Student Loan Repayment Guide for Medical Students (And New Residents)
Last Updated: November 11, 2025
Walk into residency knowing exactly what to do with your student loans, not guessing.
If you’re a 4th-year medical student (MS4) or about to begin residency, you’re in a short window where a few key decisions can save you thousands of dollars over the next decade.
This page will guide you through student loan repayment for medical students in plain English and give you the tools you need to take action with confidence.
👇 Start Here: Use The MS4 To Residency Student Loan Calculator
Before you get lost in the details, start with a quick walkthrough of your own repayment timeline.
Hey MS4s, ready to start residency with a plan?
Your student loans are about to switch from "in school" mode to "real world" mode.
This tool will show you what to expect and how to keep your payments as low as possible during residency.In just a few minutes, you will learn:
- When payments will start and how they are calculated
- Which repayment plans make the most sense for new residents
- How to lock in the lowest payment possible (often $0 during PGY1)
- How to start the PSLF clock early if you are going for forgiveness
Not pursuing PSLF? You will still see what your federal payments might look like once repayment begins so you can plan ahead confidently.
Ready to walk into residency with clarity instead of anxiety?
Before We Begin
A quick heads up.
This tool is for educational purposes only. It is here to help you understand how your student loans move from medical school to residency and how early steps like filing taxes or consolidating could lower your payments or start your PSLF clock sooner.
Think of this as a loan planning simulator, not personalized financial advice.
This tool will help you:
- Estimate payments for New IBR, Old IBR, PAYE, and RAP
- See how payments can change based on income and family size
- Understand how early moves may increase savings or forgiveness
This tool will not:
- Capture every detail of your tax or loan situation
- Replace guidance from your servicer, a tax professional, or a financial planner
This tool works best for users who are single.
If you are married, getting married this year, or thinking about filing taxes separately to lower payments, you may have opportunities to lower payments or increase forgiveness. These situations can be more complex, and a little guidance goes a long way.
You can learn more about strategies for married couples here: Student loans for married couples
Looking for personalized help? Click here to learn more
Before We Begin: A Quick Note About PSLF
Public Service Loan Forgiveness (PSLF) is a benefit for physicians and many other professionals who work full time at nonprofit or government hospitals (employers). If you make 120 qualifying monthly payments, your remaining federal student loan balance is forgiven tax free.
This means it does not matter how much interest builds up or how large the balance is later. Once you reach 120 qualifying payments, whatever is left is forgiven.
During residency and fellowship, your income is usually lower. This is one of the best times to keep payments as low as possible so that more of the balance is forgiven later.
For example:
- Paying $150,000 over ten years and having $200,000 forgiven is one outcome.
- Paying $100,000 over ten years and having $250,000 forgiven is a better outcome.
The difference is real money.
Most people do not realize that some of the most important PSLF decisions happen before your first payment is ever due. These choices typically happen in your final year of medical school or in the first months of PGY1.
That is why this stage matters. The steps you take now can either set up lower payments and larger forgiveness or make repayment more expensive than it needs to be.
Let’s walk through it together.
- Want the PSLF basics? Click here to learn more
Tell Us About Your Loans
We will show what happens if you ignore your loans during the grace period. Using your loan balance and interest rate, we will estimate your monthly payment if you take no action after graduation.
- If you are unsure of your loan balance or interest rate, you can look them up on the Federal Student Aid website.
Tell Us About Your Income and Training Path
We know your future income and training plans may still be taking shape. This does not have to be perfect. The goal is to help you see what is possible. If you are unsure, enter what you are expecting or hoping for. You can always adjust it later.
This section estimates payments under an Income-Driven Repayment (IDR) plan using your income, family size, and training path.
The table updates automatically.
What Happens When You Consolidate Your Loans
When you graduate, you do not have just one student loan. You have many. Each semester you borrowed was its own loan.
Student Loan Consolidation combines all your federal loans into one new loan. Instead of having many loans to manage, you’ll have just one moving forward.
Consolidation also keeps your loans in the federal system. That means you still have access to:
- Income-Driven Repayment (IDR) plans
- Public Service Loan Forgiveness (PSLF)
- Federal protections and benefits
- Deferment and forbearance options if needed
Consolidation is not refinancing. Refinancing moves your loans to a private company, which removes federal benefits permanently.
If you plan to pursue PSLF, you must keep your loans federal to stay eligible.
Why MS4s Should File a Tax Return (Even When Income Is $0)
Your monthly payment is based on the income shown on your most recent tax return. So the year you file matters.
