes. I would add, for anybody who graduated kind of during the pause, you haven’t had to experience like any of your payments kicking in yet. Having a – just budgeted in there, whether you’re paying it or not, right? Kind of figure out what method is best for you. Obviously, tons of research and I have an inside look at this stuff now as far as all the repayment plans. I mean, we’re kind of on fire with it right now. There are so many different ways.

I love seeing how we can save people money because, again, we talk about our experience with, hey, we probably could have done student loan forgiveness. Find every option that’s available to you. Then don’t let it cripple you. Like I said, we lived a comfortable life on a single income; starting new family, buying a new house, getting married, getting married through residency. Just the busyness through that part of your life, there’s ways to do it. Yes. I just – stay motivated. Don’t be intimidated by that big number is kind of the best advice that I could give.

[00:27:48] TU: Yes. I think it goes back to full circle. When you were talking earlier about the budget and breaking it down to smaller goals, making this number mean something today is such an important part and until you work the budget to know what capacity is or isn’t there and how this big rock is going to influence everything else you’re doing. We tend to live in that mental state of frustration. I’m confused. I’m overwhelmed.

I often say, hey, when we put it all on paper, and, Paul, you’ve seen some of the behind the scenes of this, and you look at all the analyses, and we nerd out in the spreadsheet, we may not like the numbers. Nor will they change from this month to the next month. But the peace of mind that comes from knowing we’ve looked at these numbers, knowing what our options are, and knowing what the monthly payment will be. All right. Now, we can work on a plan, right? That is so important to understand. Otherwise, it’s a hope. It’s a wish. It’s a dream. It’s a guess, and that leads to frustration, right? We’re talking here about student loans, but that’s true with all parts of the financial plan.

Let me ask you guys this. This is a huge milestone, a huge milestone. But it is one of many milestones that you’re going to accomplish on your financial journey. I think that for the pharmacists that are listening that are earlier in their career that are feeling some of the stress and the weight of their own student loans, they’re like, “Man, I just can’t wait until I get to that finish line, right?” That finish line where Jackie and Paul are. It’s a great accomplishment, but it’s not the finish line. You guys are just getting warmed up.

So my question here is what’s next for you. Now that we’ve got the student loans behind us, when you fast forward and say, “Hey, five years from now, September 2028, like what does success look like for the Boyle family? Now that we’ve moved this big rock out of the way, we can start looking towards other parts of the plan.” Paul, let’s start with you.

[00:29:34] PB: Yes. I’d say getting our retirement on track, that’s kind of top of mind. We still have our mortgage as far as debt, and we still have one car payment. But we’re going to knock out our car here pretty soon, and that’s going to be another win that gives us like, “Hey, we only have a mortgage.” That we don’t necessarily – you don’t need to pay that off as quick as you would think so. Just with that freedom, it’s like, “Holy cow, what are we going to do with this extra income?” I’m working again. That’s extra income.

So, yes, I think saving for retirement, making sure that that is lined up and then maybe some home projects. I don’t know. Maybe I get something recreational or fun for me as a short-term goal if Jackie lets me. But we really don’t splurge on a lot of things and we haven’t for the past 10 years. So maybe it’s discussing do we have any kind of bigger fun things that we want to do within the next five years, and then look at the time beyond that, and make sure that us and our children kind of are set up for a comfortable life, our vision of what a comfortable life is.

[00:30:42] JB: Oh, yes. I think to add, figuring out – I have so many questions about like investing in 529s or educational funds. We don’t really know what to do with that piece yet. We know we want to set up our kids for success for the future and whatever that looks like for them. I’ve always had dreams of like having a vacation home and somewhere we can go or rent out or like collaborate with friends or family on to have a place to make memories.

Then I think the last piece is like giving back and determining where we can contribute to our community and just pay it forward in that direction as well. So, yes, we’re really excited. We just started working with the planning team at YFP. Yes. It’s been so enlightening so far. We’ve only had one meeting and I’ve just – I’m like in awe of how much we’ve learned in one short hour. So I’m sure it’s just the beginning of an awesome journey and lots of great things on the horizon.

[00:31:41] TU: Well, this has been fantastic. Again, congratulations to the two of you. I am super excited to follow your journey and see where things are going. As I mentioned, I think you’re just getting warmed up. This is a huge, huge accomplishment, one that is certainly worth celebrating but lots of exciting times to come ahead. So, Jackie, Paul, thank you so much for taking time to join the podcast. I appreciate it.

[00:32:01] JB: Thank you.

[00:32:02] PB: Thank you so much, Tim.

[END OF INTERVIEW]

[00:32:04] TU: As we conclude this week’s podcast, an important reminder that the content on this show is provided to you for informational purposes only and is not intended to provide and should not be relied on for investment or any other advice. Information in the podcast and corresponding materials should not be construed as a solicitation or offer to buy or sell any investment or related financial products. We urge listeners to consult with a financial advisor with respect to any investment.

Furthermore, the information contained in our archived newsletters, blog posts, and podcasts is not updated and may not be accurate at the time you listen to it on the podcast. Opinions and analyses expressed herein are solely those of Your Financial Pharmacist, unless otherwise noted, and constitute judgments as of the dates published. Such information may contain forward-looking statements that are not intended to be guarantees of future events. Actual results could differ materially from those anticipated in the forward-looking statements. For more information, please visit yourfinancialpharmacist.com/disclaimer.

Thank you, again, for your support of the Your Financial Pharmacist Podcast. Have a great rest of your week.

[END]

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YFP 330: How One Physician Had $550k+ of Loans Forgiven via PSLF

Posted on by Tim U

On this episode, sponsored by FirstHorizon, Brenna Roth, MD, MPH, shares her journey of having over $550k of student loans forgiven tax-free via Public Service Loan Forgiveness (PSLF).

Episode Summary

Are student loan forgiveness programs a beacon of hope for graduates drowning in debt? Joining us this week is Brenna Roth, MD, MPH; a physician who achieved an incredible financial milestone – over $550,000 of student loans wiped clean through the Public Service Loan Forgiveness (PSLF) program. In our conversation, Brenna discusses her background in medicine, the accumulation of her student loan debt, her initial feelings about the debt, and her journey to tax-free forgiveness. She also shares advice for individuals facing high student loan debt and considering PSLF as an option. We also unpack the challenges of dealing with loan servicing companies, the impact of the COVID-19 payment freeze, and the benefits of lower monthly payments through income-driven repayment plans for those pursuing PSLF. If you’re curious about the PSLF program or facing significant student loan debt, Brenna’s inspiring story sheds light on the potential benefits of pursuing loan forgiveness and highlights the changing landscape of student loan repayment.

About Today’s Guest

Brenna Roth, MD, MPH is an infectious disease doctor and public health specialist who works in academic global health and research. She lived and worked in Tanzania for 3 years and has continued to work on international programs and research projects across sub-Saharan Africa since. She has successfully navigated the Public Service Loan Forgiveness Program across multiple loan servicers, jobs, and continents.

Key Points From the Episode

Background about Brenna and her medical career journey.
Discover how Brenna accumulated a large amount of debt.
She shares her approach to tackling the student loan debt mountain.
Her hesitancy toward PSLF and what ultimately changed her mind.
Common pitfalls and mistakes people make regarding repayments.
Challenges with loan servicing companies and documentation.
Recent changes that have improved the PSLF program.
The pros and cons of the PSLF repayment plan.
Ways COVID-19 impacted student loan payments and the freeze on payments.
Brenna’s experience making minimal payments during her time abroad.
Benefits of lowering adjusted gross income through retirement contributions.
How PSLF allowed Brenna to shift her focus towards long-term financial goals.
Advice for recent pharmacy and medical school graduates considering PSLF.

Episode Highlights

“Those high-interest rates building up over the years really impacted the amount [debt].” — Brenna Roth [0:04:53]

“My hesitancy was not knowing for sure, if after all of those years, [my debt] would actually be forgiven.” — Brenna Roth [0:10:51]

“It makes sense to, if you’re going to do PSLF, to pay during residency, fellowship, those kinds of years when you’re not making very much money.” — Brenna Roth [0:20:34]

“I think I would say, definitely give PSLF some serious consideration. I won’t say it’s the right thing for everybody. Obviously, it can depend on how much debt you have and what kind of job you are going into.” — Brenna Roth [0:25:04]

Links Mentioned in Today’s Episode

Episode Transcript

[INTRODUCTION]

[0:00:00] TU: Hey, everybody. Tim Ulbrich here, and thank you for listening to the YFP Podcast, for each week we strive to inspire and encourage you on your path towards achieving financial freedom. This week, I welcome Brenna Roth, a physician onto the show, to talk about her public service loan forgiveness (PSLF) journey, where she recently had more than $550,000 of loans forgiven, tax free.

