New Book: The Pharmacist’s Guide to Conquering Student Loans
Tim Church talks about the release of his most recent book, The Pharmacist’s Guide to Conquering Student Loans: How to Confidently Choose the Best Payoff Strategy That Saves You the Most Money.
This book is available for a special preorder until May 7 which includes exclusive bonuses like free shipping, discounted pricing and a free Conquer Loans t-shirt (with certain packages).
About Today’s Guests
Tim is the Director of Getting Things Done at Your Financial Pharmacist and a clinical pharmacy specialist at the West Palm Beach VA Medical Center.
He is also the author of The Pharmacist’s Guide to Conquering Student Loans: How to Confidently Choose the Best Payoff Strategy That Saves You the Most Money , Seven Figure Pharmacist: How to Maximize Your Wealth, Eliminate Debt, and Create Wealth and When Eating Right Isn’t Enough: The Top 5 Medications to Control Your Type 2 Diabetes.
Summary
On this episode, Tim Church dives into his newest book The Pharmacist’s Guide to Conquering Student Loans: How to Confidently Choose the Best Payoff Strategy That Saves You the Most Money. He shares that although he was happy when he and his wife hit submit on their last student loan payment, feelings other than happiness began to set in. They paid off $400,000 of student loans in 5 years, however he didn’t know enough about his options for repayment and ended up paying $100,000 more by not choosing PSLF.
The Pharmacist’s Guide to Conquering Student Loans: How to Confidently Choose the Best Payoff Strategy That Saves You the Most Money is a comprehensive guide for pharmacists and pharmacy students. Tim’s goal of writing the book is that a pharmacist can pick it up, analyze their options and choose a strategy and plan that will best align with their financial and life goals.
This book is available for a special preorder until May 7 at midnight (ET). Included with the preorder are bonuses that won’t be available after May 7 like a free Conquer Loans t-shirt (with certain packages), free shipping and discounted pricing.
Mentioned on the Show
- The Pharmacist’s Guide to Conquering Student Loans: How to Confidently Choose the Best Payoff Strategy That Saves You the Most Money
- YFP 149: Crushing $400k of Student Loans in 5 Years
- YFP Facebook Group
- Seven Figure Pharmacist by Tim Church and Tim Ulbrich
- Studentaid.gov
- Refinance Your Student Loans
- YFP 026: Baby Stepping Into Your Financial Plan – The 2 Things to Focus on First
Episode Transcript
Tim Ulbrich: Hey, what’s up, everybody? Welcome to this week’s episode of the Your Financial Pharmacist podcast. I welcome back our very own Tim Church to talk about his most recent book, “The Pharmacist’s Guide to Conquering Student Loans: How to confidently choose the best payoff strategy that saves you the most money.” Tim Church, welcome back on the show.
Tim Church: Thanks, Tim. Always on a pleasure to be on this side of the mic.
Tim Ulbrich: So excited to have you on. It’s been a long time in the making. You’ve been working hard on this book and excited to talk about the work that you have done. And I know it’s going to be a piece that’s going to help so many in their own repayment strategy. And we recently had you and Andria on the show to talk about your journey paying off $400,000 of debt in five years. And so if you’re listening to this episode and you haven’t checked out yet that episode, hit pause, go back and listen to that show, their story. I think it’s going to be an inspiration to you and will be a nice lead-in to what we’re going to talk about this week as it relates to Tim’s book, “The Pharmacist’s Guide to Conquering Student Loans: How to confidently choose the best payoff strategy that saves you the most money.” So Tim, I want to start by reading a passage from the beginning of the book, and I think you articulate so well the reality that so many pharmacy students and graduates and new practitioners are facing. So let me read a passage here from the book. “I’ll never forget the day my wife and I finally paid off our student loan debt. In fact, we still have a screenshot of the $0 loan balance. We are overjoyed, to say the least. We felt accomplished. We felt relieved. Finally, we did it. Andria and I had conquered the $400,000 of student loan debt that plagued us right from the start of our marriage. $400,000 gone. No more saying no to everything, no more anxiety about doing things we wanted to do while still funding our financial goals. No more payments. And my wife was ready to finally get a cat. The deep sacrifices we made to limit our spending finally paid off, and we were so ready to move on with our lives. But once that highly anticipated moment had come and gone, feelings other than happiness and relief set in, ones that I didn’t necessarily expect or want. I was angry and frustrated, and I had some major regrets.” Tim, what do you mean? Major regrets? Talk to us about that.
