Is a medical degree a worthwhile investment?

Often, we hear about how our million dollar doctor ministers sacrifice their previous multi-million dollar salary as a doctor in private practice. So the question is: Is it really a worthwhile investment to get an overseas medical degree if you can't get into medical school in NUS?


Here's some quick facts on the costs of getting a medical degree in Australia

1) A medical degree costs about AUD$328,000

2) Living expenses and rent amount to about AUD$20,000 a year

3) A medical degree takes 6 years to complete

4) It costs SGD $1.31 to buy AUD $1


It illustrate the total cost of getting such a medical degree, let's consider two persons A and B, both of the same intellect and talent.

A decides to study medicine in Australia while B decides to study some business-related course that takes 3 years to complete in NUS costing SGD$6,110 a year.


Here's some reasonable assumptions we make before comparing A and B financially.

1) Both start off with SGD$586,880 (that's the total tuition fee of the medical course plus living expenses and rent converted to SGD)

2) A will be spending almost all of his free time studying in order to pass his exams

3) B will have 30 hours of free time a week to work since he does not need to spend as much time as A studying

4) In addition B learns how to invest and is able to do so reasonably well (15% return on investment per annum) since he has the time to learn as well as the intellect (he could have made it to medical school after all!)


So let's begin to crunch some numbers!

Upon graduating from medical school in 6 year's time, A's net worth is a big fat ZERO

B's net worth is abit harder to calculate. To make a fairer comparison, B will only get the SGD$586,880 over a 6 year period (in equal parts) since A pays his school fees and gets his living expenses from mum and dad annually. On top of being able to invest, B spends 30 hours a week working as a $6 an hour waiter during his university days and upon graduation, he starts work drawing a starting salary of SGD$2,500 a month.

At the end of 6 years, B's net worth would approximately be SGD$1,000,000. Most of this comes from the savings by not pursuing an overseas medical degree plus the returns in his investments.

A will take another 10 years before becoming a consultant with high earning power. And until he gets to that stage, he will be exploited as a resident and then as a registrar with low pay (around AUD$15 an hour). By that time, B's net worth would already be SGD$4 million.

Unless A really gets to become a top doctor like our multi-million ministers, I don't see how A can ever catch up with B in terms of net worth even if we leave B's day job salary out of the equation.

So why are there even any Singaporeans going to Australia to study medicine? It doesn't really make financial sense. I guess they are already millionaires-to-be to begin with.