Yes, you heard that right. More than $550,000 of student loans forgiven, tax-free. We talked about how she accumulated that large debt load, her feelings toward the debt, what went as planned, and didn’t go as planned along the way, and advice that she has for those that are facing high student loan debt.

Let’s hear from today’s sponsor, First Horizon, and then we’ll jump into my interview with Brenna Roth.

[SPONSOR MESSAGE]

[0:00:45] TU: Does saving 20% for a down payment on a home feels like an uphill battle? It’s no secret that pharmacists have a lot of competing financial priorities, including high student loan debt, meaning that saving 20% for a down payment on a home may take years. We’ve been on a hunt for a solution for pharmacists that are ready to purchase a home loan with a lower down payment and are happy to have found that option with First Horizon.

First Horizon offers a professional home loan option, aka doctor or pharmacist home loan that requires a 3% down payment for a single-family home or townhome, for first-time homebuyers, has no PMI and offers a 30-year fixed rate mortgage on home loans up to $726,200. The pharmacist home loan is available in all states except Alaska and Hawaii and can be used to purchase condos as well. However, rates may be higher and a condo review has to be completed.

To check out the requirements for First Horizon’s pharmacist home loan, and to start the pre-approval process, visit yourfinancialpharmacist.com/home-loan. Again, that’s yourfinancialpharmacist.com/home-loan.

[INTERVIEW]

[0:01:58] TU: Brenna, welcome to the show.

[0:02:00] BR: Hi, thank you.

[0:02:02] TU: Well, it’s been a while since we’ve shared some PSLF stories on the podcast. In fact, over a year and a half ago on episode 248, we featured three pharmacists that collectively had more than $700,000 in student loans forgiven. We’ll link to that episode in the show notes. But all that to say, it’s been a while, and I’m certainly excited for this conversation, which came to be after YFP Planning, Financial Planner, Kim Bolton, shared the good news with our team, about your MOHELA account officially showing a $0 balance with over $550,000 that was forgiven, tax-free. And as soon as I heard that, I thought, we have to share this story with our community.

Brenna, as I mentioned to you before we hit record, there still is a lot of skepticism, a lot of questions, a lot of unknowns, surrounding public service, loan forgiveness. I think the more stories that we can share, the more information that we can get out the better. So, before we dig into your specific journey, tell us a little bit about your background, including your journey into medicine, where you went to school, and the work that you’ve been doing since?

[0:03:07] BR: Yes. So, I’m a trained infectious disease doctor. I did my undergraduate work at Tulane University. I also got a Master’s of Public Health there. Then, I worked for a couple of years in public health work research, and then I went on to medical school at Ross University. I did my residency at York Hospital in Pennsylvania, and I did my infectious disease fellowship at the University of Maryland, and I’ve been working since then.

[0:03:40] TU: A lot of years of training. Certainly, our audience can appreciate that. You know, $550,000 of debt that’s forgiven, tax-free, that’s a big number, and I think even quite shocking to our community who’s used to high debt loads, but not that high, right? Maybe $150,000, $200,000 or $250,000. But over $550,000, again, that is a large amount. I assume, and one of my questions about your brand as we get started is how did that debt load come to be as big as it was? Is that a function of medical school, as well as the master’s degree? Tell us a little bit more about the accumulation phase of that amount of debt.

[0:04:19] BR: Yes. It’s from the loans that I took out for my Master’s of Public Health as well as medical school. I was paying off the Master’s of Public Health, initially, when I left school. But then when I started in medical school, that repayment was paused. But during that time, still, the loans were collecting interest. So, it was really that accumulation over all those years of the loans plus — and I’m sure people are familiar with, they have rather high-interest rates, and I was no exception. So yes, just those high-interest rates building up over the years really impacted the amount.

[0:04:58] TU: Yes. The accumulation of interest, on a couple $100,000 or more of debt adds up pretty quickly, especially over periods of time with training involved. I think that while most people know that, we have, somewhat Brenna forgotten that, just because of the last three years, we’ve been on this freeze. So, I think for those of us that graduated, many of my loans are at a fixed 6.8% interest on the federal side, and you quickly realize, like, whoa, and you’ve got a couple $100,000 of debt. If you’re not making payments that are covering that interest, that loan balance grows pretty quickly, and all of a sudden, 200 becomes 250, becomes 300.

Now, if we’re pursuing public service loan forgiveness, and we get to the finish line of tax-free forgiveness, that’s not a bad thing. The goal is that we pay as minimum out of pocket as we can, to have as much as we possibly can, forgiven, and tax-free. But obviously, for those that go through the journey of paying those out of pocket, not through our forgiveness plan, certainly that can be a concern.

Brenna, I’m curious about your feelings surrounding the debt. No right or wrong answer. But I often talk with pharmacists. I joke it’s the student loan debt pain scale, 0 to 10. I talked with some pharmacists that may have a couple $100,000 of debt, and they describe it as a 10. The house is on fire, it’s causing anxiety, they’re frustrated, they’re worried. Even something like a PSLF strategy, they want these gone tomorrow. Even though the math shows it’s going to be favorable, it’s causing that much stress.

Other end of the spectrum, I’ll talk with pharmacists to say, I’m closer to a one or two or three. I recognize it’s a big deal, but they kind of are what they are. If it’s a longer payoff or forgiveness strategy, they may be more comfortable with that, to be able to maximize whatever they can dollars-wise. So, for you and your journey, what were your feelings surrounding the debt load, and did that change at all, as you were going through this PSLF journey?

[0:06:48] BR: It definitely changed over time. I mean, I would say it was at a tenant point. But honestly, I got to a point where, at one point, before I sorted into PSLF, I really just thought I will just have these debts forever, and it’s just going to be a part of my life and better to just accept it, and know that it’s just going to be there. So, I would say it went from a 10 to maybe more like 5 or 6, because I won’t say that I wasn’t at all concerned. But it kind of diminished. But with PSLF, I think it – well, initially, I won’t say it decreased, because I was a little skeptical about whether it was the best choice and I also, over time, I switched the companies that were handling my loans. That never proved to be a really great transition.

So, that was always stressful, because I was always worried that documentation or information would be lost, and the efforts I’d been putting in would not show up at the end, like something would go wrong. So, there were moments where stress kind of went up about all of it. But I would say overall, maybe it was only the last probably few years that I kind of – it dropped below a five for me when I started to have more confidence that things were really moving and things were really going to actually be forgiven.

[0:08:29] TU: Yes. I’m glad you brought that up with the loan servicing companies, right? That’s something we hear often, which is, those can be headaches to navigate. I mean, even right now with the new safe plan that’s coming out, people’s payments are being calculated incorrectly. For good reasons, people are freaking out, wanting to get the right information. Might have to recertify income. Should I recertify an income right now? I mean, there’s just so many nuances and wrinkles. I think as you go through some of the pain of those, and you get over those speed bumps, you tend to get a little bit more comfortable knowing how to navigate it.

But unfortunately, the difficulties with the loan servicing companies, that hasn’t gotten a whole lot better. I think people have gotten more comfortable with PSLF, because of hearing stories like yours, or we’re getting more education and information to make sure that they’re crossing the T’s and dotting the I’s correctly. But we would be lying if we said it’s going to be a clean journey for everyone, right? Just 10 years, 120 payments, you wake up, it’s tax-free. That’s the goal. But it doesn’t mean there’s not going to be some bumps along the way as well.

[0:09:34] BR: Definitely.

[0:09:35] TU: You mentioned reluctancy. I want to talk more about that. Is that something we hear a lot? I often will present on student loans, and when I show the calculations, I think, people nerd out and they get really excited about, “Oh, I can optimize this, and maybe it allows me to achieve other financial goals because I’m not having to put as much towards my student loans.” But there still is very much a sense and feeling of, what if? What if the rules change? What if this isn’t everything that I think it’s going to be? So, I want you to talk a little bit more about your reluctance, what were some of those questions, and then what ultimately changed, that allowed you to say, “Okay, yes, this is the path that I’m going to pursue.”

[0:10:17] BR: So, it should be noted that I was first presented really seriously, shortly after signing up with them with Tim, with YFP. Because this was, my loans were probably my major financial concern at the time. This was 2016, 2017, and I’d heard about the program. But I hadn’t really heard of anybody successfully navigating it, for sure. So, I think it was just not really knowing – my hesitancy was not knowing for sure, if after all of those years, things would actually be forgiven. Of course, as you mentioned, the strategy really is to lower your payments as much as possible and to get through those 10 years, meeting the requirements. But taking as little financial hit as possible.

