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The High Cost of a Dental Education


Dental professionals face many challenges in repaying student loans, but there are strategies and programs available to help.

The High Cost of a Dental Education


Congratulations, you’ve graduated from dental school! You’re ready to practice, ready to provide exemplary patient care, and ready to make some money doing it. But looming over all of this ambition is an ugly specter: The hundreds of thousands of dollars in student loans you’ve accrued to achieve these dreams. Suddenly, all of that excitement is overwhelmed by anxiety about debt—anxiety that may continue well beyond the first months or years after graduation.

“Many prospective dental students have simply never had to assume the level of debt they may have to assume in order to pay for dental school, and some may come from families where borrowing is not a common practice,” says Paul Garrard, American Dental Education Association (ADEA) senior financial aid consultant. “These perspectives can be daunting.”

And who can blame dentists for being overwhelmed, when many have accrued $250,000 to half a million dollars in debt?

“It seems overwhelming in the beginning, because new dentists don’t know what to do; even if they get a job as an associate earning $150,000 when they get out of school, after taxes, after living expenses, how much will they have left over to pay down the loan,” says Bruce Bryen, CPA, CVA, a dental practice valuation analyst at Baratz & Associates, P.A. “It’s not like being a social worker or an accountant or any other profession; they aren’t going to have that kind of dept when they get out of school. Dentists will.”

Managing any debt, especially such a significant amount, can be intimidating, and there are a lot of areas where things could go wrong. Properly navigating these pitfalls can make repaying student loans a much more streamlined—and less painful—experience.

Early Challenges

The challenges of dental-school loans begin before future dentists ever even leave school. Garrard says the following are major issues that can plague borrowers:

  • Borrowers are often not familiar with the details of the loans in their student loan portfolio (such as interest rates and repayment options), even though the majority of borrowing is directly from the government. Additionally, interest rates change each year on new loans (even though the actual source of most borrowing—again, the federal government—has remained the same for years)
  • Dental student loans are unsubsidized, meaning interest accrues or builds up during school
  • Students often do not know who their loan servicer (the third party under contract with their lender to work with them in repayment) is. Additionally, these servicers could change during the time the student is in school
  • There is endless misinformation or incomplete information about student loans and repayment on the internet, social media, and other sources who purport to know the student-lending landscape. Plus, much of this information isn’t applicable to dental student loans

“All of this can lead to challenges in understanding the basic terms and conditions of their student loan portfolio and their repayment options after graduation,” Garrard explains. “We advocate that understanding your student loan portfolio is the first step in responsible borrowing and responsible repayment.”

A lack of understanding is a big roadblock for many dental students and recent graduates, as many go into debt without a plan for the future. Many graduates are dealing with decision making around which loan repayments plans to use, while also trying to decide where to work, along with other stressors around entering the workforce. On top of this stress most student loan exit counseling is done online, often through boilerplate programs geared more towards undergraduates than graduate or professional students. This leaves many students floundering, and in need of more assistance.

Because of this, Garrard says, “It is so important for prospective, current, and graduating dental students to look to their financial aid office for guidance and to use the multiple resources available and designed specifically for them that are available online from ADEA.”

This lack of assistance hasn’t gone unnoticed by professionals in the industry, either. “In dental schools, there needs to be an increase in education in the areas of interest rates, credit scores, and repaying debt,” says Kevin Walker, DDS, founder of Dental Debt Solutions, a student debt refinance platform. Dr Walker, a dentist himself, founded his company after seeing the need to help fellow dentists. “This is a small field, and there are many colleagues that are willing to help guide along the way. We simply want to help dentists as much as possible at the beginning of their careers, as we were once in their position as well.”

Planning Ahead

Knowing that you’re going to exit school with exorbitant loans means that dentists should begin planning early for future success in their careers that can offset the cost of their dental education.

“Since dental students graduate with the highest amount of debt of any graduate school, naturally the debt-to-income ratio will be higher versus any other graduate profession,” Dr Walker says. “Dentists, especially specialists, can graduate after residency with over half a million dollars of debt. In order to get the monthly debt payment lower, dentists are likely to make the refinance payment terms 15-20 years. This also increases the interest rates.”

So, how can dentists get ahead? It all starts with making early responsible decisions, such as not taking out loans when you don’t have to.

“When in dental school, it’s easy to take more loans than you need,” Dr Walker says. “This can amount to over an extra $100,000 if you choose to live lavishly while in school.”

This lavish living can have big effects down the road, particularly when it comes time to take out a different sort of loan. While accruing even more debt may seem counterproductive, Bryen says it can really pay off.

“Associates start to see what the dentist is earning, and they think maybe I can pay this off, but I've got to buy practice to do it,” Bryen says. “That way, instead of earning $150,000, I'm going to earn $350,000, and I'm going to be able to pay this loan off much quicker.”

