Like the grim reaper, traveling salesmen, and our mothers, it can seem like medical school debt can hover over us our entire lives. With one of the most expensive careers to study, many young medical professionals are dealing with crippling school debt. Let’s look at a number that can send shivers down the spine of many medical professionals. $189,000 is about the average medical school debt for 2017 graduates, according to the Association of American Medical Colleges(AAMC). Many doctors, surgeons, and medical professionals who keep the healthcare industry running smoothly are often faced with debt that could haunt them for years to come. Luckily, there are a variety of tactics for paying off medical school debt. Below are just a few options for ensuring that your debt doesn’t become a serious ailment.
Guide to Paying Off Medical School Debt
Explore Repayment Plans
Most recent medical school graduates will opt to take the basic repayment plan that provides a monthly amount that needs to be repaid. However, while in residency, it might be tough to make these payments. This is why paying off medical school debt with income-driven repayment might be an ideal option for you. Most income-driven repayment plans will result in lower monthly payments for residents with high medical school debt. Revised Pay As You Earn (REPAYE) might be the best deal. You’ll have smaller payments with little interest. You’ll also start making more money and you’ll be able to make larger payments towards your medical school debt.
Work For Forgiveness
Now I know this sounds like something you might do after getting caught skipping out on your bar tab. However, it’s actually a great perk that you can take advantage of. If you work in public health, paying off medical school debt might be easier than you think. If you hold federal student loans and work in public service, the Public Service Loan Forgiveness program may help you pay them off. Your direct government loans may be forgiven after 120 total payments under the program. Even those smaller payments that you made during your residency count towards the total payments. You might be able to pay off that medical school debt in no time.
One of the most common tactics for paying off medical school debt is to refinance your loans. Similar to refinancing a house, you can refinance your loan with a private lender in hopes that you’ll have a lower interest rate and/or lower payments. While this may sound ideal, it’s important to understand the risks that come with refinancing. If you transition federal loans to a private lender, you’ll lose out on federal student loan protections. This includes student loan forgiveness for doctors. Make sure to do your research and even consult a financial advisor if possible so you can get the best deal possible.
Negotiate a Physician Signing Bonus
You just went through years and years of schooling; so don’t undervalue how much your education is worth. Signing bonuses are one of the best ways that a facility will attract medical professionals. 90 percent of doctors recruited through the Medicus Firm in 2016 received employment offers that included a signing bonus, according to HealthLeaders Media. Negotiating a signing bonus is a great way to ensure that you’re getting a head start paying off medical school debt. However, you will also be expected to commit to that facility for a certain number of years. Make sure you’re comfortable making that decision.
Military Student Loan Assistance
This is a great option for those with military experience who are paying off medical school debt. Army Student Loan Assistance offers up to $45,000 per year in loan assistance along with a monthly stipend of up to $2,000. This assistance is available to U.S. residents working to complete an accredited residency. Loan assistance programs can be found in all branches of the military. Make sure you’re doing your research so you can use your military programs to help pay off medical school debt.
As always, if you have other tips for paying off medical school debt, let us know in a comment below. If you’re looking for a physician job or other healthcare assignment, start here!