Which the alternative to that would be, okay, let’s focus on making paying off as much as we can each month, and getting this paid down as quickly as possible. So, you’re accumulating as little interest. Those are like the two options that were presented to me. While it was clear that PSLF made the most sense, on paper, my reluctance came from not being totally sure that at the end of that 10 years, and that would be 10 years wasted in accumulating interest. All of these things, and that was really where my hesitancy came from. Again, this was a number of years ago, when there wasn’t as much evidence that the program was really going to definitively work. I even – I didn’t know if – I even had the concern of what if they just up and decide to cancel it for some reason?

So, it was really that. And you did hear horror stories of people thinking that they were doing everything right for years, and then getting nine years in, and being told, “Oh, no, you were in the wrong repayment plan”, or whatever it may be. During one of my switches from – actually, no. I was checking in with my loan servicer, and just to see is everything on track, is everything look okay. I felt pretty comfortable because you guys were helping me. So, I felt like I’s were dotted, T’s were crossed, but I was still checking in, and they actually told me, “Oh, we don’t go back and check that stuff until it’s like the last year of repayment.” And suddenly, I realized, “Oh, that’s why people get to the end, and they don’t know, because nobody’s really reaching out and communicating with them that this isn’t correct, or this should be.” So, people were getting really far along before getting any feedback that anything was not correct.

[0:13:12] TU: Yes. And when you mentioned the skepticism for good reason, that was around 2017. Is that correct?

[0:13:17] BR: Yes, 2016 or ’17, somewhat in there.

[0:13:21] TU: Yes. Which totally makes sense, right? This program was legislatively enacted in 2007,10-year timeline to forgiveness. That first group to be forgiven would have been in 2017, 2018. This is where a lot of the initial negative press came out. To be fair, the Department of Ed could have done a lot better job in terms of, communicating this and preventing some of these problems that people were identifying it to your point, at the end, when they’re getting near the finish line. Even in the six, or seven years since then, the information has gotten a lot better, the education has gotten a lot better. I think the loan servicers are more comfortable. Still not necessarily easy to always work with, more comfortable. The path, even with employers, now there’s a, through the studentaid.gov profile, you can punch in the EIN of your employer and see if there are qualifying employers. Even those questions in the past were like, “Am I 100% sure that I’m working for a qualified employer?”

For a good reason, you had skepticism, and when you’re talking about the horror stories, I’ve mentioned to you before we hit record that there was an article published by NPR. I think it was 2018, 2019 that the headline was “99% of PSLF applicants are denied.” Somewhat of a misleading story. We haven’t actually looked into the details in terms of the number of people who didn’t fully complete their application and the paperwork. But there were fair issues, and those issues being, “Oh, I didn’t realize that I had to maybe first consolidate my loan into a direct loan, to be able to then unlock a qualifying repayment plan so that then it counted as a qualifying payment.” It’s even crazy when I present on this topic, Brenna, like, I even catch myself like, well, if you do this, and then you do this, and then you do this, then it counts as a green checkmark, right? Then we’re good.

It’s kind of crazy that we have to jump through all these hoops. But that’s just the system that we’re in and the cards that we’ve been dealt. Now, thankfully, you were positively impacted by some of the changes that the Biden administration implemented where for individuals that maybe didn’t have all those T’s or I’s crossed because they didn’t necessarily know from Jump Street that they were going on a PSLF pathway, that there was a reconciliation process for those payments to count as qualifying payments, which you benefited from, is that correct?

[0:15:33] BR: Yes, because when I consolidated and got everything in order, and that was actually another thing. I didn’t realize, because you mentioned employment and the employer’s account. I really did not think that my residency training would count, and it was actually, again, Tim, who pointed out that he really thought it would. So, that was another thing that pushed me once I realized that that period of time also counted, that that shifted, I think, my willingness to go into PSLF.

But yes, I did benefit because I did have a – some of my loans were in the correct repayment plan, but I had some that were not. So, there was a gap of, I don’t know, maybe four or five years between some of the loans just because once I got those into the correct repayment plan, you know, it started from zero. So, it didn’t matter that I’ve been paying those loans for years, none of those previous payments had counted, because they weren’t in the correct repayment plan.

But luckily, with that Biden, that like one year, going back and counting, a lot of those payments that hadn’t previously counted towards the forgiveness were counted, which was great.

[0:16:48] TU: Yes. I think it was really helpful, especially for people Brenna, like you, that maybe necessarily didn’t start with a PSLF journey in mind. We are seeing more people now that they come out, they go into residency, they know, “Okay, I’m not going to defer, so I can count those as qualifying payments” and they’re thinking about PSLF as a strategy right away. But that hasn’t always been the case. Again, just based on the age of the program and the information that we have available.

One of the things that is beneficial about the strategy, as you’ve mentioned, as I’ve mentioned, is to try to pay as little out of pocket so that we can have as much forgiven tax-free. You mentioned before we hit record that you were able to have about five years, about half of the 10-year timeline of payments, actually, where you weren’t having to make payments at all. Tell us more about what was happening, where you were able to have such a large chunk of time where you didn’t have to make those payments.

[0:17:40] BR: Yes. So, everybody has been affected by the pause in payments with COVID. So, I was also affected by that. But I moved to Tanzania, actually in 2017. I was living there, full time. Because of that, it affected my taxes, and basically what it looked like, what my income looked like, and thus my repayment. So, if I remember correctly, there were a couple of years there where technically I could have been paying zero. I was still paying a small amount on my loans. But yes, I had a couple of years there, where just because of living internationally and working internationally. My income appeared low enough that – because it’s income-based, and so basically, my payment was functionally zero.

[0:18:33] TU: Yes. You had a few years of the pandemic freeze, as did other borrowers, were those counted as qualifying payments. That was one of the big questions when that freeze started, and that was good news that people that were pursuing PSLF, those counted as qualifying payments to the freeze that just ended here in September of 2023. Then, you have a couple years in Tanzania, you mentioned, perhaps this could have been zeroed out payments. You’re making small payments.

I’m glad you mentioned that because one of the most common questions that I get is should I defer my loans during residency, or in your case, residency and fellowship. While not blanket advice, generally, my answer is you don’t want to defer, and the reason you don’t want to defer is that typically because you’re earning such a low income while you’re in residency or fellowship relative to what you will earn, and how they do the calculations on these, often these will be very low, and sometimes $0 monthly payments. But as long as you’re inactive repayment, those count towards qualifying payments of the 120.

So, I still think there’s a lot of advice out there from maybe my generation of pharmacists or those even older. I graduated in 2008, where it was kind of blanket advice. Like differing residency, differing residency, and often the case may be actually not to defer, so you can get those accounts as qualifying payments.

[0:19:54] BR: Yes. It’s funny that you mentioned that, because you just triggered – that was – I think that’s actually, because I still had that had a feeling of what if something goes wrong with a PSLF. So even though I was being told those couple of years, “You don’t have to make a payment, it’s zero, it will still count.” I made the decision to make a small payment because I didn’t want anybody to be able to come back later and say, “Oh, you weren’t paying during these times.” So, I still had my own little, is this really going to work the way it’s supposed to work even at that point? But definitely, it makes sense to, if you’re going to do PSLF, to pay during residency, fellowship, those kinds of years when you’re not making very much money.

[0:20:44] TU: Yes, and one of the other, we won’t spend much time on this now. We’ll talk about it in another episode. But one of the advantages of the new save plan that was announced by the Biden administration here in the last couple of months, and certainly, it’s not the right fit for everyone. But especially those that are new graduates, new trainees in residency, there’s a provision as a part of that safe plan where as long as you’re making the minimum payment, whatever that is, based on your income, that your loan balance can’t grow, which is really nice. Because if you’re in deferment, like interest can still accumulate, you’re not making any payment technically. So, especially for those that are in one or two or more years of residency that can be, that can be really valuable.

Brenna, what did PSLF allow you to do in terms of other goals. Typically, if we’re optimizing the strategy, we’re hopefully paying less out of pocket than we normally would have with other strategies. And therefore, that gives us options to invest and save, or pursue other financial goals, where we don’t have to just solely focus on our student loans. So, for your situation, for your financial plan, what did PSLF allow you to do in terms of other goals?

[0:21:51] BR: I really, for the most part, focus a little bit more on investment retirement, and because really, I hadn’t been too focused on that until I was finishing a fellowship, going into an actual job, and I’m feeling like I had that money. So, I think that allowed me to focus a little bit. Because as I said, I sort of always thought that these loans would just be part of my life. So, it shifted my long-term thinking, and as we discussed before, having the loans forgiven didn’t really change my day to day. But even during that process, I think, instead of being so focused on I’m going to have to repay this at some point, I could really focus on that longer term, where do I want to invest my money.

