Ouch! Dentist Has $520,000 in Student Loans: Where to Begin

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A patient's view of their Dentist
Flickr RF/Getty Images

By Christine DiGangi

A new dentist posted this question on Reddit: where should he start with his $520,000 debt for student loans?

Six-figure student loan debt is not entirely unreasonable for a dental student, if you go by the rule that you should graduate with no more debt than your starting salary. But he is starting with a $129,000 salary, so his debt load is more than four times his salary.

Dentists' salaries range from $75,003 to $229,091 and rise rapidly during the first five to 10 years of their careers, according to PayScale. Four years of dental school roughly runs from anywhere between $23,000 to $275,000 just for tuition, costhelper.com says, and there are a lot of additional expenses. The average debt load of a dental student who took out loans was $200,111 in 2010, according to research by the American Dental Education Association.

He has all federal loans, which tend to be less expensive than private loans, but graduate and graduate PLUS loans carry higher interest rates than undergraduate loans. This borrower (whose total debt includes some from undergrad) wrote he'd pay about $38,000 in interest annually.

A situation like this Redditor's would shake out something like this, according to the student loan payment calculator on Finaid.org: A $520,000 loan balance with an estimated interest rate of 7.4 percent would result in a $6,145.39 monthly payment if the loan term is 10 years. Over that term, the borrower would pay more than $200,000 in interest, resulting in an education bill upwards of $730,000.

Live Like a Student as Long as Possible

Any way this dentist can accelerate his payment schedule will mean huge savings. Options for doing so may sound really unappealing, but that's the reality of massive debt. (A lawyer did it.) As a 20-something, this dentist could could move in with his parents or split the cost of housing with other debt-ridden dentists. He could also look into consolidation.

"Continue living like a college student as long as you can to pay off as much debt as you can," suggested Gerri Detweiler, Credit.com's director of consumer education. "Don't live like a high-salaried dentist; you're not there yet."

Even small student loan balances can have a large impact on your finances, so it's crucial to stay on top of payment, especially if you're dealing with massive debt. Late payments will result in fees (as if you need to pay any more), and missed payments will be reported to credit bureaus, show up on your credit reports and damage your credit score. Student borrowers should check their credit scores as soon as possible, preferably before they borrow or enter repayment, so they can track how their debt affects their credit standing. Credit.com has e tools that allow you to check two of your credit scores for free, with updates every 30 days.


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