Tim Church: Yeah. When you say it out loud, it sounds like maybe I have like a mental health issue. But the reality is when I look back at the situation, you know, obviously we like to look at the numbers and things like that. And the reality is I was very fortunate to be in a position where I work for the government. And I had the option of going for the Public Service Loan Forgiveness program. That was definitely on the table, no questions about whether I qualified or not. But the problem was I didn’t really know that much about it at the time and all of the financial advice that I had been getting was kind of like steer clear from that. You don’t know, there’s a lot of unknowns with it. But when I actually sat down and did the math and found out that really, it was $100,000 decision that I made — meaning that I could have came out with a much better position because of how much I would have to pay for the loans versus the way that I did it. So once that hit my mind, it was kind of like, oh my gosh. Like you could have been in a much better position than you are today. So although it was awesome to get that feeling that the loans are gone and out of my life, it could have looked a lot different. And I think that’s really where those feelings started to come into play.
Tim Ulbrich: Tim, I don’t know if you remember — I was just reflecting back as you were talking. Do you remember we were in Baltimore several years ago, we were working on some student loan content, and you and I broke out the calculator and realized what we could have saved through PSLF. And you know, when we both did that, we’re like oh my gosh. This was a six-figure decision in terms of what this cost us. You know, I think that really lit a fire for both of us and really making sure people understand the repayment options that are available to them. And ideally, those that are transitioning out from student to new practitioner, getting ready to go through that grace period and that active repayment, that is the time to really understand your options and make sure that you’ve got the best payoff strategy in place for your situation. And that’s what really this book is all about. So Tim, why write this book? I mean, there’s lots of information out there, lots of opinions out there on student loans. Why invest the time, the energy — we know it’s no small feat — why do it? Why write this book?
Tim Church: Well, I think looking back, when we wrote “Seven Figure Pharmacist” three years ago, student loans were definitely a part of that, but there was just so much more to say. So many more details and things that’s important for people to know. And I think just through the YFP community, through the Facebook page and our channels that we just continue to get questions come through about student loans. It’s probably one of the hottest topic that we see come through the community. We talk a lot about it on the podcast. But it just keeps coming up. And I thought, what if we could take all of our information that we’ve done through blog posts, podcasts, what if we could take that all together and make it into a consolidated resource that although has a lot of complicated and complex information but make it in a way that’s easy to digest and ultimately helps somebody pick this up, read it, and say, “OK. I know what my options are. I’ve got a plan in place. And I’m confident about that plan.” And that ultimately was the goal of creating this.
Tim Ulbrich: Well, I can tell you you accomplished that. As I read through it, a couple thoughts came to mind. One, you have taken an incredibly complex, difficult topic and not only have communicated it and taught it in an easy-to-understand way but ultimately help the reader navigate and get to that point of, OK, I have all this information, how do I apply that to my personal situation and choose the option that’s best for me? And I think you did an incredible job in doing that. And that certainly is no easy feat. So kudos to getting that done. Chapter One is “Get Organized.” And one of the things you say is “Before jumping in to student loan payoff strategies and developing an overall game plan, it’s important to know exactly how much you owe and who you owe.” So Tim, why is this so important? And how can people get started when it comes to this concept of getting organized with your student loans?