I mean, yes, it did allow, because I think I would have been far more reluctant to maybe take this trip or that trip, for fear of what that meant longer term. So, it probably did allow me to feel a little more free to do those kinds of things. But for me, it was really more about the longer-term goals and being able to focus more on investments and retirement plans and those kinds of things.

[0:23:16] TU: That’s one of the things I love about this strategy is when we’re optimizing this, one of the goals we’re trying to achieve is to lower our adjusted gross income, the best that we can, which is the factor they’re using in the payment calculation to determine what your monthly payment is. One of the ways we can do that, kind of the low-hanging fruit, is making sure we’re maxing out traditional retirement accounts like a 401(k), a 403(b), and maxing out HSAs. So, there’s this beautiful double effect of not only are we then saving more through those vehicles, which are going to be able to grow and compound and time value of money, make sure we start that as early as we possibly can. But it’s also at the same time, lowering our monthly student loan payment, and that’s really cool. When we can see that working, and we all know our listeners know well, that when you’re saving even just a little bit more early in your career, and that money has a long time period to grow, that’s going to have a significant impact and effect.

Brenna, I’m curious, we have a group of graduates coming out right now that many may be listening to the show. We have three graduating classes now that haven’t had to make any payments on student loans, because of the freeze. Interest just started back up in September. Payments are resuming here next month in October. I think it’s fair to say, there’s a decent amount of anxiety. Maybe people that were making payments that didn’t have to, and now they’re having to make payments again. Or for new graduates, or just on the front end of this journey, and not really sure what is ahead, but certainly there’s some anxiety surrounding that. As you look backwards now, finish line has been crossed. You’ve had a large amount of debt forgiven, tax-free. What advice would you have, whether it’s pharmacy graduates, or medical school graduates, that are just getting started and they’re looking ahead and saying, “This feels big. This feels scary.”

[0:25:03] BR: I think I would say, definitely give PSLF some serious consideration. I won’t say it’s the right thing for everybody. Obviously, it can depend on how much debt you have, and what kind of job are you going into. How much are you going to be making? I’m in infectious diseases in medicine. That’s not a subspecialty that is known to make a lot of money compared to some others. So, for others – and I don’t know as much about pharmacists, and their training, and different specialties within that. But I would assume there’s some variation as well.

So, I think it is a very individual decision. And for me, though, as I said, having a financial planner, being able to discuss it, really just my income to debt ratio, PSLF was just very clearly the best option for me. So, I think, just really give it some serious consideration, and don’t talk yourself out of it immediately. It is working. Just my experience over many years, and with many different – having my loans switched from different companies, I can tell you, it’s been so much easier recently to be able to track things, to get information about things. It’s gotten so much easier over the years. I mean, it does work. There are more and more people with loans being forgiven. So, I hope that the concern and the fears are diminishing over time. I won’t say everybody needs to go out and do it. But I think it should be definitely a serious consideration as an option.

[0:26:52] TU: Yes. I’m glad you said that. We estimate in pharmacy, and I know it’s higher in medicine, just based on the distribution of practice, and where people are at nonprofit to for profit. But we estimate that about 25% to 30% of all pharmacy graduates are eligible or qualify for PSLF.

Now, they may not have the right debt-to-income ratio. It may not make sense. They may be unsure about how long they’re going to be in the nonprofit space, and there’s other questions. But to your point, Brenna, I think the take-home point I hear there is making sure that you’re considering it among all of the options, and running the numbers, how do we feel about it? What does this mean for other parts of the financial plan? And making sure that we feel that we’re making an informed decision, looking at all the different options that we have on the table. For some, that’s PSLF. For some, that could be a non-PSLF strategy over a long period of time, if they’re working for a for-profit. Or we have some individuals that say, “Hey, I really want to aggressively pay these off.” And they have reasons and a rationale that may make sense for them.

So, this is certainly an area where, whether we like it or not, student loan repayment is a somewhat complicated topic, and it’s something that we’ve really got to dig into and make sure that we’ve got good information as we look at and evaluate all the options that are available.

Well, Brenna, this has been awesome. I really appreciate you taking the time coming on the show to share your journey of having over $550,000 of debt that was forgiven, tax-free. As I mentioned at the beginning, we’re going to share some other resources in the show notes of where we’ve talked about public service, loan forgiveness, as well. And to the Department of Ed’s credit, as you gave them credit here, I think recently, of information getting better in the loan servicing companies. They have updated a lot of information and resources, and especially with so much changing right now, make sure to check that out at studentaid.gov.

Again, Brenna, thank you so much for taking time to come on the show.

[0:28:38] BR: Thank you.

[0:28:40] TU: Before we wrap up today’s show, I want to again, thank this week’s sponsor of Your Financial Pharmacist podcast, First Horizon. We’re glad to have found a solution for pharmacists that are unable to save 20% for a down payment on a home. A lot of pharmacists in the YFP community have taken advantage of First Horizon’s pharmacist home loan, which requires a 3% down payment for a single-family home or townhome for first-time homebuyers, and has no PMI on a 30-year fixed-rate mortgage.

To learn more about the requirements for First Horizon’s pharmacist home loan, and to get started with the pre-approval process, you can visit yourfinancialpharmacist.com/home-loan. Again, that’s yourfinancialpharmacist.com/home-loan.

[OUTRO]

[0:29:24] TU: As we conclude this week’s podcast, an important reminder that the content on this show is provided to you for informational purposes only and it is not intended to provide and should not be relied on for investment or any other advice. Information in the podcast and corresponding materials should not be construed as a solicitation or offer to buy or sell any investment or related financial products. We urge listeners to consult with a financial advisor with respect to any investment.

Furthermore, the information contained in our archived newsletters, blog post, and podcast is not updated and may not be accurate at the time you listen to it on the podcast. Opinions and analysis expressed herein are solely those of Your Financial Pharmacist unless otherwise noted and constitute judgments as of the dates published. Such information may contain forward-looking statements, which are not intended to be guarantees of future events. Actual results could differ materially from those anticipated in the forward-looking statements. For more information, please visit yourfinancialpharmacist.com/disclaimer.

Thank you again for your support of the Your Financial Pharmacist Podcast. Have a great rest of your week.

[END]

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YFP 110: How One Couple Overcame Hardship to Pay Off $150,000

Posted on by yfpadmin

Debt Free: How One Couple Overcame Hardship to Pay Off $150,000

Betsy and Casey Hoida join Tim Ulbrich to talk about their debt free journey paying off $150,000 of student loan debt, why and how Betsy left her secure pharmacy job after completing residency and getting board certification and how they managed to work together to get on the same page financially despite some highs and lows along the way.

About Today’s Guests

Betsy and Casey Hoida reside in Green Bay, WI with their two daughters, Mollie and Claire. The couple both obtained their PharmD from Ferris State University in 2006.

Casey is a home infusion and hospice/palliative care pharmacist. He has been working in the field of home infusion for 10 years. Casey specializes in infusions involving antibiotics, anti-fungals, TPN, chemotherapy, PCA, inotropic, immunoglobulin and other biologic drugs. His future plans involve continuing to expand biological services with in the pharmacy as well as introducing MTM services to his patients. Outside of work Casey’s interest in personal finance continues to grow and he plans on pursuing opportunities in fee for service based financial planning.

Betsy has a diverse clinical pharmacy background with experience in a multitude of practice settings. In December of 2017, she left her traditional hospital clinical pharmacist role to take on the position of CEO of the Hoida Household. Currently, she staffs part time in a compounding pharmacy and is obtaining a certification as a Hormone Replacement Therapy (HRT) Specialist with the hopes of using her entrepreneurial spirit to start a consulting business this fall.

Together they paid off $150,000 of debt in 6 years.

Summary

Betsy and Casey Hoida share their journey of paying off $150,000 of student loan debt. They both received their PharmD from Ferris State University in 2006 and have since had diverse careers. After graduating, Betsy worked for a year and then completed residency. In 2017, Betsy realized she was burned out and needed to step away from a traditional pharmacy career. Currently, she staffs part time in a compounding pharmacy and is obtaining a certification as a Hormone Replacement Therapy (HRT) Specialist with the hopes of using her entrepreneurial spirit to start a consulting business this fall. Casey had a retail pharmacist internship and worked for a retail company for a year after graduating. He took Betsy’s long-term care position and fell in love with the infusion portion of pharmacy. He currently works as a home infusion and hospice/palliative care pharmacist and has been working in the field of home infusion for 10 years.

Casey explains that when they graduated, the market for pharmacists was hot. He knew that they carried student loan debt, the majority being his, but he wasn’t worried about finding a job and having a good salary to begin paying it off. Casey took the lead on managing their finances and the couple began moving on paying off their debt. They did two things from the beginning to help them learn how to live off of less; automatically maxing out their 401(k) so they didn’t see the amount on their check and making the shift to living off of one salary.

