Menu Icon Search
Close Search
Loan image courtesy of Shutterstock

The Ultimate Student Loan Repayment Guide for Doctors

Created October 21, 2015 by Cat Alford
Share

$176,000.

It’s a number newly-minted physicians or those in the process of becoming a doctor should know.

No, it’s not the average salary of those in the medical field or the cost of an average physician’s home.

It’s also not something fun like the price you can pay for a new Audi R8 when you graduate from medical school (although that would be super nice.)

Rather, $176,000 is the average amount of medical school debt graduates had in 2014 according to the Association of American Medical Colleges. Even worse: this number doesn’t include debt they may have incurred as undergraduates.

Because physicians earn high incomes when they graduate, many assume repaying student loans will be something they will be able to handle with ease.

But with ever increasing costs and a decline in physician reimbursements, student loan repayment is something all physicians should take the time to research and consider. This includes calculating how the repayments will fit in their overall budgets and how long it will take to pay all these loans. After all, they worked far too hard for too long to be saddled with financial issues.

Where to start? Here’s our guide for MDs repaying their student loans.

Crunch the Numbers First

I realize that after devoting 12-15 years of their lives to training, you are prone to lifestyle inflation when you graduate. However, the first thing you should do upon graduation is crunch the numbers to find out what you owe in student loans.

With the average student loan balance for physicians at $176,000, it’s best to get ahead of the game and pay them off as soon as possible to avoid large interest payments.

Learn how much is owed and decide how much time it will take to pay them back before being tempted to upgrade your car or home.

For example, if a physician wanted to pay back $176,000 at 6% interest over 10 years, that would be around $1,954 a month every month for ten years. This includes nearly $58,500 in interest charges over the life of the loan.

While $2,000 a month might be a small portion of a physician’s paycheck, it is definitely not a small number in general. Consistently investing that amount in a retirement account would have massive wealth-building potential over time.

Plus, that $58,500 could be spent on so many other exciting things like a rental property, a few trips around the world or other investments. Wouldn’t that be better than paying it to the bank?

For all these reasons, we’ve created the ultimate student loan repayment guide for doctors including some solutions and lesser-known options for paying back student loans. That way, student loan burdens can be drastically reduced so hard-earned money can be spent on enjoyable things enjoy instead of high-interest payments.

Here are some examples:

Refinance Your Student Loans

One of the first things you should consider when paying back student loans is whether or not you should refinance them.

Refinancing your student loans can be a great way to save on interest payments over time. This is especially true if you have private student loans with rates as high as 9%.

Essentially, you would work with a new loan company who would pay off your student loans from your current provider and repackage it to you at a lower interest rate.

For example, by dropping your interest rate from 9% to 5%, you can save thousands of dollars over the course of your repayment period.

Keep in mind that you will typically need a good credit score to get the best rates and some companies who refinance loans are stricter with who they’ll accept than others.

Make sure you are prepared to make your payments on time because if you refinance federal loans, you won’t have access to their flexible repayment options anymore. However several lenders who refinance loans, like SoFi, offer unemployment protection.

All things considered, refinancing is definitely a worthwhile strategy, but make sure it’s right for you before diving in.

For more often-overlooked options for paying off your student loans, click here to read the rest of the article by Student Loan Hero.

// Share //

// Recent Articles //

  • Medical, +1 MORE
  • Q&A with Dr. Ali Wong, Plastic Surgery Resident and Creator of Sketchy Medicine

  • Posted October 17, 2017 by Gloria and Chigozie Onwuneme
  • Dr. Ali Wong is a plastic surgery resident in Nova Scotia, Canada and creator of the website Sketchy Medicine, in which she shares graphical representations of various medical concepts. Dr. Wong received her Bachelor of Science with Honours in Neuroscience (2009) and her MD (2013) at Dalhousie University. Following initial year in residency, she went...VIEW >
  • Four Ways to Practice Teaching as a Medical Student

  • Posted October 16, 2017 by Jacob Adney
  • During the first years of medical school, we are taught a huge volume of material, covering basic sciences and organ systems. It is not until our clinical rotations that we truly begin to experience medicine in real time. Over our clinical years, we learn how to become comfortable with patients and help them become comfortable...VIEW >
  • Planning Now for MD Happiness

  • Posted October 13, 2017 by The Short Coat Podcast
  • Can You Plan Now for Happiness Later? Once you’re on the path to doctorhood, it can be hard to step off. You’ll probably be happy…but what if you find out you’d rather just skate? Sure, you’re making money, you’re an important part of the medical profession, you’ve got this under control…but there’s something missing: happiness,...VIEW >
  • Quiz of the Week: Do you recognize this chest abnormality?

  • Posted October 13, 2017 by Figure 1
  • A 30-year-old male presents to his new family physician for a routine physical. He reports being in good health, but has some cosmetic concerns about a chest abnormality he’s had since he was a child. On examination, he has a high-riding left scapula and his left pectoral muscle appears to be absent. Which of the...VIEW >
  • What Medical Schools Are Looking For: Understanding the 15 Core Competencies

  • Posted October 12, 2017 by AAMC Staff
  • When you think about how medical schools will evaluate your application, it can seem like a mystery. What will an admissions committee look at first? How are experiences that are not related to health care viewed or evaluated? How do you explain a personal circumstance that may have led to poor grades during an academic...VIEW >
  • How Do I Know Which Medical School is Right for Me?

  • Posted October 11, 2017 by Cassie Kosarek
  • Receiving multiple admissions offers to medical school can be both thrilling and daunting for prospective medical students. For many applicants, the simple goal is to get into medical school; a scenario in which one has to choose between multiple programs is simply not considered. But for a fraction of admitted medical students, juggling the pros...VIEW >
  • What are Gallstones?

  • Posted October 10, 2017 by Open Osmosis
  • What are gallstones? Gallstones are solid stones that are produced in the gallbladder when there’s an imbalance in the composition of bile. The main types of gallstones are cholesterol stones, bilirubin stones, and brown stones. This video discusses the pathophysiology and known mechanisms of formation for each type of gallstone in the gallbladder, as well...VIEW >

// Forums //