Am I too optimistic about paying off loans?

[TravelRhythm]

I'm a neurotic planner and I like researching the hell out of things before I commit to them (that's how I switched from physical therapy to nursing, and so glad I did).

So I hear a lot, a LOT about the issue of paying back loans. I've considered maybe a nursing corps loan forgiveness program but I wanted to explore other options, mostly because I've seen a lot of people frustrated with the state of under-served areas. As a new baby nurse, I'd rather my first couple years be in an environment that isn't so frustrating.

This is a lot of math guesstimation if you want to skip it.

I'm from Hawaii and I'd like to go back, and according to the research I've done the take home for BSN is 1,500 dollars a week (1,600, but lets leave room just in case). I'm a low maintenance person and will probably share a house and use public transit or a scooter for getting around. Craigslist has a lot of shared houses at around 600-700 a month and I estimate no more than 400 a month on groceries. I spend 200 a month now, but food is more expensive on the islands. That leaves me with more than 3000 dollars a month. I'm expecting no more than 30k in debt, most likely closer to 20k but again, let's leave room just in case. These loans are mostly government. I'm storing 600 a month away for taking my parents on a trip after my first two years. What am I forgetting? I'm left with 2,500 a month for loans and whatever else. After my trip with my parents I'm going to give travel nursing a shot and then start putting away money for later.

What I'm doing now is using about 8,000 to pay for school that I had in a fund, plus half my tuition is covered via scholarship, and I'm living at home. I'm working, but all of that money goes straight to travel, because that's how I keep my sanity.

I mean I'm in my 20's, I don't have kids (nor expect any, ever), I don't have any commitments- should I be bracing myself for a nightmare? What other costs am I not factoring in? Should I be looking at loan forgiveness programs?

[kp1987]

You should probably budget for an emergency fund and what about insurance etc?

Other than looks pretty good

[TheCommuter, BSN, RN]

What other costs am I not factoring in?

You have not factored in the extreme difficulty of securing new grad RN employment in Hawaii. You might need to consider a Plan B that entails working on the mainland for a year or two to obtain experience before returning to Hawaii.

[TravelRhythm]

Awesome yes, I would not have even thought of that! Plan B is staying at the hospital I'll be in and out of through my university in my upper levels until I can secure a job elsewhere.

[meanmaryjean, DNP, RN]

I would find a different way to 'keep your sanity' and actually pay your current expenses with the money from your job. Because what you're REALLY doing is borrowing money for travel while a college student. Which is not smart or mature.

[TravelRhythm]

I appreciate the suggestion. My travel money is for camping in the state above me, and going into in a savings fund for my trip to Israel after I graduate- I'm Jewish.

That being said I respectfully disagree that traveling in college isn't smart or mature. Part of education is exposing yourself to new things. Two years ago I went to Central America alone for two weeks and it's one of the most profound learning experiences for me so far. I didn't have any fun the summer I saved for it, and it was worth it.

[Horseshoe, BSN, RN]

That being said I respectfully disagree that traveling in college isn't smart or mature. Part of education is exposing yourself to new things. Two years ago I went to Central America alone for two weeks and it's one of the most profound learning experiences for me so far. I didn't have any fun the summer I saved for it, and it was worth it.

I don't think the traveling while in college part was what she was referring to as being neither smart nor mature. I think it's the borrowing money in order to travel while in college because you can't afford it is what she sees as the problem. That's my guess anyway.

[Anonymous865]

I see a lot of expenses that you have not figured into your budget.

housing - you've accounted for this

utilities - electricity, gas, water, internet, phone, cell phone, cable

taxes - state income, possible personal property, vehicle registration

vehicle

gas for your vehicle

maintenance/up keep of vehicle

parking

transportation if you decide to use public transportation instead

ira / roth ira / 401k

emergency fund

travel to/from Hawaii since it sounds like you aren't from there. You will probably want to "go home" occassionally. At a minimum you are going to have to pay to get there to start your job.

entertainment

clothes (uniforms, shoes, etc.)

professional associations / journals

insurance - vehicle, renters, medical

Dr. copays, deductible, prescriptions

Are you sure that the take home pay for a new grad is $1500 a week. If you figure in a 25% federal income tax, that means that you would be starting at over $100K annual salary for a new grad.

[jadelpn, LPN, EMT-B]

Will $1500 be your take home pay? If not, you need to consider taxes and any other deductibles--health insurance, dental, union dues--whatever is taken out.

You also need to consider your housing. Craigslist is not always an ideal--and you need to consider that more than likely you will be working nights and need to sleep. And not have to worry about having to move if it isn't working. And that you may be responsible for part of utilities.

If you have a $300 a month loan payment, have that $150 bi-weekly direct deposited into a savings account. Have the loan company then take the money each month. On the months that you have 3 paychecks, leave the third as a cushion, or directly pay on the principal that payment.

Also realize that a "baby nurse" is a specialty. And that more than likely the new grad positions you may find are not specialties. I would do research on the availability of positions in the area of Hawaii you would like to be. Look on the various hospital websites as to what kind of a nursing position you can qualify for. Send a resume and cover letter, and follow up with the nurse manager.

Finally, get yourself a credit card that has miles on it. If you use it for say groceries, it can give you extra miles, a certain percentage back, that kind of thing. And helps you to establish credit. It can also assist in the trip you are planning. And if you or your parents are triple A, your parents AARP there are a lot of travel deals that come up with both those groups.

If you are in the 25ish dollar range, after taxes and insurance, you could more than likely end up with around $800 dollars a week take home (this is such a broad guesstimate amount). The cost of living in Hawaii is rather high. It may be more worth your while to stay home for a couple of years to really have a significant cushion, have your 2-3 year experience under your belt, and then start travelling. (and of course travel to Hawaii). The pay may or may not be better, but you usually get housing or a stipend, travel costs, and the time to travel to where you want to with your parents between assignments.

Best wishes!!

[Libby1987]

Tangent, how did your research direct you to nursing versus physical therapy?

[KelRN215, BSN, RN]

$1500/week take home? Where did you get that number from? I took home about $1500 every OTHER week when I was a new grad. To take home $1500/week, you'd have an hourly rate of over $50/hr. I don't know anywhere that pays new grads that. I don't make that now as an RN with 9 years experience.

[meanmaryjean, DNP, RN]

I appreciate the suggestion. My travel money is for camping in the state above me, and going into in a savings fund for my trip to Israel after I graduate- I'm Jewish.

That being said I respectfully disagree that traveling in college isn't smart or mature. Part of education is exposing yourself to new things. Two years ago I went to Central America alone for two weeks and it's one of the most profound learning experiences for me so far. I didn't have any fun the summer I saved for it, and it was worth it.

Borrowing money to travel is unwise- and that is what you are doing. I stand by my statement. Travel is a luxury- and to equate it with maintaining your mental health makes a mockery of those with real mental illness.