For many physicians, six-figure student loan debt is an unavoidable reality. Learn how locum tenens can help you boost your income and tackle debt more aggressively.
Student loan debt has ballooned in the past decade.
The average debt for medical students is over $200,000––and that doesn’t include undergraduate loans. When undergraduate student loans are included, the median debt is closer to $250,000.
The standard repayment timeline for federal student loans is ten years––but for physicians, it can take much longer. Interest also builds over that time, and what started as a $200K loan can double within the course of a decade. This means you could end up paying over $300K for medical school.
This is an issue that impacts the majority of physicians: 74% of physicians depended on loans for medical school, and 32% of those still owe upwards of $250,000. It has an even bigger impact on low-income students, especially with new federal restrictions on borrowing. A recent survey showed that over half of respondents would likely not have chosen medicine if student loans were capped.
Carrying a large amount of debt can impact financial confidence in the long-term.
Physicians might be high earners, but in the residency and fellowship stages, when salaries are lower, it can be hard to see the light at the end of the tunnel. The burden of debt can make it difficult for early-career physicians to simultaneously pay off loans and save toward any other financial priorities.
A recent financial survey found that financial confidence is low among physicians across all career stages. Physicians ranked their financial confidence at 2 out of 5 while in medical school, —but that score rises to only 3 out of 5 among practicing physicians.
The survey’s authors identified student loan debt as a likely contributor to this ongoing financial stress. And that stress isn’t going anywhere soon: recent reports show that 77.3% of students entering medical school report that their ability to pay off debt is a major concern.
Because medical school debt is so high, the three-quarters of physicians who depend on student loans often spend their early career worrying about how to pay them off—which leaves no time to think about long-term financial planning.
Taking occasional, short-term locum assignments can help you pay down debt faster.
Supplementing your full-time income with locums assignments helps give you the breathing room to pay off debt faster, and build toward your other financial goals. With the additional income you earn through taking on assignments as your schedule allows, you can pay off student loans faster, while reserving your full-time earnings for your everyday expenses.
The good news? You don’t have to completely overhaul your schedule to see a financial impact. Because locum tenens assignments often offer competitive pay rates, even a few extra shifts each month can help accelerate your debt repayment goals. That might mean working one weekend a month or picking up a few holiday assignments––which can be especially lucrative thanks to holiday pay rates.
Here’s how to make a plan to pay down your student debt sustainably.
When you begin working with Hayes Locums, your consultant will learn more about your goals, including where you’re willing to travel and how much time you’d like to dedicate to locum tenens work. Once you’re matched with an assignment, you’ll receive confirmation details that include your pay rate, making it easier to set financial goals and determine how much additional income you can earn.
Your consultant can also help you estimate your earning potential based on your availability and travel preferences. After accounting for taxes and other expenses—as a 1099 contractor, you’ll be responsible for paying taxes on your locums income—you can create a realistic plan for how much debt you’ll be able to pay down each month. Even taking on a few assignments throughout the year can make a meaningful impact on your financial goals.
For example, with a supplemental income of $5,000 a month, you could pay off $200K in loans in a little over 3 years, if you’re able to dedicate the entirety of that income to student loan debt. But you could also choose to pay them off over a longer period, and use that additional income to work towards other priorities, like buying a home or saving for retirement.
The important thing to remember is that you’re not in it alone. While student loan debt can be overwhelming, your consultant is there to help you strategize a sustainable and achievable plan to help you pay them down faster. Whatever your financial goals are, locums can help you get there––and it doesn’t have to take a decade.