Each year, you file a tax return to report the previous year’s income. During your final year of medical school, you’ll file a return for January 1, 2025 through December 31, 2025 by April 15, 2026 (while you’re still in medical school).
You might be thinking, “I didn’t earn anything in 2025. Why would I bother filing a tax return?”
When you enroll in an Income-Driven Repayment (IDR) plan, your monthly payment is based on your income and family size. If your 2025 tax return shows $0 income, your first year of payments could be $0 per month.
If you don’t have a tax return on file, your servicer will use what’s called alternative documentation of income, such as a pay stub or employment contract, which likely will mean higher payments (like we saw in Step 6).
Filing your 2025 tax return by April 2026 helps ensure your first year of repayment starts with the lowest possible student loan payment.
Why a Tax Extension Might Be Your Secret Weapon
Once you’re on an Income-Driven Repayment (IDR) plan, your payment resets every year on your IDR Anniversary Date. That’s when your loan servicer reviews your income and family size to calculate your next 12 months of payments.
If you start repayment in July 2026, your IDR Anniversary Date will be July 2027. By then, you’ll have earned about half of your first-year residency salary.
Here’s how the timing works:
- Your 2025 tax return reports income earned from January 1, 2025 through December 31, 2025, your final year of medical school.
- Your 2026 tax return reports income earned from January 1, 2026 through December 31, 2026, which includes about half of your first-year residency salary.
If you file your 2026 tax return in April 2027, that new income will be on file, and your payment will likely increase that July.
Here’s where a tax extension can help.
Filing a tax extension lets you wait to submit your 2026 return until October 15 instead of April 15. You still pay any taxes owed by April, but you delay filing the return itself.
Because your loan servicer uses your most recent tax return on file, delaying your 2026 filing means your 2025 tax return will still be used for your July 2027 IDR update. That return likely shows little to no income from medical school.
That could keep your payment very low or even $0 for one more year.
Simple takeaway: You’re not avoiding taxes or changing your income. You’re simply controlling the timing. A tax extension can help keep your IDR payment low for an extra year while you continue residency and work toward Public Service Loan Forgiveness (PSLF).
This is an advanced tax planning move. It’s a good idea to work with a tax professional or financial planner who understands how student loans fit into your overall plan.
Your Payment Story
The goal right now is to keep your student loan payments manageable while your income is low. Income-Driven Repayment (IDR) bases your payment on what you earn, not what you owe. When your income is low, your payment can be low too. Sometimes even $0. That breathing room matters early in residency.
If you take no action
Once your loans enter repayment, they automatically move into the 10-Year Standard Repayment plan. Payments are based on your total loan balance and interest rate.
Your monthly payment would be $0 per month.
For most residents, that number simply does not fit into the budget.
If you choose an Income-Driven Repayment (IDR) plan
Your payment is based on your income and family size instead of your loan balance. Most of the time, your income comes from your latest tax return. If you do not have one yet, you can use a paystub or contract to document your income.
Based on an annual residency salary of $0 and enrolling in New IBR, your first monthly payment would be about $0 per month.
Compared to the Standard payment of $0 per month, you would save about $0 per month, which adds up to roughly $0 in your first year of repayment.
That one decision creates much needed breathing room in your budget.
If you file a 2025 tax return
Based on your 2025 income of $0, your first income driven payment would be $0 per month.
That means you would save about $0 per month, which adds up to $0 saved over the first 12 months, compared to what your payment would have been if you did not file a tax return.
Filing the 2025 return allows your payment to be based on your lower income from medical school rather than your residency salary. It is a small step that locks in a big advantage for your first year of repayment.
If you use a 2026 tax extension
When it is time to recertify your income for the next year on your IDR anniversary, filing a tax extension lets you delay updating your income.
By doing this, you keep your existing monthly payment of $0 per month for 12 additional months, even as your residency income increases.
This simple move extends your lowest payment into a second year.
The bottom line
Each step is simple on its own, but the real power comes from understanding how they all fit together.
Once you understand how your student loan payment works, you can start building a longer-term strategy to actually crush your loans, not just survive them.
You do not have to figure it all out alone. Getting a little help now can save you years of frustration and thousands of dollars later.
This is your chance to move into residency with clarity, confidence, and a plan that supports the bigger life you are working toward.
How Dream Bigger Financial Can Help
You’ve got this! Early in your career there’s a lot happening at once, and student loans can feel like one more thing to juggle. The decisions you make now can be the difference between a low or even $0 payment during intern year and paying tens of thousands more over time. A bit of guidance can help you set things up the right way from the start. If you’d like support, here are two options.
Student Loan Strategy Session
We’ll choose a repayment plan that fits your income and goals so this stops feeling overwhelming.
