Taking out loans during my clinical program?

[yeeboi]

I got accepted to a clinical psych program that guarantees full tuition and a stipend. The stipend is on the lower end--I've talked to people in the program who make do with it, but they said it's not uncommon for people to take out a small loan. I wanted to ask you guys about what you personally did to prepare for school financially. I don't want to take out unnecessary loans, but I also don't want to worry financially if something came up.

I was thinking of taking out 10k in loans for the first year, just to give myself some padding. Ideally I won't take out any loans after this--it's really just for financial stability as I spend the next 5 or so years in school. What do you guys think? I've worried about finances all my life, so I need some advice as to whether this makes sense. To add, I don't have debt from undergrad and I will be splitting rent with my boyfriend (however, I don't want to base anything on him and his income at the moment).

(Edit: this would be an unsubsidized FAFSA loan)

Thanks guys

Edited May 10, 2020 by yeeboi
More info

[PsyDuck90]

I would look at the cost of living for wherever it is and take out the bare minimum. The less debt you graduate with, the better. The issue comes into play when you factor in the interest. $10k at the start keeps accruing interest and that interest gets capitalized, so you accrue interest on your interest. I'm not sure what interest rates are for federal loans right now, so it's hard to give a more solid answer. I personally think, the less debt the better. If you need to take some loans out to cover your basic living expenses, that's ok. But I would try to avoid taking out more than I need. It also may be in your better interest to take out smaller amounts over the 5 years than 1 lump sum of $10k because that equals less interest. 

[Modulus]

You may want to look into the NIH Loan Repayment Program, just for some information about options which currently exist for scientists with student loan debt (can be used for housing, I know that). 

(I personally do not plan to take out loans.) 

[PsyDuck90]

7 minutes ago, Modulus said:

You may want to look into the NIH Loan Repayment Program, just for some information about options which currently exist for scientists with student loan debt (can be used for housing, I know that). 

(I personally do not plan to take out loans.) 

Definitely emphasis on the "currently."

For anyone considering these options, I would urge you to consider a few things. The issue with these loan forgiveness program (with NIH being one of the more competitive ones) is that a. They can have very particular language that can easily exclude people (just look at the rates for public-service loan forgiveness programs) and b. There is no guarantee if these will exist once someone gets out of school. 

There are several great options when available, but they come with a caveat that is important for anyone considering taking out loans to be aware of: you may not get them so do not bank on them when deciding if/how much debt to incur for graduate school. This is more of a general public service announcement for anyone reading than a direct reply to Modulus or even OP lol. 

[Psychological Yam]

I would attempt to live off your stipend and then decide to take out a loan later on, if truly necessary.

I'll be living with my boyfriend and I'll have to live off of $20k in Chicago. We're setting our rent budget as 30% of my stipend + 30% of his income - that way we're both paying an amount proportionate to what we're making, rather than splitting it down the middle, when he makes 2x as much as me. Could be something that works for y'all as well.