Tim Church: Yeah, I mean, you really have to know what you’re facing before you can even talk about what your options are because those options are largely dependent on the types of loans that you have, also your employer as well. But really getting down into the specific types of loans one has, how much those loans are, the interest rates, all of those things are really important as you break this down. Most pharmacists that are graduating are going to have federal loans. So loans that are funded through the Department of Education and then through one of their servicers. So that information is available through the NSLDS. So there’s a number of different ways that people can get that information on their federal loans. But the easiest way is to go to StudentAid.gov and log in and put in your information and then whether you’re looking at their loan simulator or just your account itself, you can get a really nice quick snapshot of all of your loans that you have that are outstanding, your servicers, your interest rates, that kind of thing. And then some people beyond federal loans, they’re going to have private loans as well, and that’s — I mentioned in the last podcast episode that I had some private loans through undergrad that I still had to consider when I was paying back everything. Although they had a similar servicer, they were not — they were private loans, some of them were. So they have a little bit different in terms of the strategy that you’re going to consider for those. And then I think other people, sometimes they forget do they have loans to family members? And I think it’s really important to keep that in mind too because all those things are going to play into when you develop that strategy and come up with all of those options.
Tim Ulbrich: Tim, as I read Chapter Two, “The Key Payoff Strategies,” you know, the first thought that came to mind was, my gosh, I wish I would have had this as I was in school or navigating residency, you know, going through that period of ultimately should I defer? Should I not? I’m in the grace period, I need to choose. And I ended up going the standard, default 10-year repayment. I’m grateful we got through them quicker than that, but it really cost us a lot of money as we already talked about. I could have went PSLF, I could have refinanced. So unfortunately, this is so difficult to navigate. You do a great job in Chapter Two talking about the key payoff strategies. My question here for you is there a common mistake or two that you see pharmacists making when it comes to their student loans and the repayment strategy and decision that they make?
Tim Church: I think the biggest one, Tim, is when I ask somebody, I say, “Well, what is your student loan strategy?” And they’ll come back to me and they’ll say, “Well, I’m in the standard 10-year payment,” or, “I’m on an extended repayment plan,” or, “I’m on Revised Pay As You Earn repayment plan.” And I say, “Well, that’s not what I asked. I said, I asked what your strategy was.” And this big misconception as to repayment plans being strategies I think is the biggest mistake that I see people make. And whether it’s through the federal system or a private lender, your repayment plan is just dictating what the minimum payments are for a specific term. It’s not necessarily an overarching strategy on how you’re going to best tackle your student loans. Now, when you pick one of those strategies, you may utilize one of those repayment plans as the way that you’re navigating that strategy. But that’s not the strategy itself. You have to really look at what is the math behind the overall strategy? And when we talk about some of the big ones, you know, there’s forgiveness, there’s non-forgiveness, and that’s basically kind of opened the door to anything else that’s out there that isn’t a forgiveness option. And then within that, there’s obviously many options, whether you pay it off through the federal government or whether you refinance and pay it through a private lender. And then within those options, you have the different repayment plans. But even though you’re committed to a repayment plan doesn’t mean you have to make those payments. You could make extra on those payments. So there’s really — you have to look very broadly about what those options and strategies are. And then you have to really get tactical about how you’re going to execute those.
Tim Ulbrich: Great stuff. And let’s talk about one of those options in a little bit more detail: PSLF, which you talk about in Chapter Three, “Public Service Loan Forgiveness.” And we know that many pharmacists like you may be eligible but haven’t chosen this path for a variety of reasons. Perhaps they’re not aware, they’re scared of the unknown, they don’t want these loans hanging around for 10 years. And as you say in the book, “It’s honestly hard to find anything positive in the media about the program, especially when 99% of borrowers who apply for PSLF are denied.” So my question to you is why are we even talking about it? You know, when you look at a headline like that, where does PSLF come to play? And is this an option that perhaps more people should be considering?
