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This article covers medical school debt and what steps a resident can take to wipe out his debt more quickly. I discuss some of the most common problems that a resident may face and what strategies I use to pay off my medical school dept.

As you begin your path in Medicine, you soon realize that this is not a cheap profession to get into as costs keep pilling up.  With tuition already around $50,000 a year on average, when you compound the rent for the apartment, the gas to get to all your rotations, and the cost of successfully completing STEPs and books, over 85% of all Medical School graduates have some form of debt by the time they graduate the program.  The highest average debt reported in the US for Medical training in 2014 was $259,177 in a 4-year span for students attending the West Virginia School of Osteopathic Medicine.  Yes, it is true that DO programs typically are most costly than their MD counterparts, but on average, most MD residents can also find themselves in over $200,000 of debt and with Resident salaries barely exceeding $50,000 a year, it is no surprise that students face a tall task of trying to climb out of these monstrous debts.  While selling a kidney or yourself (that's a joke!) is always an option for some additional money, I'll present some of the more realistic approaches that my colleagues and I use to try to combat our massive debts and find financial freedom.  

Number 1:  Research and Find the Right Loan-Program for You 

I cannot advocate for one loan plan over another just because everyone has a different financial set-up to consider when you are attempting to get out of debt.  Some of you may already have children, multiple properties, or the nice Mercedes that you have to consider and that would make some loan repayment options more advantageous for you than others.  

One common loan repayment strategy that a lot of my colleagues use is called the Pay as You Earn (PAYE) Program.

This Loan forgiveness program takes monthly fees from your salary check and in 20 years, without paying any more money additionally, you could be free of your debt.  Payments can be as little as $290 per month and gives young doctors more flexibility to use their meager incomes for other necessary items.  What is advantageous about this payment plan is you can target the accrued interest rates often adjoined to these loans so you won't have to deal with a debt payment ballooning after a few years. 

Some of my fellow residents swear by attempting to re-finance their loans for better rates.

The one good thing about begin a young doctor is that your credit rating lurches in a positive direction because of the new "security" around your accounts. When you were a student, government loans would have a low interest rate but usually the sum would not be enough to cover all expenses so students would have to take out private loans as well.  Now that you have a Doctor title, it will be much easier for you to walk into a bank and get another loan to pay off your debts and have the added bonus of having a lower interest rate in order recover from the "red" more rapidly.  

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