The American Medical Association recently released a guide for residents, fellows and young physicians on how to manage their student debt. Here are five tips from that guide:
- Understand your loan interest and the types of interest and loans, including compound interest, subsidized loans and unsubsidized loans.
- Use the grace period before interest starts accruing — typically six months after graduation — to your advantage by considering loan consolidation during this time.
- Know when to use loan deferment or forbearance if you need it. Deferment is a period of time during which payments are not required and can be requested for a variety of reasons, such as school attendance or unemployment, but it can only apply to certain types of loans. Conversely, forbearance is a temporary extension of time for making payments or a temporary end to or reduction of payments.
- Be cautious of being late on scheduled payments, which would make you delinquent on the loan. If you continue to be delinquent, your loan could go into default, which can have serious consequences.
- Seek out repayment assistance and loan forgiveness plans that have been created to address physician shortages across the country.