I wanted to take a break from my usual writing to put some information out there about the financial benefits of the HPSP program. I know there are a lot of dental students and future dental students who read this blog so here is some information for you. And with the rising cost of dental education this is becoming more and more important.
When I was in dental school, a classmate gave me a hard time about taking the Army scholarship. He said it was financially a foolish move and that I could make so much more money in the civilian world. I explained to him that my decision to come in the Army was not about the money in my particular case, but a desire to serve. He couldn’t argue with that one, but remained adamant that I got a raw deal.
So after five years in the Army I am looking back and re-evaluating the cost benefits of this scholarship. All non-financial issues aside, this program was totally worth it. Here is my rationale using the in-state numbers from my dental school in todays dollars.
Tuition and living expenses for 4 years: $336,131. I’m assuming a Stafford loan with the current default* 6.8% interest rate and the standard 10 year payback. Using a student loan calculator, a new dentist from my dental school would need $3,868 a month to pay that loan off in ten years. Over the ten-year term of the loan, he would pay $128,053 in interest bringing the total cost of his dental undergraduate education to $464,184.
Now lets run those numbers based on a 4 year commitment to the Army – meaning your dental school loan is paid off in four years, not ten. With those same numbers, a new dentist wanting to beat the HPSP would have to find $8,017 in his monthly budget to pay off that loan. That is $96,204 a year in student loans. That is feasible if you are a practice owner, but an associate making a generous $110,000 a year would have to live off of about $14 grand a year for four years to beat the HPSP.
So here I am at almost the five-year mark (I had a five-year commitment because I completed an AEGD). My dental school is almost paid off. I’m in a pretty good position to buy a nice practice and a nice home – or do whatever I want without having to worry about paying that huge note if I choose to leave the military.
*Term “default” used to refer to the default setting of the online loan calculator. This does not refer to the interest rate charged to a borrower when a loan is overdue.
Army Dentistry 