Betsy explains that the driving force on their mission of becoming debt free stems from not wanting to feel trapped. Casey shares that he was raised to avoid debt, to pay it back quickly if you’re in it and to save. While in the process of paying debt off, he got to the point where he didn’t want to be owned by someone else for the debts he had.

Casey explains that in order to pay off the $150,000 of debt in 6 years, they had to become really intentional with their money and, most importantly, get on the same page. The first year that they were paying it off, they didn’t have a mortgage and used the extra money to chip away at it faster. They continued to remain mindful of their budget and made short term goals (six months or a year). They used overtime earnings and any extra income to go to paying off their student loans. Now that their student loans are paid off, they are so much more relaxed.

Betsy and Casey also discuss why and how Betsy left her secure pharmacy job after completing residency and getting board certification and how they managed to work together to get on the same page financially despite some highs and lows along the way.

Mentioned on the Show

Episode Transcript

Tim Ulbrich: Hey, what’s up, everybody? Welcome to this week’s episode of the Your Financial Pharmacist podcast. I know I say this often, but I mean it sincerely each and every time, and this week is no exception. We have a great episode for you where I’m going to talk with Betsy and Casey Hoida. We’re going to talk about their financial journey. Yes, we’re going to talk about the student loan debt that they paid off. But more than that, we’re going to talk about life, how did they manage this topic together, what does this mean for their future, and we’re going to talk about the impact and how they translate their finances and connecting that with their career. So Betsy and Casey, thank you for your time and welcome to the Your Financial Pharmacist podcast.

Casey Hoida: Thank you. Thank you for having us.

Betsy Hoida: Yeah, we’re super excited. Big fan.

Tim Ulbrich: I am excited. Thank you. We’ve been meaning to record this for some time, and here we are. And before we jump into the interview, I want to read briefly, Betsy, you had sent me an email about a month or so ago, and I think it’s going to help frame our conversation as it gives a little bit of background in your story and then certainly I’m going to ask you to build off of that. So you said, “Hi there. My husband and I love the show. I actually became addicted, and he listens from time to time as well. We’re both pharmacists, but I recently left the profession in search of something else. Not sure what. We’ve had a long but inspirational journey, currently debt-free, minus our mortgage.” So I want to talk about that journey, and before doing so, congratulations on being debt-free except your mortgage. That certainly is no small feat, and I want to talk a little bit about how you did that. So Betsy, let’s start with you. Take us back to your story, your financial journey. You graduate from pharmacy school at Ferris State, and tell us a little bit about your career path, what you did after graduation, and tell us a little bit about your student debt situation and how you viewed this topic of money.

Betsy Hoida: Sure. So I graduated in 2006, and I decided to work initially community pharmacy and then changed my mind last-minute because I had heard about a job in long-term care. So I took that position. I worked for a year, and then I decided to go back and do a residency. At that point, Casey had kind of taken over our debt together. So I really, I didn’t even know what my student loans were, to be honest with you. So I did a residency in our first year of marriage, which was interesting.

Tim Ulbrich: I did that as well. It’s challenging, right?

Betsy Hoida: Yes, it was very challenging. But we weren’t even to the real challenges in life yet like kids and so on. But anyways, to get back to my background, then I decided that we were ready to have kids. I guess we decided, not I decided.

Casey Hoida: It takes two people.

Betsy Hoida: Right. To move back home, which was the UP, but we didn’t want to move back home, so we chose Green Bay, Wisconsin. And I got us both jobs up here. I’m a networker, so at a residency conference, I kind of found about Aurora and got us both jobs up here. And my journey since then has kind of been finding out really what I wanted in the profession and also balancing being a mom, which was really hard for me married to a pharmacist as well.

Tim Ulbrich: And we’re going to come back to that because what really stood out to me when you and I had talked prior to the interview, Betsy, is that as I look at your career path, you know, PGY1 residency, board certification, you were involved in lots of different clinical services, you served as the residency program director, I mean that often for many is really viewed as kind of the premier career path into clinical pharmacy residency training, board certified and so forth. But you ultimately made a decision to pick up and walk away from that, and it’s a little bit of a teaser for our listeners, but we’re going to come back and talk about why. And we’ll talk about the impact of that obviously financially as well. So Casey, before we go into more of that, tell us a little bit about your background after graduating from Ferris State and some of the work that you’re doing now and how you got into that career path.

Casey Hoida: Sure, yeah. I graduated in 2006 also and at that time, we were one of the — not newest classes of PharmDs, but it was fairly new. So we had all this clinical knowledge and were ready to use it. And in pharmacy school, in doing my internship, I was in retail. And so I guess it just kind of made sense that I continued on there once I graduated. So I worked for a company for about a year, and then our career paths, Betsy and I, kind of intertwined here. When she left the long-term care facility to pursue a residency, I actually took her position, and that’s how I got into long-term care. To tell you how I got to where I am now, in long-term care, there was a small IV pharmacy department, and the pharmacist, who was a little bit older than me who was kind of running it didn’t really enjoy, didn’t care much for it. I said, “Oh, wow, this looks interesting.” Potential for me to use more of my clinical knowledge, and so I jumped in and just really kind of fell in love with the infusion portion of pharmacy. And so when we decided to make the move to Wisconsin, as Betsy stated, she was kind enough to find me a position. I didn’t even have to look. And it was for a home infusion position. And I had very limited experience, I interviewed for it, was asked a lot of clinical questions by my director, and he knew that I didn’t have a lot of experience but liked me and thought that I was going to be a good fit and gave me that opportunity to get into a portion of pharmacy that not a lot of people know about, a practice setting that’s not very familiar to many people. And I’ve been there for 10 years now, and I really, really enjoy it.

Tim Ulbrich: So to our listeners, if anybody needs a job or is currently looking for a job, we’ve learned that Betsy is the networker.

Betsy Hoida: You got it!

Tim Ulbrich: So she can help open up those doors. And I love that career path story, though. You know, in terms of the two of you working together. But Casey also kind of finding yourself in somewhat of a “nontraditional” career path, despite not doing residency and other things. But I think that speaks to the value and the power of networking and connections and certainly leaning on your wife where appropriate. So that’s exciting. So I want to hear about the two of you, you graduated from pharmacy school, you’ve got student loan debt, we still are in the time period where the job market’s pretty good, 2006-2007. Obviously, you’re facing somewhat of a significant indebtedness load. And one of the common things that I see among pharmacists, myself included, is there’s this tendency of, hey, I’m going to make great money or I do make great money, I’m not really worried about it. So let’s focus on buying a home and doing these other things. And then all of a sudden, you end up in a position where you feel like, wow, this is a little bit more stressful and we feel more pinched than we thought we would. So did you both have the stress as it related to student loans? Were you worried about it? Were you not worried about it? What was your perspective coming out financially. And let’s start, Betsy, if you want to talk about that.

Betsy Hoida: No. I did not. Because like I said, Casey naturally is great at finances. And I just let him have control over it. I didn’t even pay attention. That sounds horrible. It really does. But you know, that was his gift. And we bought our first house, we didn’t know what we were doing, and yeah. Do you have anything to add to that?

Casey Hoida: Yeah, you know, the first thing that I want to point out just kind of for the listeners is we were really in a different position back then when we graduated in 2006, like you said. It was — the pharmacy market was hot, there was money flowing everywhere, sign-on bonuses and stuff. And so yes, we had this student loan debt, but I wasn’t worried about finding a job and getting a top-end salary. So today, from what I know, that’s a lot different. Kids that are coming out —

Betsy Hoida: Kids.

Casey Hoida: Yeah, I say kids.

Tim Ulbrich: Those kids.

Casey Hoida: Yeah, professionals are coming out from pharmacy school, and the job market is a lot different. And salaries potentially are a lot different than what they used to be. So with that being said, yeah, I was concerned about our debt. I knew that a majority of it was mine, so there was a personal aspect of it that I brought a majority of the debt to our marriage. And I felt more responsible for it, and so it was a worry and it was something that I wanted to address right away. I didn’t want to, you know, utilize it for tax purposes for 20 or 30 years like some people think. So I was definitely on it from the beginning.

Betsy Hoida: We talked about that for awhile. But I wanted to go back, Casey, you talked about us always living on one income.

Tim Ulbrich: Yeah, go ahead. I’d love to hear about that because I think that’s something we’re seeing with graduates today where, you know, expenses go up to the income right away. Or you have two pharmacists or not even two pharmacists, but people that are able to live off of less than they make, whether that’s one income or just a lesser percentage, obviously put themselves in a position to be able to achieve all their goals that they want to achieve but also that you never know what life’s going to throw at you for a variety of reasons. So it gives you margin and flexibility. So I’d love to hear how you made that decision and why you made that decision because that’s a very intentional choice.

