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    A guide to understanding loan repayment options for physicians

     

    Pay-off strategies for different career paths

    Here are two pay-off strategies for different career paths.

    1. Employed or Academic physician. The most important thing is to get into one of the income-based plans as a resident to take advantage of low payments, and then continue working for a nonprofit institution. Take advantage of the interest subsidy and pay the minimum monthly payments while your income is low, then switch to IBR two months before you graduate and start working to take advantage of the capped maximum payment. Once you have made 120 payments, have the remainder of your loan balance forgiven.

     

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    2. Private practice or for-profit employee. Once you start residency, look at private refinancing. If the rate is better than what you would get with REPAYE, then refinance, if not enter REPAYE for the duration of residency. After you graduate, refinance privately with whoever will offer you the lowest interest rate and then aggressively pay your loans off with your attending salary.

    Making the right moves as physicians is more important than ever as the loan burdens increase and the cost of mistakes rises.

     

     

    References:

    1.  Peckham, C. (2015, April 21). Medscape 2015 Compensation Survey. Retrieved March 23, 2017, from http://www.medscape.com/features/slideshow/compensation/2015/public/overview

     

    2. Income-Driven Repayment Plans: Questions and Answers. (2016, February 01). Retrieved March 23, 2017, from https://studentaid.ed.gov/sa/sites/default/files/income-driven-repayment-q-and-a.pdf

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