- Review your current loans and monthly payment options
- Talk through which repayment plan is the best fit for you
- See if tax-free forgiveness through PSLF is available for your path
- Leave with a clear game plan and exact next steps
Concierge PSLF Support
Ongoing student loan and tax planning support to keep you on track toward forgiveness.
- One yearly meeting to confirm your plan and make updates
- Help with forms, payment changes, and employment certification
- A simple action plan each year so you always know what to do next
- Email access all year when questions come up
PSLF basics and qualifying employers
Qualifying employers
- Government organizations
- 501(c)(3) nonprofits
- Some non 501(c)(3) nonprofits that provide qualifying public services
Most for profit employers do not qualify.
Where to check
Before repayment begins your loans move through three stages
1) In School Status
- While you are enrolled at least half time your loans remain in In School status.
- No payments are required.
- Interest accrues on unsubsidized loans.
2) Grace Period
- After graduation loans enter a six month grace period.
- Payments are not due yet but interest keeps building.
- This is your window to consider consolidating and enrolling in an Income-Driven Repayment (IDR) plan.
3) Repayment
- Once grace ends repayment begins.
- If you take no action you are placed on the 10 Year Standard plan.
- Payments on a qualifying Income-Driven Repayment (IDR) plan count toward PSLF.
Income-Driven Repayment (IDR) plans
- Payments are based on income and family size.
- Lower income usually means lower payments.
- Larger family size can reduce payments.
- Most IDR plans do not use loan balance or rate to set the payment.
- Payments can be $0 if income is low enough.
Adjusted Gross Income
AGI is your total income minus certain deductions (Form 1040 line 11). It is the income used for IDR payments.
Loan consolidation in plain English
- Combines federal loans into one Direct Consolidation Loan.
- Keeps access to IDR and PSLF.
- Starting in July instead of December adds five qualifying payments during training.
Calculations are believed to be correct. If you notice anything that doesn’t look right, please send an email to michael@dreambiggerfinancial.com.
The Three Deadlines That Can Save You Thousands
You do not need to memorize every student loan rule to win. You do need to hit three key milestones on time.
Think of this as your MS4 student loan checklist.
Step 1: File Your Tax Return For Last Year
Goal: Lock in the lowest possible income driven payment for your first year of residency.
Your Income-Driven Repayment (IDR) plan is based on your most recent tax return or your current income. If last year’s income was very low or zero, you want your servicer to see that on paper.
Why it matters
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A tax return that shows little or no income can qualify you for very low or even zero dollar monthly payments as an intern
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Without a tax return, your servicer may use your residency paycheck instead, which usually means a higher payment in year one
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What to do
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File a federal tax return for the prior calendar year, even if you think you earned nothing
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Keep a copy of the return handy so you can upload it when you apply for an income driven plan
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Soft deadline: April 15 of your MS4 year
Step 2: Complete Federal Student Loan Exit Counseling
Goal: Unlock the ability to consolidate and choose a repayment plan.
You are required to complete exit counseling before you move into repayment. It is not thrilling, but it is necessary.
Why it matters
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You cannot consolidate or pick an Income-Driven Repayment (IDR) plan until exit counseling is complete
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It is a good chance to confirm your servicer, update your contact information, and avoid missing important emails
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What to do
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Log in to the Federal Student Aid website
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Complete exit counseling shortly after you graduate
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Make sure your email, phone, and mailing address are current
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Soft deadline: June 1, ideally shortly after you graduate medical school
Step 3: Consolidate And Enroll In An Income-Driven Repayment (IDR) Plan
Goal: Start your Public Service Loan Forgiveness (PSLF) clock as early as possible and lock in those low payments.
Most MS4s finish school with a handful of separate federal loans. Consolidation lets you turn them into one new Direct Consolidation Loan and choose your repayment plan at the same time.
Why it matters
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Consolidation is often the fastest way to get into the right Income-Driven Repayment (IDR) plan
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Your count toward the 120 qualifying payments for Public Service Loan Forgiveness (PSLF) does not start until you are in a qualifying plan
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Every extra month that counts while you are an intern is one less month you pay as an attending
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What to do
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After exit counseling is complete and your loans show as “In Grace Period” status, submit a Direct Consolidation application through the Federal Student Aid website
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Choose an Income-Driven Repayment (IDR) plan such as RAP, New IBR, PAYE, or Old IBR, depending on your eligibility
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When you are asked about processing delays, choose the option “do not delay processing” so your repayment start date is not pushed back
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Soft deadline: June 1, shortly after you complete your student loan exit interview
Getting these three steps right is the core of your strategy. Everything else is details.