Casey Hoida: Yeah. I think there were two things that we did, and I had thought about this in the past and I couldn’t come up with anyone who might have mentioned this to us, so I’m going to take credit for it or Betsy and I can both take credit for it.

Betsy Hoida: No, totally you.

Casey Hoida: The first thing that we decided to do when we graduated and took our first job is we were going to — and we did — automatically max out of 401k’s. And the reason behind that is we wanted to start saving for retirement right away. And we didn’t want to know what our paycheck looked like when we weren’t contributing to retirement. And so you know, there’s pros and cons to that, but that was one thing that we did. And then the other thing that we did and being mindful about it is we knew that at some point in time, we were going to have kids and who knows what the future holds besides kids? And we wanted to be able to live off of just one salary. So when we were looking at purchasing vehicles and buying a home and a majority of our financial decisions were based on can we do this on one salary? And that’s something we’ve lived by since the beginning.

Tim Ulbrich: Such wisdom there. I hope our listeners caught on and especially the students and those transitioning post-graduation, I mean, the two themes that I really heard there were obviously living off of less than you make, which just has so many benefits in so many different areas — and we’re going to come back and talk to those, about those, here in a little bit as we talk about Betsy’s career transition — but also automation. Automation, automation, automation. And you talked about it in the context of retirement. We’ve talked about it before, Episode 057, we talked about automating your financial plan. But if you can put those automation principles in place as early as possible, you’re less likely to feel like you’re missing it. And obviously, that has a significant compound effect over time in whatever goal that you’re trying to achieve. So what I want to talk about here for a minute, before we talk about the specifics of how you paid off the debt — because I think that’s important. We often focus stories on this podcast where we talk about big numbers and short periods of time. But often, we may not necessarily talk about how you exactly did it, and that’s certainly the piece that listeners want to know. But first, I want to talk about this topic even matters to the two of you. So here, we’re getting into the concept of identifying and finding your financial why. What’s the purpose? What’s the vision? What’s the direction when it comes to the finances? Why do you want to become debt-free? Why do you want to save for the future? Why do you want to do all of the things that we talk about on this show? And that could be different for every person. But having that financial why is incredibly important to being able to have that motivation to achieve your financial goals. So I know this is a big, loaded question, but Betsy, when I say that concept of kind of finding your financial why and why does this topic of money even matter, what comes to mind for you first?

Betsy Hoida: Freedom. Just finding out I was not happy where I was. And you know, that could be a number of things. We have children. I was trying to do everything, but I think the biggest thing is I was not using my gifts to — I’m going to give a shoutout to Alex Barker with his book “Indispensable.” I’ve been following him, and my career path or personality is very similar to him, and I think I felt trapped. I know that there’s something for me, and I really want that freedom to be able to explore that. So that’s my why.

Tim Ulbrich: Love that. Freedom and trapped are two words that really start out to me there. Casey, how about you?

Casey Hoida: Well, for me, it goes back to kind of how I was raised. I was raised that you try to avoid or you don’t owe people money. And if you do, you pay them back. And you save. And that was initially my motivation is that’s how I was raised, and that’s how I viewed money. But as I got older and as I gained more experience, I’d have to kind of reiterate what Betsy has already said is that you get to a point in your life where you just don’t want to be owned by anyone. And carrying debt and having all of these payments to make keeps one working and indebted to the system. And we just got tired of doing that. And so we want to have a future that allows us to follow our passions and to just kind of go where we feel like we’re being led.

Tim Ulbrich: That’s awesome, and that obviously directly plays into why you decided to get the student loan debt off your back. So Casey, talk to me for a little bit about, you know, $150,000 roughly of student loan debt, we’re talking about approximately six years, give or take a little bit of time, that certainly is not a plan where you’re just wandering in 10, 15, 20 years. There’s some intentionality in getting those paid off in a relatively short period of time. So how did you guys practically do it? Month-to-month, year-to-year, how were you able to pay off that amount of debt in a relatively short period of time?

Casey Hoida: Well, we first of all just sat down at one point in time — although we weren’t as serious as we are now — but we sat down, we got the number, we looked at it, we were both on the same page that we didn’t like it and we didn’t want it. And so obviously then the next step is how to go about it. And you know, the first couple years in our marriage, we didn’t have kids. So, and I think —

Betsy Hoida: Yeah, we did.

Casey Hoida: I think the first year — well, not right away, did we? Anyways, the first year, we didn’t have a home and so we had some extra income because we were living off of one to really start pounding away at that debt. And so initially, it kind of went fast. Like we were seeing gains month-to-month, year-to-year. And we’re like, oh wow, this is great. And then you add on a true mortgage, not a rental, and you add on some kids and expenses, vehicles and different things, and it starts to slow down. And so I guess what we really did is we just, we remained mindful that it was there, and we made short-term goals, whether that was six months or a year. And we said, OK, well, here’s the number where it’s at right now, and here’s where we want to be in six months or in a year. And so any overtime that was worked or any extra money that we would get from tax returns or anything like that, it all went to the mortgage — or excuse me, to the student loans — which isn’t fun, but it does decrease that number a lot quicker than just making the minimal payment.

Betsy Hoida: I’d like to jump in here, Tim, and say those were Casey’s thoughts. Honestly, honestly, I mean, I think I talked to you about where we hit a fall.

Tim Ulbrich: Yeah.

Betsy Hoida: I was — again, I told you, I wasn’t happy. I couldn’t pinpoint why. So I thought you know what, let’s move into a much bigger house. And let’s just live the ways of the world, this is going to make me happy. Which I was wrong. Spoiler alert. And what had ended up happening was I had after surgery, lost my job. And that was my wakeup call. And at this point — I’m just going to be open and honest here —

Tim Ulbrich: Appreciate it.

Betsy Hoida: That our marriage had hit a low point. And we’d signed up at church for this thing called Marriage Bootcamp. Little did we know that it was actually Financial Peace University. So I put it aside, we’re not doing this, until that low point. And I pulled it out, and I was like, wow, we need to start paying attention to this. Duh. I mean, Casey already was. But I really like how as a team, he is definitely the nerd, and I’m the free spirit. And I’m the one who was finally like, you know what? We have x amount of dollars to pay on this student loan. I know you love the security, but let’s just write the check. Let’s do it. And because I think we had identified that security is so important for both of us, so we did. And on top of that, we really hit the budget in that I wanted to see the numbers. That’s where I started listening to you, I started listening to Dave Ramsey, I just — I didn’t become obsessed, but kind of. I had to because I didn’t know anything about it. And our spending was very intentional.

Tim Ulbrich: So you were a free spirit with a little bit of a conversion to a nerd, you know, right? Along the way. So yeah, and I want to talk about that because I appreciate you sharing honestly some of the back story. And for those listeners that haven’t heard of the nerd-free spirit, that comes from Dave Ramsey’s Financial Peace University. It talks about money personalities, and we tend to fall at different degrees in one of those two buckets, so a nerd or a free spirit. The terms are pretty self-explanatory when it comes to how we manage our finances. But to me, what I love about in hearing your journey is that neither one of those for anybody is right or wrong. It’s a matter of identifying which of those do you tend more towards and how can you effectively work together, especially if you tend not to approach it in the same way. I would even argue for Jess and I, it’s a blessing that we don’t approach this topic in the same way.

Betsy Hoida: Amen.

Tim Ulbrich: Because I think if we were both nerds or we were both free spirits, we may be down a very different path. And I am very appreciative of what she brings to the financial table for us and really helps me look at it in a much different and healthier way, then collectively, we’re able to help each other. So to that point, though, I think often with the nerd-free spirit mindset, there can be tension in that. And so talk to me a little bit more, Casey, about how you were able to navigate that. You know, it sounds like certainly there was some pain there, which necessitated the two of you getting on the same page. But often, I hear from people that say, ‘Hey, I’d really love to dig into this topic, but I feel like I may not be able to get my spouse or my significant other on board. So what worked and didn’t work for you in terms of the two of you getting on the same page financially? Casey, let’s start.

Casey Hoida: Well, I can tell you what didn’t work. And it was trying to impose my financial will on my wife, to simply say, “This is what we’re doing. And this is how we’re going to do it.”

Betsy Hoida: That’s never worked.

Casey Hoida: No.

Betsy Hoida: On anything.

Casey Hoida: And it hasn’t really worked for much of anything, correct.

Tim Ulbrich: She’s a true free spirit, yes.

Casey Hoida: Yes, yes. I mean, you know, I won’t speak for Betsy on this, but one, for her, it helped when she truly became interested in our finances and took ownership on her end. And that’s what I’ll say about that, but then that allowed us to really sit down and one, just have a conversation, what is important to us financially? And what I mean by that is savings, retirement, college funds.

