Average medical school debt: How much do students borrow?

The average medical school debt in 2023 was over $200,000, according to the Association of American Medical Colleges (AAMC). However, graduates often pay over $300,000 over the life of their loans due to interest charges.

Though this figure is staggering, it’s not surprising. During the 2023-24 academic year, resident students at a public institutions paid an average of $40,493 for tuition, fees and health insurance. Non-resident students paid even more: a whopping $64,473.

Because most medical school students have debts in the six-figure range, knowing how to manage that debt can be a critical skill both during school and after graduation.

Medical debt statistics

Why do medical students get in debt?

Medical school is one of the most costly education paths out there. Graduate students at other programs pay an average of just over $20,500 in tuition and fees per academic year as of 2021-22. Medical students, on the other hand, often pay more than double that amount per academic year. This, in part, due to the higher cost of health care, plus materials required to train medical students.

According to the AAMC, the median four-year cost of attendance for the class of 2024 is $276,006 for resident students at public schools. That same figure goes up to $374,476 for resident students at private schools.

With such high figures, it’s almost impossible for most students to pay for their education out of pocket. That’s why many turn to medical school loans to bridge the financial gap when scholarships, grants and tuition discounts fall short.

What are the average interest rates on medical school loans?

If you have federal student loans, interest rates are updated annually. Private student loans, on the other hand, typically offer a range of interest rates, which depend on your credit profile or your co-signer’s.

For the 2023-24 school year, the interest rate on Direct Unsubsidized Loans for graduate students is 7.05 percent. Direct PLUS Loans — used for graduate and professional students — have an interest rate of 8.05 percent. Private student loan interest rates range from roughly 4.10 percent to 15.50 percent, depending on the lender and your credit profile. Stronger creditworthiness will lead to lower interest rates.

Most student loans — whether private or federal — accrue interest while you’re in school, even if you elect not to make payments. The interest will compound if you choose to continue that deferral through residency. Once you’re ready to make payments, the lender will capitalize the interest, adding it to your principal balance and increasing your monthly payment.

How long does it take to pay off medical school debt?

The standard repayment term for federal student loans is 10 years. But if you have a hard time keeping up with your monthly payments you can extend your repayment schedule to up to 30 years with alternative repayment plans:

Private student loan companies set their repayment terms, but most private medical school loans will allow you to choose terms from five to 20 years. You can also refinance your loans to new terms, extending the payoff period. How long it takes to repay your medical school debt depends on your salary and other expenses.

How do I reduce my medical school debt?

You may find it difficult to work even a part-time job while in medical school, so you may need scholarships and grants to reduce your reliance on debt to get you through college.

Once you finish school, you’ll have a few different options to reduce your student loan balance or at least the amount of interest you pay on the debt.

Student loan forgiveness programs

The federal government offers student loan forgiveness to borrowers who work for a government agency or eligible not-for-profit organization. To qualify for the Public Service Loan Forgiveness (PSLF) program, you’ll need to work full-time for an eligible employer while making 120 qualifying monthly payments. Once you’ve completed all of the requirements, your remaining debt will be forgiven.

You can also achieve forgiveness by getting on an income-driven repayment plan and completing the repayment term. After 20 to 25 years of payments, your remaining debt will be forgiven.

Student loan repayment assistance programs

Federal agencies and state governments offer a variety of student loan repayment assistance programs. These programs aren’t technically forgiveness programs because the benefit doesn’t come from the U.S. Department of Education.

However, depending on the program, you could get tens of thousands of dollars in repayment assistance. The Association of American Medical Colleges maintains a list of state and federal programs you may be able to take advantage of.

One thing to remember is that these programs typically only assist borrowers with federal loans. If you have private medical school student loans, they may not be eligible.

Student loan refinancing

Student loan refinancing replaces one or more existing loans with a new one through a private lender. Depending on your income and credit history, you may qualify for student loan refinance rates that are lower than what you’re currently paying, which can save you money and reduce your monthly payment. You’ll also be able to shorten or extend your loan repayment term — lenders typically offer terms ranging from five to 25 years.

If you have federal loans, refinancing may not be the best option if you’re working toward forgiveness, a repayment assistance program or an income-driven repayment plan.

Is medical school worth it?

The answer to this question is different for everyone. According to the Bureau of Labor Statistics, a median salary for physicians and surgeons is $229,200 or more. Such an income could easily offset the cost of a medical degree – especially over the course of a career.

The cost of medical school entails tuition and fees but also admission expenses, like application fees and registration for the MCAT exam. Once you are admitted, you will want to consider living expenses as well, as the academic pressure of medical school does not typically allow for outside employment.

Starting salaries vary and depend on location and what kind of medicine you choose to pursue. To build an understanding of whether medicine is a worthwhile pursuit for you, consider arranging some informational interviews with professionals who practice in an area of your interest.

The bottom line

The average medical school debt is over $200,000 — a hefty amount of debt to carry at the start of your career. The expected payoff schedule can exceed the 10-year mark. During that time, you’ll be paying the equivalent of an extra mortgage payment to make progress on the loan. You may be able to save some money by going to an in-state school as a resident.

Given the average salary for a medical doctor, paying off the loan ahead of time is possible but will depend on where you work and your specialty.