Dentist’s Guide to Student Loans Repayment Strategies

What It Takes To Become a Dentist

There are more than 200,000 practicing dentists in the United States. After undergraduate prerequisites, dentists attend accredited dental schools to obtain a DDS or DDM degree. With an increased demand for dentists, younger dentists enter the industry at higher volumes than ever. 

After graduation, they’re faced with additional training and likely becoming an associate dentist with a practice owner looking to retire. With more than 40% of dentists being under age 45, quite a few dentists are carrying student loan balances. Therefore, obtaining loans for practice transitions can be difficult, and home purchases are often delayed.

Income Demographics

There is plenty of income disparity between dentists geographically and whether they choose a specialty. The average income for a general practitioner in the United States is around $200,000, while the average for a specialist is more than $320,000. 

Additionally, more than 60% of dentists are practice owners, leading to additional complexity as you try to make decisions about your student loans. The variables to determine your student loan repayment strategies work best when tailored to your income and employment status (self-employed vs. an associate in another practice).

There’s no one-size-fits-all, but this article will dive into common scenarios for dentists. 

Dentists in Residency 

After eight years of mandatory schooling, some dentists opt for residency programs that usually last between 1-3 years but some last longer. Once you’ve entered a residency program, you no longer qualify for in-school deference and forbearance for your student loans. You have to start repayment or enter into a medical residency forbearance.

Time spent working in a residency program can be considered for public service loan forgiveness (PSLF). However, you must continue working for a qualified non-profit employer after your residency program ends to complete the requirements for PSLF. Many dentists go into private practice after residency, making public service loan forgiveness not an option. 

While in residency, Pay As You Earn (PAYE) is the best repayment plan for borrowers with federal Direct Loans. Revised Pay As You Earn (REPAYE) works in specific scenarios but is less flexible than PAYE. Refinancing doesn’t make sense during residency. 


Pay As You Earn (PAYE) and Revised Pay As You Earn (REPAYE) are usually the two repayment plans you pick. Your loan servicer and unqualified financial advisors may recommend REPAYE or refinancing. While these routes can lead to student loan payoff, they’re usually not the best option in residency or the early years as an associate. 

PAYE is generally preferred to REPAYE since your loan payments will not exceed the 10-Year Standard Repayment plan. Therefore, under PAYE, your required payments will be lower. If you have lower payments, you’ll find it easier to start a practice or purchase a home. 

To qualify for PAYE, you must meet the following criteria: 

  • You must be a new borrower that has taken loans after October 1, 2007, and at least one Federal Direct Loan issued after October 1, 2011. 
  • You must have eligible loans. You must have Direct Loans as issued or Direct Loans from consolidation. 
  • You must have a high debt-to-income ratio. 
  • Your loan payments need to be lower than they would be under the standard 10-year repayment schedule. 

Associate Dentists

As an associate dentist employed under a private practice, you’re most likely looking to purchase a home or start your practice. Managing your student loan debt and repayment strategy is critical to accomplishing those goals. 

If you’ve elected PAYE during residency, it may not be time to change. PAYE should keep your payment lower than refinancing or under REPAYE. Therefore, you’ll be able to save more towards your goals and have an easier time qualifying for a loan because your required payment is lower. 

If you haven’t elected PAYE during residency, you may not qualify as an associate because your income is too high. You’ll want to consider all options, such as other income-driven repayment plans,  to keep your payment as low as possible during the early years as an associate. 

Once you’re making real money and practice ownership isn’t in your future, refinancing your student loans could make sense. Refinancing may be your best option when you’re trying to pay down your debt quickly and have the cash flow to do so – more on this below. 

Practice Owners

In the early stages of practice ownership, your personal cash flow may go down as you’re building your client base or trying to expand your business. In this case, it’s essential to be flexible with your student loan repayments. Income-driven repayment plans could still help you during the early stages of starting a practice. 

Once your practice generates real cash flow, it’s time to consider private refinancing. You’ll usually lower your interest rate through private refinancing and pay your loans faster. Private refinancing is an irrevocable decision that causes your federal student loans to become private. 

Private Refinancing 

Dentists are better candidates for private refinancing their student loans relative to others. However, it’s important to refinance when it makes sense to do so. It usually doesn’t make sense to do so immediately after graduation or even through the early years as an associate. 

