Student debt, especially for medical doctors and dentists, is ridiculously high. The average debt is between $200,000 and $293,000, a sizeable stressful burden. Here is a list of 10 tips to help reduce student debt faster.

1. Income-Driven Repayment Plans (IDR)

IDRs calculate your monthly payment based on your income rather than the total debt, which can be particularly beneficial during residency.

This approach makes repayments more manageable and may qualify you for federal programs that cover part or all of the interest accruing on your loans.

2. Refinancing

Securing a lower interest rate through refinancing is a prime strategy for alleviating the weight of student loans. For example, refinancing companies like SoFi offer reduced rates, potentially cutting the interest from 7% to as low as 2.25%, alongside perks such as debt forgiveness in specific scenarios, making significant savings on interest payments a reality.

3. Military Service Repayment Programs

Committing to military service can expedite debt reduction through substantial loan repayment programs and stipends, with offerings like up to $120,000 in loan repayment for active duty members and sizable sign-on bonuses for specific specialties.

4. Federal Loan Forgiveness Programs

The Public Service Loan Forgiveness (PSLF) offers a route to cancel the remaining debt after ten years of service in high-need areas or non-profit sectors. Other federal initiatives include the Indian Health Services and National Institutes of Health Loan Repayment Programs, which provide substantial financial assistance in return for service commitments.

5. State Loan Repayment Assistance

Many states have programs to attract health professionals to serve in areas with significant healthcare shortages, offering loan repayment as an incentive. Research through resources like the National Health Service Corps and the AAMC can uncover these opportunities.

6. Tax Deductions

Taking advantage of tax deductions for student loan interest and tuition can yield savings, reducing taxable income and stretching your dollars further.

7. Biweekly Payments

Splitting your monthly payment into biweekly contributions can reduce your interest over the life of the loan and shorten the repayment period, as you'll make one extra full payment each year.

8. Loan Forgiveness for Volunteers

Organizations like AmeriCorps, Peace Corps, and certain volunteer programs offer loan forgiveness or repayment assistance in exchange for service, presenting a dual opportunity to contribute to social causes while easing debt burdens.

9. Employer Repayment Programs

Some employers offer student loan repayment as part of their benefits package. Investigate whether your workplace or potential employers provide such incentives, which can directly reduce your loan balance.

10. Automate Payments

Many loan servicers offer a reduced interest rate for setting up automatic payments. This ensures you never miss a payment and lowers the total interest paid over time.

By embracing these strategies, from seeking better interest rates and leveraging loan forgiveness programs to taking advantage of tax deductions and employer benefits, you can navigate a faster route to clearing dental or medical school debt.

While the journey may require sacrifices and strategic planning, the freedom from debt is well worth the effort.

We at PSSCPAs are financial advisors in Florida specializing in helping medical professionals reach their financial dreams, don’t hesitate to contact us.