Betsy Hoida: Giving.
Casey Hoida: Giving, yeah, yes, definitely. Giving and mortgage and everything else. And so first, we had to identify what was important to each of us because that, I feel, is important knowledge to have before you can actually put together a —

Betsy Hoida: Cohesive plan.

Casey Hoida: Cohesive plan. And see how wonderful she is at finishing my sentences? Awesome. And so that’s basically it. First, it’s just communication with each other. And then it honestly just started to fall into place. I mean, we would have monthly financial meetings, budget meetings.

Betsy Hoida: They could be heated.
Casey Hoida: They were heated at first, and then they — as we continued on in them because you need to gain experience, they were less heated and they were more productive, and we really started to gain traction at that point in time.

Tim Ulbrich: So Betsy, let me ask — to follow-up on that — ask it this way. I often will talk with people and they may say, ‘Hey, I’m really having a hard time getting my spouse or significant other on board,’ as I mentioned. So from your perspective where maybe Casey was all ready to go and obviously, again, there was pain there that helped to necessitate this, but what advice would you give to those nerds out there of how to effectively engage a significant other that may be more of the free spirit mindset? What works? And what doesn’t work?

Betsy Hoida: So I would approach it as just as, you know, marriage. You keep your side of the street clean, and you know, money is attached to emotion. So really hearing what the other person has to say. And that means sitting down, not duking it out, but you know what I mean. Like we’re going to sit here, and we’re going to get this figured out. And a lot of times, it’s shutting my mouth and listening.

Tim Ulbrich: And building off of that too, going back to what I heard you guys saying your why is that I often will encourage couples — and I’m speaking here out of things I wish I would have done differently and what it took for Jess and I to get on the same page, but if you can start with the why and start with the dream and start with the goals, these month-by-month conversations — I’ll never say easy — but become a little bit easier because you agree on the vision and where you’re going. But if it’s not a shared vision, then I think that month-to-month can be somewhat combative, people shut down, and then you’re certainly resetting the clock. So again, keeping that why and keeping that vision in mind. So the reason I wanted to talk first about the paying off of the student loans and how you guys worked together is because I think that directly relates to, Betsy, to the decision you made that you were kind of unhappy with work, family priorities, prioritizing your marriage, and making the decision to walk away from that and being in the position to do so is really what I want to talk about here. So talk us through for a minute, you know, where were you in terms of just work, you know, externally, people may look at that and say, ‘Hey, you’ve got residency training. You’re board certified. You’ve got a ‘good job.’’ So what was not going well? What wasn’t working? And what was going on that led to you to the decision to say, ‘You know what, I need to walk away and take a break from this.’

Betsy Hoida: First, people thought I was crazy, like you said. But it turned into my health was not — it was slowly going down the drain, I was not taking care of myself, we have a child with special needs, I couldn’t sleep at night, my hair was falling out, I had lost a significant amount of weight. It got to the point of I can’t do this anymore. I can’t do this anymore. I need a break. And that was really hard. And it’s still really hard, I’m not going to lie, being at home and finding out my why. But you know, I’m still working on the board certification stuff. But it’s slowly coming together, and I have a belief that if I keep this path, it’s going to lead me to something. I know it is. I listen to your show, and I’m so inspired. Listening to other pharmapreneurs talking about their journeys is so powerful. And that just kind of keeps me motivated.

Tim Ulbrich: When we had talked a couple weeks ago, Betsy, I took some notes. And you had mentioned that you felt like you were in a crazy cycle. You felt like you had “lost me.” And you felt like you were burned out. And you know, there certainly were physical things that you mentioned there, but I think that many people listening may feel some of that, and they start to see the impact of relationship with family or kids, and what I want to highlight here is the importance of the financial piece to allow yourself to make an alternative decision if you find yourself in that place. And that’s why I love the work that Alex Barker’s doing, his book “Indispensable,” and to me, there’s so much synergy here between finding a fulfilling career and making sure you have yourself in a financial position that allows you to make some of those bold decisions. And sometimes, that is a different full-time job, sometimes that’s working part-time to be with family, sometimes that’s pursuing an entrepreneurial dream. Sometimes, that’s traveling the world for a year and taking the year off like Nick Ornella did that we featured on the podcast.

Betsy Hoida: Yeah.

Tim Ulbrich: I mean, it can look many different ways depending on your why, but the point is you put yourself in a position to do that. And so talk me through, I would assume there was a significant amount of fear there when you made that decision. I’d love to hear from both of you here. But did you put some markers in place to say, hey, before we do this, we want to be out of debt, we want to have a fully funded emergency fund, we want to be here, here, and here? Or were things just at such a point that you said, you know, overall, we’re OK and we’re just going to move on and we’re going to figure it out. So talk me through how you figured out where that place was financially where you could make that jump.

Casey Hoida: Sure. The funny thing is that we were at a financial point where we could do it immediately. We had our emergency fund, the student loans were paid off at that time, we had moved on to paying off our mortgage and were making good strides there. We had no other debt, and yet it terrified — I’ll speak for me, I won’t say us. Betsy will probably agree, but it terrified me for her to stop working.

Betsy Hoida: Oh my gosh, yes.

Casey Hoida: Because we — it was multiple things. One, it was oh, we’re going to lose all of this income and we’re making such great strides on the mortgage and we’re putting additional away in savings, and I don’t want to lose that. But after stepping back and looking back at what our life had become, just a rat race of who’s going to pick up the kids this time, who’s going to — I have to be here to exchange them or I’m going to go to this meeting or whatever the case is. It’s just we were trading off our kids and our lives so each of us could work full-time. And it just got to the point, like Betsy said, where her health was being affected. Mentally, I was exhausted. And I guess —

Betsy Hoida: Or our children. What are we showing our children? You know?

Casey Hoida: Yeah. It just got to the point that we couldn’t take it anymore. And I wish there was something more magical than that. It just got to the point where it had to break. And so we had to say, OK, Betsy — it was best for Betsy to stop working as I carried the insurance and some other things. And so it was best for Betsy to say, I need to step away and take care of myself and take care of my family. And so that’s what we decided to do.

Betsy Hoida: Yeah, best decision. It was terrifying. We had summer coming up. And it’s quality of life as well, you know? Life is short.

Tim Ulbrich: So Betsy, how would you describe, you know, if we used words before like “crazy,” “psycho,” “lost yourself,” and you were burned out, physically, emotionally, etc., like how would you describe it now? I mean, give me some of the words that you would use after you made that decision, what that’s meant for you as a parent, you as a wife, and your family and what would you use to describe that?

Betsy Hoida: I would say I am so much more relaxed. I really, I am. And realize you just day-by-day, day-by-day. I don’t know the future. And we recently had a flood. That would have sent us both into a tailspin, and I’m not going to lie, it was not the greatest waking up in the morning and being ankle deep in water. But we’re able to handle that. And I think, you know, just being I’m at home during the day, so I can handle that kind of stuff and just the nitty gritty details of recovering from the flood.

Tim Ulbrich: And let’s not forget to add that Casey had flood insurance policies in place lined up.

Betsy Hoida: Oh, yeah. So smart. People in this area were shocked because we got hit really hard.

Tim Ulbrich: That’s awesome, and I asked you too because I think I said, “Hey, are you guys in a flood zone?” And you had said no but had that policy in place. So great work, Casey. We talk about building a financial foundation and having a plan to protect your income in emergencies and all those things, and certainly just as important as debt repayment and investing and some of the other things that we talk about on the show. So Betsy, the last question I want to ask you about in terms of this transition away from work is talk to me about the fear of missing out, the FOMO, because I feel like that’s real in pharmacy. It’s real in any profession, but I think for whatever reason, moreso in pharmacy. So again, here you are, board-certified, you’re still working on those very tedious, long board certification exams, right? Residency trained, you’ve had a great career as running out since 2006, but you know, I’m sure you’re having these questions of what does this mean long-term? Am I going to re-enter? Am I going to forget things? Am I going to stay relevant? Am I going to be employable if I want to go back? So is that something you’re still struggling with, the fear of missing out? Or is that something that you’re able to get over quickly as you realize the benefits of the decision that you made?

Betsy Hoida: Honestly, it terrified me until recently where I realized that I’m not going to go back. I really, really believe that there’s something else — I am currently working three hours at a compounding pharmacy, and I’m really interested in bioidentical hormone replacement therapy and care of women around mid-life in that area and also just integrative health, that there’s other areas than just the current board-certification, the stuff I’m learning there, that there’s just more out there. There’s way more out there, that’s what I’m so excited about. And I don’t have to. And I don’t have to know today.

