You're in medical school, and most likely accruing debt. While repayment not feel urgent now, thinking ahead about your student loan repayment strategy could make a meaningful difference in your monthly payments later.
The plan you choose impacts how much you pay back each month, but did you know it also determines whether you're eligible for student loan forgiveness? These factors can be why an income-driven repayment plan may be worth considering.
The nuts and bolts of an Income-driven repayment plan
Income-driven repayment (IDR) bases your monthly federal student loan payments on your income and family size rather than your loan balance. Payments only increase as your income rises.
Having an IDR in residency or fellowship can shrink a standard payment, which can get as high as $3,000 per month1, to something more manageable, even to zero in some cases. While most medical school graduates still pay something during training, it's typically an amount that fits within a resident or fellow's budget. You'll have to update your income annually, so expect payments to rise once you become an attending physician.
Beyond affordability, IDR can also open the door to student loan forgiveness. As long as your loan stays a federal loan and isn't refinanced, your remaining balance may be forgiven after 20-30 years of qualifying repayments. Forgiveness is tied to time, not a specific dollar amount.
Pick your specific IDR plan
All IDR plans calculate payments based on income, but you do have options, and the details can vary.
Income-based repayment (IBR)Requires a payment of around 10-15% of your discretionary income, with the possibility of forgiveness after 20-25 years.2
Repayment assistance plan (RAP)Requires a payment of around 1-10% of your income, with the possibility of forgiveness after 30 years.3
Your available options depend on when your medical school loans were first disbursed. If you're uncertain about which plan fits your situation, consider speaking with a financial advisor familiar with student loan repayment.
Other available loan repayment options
Non-IDR plans base monthly payments on your total loan balance, not your income. The federal Standard 10-year plan is one of the options, but for medical school graduates, typically carrying $200-$400K in loans, payments can reach $2-$3K per month, even during residency.1
This financial strain can lead residents or fellow to pause payments through forbearance or a deferment, extending the length of time it will take to pay off the loan.
Forbearancemay be available if you're struggling to make payments. Granted in 12-month increments and renewable, interest continues to accrue and is added to your principle afterward.
Economic hardship defermentrequires proof of low income. Granted in 12-month increments, there's a lifetime limit on how often you reapply. Interest only accrues on unsubsidized loans, which most medical school borrowers have.
While both options here can provide temporary relief, your balance continues to grow while you're not paying, often resulting in a higher total repayment. They also do not count toward PSLF, meaning you'll have to repay the full balance.
Why IDR is valuable to medical school students
Selecting an IDR plan can support your financial stability in several ways.
1. More manageable monthly payments
IDR during residency and fellowship lets you start paying down your student loans without sacrificing essential living expenses. Payments stay aligned with your income even while you're still in training.
2. Lower risk of default
Because payments reflect your earnings, IDR can reduce the likelihood of late payments or defaulting on the loan completely.
3. Helps you qualify for loan forgiveness
PSLF requires an IDR plan and 120 qualifying payments. Starting those payments during residency or fellowship can help you become eligible for forgiveness earlier, all the while making payments that are typically affordable.
4. Less need to refinance
With income-based payments, you may not need to refinance your student loan to lower your monthly student bill. Avoiding private refinancing preserves PSLF eligibility and keeps forgiveness on the table.
Making the right choice for your student loan repayment
Building a strong financial foundation when debt is high and income is low matters. Choosing the right student loan repayment strategy can help you maintain a workable budget and may reduce your financial stress so you can focus on your medial training.
A financial professional, experienced in student loans, can help you evaluate your options ad plan for long-term success. At Physician Financial Group, we've helped forgive over $1 million* in student loans. Contact us today to learn more.
1Herries, A. How Much Do Doctors Pay Back Student Loans Per Month? International Center for Global Health Information (ICGI) (2024).
2Federal Student Aid. Income-Based Repayment (IBR). (2026)
3Federal Student Aid. Repayment Assistance Plan (RAP). (2026)
*As of July 2026. The values provided should not be used in making a determination of the quality of services provided by representatives of this agency.
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