Becoming a physical therapist is a fulfilling profession that helps people improve their health and well-being. However, it also comes with a hefty price tag.
Most physical therapy graduates have to deal with large amounts of student loan debt, which can affect their financial security and life goals. But don’t despair.
You can overcome this obstacle and achieve your dreams. In this guide, you will learn how to handle your student loans smartly and efficiently. You will discover various options and tips to reduce your debt, save money, and plan for the future.
By following this guide, you will be able to take control of your finances and enjoy the benefits of your physical therapy career.
Exploring Forgiveness: Federal Programs as Solutions
If you work in public service or certain professions, you may qualify for loan forgiveness through various federal programs. These programs can help you reduce or eliminate your student debt, depending on your eligibility and commitment.
Public Service Loan Forgiveness (PSLF)
This program rewards those who dedicate 10 years of their career to public service. You need to make 120 qualifying payments on your loans while working for an eligible employer.
You also need to enroll in an income-driven repayment plan and verify your employment every year. After meeting these requirements, your remaining loan balance will be forgiven tax-free.
Income-Driven Repayment (IDR) Plans
These plans adjust your monthly loan payments according to your income and family size. You can choose from four different plans: PAYE, REPAYE, IBR, and ICR.
Each plan has its eligibility criteria, repayment period, and forgiveness terms. Generally, you can expect to pay 10-20% of your discretionary income for 10-25 years, and then have the forgiven amount taxed as income.
You may also be eligible for some lesser-known programs that offer loan forgiveness for specific occupations or situations. For example, if you are a special education teacher, you can apply for Perkins Loan Cancellation, which can forgive up to 100% of your Perkins loans.
If you are a healthcare professional working for the Department of Veterans Affairs, you can benefit from the Education Debt Reduction Program (EDRP), which can provide up to $200,000 in forgiveness over five years.
State-Specific Support: Leveraging Local Programs
In addition to the federal programs, you can also take advantage of the state-level programs that offer loan repayment assistance for healthcare professionals. These programs are designed to encourage you to work in areas that have a shortage of health services and providers.
State Loan Repayment Programs (SLRP)
These programs can help you pay off your loans by serving in a Health Professional Shortage Area (HPSA) for at least two years. You can receive up to $50,000 per year, depending on the state and the type of service.
Some states may require you to match the funds or have a specific license or degree.
Faculty Loan Repayment Program
If you are interested in teaching at a health professional school, this program can provide you with up to $40,000 for a two-year commitment. You can also receive mentoring and guidance from experienced faculty members.
Some states have similar programs for specific fields, such as New Mexico’s Allied Health Loan For Service and Iowa’s Health Professional Recruitment. These programs can forgive a portion of your loans for each year of service as a faculty member.