Tim Church: Yeah, I mean, it’s hard to argue with the math behind PSLF. If you have standard student loan payments that you’re coming out with, you know, the average pharmacist is going to borrow around $170,000. For a private school, it’s going to be much more, when you look at the amount forgiven and the amount that you have to pay over that time, you just can’t argue with the math. I mean, there’s simply — unless you’re getting a tuition reimbursement plan where they’re basically just giving you free money, even if you were to refinance and pay the loans off faster with lower interest rates, you’re still never going to be able to compete from a math perspective with what you’re going to get if your loans are forgiven after 10 years, mainly because that amount forgiven is going to be tax-free. So it’s not going to be counted as income, any amount forgiven. But then also, within PSLF, you have options to even lower your student loan payments as you’re building your net worth and as you’re putting money in retirement accounts since your payments are going to be based upon your Adjusted Gross Income. So you just really can’t argue with the math. The only time that it really doesn’t make sense if you came out with a very small debt load where nothing would even be forgiven if you were making payments.
Tim Ulbrich: Yeah, and for those that are wondering about PSLF, you know, should I be pursuing it? Should I consider it? Or in it and making sure they want to cross their t’s and dot their i’s, I would highly encourage you to get a copy of the book. I think it’s one of those things that has gotten a lot of negative press. And to be fair, I don’t think they’ve done a great job promoting the program. There hasn’t been consistent information and advice, especially from some of the student loan servicing companies. But I think as we’re starting to see this program evolve and obviously we’re now — let’s see, it started in 2007, first group 2017 have forgiveness, we saw a lot of negative press come out then. I think we’re going to start to see more and more people that are applying for and receiving forgiveness and hopefully some of it we’ll be able to feature on the show here soon as well. So make sure you get your information, make sure you know what you’re trying to do from a strategy standpoint but also that you’re following all the PSLF rules as that, of course, is critically important. Tim, in Chapter Five — and we’re just scratching the surface of some of the things that you talk about in much, much more detail in the book — Chapter Five, “Non-forgiveness and Refinancing.” So you know, essentially if somebody does not choose the forgiveness route, whether that be PSLF or non-PSLF — and we’re not going to talk about non-PSLF here, but you talked about it more in the book — if they don’t choose forgiveness, we’re really looking at a good old strategy of just paying them off. So what options then exist here in the federal and the private sector if somebody is not choosing the forgiveness route?
Tim Church: Yeah, I think this is a tough one to consider because you have so many different options in terms of repayment plans and whether or not you keep your loans with the federal government or whether you refinance with a private lender. But then not only that, you have to determine your strategy in terms of what does your timeline look like? So you could accomplish the same timeline whether that’s through federal or private. But you have to really then take this in context with all of your financial goals since largely, it’s going to depend on when you pay this off is your payments that you make towards it. So obviously the bigger your payments that you make, the faster you’re going to pay off your debt. However, the more that you pay towards your student loans, there’s obviously an opportunity cost to other financial goals such as retirement, saving money for a house, going on more vacations from a lifestyle perspective. So I think this one is really tough because yes, you may choose a repayment plan. But what is actually your strategy within that repayment plan or within whether you’re paying them off federally or through a private lender? So this is really where you see all of those blog posts, all of those discussions, should I invest while I pay off my student loans? Should I buy a house while I pay off my student loans? And really, you know, there isn’t one correct answer that you’re going to find out there. So part of this is somewhat subjective. But within that chapter, I put some key points in there to really consider as you’re doing this because I think it can help figure out how far fast forward — how much do you want to fast forward that timeline? How fast do you want to pay them off? And you know, if you’ve listened to the podcast episode that my wife and I did, you know, for us, we were kind of in this situation once forgiveness, we decided against it at some point, which I didn’t really understand, but basically for us, you know, we decided we were going to get our matches through our retirement 401k equivalents and then also do an HSA. So we kind of decided to do both. You know, other people you’ve had on the podcast, they’ve basically every single extra dollar they had went towards their student loans. So obviously there’s some subjectiveness to figuring that out, but I think there’s also some considerations you have to put in there. You know, obviously if you’re somebody who is just out of school and maybe is more of a traditional age and has a lot of time to prepare for retirement and other life events, then you’re a little bit more aggressive. But that might — you may not have — time may not be a luxury that you have if you’re more of a nontraditional student that’s graduating. So there’s a lot of different I think considerations that help decide and guide you where you want to fall on that timeline.
