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Eight out of 10 medical school graduates borrow to earn their degree — and most take on six-figure debt with 18% borrowing $300,000 or more.

A roundup of the latest statistics show average medical school debt now exceeds $200,000. While medical school graduates can generally expect to earn six-figure salaries, nearly half plan to apply for student loan forgiveness:

  • Average medical school debt → $232,300
  • Average education debt after medical school → $251,600
  • Average salary with a medical school degree → $210,980
  • Average time to repay medical school debt → 13 years

Here are the charts and data you’ll find below:

Average medical school debt

According to the most recent numbers from the National Center for Education Statistics, the total student loan debt taken on by doctors to graduate from medical school has nearly doubled since 1999-2000.

The chart above shows average total education debt for medical school graduates is:

  • For the class of 1999-2000: $127,500
  • For the class of 2015-2016: $251,600

That’s an increase of 97% — even after adjusting for inflation.

Total education debt includes both medical school and pre-med debt taken on to earn a bachelor’s degree.

If we exclude pre-med debt and look only at loans taken out for medical school, medical school debt at graduation averaged:

  • For the class of 1999-2000: $115,300
  • For the class of 2015-2016: $232,300

That’s an increase of 101%, using 2017-18 dollars to account for inflation.

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Extreme medical school debt

Not only has average medical school debt grown significantly, but it’s not unusual for med students to borrow more than average.

According to an annual survey by the Association of American Medical Colleges, most medical students borrow less than $300,000, but close to one in five take on more total education debt.

Looking only at members of the class of 2019 who borrowed to get their degree, AAMC found:

  • Borrowed less than $150,000: 28.3%
  • Borrowed $150,000 to $299,999: 53.5%
  • Borrowed $300,000 or more: 18.1%

Looking at all members of the class of 2019:

  • Graduated without debt: 27%
  • Plan to apply for loan forgiveness: 44%

Learn More: How to Pay Off $200,000+ in Student Loan Debt

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Cost to repay medical school debt

The cost to repay medical school debt depends primarily on three factors:

  1. The interest rates on your loans
  2. What you do with your loans in residency
  3. How how long it takes you to pay your loans back

Learn More: How to Pay Off $100,000+ in Student Loan Debt

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Average interest rates on medical school loans

There are three interest rate tiers for federal student loans — one for undergraduates, one for graduate students, and one for PLUS loans. Many doctors will have all three types of loans by the time they graduate from medical school.

Rates on federal student loans are fixed for life once you take them out. But rates offered to new borrowers are adjusted annually to account for the government’s cost of borrowing. Based on average student loan interest rates in recent years, a typical medical school graduate would have loan balances and interest rates that look like this:

Loan type and amount borrowedAverage interest rate
$19,300 undergraduate loans4.79%
$162,000 in direct unsubsidized loans for grad students6.36%
$70,300 in PLUS loans7.41%
Total: $251,600Weighted average interest rate: 6.6%

Typical loan balances and interest rates for med school grads

Medical school students can take out a total of $224,000 in subsidized and unsubsidized direct loans before turning to PLUS loans. But for most medical school students, the annual borrowing limit on the more affordable federal student loans is $40,500.

With annual medical school borrowing now averaging nearly $60,000 a year, students often turn to federal PLUS or private student loans loans to fill gaps in their education funding.

How interest piles up during residency

In addition to the interest rates on your loans, your repayment costs will depend on how long it takes you to pay back your loans. Residency can add three to seven years to your repayment timeline.

During residency, many medical school grads make only partial monthly payments on their loans, or no payments at all. When it comes to interest, remember that:

  • With the exception of need-based subsidized loans you took out as an undergraduate, your federal and private student loans will continue to accrue interest during residency
  • If your loans are in deferment or forbearance, or you enroll in an income-based repayment plan like REPAYE, your monthly payments may not cover the interest you owe
  • Some or all of this unpaid interest may be “capitalized” — added to your loan balance — when you finish your residency

Learn More: What Is Capitalized Interest on Student Loans?

