Medical school debt can feel insurmountable, but not when you have a plan to pay it down! Here’s how to strategically (and creatively) approach med school loan repayment..

<h2>Medical School Debt: A Looming Problem</h2>

<h3>$200,000.</h3>

<p>
  That&rsquo;s the median amount graduates owed on their medical school loans in
  2020 (<a
    href="https://store.aamc.org/downloadable/download/sample/sample_id/368/"
    target="_blank"
    >Association of American Medical Colleges</a
  >).
</p>

<p>
  But medical school debt isn&rsquo;t just an expensive problem; it&rsquo;s also
  a ubiquitous one:<strong> 76-89%</strong> of med school students graduate with
  medical school debt, and <strong>43%</strong> of graduates also carry pre-med
  debt (<a
    href="https://educationdata.org/average-medical-school-debt#:~:text=The%20average%20medical%20school%20debt,graduates%20have%20premedical%20educational%20debt."
    target="_blank"
    >EducationData.org</a
  >).
</p>

<p>
  In addition to being a substantial and widespread issue, medical school debt
  is also stressful. The pressure of looming debt can erode physicians&rsquo;
  quality of life and has even been shown to negatively impact
  <strong>mental health</strong>, <strong>academic performance</strong>, and
  <strong>specialty choice</strong> among aspiring physicians (<a
    href="https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6609129/"
    target="_blank"
    >Pisaniello, Asahina, et al.</a
  >).
</p>

<h2>Top Strategies for Reducing Med School Debt</h2>

<p>
  Fortunately, with strategic planning, physicians can reduce the time it takes
  to pay off medical school debt as well as the amount they&rsquo;ll have to
  pay. Theories abound about the best way to approach loan repayment, and each
  provider will need to decide what&rsquo;s ideal in their particular scenario.
  One thing is certain: not having a plan can be disastrous. These strategies
  for reducing medical school debt can help physicians lighten the load and
  create space to enjoy the pleasures of life and the rewards of the career.
</p>

<h3>Make a Plan.</h3>

<p>
  The first step is to get organized and develop an approach. Devote a day
  specifically to researching options and creating a plan to pay down your med
  school loans over the long term. Consider involving your partner or spouse
  and/or enlisting the services of a financial planner or wealth advisor.
  Determine precisely how much you owe. Estimate what you&rsquo;ll spend on
  interest if you pay it out over the life of the loan as is. Then re-evaluate
  as you consider each of the strategies below and map out the best path for
  reducing your loans.
</p>

<h3>Don&rsquo;t Wait.</h3>

<p>
  If you&rsquo;re still in your residency, don&rsquo;t defer payments on your
  loan. It may be tempting to put loan payments on hold for as long as you can,
  but resist that urge. It could save you hundreds of dollars each month and
  tens of thousands over the long run. For example, if you owed $200,000 at a
  5.3% interest rate and chose to defer your loans for three years during a
  residency, you would incur $31,800 in additional interest. This would increase
  your balance to $231,800, and you would have to pay approximately $342 more
  per month than what you would have paid without the deferment (<a
    href="https://studentloanhero.com/featured/pay-off-medical-school-debt/"
    target="_blank"
    >Student Loan</a
  >). If, as a resident, you are unable to afford full loan payments on your
  resident salary, pay as much of the interest as you can to keep your balance
  from growing.
</p>

<h3>Make More and Spend Less.</h3>

<p>
  If you increase your earnings and reduce your expenditures, you&rsquo;ll be
  able to unburden yourself from your med school loans much sooner. Many
  physicians pick up extra shifts moonlighting or working weekends or vacations
  on
  <a href="https://www.crosscountryhealthcare.com/physicians" target="_blank"
    >locum tenens assignments</a
  >
  to pay down loans. Others take on side work as consultants, medical writers,
  paid lecturers, or expert witnesses. Other ideas are to publish a book, teach
  at a university, coach medical students and tutor for MCATs or med school
  classes. Further, you can use any additional money that comes in &ndash; from
  signing or performance bonuses, raises, or tax refunds &ndash; to pay down
  loans. You can even make an additional loan payment each year (a strategy many
  homeowners use to pay down mortgages) to pay off your loan faster. Moreover,
  if you reduce what you spend by sticking to a budget and living a reasonable
  lifestyle, you can pay off your loans more quickly, which means you&rsquo;ll
  be able to fully enjoy that physician salary you&rsquo;ve worked so hard to
  earn &ndash; much sooner and for a longer period of your life.
</p>

<h3>Consider Loan Forgiveness.</h3>

<p>
  Look into different opportunities to work with underserved patient populations
  in exchange for forgiveness of your med school loans. Some states, academic
  organizations, and nonprofits have different programs to help with loans. And
  many federal organizations will reduce or forgive school debt, and options may
  include Indian Health Services, Veterans Administration, US Public Health
  Commissioned Corps, the US Military, the Centers for Disease Control and
  Prevention, National Institutes of Health, National Service Health Corps, and
  Department of Health and Human Services. Additionally, there is the federal
  Public Service Loan Forgiveness Program, which will forgive loans after you
  have made a certain number of payments. Keep an eye out for future
  developments in these programs, as recent federal administration changes may
  lead to more opportunities to reduce loan debt.
</p>

<h3>Refinance.</h3>

<p>
  Med school loans are comparatively expensive: interest rates on these loans
  are significantly higher than rates on undergrad loans. Fortunately,
  refinancing lenders offer low annual percentage rates that can help you save
  significantly (up to thousands of dollars, based on your debt-to-income ratio
  and credit score). It is critical to note that if you refinance, you will no
  longer be eligible for programs like
  <a
    href="https://students-residents.aamc.org/financial-aid-resources/income-based-repayment-ibr"
    target="_blank"
    >federal income-driven repayment plans</a
  >
  (including PAYE, REPAYE, IBR, and ICR, which let you pay based on what you
  earn versus what you owe),
  <a href="https://studentaid.gov/pslf/" target="_blank"
    >public service loan forgiveness programs</a
  >
  (which forgive loans for those in public service after a certain number of
  payments), or other state or nonprofit loan forgiveness programs.
</p>

<h3>Use Your Resources.</h3>

<p>
  Professional medical associations, government agencies, academic institutions,
  and even healthcare organizations offer resources to help physicians deal with
  med school debt. For example, American Academy of Family Physicians&rsquo;
  <a
    href="https://www.aafp.org/students-residents/medical-students/begin-your-medical-education/debt-management.html"
    target="_blank"
    >Managing Medical School Debt</a
  >, American Medical Association&rsquo;s
  <a
    href="https://www.ama-assn.org/residents-students/career-planning-resource/manage-medical-student-loans"
    target="_blank"
    >Managing Medical School Loans</a
  >, and University of Minnesota&rsquo;s
  <a
    href="https://med.umn.edu/md-students/financial-aid/resources-managing-debt"
    target="_blank"
    >Medical Resources for Managing Debt</a
  >
  are full of valuable resources for physicians.
</p>

<p>
  Above all, make a plan and start now. You&rsquo;ll be that much closer to
  financial freedom and reaping the rewards of your dedication to your
  profession, your practice, and your patients.
</p>

<p>
  To learn more about opportunities that can help you conquer med school debt,
  like taking a locum tenens assignment,
  <a href="https://www.crosscountrylocums.com/home">contact us today.</a>
</p>


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