Tim Ulbrich: Yeah, and I love what you said there, Tim, is that there is no one right repayment strategy. I mean probably one of the most common questions we get, you know, whether it’s submitted through the Facebook group or an email or when we’re speaking or through the podcast, whatever, is hey, what’s the best repayment option or strategy? And you know, our answer is uh, depends, right? It depends. And what I love about what you’ve done with the book is you go through all of the options. But again, you present it in a way that if someone can layer their personal information on top of those options as well as how they feel and other life factors and other goals that you’re trying to achieve, when you get to the end of the book, the goal is that you’ve identified that one repayment option or strategy that is best for your personal situation and you can feel confident in executing that plan going forward. And speaking, Tim, of how to manage debt repayment with competing financial goals, I think you do an awesome job of this in Chapter Seven, talking exactly about that. How do you manage competing financial goals with student loans? You know, and here we’re thinking about — as you mentioned — obviously home buying or retirement. So talk to us a little bit about if you were sitting down with somebody who was reading this book, what would you not necessarily advise them, but what would you encourage them to think about as they’re trying to make this decision of should I go all in? Should I go in Tim and Andria Church-style of $6,667 per month on average to pay off $400,000 over five years? And I know you guys did a little bit of balancing of other things. Or should I spread this out among other things that I’m trying to achieve? How would you talk somebody through this debate of how do I compete multiple financial goals while I’m also thinking about debt repayment?
Tim Church: I mean, I think the first thing I would ask is how emotionally weighing are the loans? I mean, for a lot of people — and there’s studies out there that show this, that student loan debt can cause you to have insomnia, it can cause depression and other emotional situations for people. So I think that actually has to be part of that equation because if you’re somebody that really is being affected and even though you have the knowledge and equip yourself, despite knowing that, it’s not going to change some of those negative thoughts and feelings you have, then obviously that is something that has to go in when you’re figuring that out in the context of all your other financial goals. I think some of the other things are do you have really high interest debt that you’re comanaging with student loans? So if you’ve got credit card debt, you know, in the 20%, 15%, I mean, you have to really look at other high-interest debt and maybe knocking that out first before you go really aggressively. And you know, the other thing I think about is an emergency fund. I mean, along the way when Andria and I were being super aggressive with our student loans, I mean, we had some things come up that we never expected. So we had big car repair payments that we had to make. You know, one time I think Andria’s car was like $3,000. She has a Volkswagen Rabbit and there was some like very specific part that you had to get from the dealer or something like that, and it was just crazy. So it was like a huge hit. So we’ve had that, we had some medical issues come up along the way. So I think before you’re going to go super aggressive, I think you have to make sure you have a cushion there in case anything else comes up because even if you’re planning to pay your student loans off on a specific timeline, I mean, there’s really other life events that can come up that can kind of knock you off whatever your anticipated payoff date is going to be.
Tim Ulbrich: Yeah, that’s great. We’ve talked a little bit about that earlier on the show, I want to say back in the 20s. It might have been 026, Baby Stepping into a Financial Plan, thinking about things like consumer debt and emergency funds and how those fit in as really building that foundation in which you lay upon student loan repayment strategies, investing and home buying, other goals that you’re trying to achieve. One of the things too, Tim — and I want to just mention for a moment knowing the times we’re in right now obviously with the COVID-19 pandemic, in Chapter Nine, you talk about how to handle student loans during job loss or hardship. And I think this really comes at a good time. And we’re going to be supplementing the book as well with some additional information related to the CARES Act and student loans specific to this moment in time that we’re in. But I think this is an area that we don’t talk a whole lot about. You know, we talk about those that are doing well, making big, big, big student loan payments, but we don’t talk about those that might be in a situation that job loss, hardship, and how do you handle that? So what words of encouragement would you have for folks that are — find themselves in the moment in a financial hardship or in a job loss situation about what options they have related to their student loans?