Private refinancing makes sense for many dentists but only after their further along in their careers with real cash flow. The goal of private refinancing is usually to pay down your loans quickly and accrue less interest. 

When private refinancing, you will want to consider purchasing an individual disability policy with an own occupation rider and additional term life insurance. These policies will allow you or your loved ones to pay down your student loans in case of your disability or death. Private student loans don’t carry the same protections as Federal student loans. 

Who Shouldn’t Private Refinance

Private refinancing usually doesn’t make sense if you’re an associate dentist looking to start a practice. Flexible payments can help dentists with cash flow obligations that come with starting a practice. With private refinancing, you lose most of this flexibility in your repayment plan. 

With private refinancing, you’re amortizing your student loans over a period of time. This means you must make payments regardless of your current income and financial situation. You will lose some of the protections offered with federal student loans. 

Private refinancing pays down your federal student loans and starts new loans issued by private institutions. Therefore, you’re giving up access to income-driven repayment plans, taxable loan forgiveness, public service loan forgiveness, deferment, and forbearance options. Early career dentists usually benefit from holding federal loans instead of refinancing them. 

Taxable Loan Forgiveness

Taxable loan forgiveness works best when your student loan balance is much higher than your income and you don’t qualify for PSLF. You’re likely an associate dentist that’s decided not to start a practice or a low-volume practice owner. Repayment plans such as IBR, REPAYE, or PAYE count towards taxable loan forgiveness.

Taxable loan forgiveness means that your remaining balance after the required payments is taxable to you. Saving and investing to pay the taxes due is essential for this plan to work. A thorough analysis of your situation should show that you’ll pay less towards your student loans and the required savings for tax payments upon forgiveness than aggressively paying down your loans. 

Government, Military, and Non-Profit Employers 

Government and non-profit dental positions make up less than 10% of dentists. If your employer is a government or non-profit, you’re likely a public service loan forgiveness (PSLF) candidate. 

To pursue PSLF, you must meet the below criteria. 

  1. You must have a qualifying non-profit or governmental employer
  2. You must work on their definition of full-time employment
  3. You must have the correct loan type – federal direct loans. 
  4. You must have an income-driven repayment plan. 
  5. You must make 120 payments with all of these requirements combined. 

Additional Dentist Forgiveness Options 

Here is a list of additional programs available to dentists. They are not very common as most dentists go into private practice in populated areas. 

  1. Military programs for loan forgiveness
    • Army
    • Navy 
    • Air Force
  2. HIS Loan Repayment Programs
  3. NHSC Loan Repayment Programs
  4. Veterans Affairs student loan repayment program
  5. Medical school loan repayment assistance programs – vary by state. 

Bottom Line

It’s essential to design the right repayment plan depending on your goals and career stage. Making the correct choice allows you to better plan for starting a practice and purchasing a home.

Nearly all loan servicers and financial advisors haven’t had the proper training to help you optimize your student loan repayment strategy. If you’re looking for guidance on optimizing your loan repayment strategy, ensure your advisor has the proper credentials, such as the Certified Student Loan Professional (CSLP®), and understands the unique challenges dentists face.

Author: Cecil Staton, CFP® CSLP®

Author: Cecil Staton, CFP® CSLP®

I'm a fee-only financial advisor for dentists serving clients nationwide.

I left the large financial institutions to start my own RIA. I did it so people could pay for real planning and not just an agenda to sell a hidden product. As a fiduciary, Arch Financial Planning, LLC was built on that promise by delivering non-cookie-cutter plans that provide solutions to achieve their goals.

Who do I serve?

Typical: Dental practice owners
Goals: Pay off student debt, start/sell a practice, and grow their wealth
Location: Virtually anywhere in the U.S.


This website (the “Blog”) is published and provided for informational and entertainment purposes only.  The information in the Blog constitutes the Content Creator’s own opinions and it should not be regarded as a description of services provided by Arch Financial Planning, LLC or Cecil Staton, CFP® CSLP®.

The opinions expressed in the Blog are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific security or investment product.  It is only intended to provide education about personal financial planning.  The views reflected in the commentary are subject to change at any time without notice.

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