Common MS4 Student Loan Questions (Answered Simply)
Common MS4 Student Loan Questions (Answered Simply)
Once you understand the deadlines, the next question is usually…
“Okay but what about my situation?”
Here are the most common questions MS4s ask about student loan repayment for medical students as they get ready for residency.
Skim through the ones that apply to you.
Can I Really Get A Zero Dollar Payment As An Intern?
Often, yes.
If your last tax return shows very low or zero income and you enroll in an Income-Driven Repayment (IDR) plan, your required payment can be zero for that first year of residency, depending on your plan and family size.
The key is that your servicer uses your tax return, not your residency paycheck. That is why filing that low income return before you enroll is so important.
Even if your payment is zero, those months can still count toward Public Service Loan Forgiveness (PSLF) as long as you meet the other requirements.
You can get a quick sense of your potential payment using our Income-Driven Repayment (IDR) Calculator.
What Happens If I Do Nothing During My Grace Period?
If you graduate, ignore your loans, and wait for the six month grace period to end, your servicer will usually move you into the 10-Year Standard Repayment plan.
That means:
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A payment based on your loan balance and interest rate, not your income
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A monthly amount that can easily land in the two thousand to three thousand dollar range for many new physicians
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The good news is that this is avoidable.
File your taxes, complete exit counseling, and enroll in an Income-Driven Repayment (IDR) plan before the end of your grace period so you are not surprised by a huge bill.
Is Consolidation Required To Get PSLF?
Not always, but it is often the cleanest path.
You must have Direct Loans to qualify for Public Service Loan Forgiveness (PSLF). Some older federal loans are not Direct. Consolidation lets you roll those into a new Direct Consolidation Loan that can qualify.
Consolidation can also:
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Simplify your life by turning many loans into one
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Let you choose your repayment plan on the application
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Help you start your PSLF clock sooner if you consolidate right after graduation
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There are a few situations where consolidation may not make sense, especially if you already have repayment history on older loans.
But for most MS4s entering residency with only medical school loans or without a gap between undergrad and medical school, consolidating shortly after graduation is often the right move.
Which Income-Driven Repayment (IDR) Plan Should I Choose As A New Physician?
The right plan for you depends on:
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When your loans were first taken out
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Your expected income path
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Whether you are married and how you file taxes
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Whether you plan to pursue Public Service Loan Forgiveness (PSLF) or pay the loans off yourself
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For many early career physicians who are PSLF bound, the priority list usually looks something like:
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New Income-Based Repayment (IBR) when eligible
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Pay As You Earn (PAYE) when eligible
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Old Income-Based Repayment (IBR) when that is the best remaining option
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Repayment Assistance Plan (RAP) is also available and has its own rules for how it treats income and dependents.
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If your situation is complex, especially if you are married, it can be worth talking with a student loan specialist or tax professional before you lock in your choice.
Which Income-Driven Repayment (IDR) Plan Am I Eligible For?
Not sure which repayment plans you qualify for?
You’re not alone. The rules can feel confusing, and eligibility isn’t always clear.
Answer a few quick questions and this tool will narrow down which Income-Driven Repayment plans you may qualify for so you know what’s available to you.
Ready?
Should I Refinance My Federal Loans Before Or During Residency?
In most cases… no!
Refinancing turns federal loans into private loans. When you do that, you permanently give up:
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Public Service Loan Forgiveness (PSLF)
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Income-Driven Repayment (IDR) plans
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Built in protections like federal forbearance and deferment
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Most residents are better off keeping federal loans federal, using an Income-Driven Repayment (IDR) plan, and preserving PSLF flexibility.
Refinancing can make sense later if you are certain you will not use PSLF and truly plan to pay the loans off yourself on a faster schedule.
Does PSLF Actually Work For Residents And Fellows?
Yes!
As long as you meet the rules.
You can earn Public Service Loan Forgiveness (PSLF) credit during residency and fellowship when:
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You work full time for a qualifying nonprofit or government employer
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You have Direct Loans
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You are in a qualifying repayment plan such as Income-Based Repayment (IBR), Pay As You Earn (PAYE), or Repayment Assistance Plan (RAP)
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You make a required payment each month, even if that payment is zero under your plan
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The earlier you start, the more of those 120 required payments you can complete while your income is still relatively low.
What If I Am Married Or Have Income From The Prior Year?
Marriage and prior year income add a layer of strategy, not a reason to give up.
If you are married or had meaningful income last year, your plan choice and tax filing status can change your payments quite a bit.