Tim Church: Yeah, it’s a great question, Tim. And unfortunately, a lot of people have been in that situation. And some people have defaulted on their loans, and it can get as bad as having your wages garnished. I mean, there’s really a lot of power that the federal government has in terms of taking money from you if you’re delinquent. But the reality is that things are going to come up and some people, even pharmacists, are going to face these situations. Now, I think the good news is that if you have federal student loans that there are a lot of options within there to kind of temporarily manage the situation. So hopefully whatever the situation may be, it’s just a temporary one and you need to kind of put pause on your student loan plan and strategy and just kind of make it until you can either find another job, get your income back up, or whatever that issue may be that you’re dealing with. So I think the easiest one — well, let me take a step back. I think it also depends on kind of what your strategy is because that may also dictate some of the things that you’re doing. So fortunately that if you’re in a forgiveness plan, you’re going to make income-driven repayments. So those may also — those may already be somewhat manageable, so maybe nothing really changes for you in the meantime if you’re able to at least make those payments. So I think that’s always a great option on what to do because if you can still make those payments, especially if you’re in forgiveness, they still may actually count, depending on what your situation is. But you know, last resort, if you can’t make a payment, even on an income-driven, they do have forbearance where basically you can put pause on making any payments on your student loans. Interest will accrue during that time. However, this is — I’m talking about this aside from what’s currently happening with COVID where this is an unprecedented situation where it’s more of an administrative forbearance where interest doesn’t accrue and you don’t have to make student loan payments during this time. So it’s a little bit different. So I think you have definitely quite a few options if your loans are held by the Department of Education. Now if you have private loans, the equation changes quite a bit because you’re really dependent upon whatever that private lender, what they have established. Now they may be willing to work with you, so it may be some kind of a forbearance option and maybe a change in the term or the repayment plan that you’re currently on, and some of the refinancing companies, they do offer income-driven repayment options or somewhat of a forbearance. So there are some that have options, but it’s really up to them in determining what they can do for you at a particular time. So really depends on that situation. But yeah, I mean, the good news is that a lot of these situations are temporary. But there are options that exist. And that’s kind of what we talk about in the chapter is like really trying to think through how can you have the most minimal impact on what your overall strategy is because like I said, you may have to just put pause on it for the time being.
Tim Ulbrich: Yeah, I think you do a great job of that in Chapter Nine, How to Handle Student Loans During Job Loss or Hardship, and I think again, a good consideration — hopefully certainly we don’t want people to be in that situation, but if they are, to understand the options that are available. So there you have it, the latest from Tim Church, “The Pharmacist’s Guide to Conquering Student Loans: How to confidently choose the best payoff strategy that saves you the most money.” And so if you’re somebody listening that you feel overwhelmed with your student loans or perhaps confused by the repayment plans that exist, many of which we talked about here today, if you’re unsure if the strategy you have in place is the best one, or maybe you’re feeling anxious about how to handle student loans during residency or during a financial hardship, this book is for you. It takes a very complicated topic, presents it an easy-to-understand and actionable way, all customized for the pharmacy professional, and written by somebody who’s done it. No theory, no case studies, but actual execution. So again, you can head on over to PharmDLoans.com and for the next week, you can pre-order your copy where you can get free shipping, reduced pricing, and access to exclusive bonuses. So Tim, I’m going to end with this quote from the very end of the book, which I think is a great summation of our conversation. You say, “Whether you’re facing $50,000 or $400,000 in student loan debt, the bottom line is you have options. Having clarity about your plan can take an immense weight off your shoulders, allowing you to focus on other financial goals and live your life. I know firsthand how difficult and overwhelming it can be looking at six figures of debt right in the face and trying to figure out what to do. Be intentional. Develop a plan. Execute. And adapt as necessary. And then enjoy the security and financial freedom of paying off those loans.” So Tim, congratulations on your work in this book. And thank you so much for taking time to come on the show to talk about it.
Tim Church: Thanks, Tim.
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