The table below shows how interest can pile up during your six-month grace period after graduation, and during three years of residency. The table assumes you request mandatory forbearance after your grace period, and make no payments on your loans during residency.

Months in forbearanceMonthly interest chargesTotal interest chargesLoan balance after residency
42$1,384$58,128$309,728
Interest charges on $251,600 in education debt at 6.6% interest during 6-month grace period and 3-year medical residency.
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Average student loan interest charges during medical residency: $58,120

If you’re able, paying even part of the interest you owe on your loans while you’re completing your residency can keep your loan balance from growing so dramatically.

Average time to repay medical school loans

How long it takes you to repay your medical school loans depends on your choice of repayment plan, and what (if any) payments you make while you’re a resident.

For medical school grads who must complete a 3-year residency, the average time to repay student loans after graduation is:

  • Standard repayment plan: 13 years
  • Income-driven repayment (REPAYE): 20 years

The table below shows how refinancing your loans at a lower interest rate can help you pay your loans off faster, potentially saving thousands in repayment costs.

Repayment planMonthly paymentYears of paymentsTotal repayment cost
Standard (forbearance during residency)Residency:
$0

Post residency:
$3,533
Residency:
3 years

Post residency:
10 years
$423,921
REPAYE (income-driven repayment)Residency:
$311-$358

Post residency:
$1,602-$3,610
Residency:
3 years

Post residency:
16 years, 7 months
$499,992
REPAYE, then refinance after residency into 5-year loan at 4% Residency:
$311-$358

Post residency:
$5,057
Residency:
3 years

Post residency:
5 years
$315,571
REPAYE, then refinance after residency into 10-year loan at 5% Residency:
$311-$358

Post residency:
$2,912
Residency:
3 years

Post residency:
10 years
$361,645
Average cost to repay $251,600 in medical school debt with a weighted average 6.6% interest rate at graduation.

Average cost to repay medical school debt

The examples above assume a doctor who enrolls in REPAYE starts out earning $56,000 a year during their first year in residency, then sees their salary increased to $211,000 after completing their residency.

Average earnings with a medical school degree

Although most doctors leave medical school with six-figure education debt, once they finish their residencies, they can expect to earn salaries on par with their debt.

According to the latest figures from the Bureau of Labor Statistics, average annual earnings in 2018 were:

  • All medical school graduates: $210,980
  • Pediatricians: $183,240
  • Surgeons: $255,110

The chart above highlights that doctors who specialize in fields like psychiatry, obstetrics, surgery and anesthesiology can expect to earn more than the average medical school graduate, while pediatricians and general internists often make less.

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How to pay off medical school debt

Doctors face unique challenges when repaying medical school debt because they borrow more than most graduate and professional students. And although most will eventually earn enough to comfortably repay their loans, they’ll first have to get through three to seven years of relatively low-paying residency work after medical school.

Here’s how to pay off medical debt in four steps:

  1. Find out if you qualify for loan forgiveness: If you plan to work for the government or a qualified nonprofit, you may qualify for Public Service Loan Forgiveness after 10 years of payments. If you don’t plan a career in public service, you may still qualify for federal loan forgiveness after making 20 or 25 years of payments on your loans in an income-driven repayment plan.
  2. Decide what to do with your loans during residency: Many medical school graduates don’t earn enough as residents to start making full payments on their loans. The three most popular options for managing loans during residency are mandatory forbearance, income-driven repayment, or graduated repayment.
  3. Choose a repayment plan after residency: After you complete your residency, you may want to consider a new repayment strategy for the long term. The salary boost you can expect after completing your residency means you may be able to save money by paying your loans off faster.
  4. Evaluate whether refinancing makes sense: While interest rates on federal student loans are “one-size-fits-all,” borrowers with good credit and earnings potential can often qualify for lower rates from private lenders.

Keep Reading: How to Pay Off Medical School Debt

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About the author
Matt Carter
Matt Carter

Matt Carter is a Credible expert on student loans. Analysis pieces he’s contributed to have been featured by CNBC, CNN Money, USA Today, The New York Times, The Wall Street Journal and The Washington Post.

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