In general:
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Filing a tax return is still important. You want accurate numbers on file
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Your choice between married filing jointly (MFJ) and married filing separately (MFS) can change your payment under some plans
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Some plans can ignore your spouse’s income if you file separately. Others cannot
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You can get a feel for how this works using our Student Loans for Married Couples Calculator.
What If I Miss One Of These Deadlines?
Missing a step isn’t the end of the world, but it can come with consequences.
If you didn’t earn income last year, you aren’t required to file a tax return. It’s worth noting that the April 15 tax return date isn’t a true hard deadline in that situation. You can still file later and use that return as long as it’s processed before you apply for consolidation. The catch is timing… Filing late may create a lag while the IRS updates your record.
Here’s how delays can show up:
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- Filing your tax return late may cause your servicer to use your residency income instead of a low or zero-income year
- Skipping exit counseling delays consolidation and IDR enrollment
- Waiting to consolidate and enter an IDR plan can cost you PSLF credit and may lead to more high attending-level payments at the end of the journey
If you’re already behind, focus on what you can control now.
Get into a qualifying repayment plan, confirm your employer counts for PSLF, and avoid letting a small delay spiral into a much longer one.
Download The Full MS4 Student Loan Guide
If you want a deeper walkthrough with timelines, examples, and reminders, grab the free ebook that pairs with this page.
You will learn:
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- The full three deadline game plan in more detail
- How income, family size, and tax strategy all work together
- Scenario based examples that show how small decisions change your total cost over time
(By signing up, you gain access to the Dream Bigger: Physician Edition Newsletter! Quick, no-fluff financial tips designed for busy residents.)
🚨Important: Please use a personal email address to ensure you don’t miss out on timely deadlines and student loan updates, especially when you transition from med school.
Know someone who needs this? Send them here!
Want Help Double Checking Your Plan?
Most MS4s can get started on their own using the calculators and the guide on this page. If you would rather have someone walk you through the decisions or confirm you are doing things the right way, here is a simple way to decide.
If any of these sound like you, a one time review is probably enough:
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You feel mostly confident but want a second set of eyes
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You want help choosing the right repayment plan
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You just want to make sure you are not missing something
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If these sound more like you, ongoing support usually makes sense:
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You plan to pursue PSLF and want help each year
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You do not want to deal with annual forms, servicer changes, or payment recertification
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You want someone in your corner while you are busy being a doctor
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Choose the option that fits where you are right now.
No wrong choice here… Pick the path that fits you today. You can always upgrade later if you want more support.
Student Loan Strategy Session
We’ll choose a repayment plan that fits your income and goals so this stops feeling overwhelming.
- Review your current loans and monthly payment options
- Talk through which repayment plan is the best fit for you
- See if tax-free forgiveness through PSLF is available for your path
- Leave with a clear game plan and exact next steps
Concierge PSLF Support
Ongoing student loan and tax planning support to keep you on track toward forgiveness.
- One yearly meeting to confirm your plan and make updates
- Help with forms, payment changes, and employment certification
- A simple action plan each year so you always know what to do next
- Email access all year when questions come up
Disclosure: This content is for informational purposes only and does not constitute personalized financial, tax, or student loan advice. Student loan programs and repayment rules change frequently, and while I strive to keep this page up to date, I can’t guarantee accuracy at all times. Please consult your tax or financial professional for guidance specific to your situation.
Meet Your Team
👋 Hi, I'm Michael.
I help early-career physicians feel confident about money without the jargon, overwhelm, or sales pitches.
I work alongside two highly enthusiastic (but not exactly qualified) team members:
🐶 That's Max on the left, our Pawsome Intern
🐶 And Ryder on the right, our Chief Barketing Officer
Together, we’re here to make financial planning feel less intimidating... and maybe even a little fun.
Ready to Chat?
We're currently accepting new ongoing financial planning clients!
Ongoing means we meet regularly and help with all parts of your financial life.
Not ready to chat?
Follow me on social for quick tips on loans, taxes, saving, and more.
Michael Putterman, CFP®
☁ Virtually serving clients nationwide ☁
Meet Your Team
I help early-career physicians feel confident about money without jargon, overwhelm, or sales pitches.
I work alongside two highly enthusiastic (but not exactly qualified) team members:
🐶 Max — Pawsome Intern
🐶 Ryder — Chief Barketing Officer
Together, we’re here to make financial planning feel less intimidating, and maybe even a little fun.
Ready to Chat?
We're currently accepting new ongoing financial planning clients!
Ongoing means we meet regularly and help with all parts of your financial life.
Not ready to chat?
Follow me on social for quick tips on loans, taxes, saving, and more.
☁ Virtually serving clients nationwide ☁