Average Student Loan Debt for Medical Schools

You have always dreamed of becoming a doctor, but the cost of medical education is a fact. It is easy to believe that a high-paying job would cover your debt. But it is more complicated for medical students. 

In addition, many graduates of medical schools, particularly private ones, leave with substantial debt from student loans due to the high cost of yearly tuition and fees. 

The most current data U.S. News gathered from 122 medical schools evaluated for research and primary care revealed that graduates who borrowed money for school had an average debt of roughly USD 184,000 upon graduation. It does not include student loans or other obligations.

Going to medical school is extremely expensive. As a student, you need to carefully plan ahead to be able to meet the finances that are ahead of you. 

This article aims to enlighten you about the average student loan for medical students, along with some tips on how to pay for them and reduce medical school expenses simultaneously.

How Much Does It Cost to Be a Doctor? 

Medical school is as expensive as a home, according to AAMC data, with the median four-year cost of attendance (2020 data) ranging from USD 255,000 to USD 337,000. The AAMC reports that 84% of graduates have debts of USD 100,000 or more due to the high cost of medical school.

The average cost of medical school for first-year students is predicted by the AAMC to vary from USD 39,237 and USD 63,630 (2021–22). This does not include living expenses such as tuition, fees, and student health insurance.

The median total cost of attendance over four years, which considers class time, lab time, and clinical experience, ranged from USD 255,517 to USD 337,584. 

The cost of attendance is a more comprehensive measure of the expenses because it considers additional costs like tuition, fees, lodging, board, books, and supplies.

Note: Most of the numbers shared here are from 2020-2021 and 2021-2022 data. These costs are expected to increase in the current year and for the class of 2023-2024.

What is the Average Student Loan for Medical Schools?

High monthly student loan payments can strain your budget until you pay off your loans, even if you can expect to earn a good living once you graduate from medical school.

Hence, you need to know the average student loan for medical schools to better understand and plan ahead. 

The average student loan for medical school, including debt from pre-medical education, is USD 207,500. 

With a federal 10-year Standard Repayment Plan and an average interest rate of 5.5%, you would pay USD 2,182 monthly with an average balance of USD 203,062. 

Although these debt amounts are startling, depending on your salary, you could be able to handle your monthly loan payments. 

Based on the data from the Bureau of Labor Statistics from 2021, a family medicine doctor makes an average of USD 223,270 annually. Other medical specialties, like oncology and cardiology, can bring in an additional USD 100,000 or more for doctors.

A. Average Medical School Debt By Calendar Year

According to the AAMC, the average debt for medical school graduates climbed at 2.3% per year between 2009 and 2019 — a rate that outpaced the yearly Consumer Price Index inflation rate of 1.7%.

The cost-of-attendance (COA) against debt for medical education from 2009 to 2019 is broken out as follows, with inflation taken into account:

Source: AAMC Medical School Graduation Questionnaire and Tuition and Student Fees Questionnaire 

The amount of debt owed by medical students has remained unchanged even though the cost of admission has climbed twice that of inflation.

When you take a longer perspective, you will see a more significant difference in medical school debt. 

B. Average Medical Schools Debt: Public and Private

Another significant element affecting your overall student loan debt is your school attendance. 

The cost of attending private medical schools is typically higher than that of public ones. 

The average debt for graduates of private medical schools was USD 220,000 in 2021, compared to USD 195,000 for graduates of public medical colleges, according to the AAMC. 

According to data from 2022 from U.S. News and World Report, graduates from these 12 medical schools have the highest levels of student loan debt in the United States.

Source: US News & World Report 

How Medical School Specialty Affects Loan Payoff

Following medical school, students enroll in postgraduate training or residency programs lasting anywhere from three to nine years, depending on their field or specialty. 

Even though you earn an annual stipend as a resident, the duration of the particular residency program may impact when you can start paying off debt. This is because stipends are far lower than the USD 224,905 average physician wage and may make it more difficult for you to pay off massive debt.

According to an AAMC survey, stipends for residents in their first year of residency ranged from USD 58,921 to USD 77,543 (for programs that require that many years). For instance, an orthopedic surgeon can have the same debt from medical school as a specialty with a lesser salary.

However, they will likely need to complete a five-year residency program that consists of four years of orthopedic surgery training and an additional year in a different, more general practice specialty. A pediatrician usually completes their residency in three years and may begin paying back their student loans earlier.

How to Pay Medical School Loan

Even though you could have six-figure medical student debt, you probably have the means — or the potential — to manage it. Here are a few pointers to get you going.

1. Refinance Your Loans From Medical School

If you have student loans from a private lender, refinancing your student loans may allow you to cut your payments and eliminate your debt more quickly. This could reduce your interest rate and monthly student loan payments, saving you thousands of dollars.

You can refinance any federal student debts you may have, but doing so will convert them into private student loans. Thus, you will no longer enjoy some of your former federal protections. 

2. Apply for Loan Forgiveness

The fastest way to pay off your debt from medical school may be through student loan forgiveness if you have federal student loan debt. Suppose you make 120 qualifying payments and work for a government agency or a not-for-profit organization. In that case, you might be qualified for Public Service Loan Forgiveness (PSLF).

Unfortunately, loan forgiveness programs do not apply to private student loans.

3. Sign Up for an Income-Driven Repayment (IDR) Program

Your payment amount is determined by the total amount of your student loan debt under the conventional 10-year Standard Repayment Plan for federal student loans. 

However, your monthly payments will depend on your income and family size if you sign up for one of the Department of Education's four income-driven repayments (IDR) plans. 

For instance, the Pay As You Earn repayment plan needs 10% of your monthly discretionary income. Your remaining medical school debt will be forgiven after 20 years of payments (although taxes will apply).

Consider signing up for a graduated repayment plan. This kind of plan may be the best option for people whose income is modest today. 

Still, it will increase in the future because it starts with lower starting payments that increase every two years.

4. Improve Your Financial Literacy

The more financially informed you are, the better you will manage debt. For this reason, a lot of medical schools offer financial literacy instruction. 

Additionally, students must participate in at least four financial literacy sessions during enrollment, ranging from one-on-one entrance and exit interviews to group sessions on subjects like debt management, at the Albert Einstein College of Medicine in New York. They cover topics like investments, insurance, home buying, retirement, and even things as basic as how to find an apartment.

Some institutions require students to utilize the AAMC's MedLoans Organizer and Calculator, which helps them track loans and run payback scenarios. This tool was created especially for medical school students.

5. Lower Your Interest Rate

You can save money and get out of debt more quickly by refinancing your student loans for medical school. Federal repayment or forgiveness programs do not apply to refinance debts.

6. Pick a Budget-Friendly Location

A long-term repayment plan or other trade-offs may be necessary if you practice medicine in an expensive urban area. 

7. Utilize the AAMC's Resources

Through its FIRST (Financial Information, Resources, Services, and Tools) initiative, the AAMC provides a range of information to applicants, students, and locals. 

This includes online materials on paying for medical school and how to afford it, videos, and seminars on topics including managing loans while in residency and repaying student loans.

8. Pay During Study and Residency 

Even with a limited budget, making partial or complete payments toward your daily accruing unsubsidized loan interest can help you pay off your long-term debt. 

Otherwise, your unpaid, accruing interest will be added to the loan's initial balance at the end of your grace period following graduation. The total amount you owe will rise, and your lender will add interest.

Additionally, you can only fully benefit from the tax deduction on student loan interest payments, which you will likely do when you are a practicing doctor.

Additional FAQs – Average Student Loan for Medical School