Tim Ulbrich: Yeah, and again, just a shoutout to Alex Barker, the Happy PharmD. For those of you that are looking for something else, he’s doing great work over there, and I think he’s really helping people that are working through situations like what you have talked about. So I want to talk about kids for a minute because, you know, as I hear your story and obviously as a father of three young kids, soon to be four, one of the things that gets me so fired up about this topic is that you guys have put yourself in an awesome position in terms of what you’re teaching your kids, what you’re role modeling, but also what the legacy will be of your family going forward. You’ve become debt-free, you’re working hard to teach them financial principles, you’ve prioritized the time with the family. So the question I have here, which is sort of a loaded question, is you know, knowing you have 6 and 9, is that correct, how old your children are?

Betsy Hoida: Yep.

Tim Ulbrich: OK. Knowing you have kids that are 6 and 9, you know, when they’re grown adults, you know, how do you want them to talk about you guys? What is the legacy that you want to leave in terms of financially and how you’re raising your family and how you’re maybe changing that generation for them going forward?

Casey Hoida: I always thought initially what I wanted for my kids from a financial standpoint is just to have a big pile of money for them when they get older so life won’t be so hard for them. And that was years ago, even semi-recently, that was my thought. And then I started just doing some more searching and thinking. And you know, that’s not the answer. That is not the answer at all is just having money sitting somewhere. That doesn’t teach anyone anything. And so I guess what I’m looking at now is to teach my kids the danger of money and what the love of it can do to you, to your life, to your relationships, and how to hopefully avoid that in their lifetime. That’s the biggest thing, really, is I want them to not be ruled by money because it can put you into a life that is not at all what is going to make you happy.

Tim Ulbrich: Absolutely. And Betsy, talk me through a little bit about what you guys are doing to role model this. I know you’re beginning to do some more of this, but in terms of teaching your kids about money. I know that’s something that my wife and I talk a lot about, we struggle with at times, you know, how can we teach them about this topic that is so big and so important but also make it relevant at where, the ages of where our kids are? So how are you guys approaching the concept of money and teaching that to your children?

Betsy Hoida: Absolutely. I just was emotional for a second about that when he was talking about for me, when you’re giving up — you know, there’s quality time. The time that I’ve been able to spend with them is irreplaceable. And being around for them, they love it. I mean, you know, I’m able to pick them up from school and just invest more in them. But to get back to your question, we are just at that point where we’re starting to teach them. And our oldest is really grasping the fact that — well, she wants all the things. But no, Molly, we’re going to teach you about having a savings account, a spending account, and a giving account. And same with Claire. And I think Dave Ramsey has a program that we can look at, but I kind of, I stole my neighbor’s plan. She does a great job. She is an accountant.

Casey Hoida: I just want to add, I mean, some of the practical things that we’re doing is the girls see us having our financial meeting each month. And they know that it’s occurring, so they’re seeing that. Betsy and I are very mindful when we’re at the store with them that we don’t make just knee-jerk purchases or anything like that. If it’s something that is above a certain dollar amount, I don’t know, I’ll just say $100 — not that that’s our number — but that we have a discussion about it and we’re like, no, we need to save for this and put money away until we have it. We don’t just grab a credit card and buy it that day. Instant gratification, we talk a lot about that in regards to finances. And so along with —

Betsy Hoida: The cars we drive.

Casey Hoida: Yeah, just showing them. We don’t go out to eat all the time, and when we do, we build it up as something special and a treat and not just something you do all the time. Our vehicles are quite old and, you know, just things like that. We’re just very, very mindful about how we talk about money in front of the girls and then what we do with our money in front of them.

Tim Ulbrich: And every single one of those things matters and it has cumulative, compound effects over time. And you know, I can’t remember if I’ve shared this story on the podcast or not, but I can vividly remember — and a shoutout to my parents for this — vividly remember sitting at my kitchen table, probably as early as 7 or 8 years old and getting a weekly allowance and having some of it allocated to savings, some of it allocated to spending, some of that allocated to giving. It might have been dividing up $2 or $3, but it doesn’t matter. You know, eventually that’s going to be $5,000 or $10,000. And those principles get ingrained over time. So whatever you define as those priorities for those of you that currently have kids or will have kids, in addition to not only teaching them those concepts of saving, spending, giving, but also just talking about this. So them seeing that you’re having these meetings, them seeing that you’re working through these issues month-by-month, hearing the discussion, and figuring out that, OK, there’s a process of saving up for something before you spend it and talk it through and not necessarily swipe it on the card, and you know, not have a discussion. So kudos to you guys, I think that’s awesome. And they are, I’m sure, absorbing way more than maybe even you necessarily intend to teach them in the moment. The last piece I want to end up on here is giving. And I know when you and I had talked prior to this recording, you know, as we were talking about kind of a financial why and why does this matter, I had sensed some more philanthropic giving aspirations. And I think you all are in a great position to make this a priority of your financial plan going forward, and it is a hope I have for the YFP community that once you have your own financial foundation and personal finances in place, you’re in a great position to help in many capacities, whether that be with church, local communities, family, anybody that may be in need. And so talk to me about giving for you guys, philosophically how you feel about it and where it fits into your financial plan. So Casey, you want to start?

Casey Hoida: Yeah. Yeah. So just a quick little backstory, so about two years ago as Betsy had indicated, when we were really struggling, we kind of renewed our faith life and became true followers of Christ. And that was a stepping stone for us in regards to giving that — how important I guess it is in one’s life to give back. We’ve received so much and have so many blessings that it’s only right, then obviously, to give a portion of that back. At first, I’ll be honest, when we would go to church, we would give a certain amount because that’s what you’re supposed to do. You’re supposed to just give some money to the church. And when I thought about it more and I thought about where that money was going and who it was helping, it changed for me. And I became more of a cheerful giver, if you will, than just checking a box like, yep, I gave some money to the church. And so I just, I don’t know, I feel that as we continue to grow in our faith life, we realized how important giving is. And I know when you and I talked a few weeks ago, something that you had mentioned and I’ve heard before about having your monthly amount that you give but then having kind of a discretionary amount set to the side for anything that is just put on your heart and you’re like, wow, now I have this money to help this individual or to help this cause or whatever. And that’s something that I had heard before. But when you had mentioned it, it kind of brought it back to the forefront for me. And I think that’s something that Betsy and I want to be more intentional about is having that discretionary money set aside for just anything that would come up. And then we’re really able to give and to help, and I think that’s important.
Betsy Hoida: Show the girls, show the girls. We had a Christmas party this year. You know, Christmas was a big point where it was a really good teaching opportunity in that they got to see we picked some families to sponsor, and they got to see the families themselves receive the presents. And we got to put together boxes to send overseas, and we got to pick out toys for children. And it was awesome. It was really great. I thought it was going to be a difficult time in Target, but they had so much fun. They really did. And —

Casey Hoida: I think they really understood what we were doing and why they were doing it, especially at what Betsy was saying, the Christmas party, where the children receiving the gifts didn’t know they were from us. It was set up a little bit differently. But the girls, our girls, were able to see those kids receive those gifts and the looks on their faces and just experience the joy of sharing, of giving, I think was prominent and right out in the forefront. And that’s what we were so happy that they were able to experience and see.

Tim Ulbrich: Yeah, and there is — as you both know, I’m sure many of our community feel the same way — I mean, there is true power in giving, obviously not only for those that are receiving but also for the giver. I think it really just shifts your mindset and how you look at the rest of the financial plan, how you spend your money, prioritization of things. And so we actually talked about that in Episode 022 of the podcast, the Power of Giving, for those that want to talk a little bit more about that and again, hopefully that’s a vision that we can continue to inspire among this community. So Betsy and Casey, you have truly inspired me. I’ve enjoyed our time together here, also in our pre-recording. When we had talked prior to the recording, I ran home and shared some of your story with my wife. I was fired up about doing this. And I am 100% confident you’re going to inspire our listeners as well. So thank you so much for coming on the show, thank you for taking the time, and thank you for your willingness to share your story. I really appreciate it.

Betsy Hoida: It was wonderful. It’s our pleasure. It was great.

Casey Hoida: Yeah, we really enjoy just sharing our story. And thank you so much for having us on. I really appreciate it.

Tim Ulbrich: Thank you both. And to the YFP community, again, we appreciate you joining us for this week’s episode of the Your Financial Pharmacist podcast. If you have not done so and you’ve liked what you heard on this show or on any other show that we record each and every week, please head on over to iTunes or whatever podcast player you get your information from each and every week. We’d love to hear your feedback. And if you could leave a review in that podcast player, that would help others recognize the show as well. Until next week, thank you again for joining. And have a great rest of your day.

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