The rapidly increasing cost of a medical degree is to say the least, intimidating. If the debt piled up from undergraduate studies is any indication of the nightmare experienced by the average medical student, there seems to be little hope for the rising class. Last year, the average cost of attendance for one year of medical school was around $35,000. That includes in-state tuition, fees and insurance, but omits the cost of living. The living expenses of students from the University of Michigan medical school totaled $25,800 annually. This brings the year’s total from $35,000 to $60,800. Multiply this number by four, and the student is left in about $243,200 of debt. The case is much more drastic in regards to private medical schools and out-of-state tuition. God forbid a student attend an out-of-state, private medical college. Those in this particular situation spend over one and a half times as much over the course of four years.
Keep in mind, that these figures are on top of the on average $141,480 spent obtaining an undergraduate degree. This leaves the graduate medical student $384,680 in crippling debt. With that kind of money, you could buy a home.
Upon graduation, family physicians, pediatricians and psychiatrists are offered about $189,000 annually, the lowest base pay of most physicians. More specialized physicians such as cardiologist and urologist can make up to $512,000 annually. However, this level of specialty requires more advanced training, which in turn costs more.
This dismal picture painted above can be seen in a more flattering light. There are bounteous opportunities to payoff this outrageous amount of money. Public Service Loan Forgiveness allows the loan of a physician practicing in a public or nonprofit hospital, the public health sector, academia or in the military to be forgiven after 10 years of service.
Making a strategic plan to pay off debt during residency rather than opting into deferred payments can also reduce your final debt by reducing the amount of accrued interest. Some physicians find it beneficial to allocate their physicians signing bonus to paying off their debt, this bonus is usually around $25,000. This method can shorten the repayment period and decrease the amount of interest of the loan over time.