Dental School Dilemma

Sawyer has a wife in dental school. They have an opportunity for her to have tuition paid for by a clinic, but she'll have to work for them for a year of every year of school paid.

QUESTION: Sawyer in Seattle has a wife in dental school. Her tuition is $45,000 a year, and they have an opportunity for her to have tuition paid for by a clinic, but she’ll have to work for them for a year of every year of school paid. Dave advises Sawyer to jump on this opportunity with a caveat.

ANSWER: That’s awesome. I love indentured servant plans. I think that’s a great way to clear it up.

What I would do is continue to save money like crazy and build up an account equal to the balance of the student loans so that you can pay them off if something blows up with this employer. But yes, I would definitely take them up on their offer, unless you can make $200,000 in the open market and they are only going to pay you $50,000 plus pay off a $50,000 tuition. You don’t want to take a pay cut to get this benefit. But all things being equal, this is a nice benefit.

If the average starting salary is $150,000 and these people are going to pay her $110,000 and pay off $50,000 in tuition a year, it sounds like a good deal to me. But remember to pile up cash in case this goes bad. They are not taking on the student loans; if they went bankrupt in the third year, you’d still have to pay them. That’s what I would do.