Tips for Managing Dental Education Debt

A female student reviews dental education debt management strategies on her laptop as she pursues financial paperwork.

Dentistry can make for a high-paying career. However, before you can start earning as a dentist, you may need to figure out how to pay for your education. Depending on your financial circumstances, this may involve learning how to manage dental education debt.

6 Things to Keep in Mind Before Going into Dental Education Debt

While you might not be able to avoid incurring dental education debt altogether, there are steps you can take to help keep it to a minimum and manage your finances more effectively.

1. Find Out What Your Cost of Attendance Is

The first step in managing your dental education debt typically is to figure out what your cost of attendance (COA) is. Your COA is different from your tuition, although tuition could be a big part of it. It is also different from your budget, which is the total amount of funds you have available to pay for your education.

The COA – also known as financial aid budget – is an estimate of the total amount of money most students may need to attend one year of schooling in a particular institution. This could include the costs of:
  • Tuition and fees
  • Room and board
  • Transportation
  • Books, stationery, and other supplies
  • Medical insurance
  • Dental instruments
  • Personal expenses
Your COA may vary depending on whether you attend an in-state or out-of-state school, a public or private school, and if you are a resident or non-resident student.

Every school’s yearly COA is determined by its financial aid office (FAO). To find out your program’s COA, check your school’s website. You should also consider contacting your FAO directly, as they may be able to provide you with a detailed breakdown of the COA by category.

2. Plan Your Budget

Once you know your COA, you can figure out how much money you will likely need to cover your expenses. This, in turn, could help you plan your budget and determine if you may require financial aid and, if so – how much.

A way to start is to set a monthly budget. To do that, take the total annual amount of costs under your control, such as transportation and personal expenses but not tuition fees, for example. Then, divide these by the number of months in your program’s COA. Depending on your school, these may be anywhere between nine and twelve months.

The amount you end up with is your estimated monthly living allowance. To help minimize your dental education debt, try to live under the budgeted amount.

3. Consider Alternative Financing Options 

Before applying for a student loan, you should look at any other financing options that may be available.

These may include:
  • Scholarships and grants. These may be awarded directly from your school or outside organizations and are usually based on need, merit, or a combination of both. Some, like those provided by the National Health Service Corps, the U.S. Army, and the Indian Health Service, can be tied to a service commitment after graduation. 
  • Work-study programs. If you are able (and willing) to work as you pursue dental training, you could ask your FAO if your school offers any work-study programs.  
  • Education tax breaks. Some students and graduates may be eligible for tax breaks after filing a tax return. For more information, consider talking to a professional tax advisor or read IRS Publication 970, Tax Benefits for Education.

4. Know the Different Types of Student Loans 

Student loans typically come in several different forms, and some may be a better fit for you than others.

Loans you may be eligible for include:
  • Federal Direct Unsubsidized Loan. This is the most common loan type. Your school may require you to borrow in this program to become eligible for other forms of financial aid.
  • Federal Direct PLUS. Previously known as Grad PLUS, this loan is used to supplement borrowing from direct unsubsidized loans and other programs.
  • Health Professions Student Loan (HPSL). The U.S. Department of Health and Human Services gives these types of loans based on exceptional financial need.
  • Loans for Disadvantaged Students (LDS). These are open to students from disadvantaged backgrounds.
  • Institutional loans. Your dental school may provide in-house loans with more favorable conditions. 
  • Private loans. Compared with federal programs, these loans have limited postponement and repayment options. 
For more information on the different types of loans, you can check out the American Dental Education Association’s dedicated page or contact your FAO.

5. Have a Repayment Strategy in Place 

Once you take out a loan, you should figure out how to repay it.

With student loan repayment plans, you can usually choose between:
  • Time-driven repayment. The monthly payments are typically spread over 10 or 25-year periods, with both level and graduated options available. The payment amount is not based on income, tax-filing status, marital status, or household size. Note that payments under time-driven plans are not considered qualifying payments for Public Service Loan Forgiveness.
  • Income-contingent repayment. These include Pay As You Earn (PAYE), Revised Pay As You Earn (REPAYE), and other types of income-tied plans. The payment amount typically changes every year as you submit updated information on your income level and family size. Such repayment plans could be a good fit if your debt considerably exceeds your income, and you may not be able to afford a time-drive plan. 

You can use tools like the AAMC/ADEA Dental Loan Organizer and Calculator (DLOC) to calculate and compare repayment estimates under different plans. This could help you make an informed decision about which option may be better suited to your financial circumstances.

6. Take Out Dentist Malpractice Insurance 

You do not need to be a fully qualified and practicing dentist to benefit from malpractice coverage. A dental student malpractice insurance policy can help cover you against a wide array of legal risks and financial harm. This can also help you to plan your budget and loan repayment with more certainty.

Looking to Minimize Your Dental Education Debt? 

Loans can be stressful. Fortunately, a dental professional liability insurance policy can give you some extra peace of mind when it comes to your finances. 

Get a free quote today.