Purchasing a practice can be a great way to pay down loans more rapidly, since the dentist will be making more money and have more disposable income to put towards the loans. To buy a practice though, you’re facing another lender—a lender that wants to see good credit. Even though a dentist exits school with significant debt, lenders with experience lending to dentists expect that, and it won’t really bother them as long as the credit rating is good. They know that bankruptcy filings by dentists are rare and it’s unlikely that the dentist is going to go broke, making this one of the safest loans a lender has. However, it will only be appealing to the lender if the dentist has made wise financial decisions elsewhere.

“You need to have good credit to buy a practice,” Bryen says. “Even though you’re borrowing all this money for school, what you can’t do is accumulate a lot of credit-card debt. Maybe you think it’s necessary while you’re at school, but from a lending standpoint, it’s going to hurt their chances to get the big loan they can use to buy the dental practice.”

Essentially, Bryen says, the most important thing is to be very careful about borrowing excessively on a credit card that might show a lender a pattern of nonpayment or excessive borrowing. “The lender wants to see a good, clean credit rating,” he reemphasizes. “It almost doesn’t matter how high the dental school loans are; that’s accepted. But anything else is really going to hurt them. You’ve got to stay away from accumulating other kinds of debt other than school loans.”

It may take associates 2 to 3 years to learn what they need to become an owner of a practice (such as the skills they’ll require in the industry, learning from the dentist that hired them, talking to their peers, etc.) but while they may be struggling with student loans during their period, there will be an end in sight. “Plus,” Bryen says, “for 2 or 3 years as an associate you may be struggling, but you’re going to be struggling making over $100,000 a year, so that’s not so bad.”

For dentists that aren’t interested in being business owners, joining a dental service organization (DSO) can also be a lucrative decision. Working at a DSO lets new dentists be dentists instead of dentists/administrators/accountants, allowing them to concentrate on helping patients and learning clinical skills that could ultimately earn them more money down the road.

“Use that knowledge to keep earning more and more money, that you can use to pay down loans,” Bryen says. “The tradeoff of not having the administrative headaches of an owner is double the money, because you won’t make as much as a practice owner. But working as an associate is not a bad living or comfort level. And you may not be able to pay down the loan as fast as you could, but you’re going to able to focus on dentistry.”


Whether or not a dentist has big plans to boost income by buying a practice, choosing an ideal repayment plan can make a big difference in how easy it is to pay down a loan.

“One of the main things graduates need to remember is that between time-driven repayment plans (where the loan servicer simply spreads out their balance evenly over 10 or 25 years) or income-driven repayment plans (where the calculated payment is based solely on income and family size and not debt level), they should be able to secure a repayment plan with a minimum required payment they can comfortably manage,” Garrard recommends. “This puts them in a position to either be aggressive in repayment by paying more than the required amount or simply making the minimum payment.”

Many students go the aggressive route, to try to chip away at debt as soon as possible. Recent ADEA Senior Surveys found that the most common initial repayment strategy for graduates is to be aggressive in repayment. Student interest in repayment plans to help manage cash flow by minimizing payments was also high. The surveys found that a smaller percentage of students were interested in loan repayment assistance programs, such as service commitment programs and public service loan forgiveness.

Whichever route you go, keeping abreast of market trends during repayment is always a good idea.

“A big repayment mistake is not refinancing multiple times as interest rates go down from time to time,” Dr Walker says. “Interest rates typically go in cycles and it is extremely important to take advantage of those times when interest rates are lower. If you have all of your paperwork organized, you would be able to complete a refinance application within 1 hour. This can save you thousands of dollars over the life of your loan.”

Dr Walker recommends refinancing whenever you can find a lower interest rate for your loans, particularly because the large amount of debt accrued from dental school generally cannot be paid off quickly. He likens it to a mortgage; when interest rates get lower, many people refinance to lower monthly payments since it can take up to 30 years to repay the loan.

Navigating this refinancing landscape may seem challenging, but there are resources out there to help dentists find the best interest rates and most ideal repayment plans. Dr Walker’s Dental Debt Solutions works with various companies to connect dentists with the best refinance partner. By simply clicking on links on the website, borrowers are redirected to partners to get quotes and apply for loan refinance and lower interest rates—with the added perk of being eligible for promotions and cashback bonuses.

“When it comes to finding the lowest interest rate, our company partners with all of the refinance companies that will service the high dental school debt loan refinance,” Dr Walker says. “Our website allows you to find the best options to refinance your dental school debt in one place.”

The ADEA also has resources that can help students and recent graduates. The AAMC/ADEA Dental Loan Organizer and Calculator (AAMC/ADEA DLOC) is the only repayment calculator designed specifically for dental students, and can help support borrowers make good choices about future borrowing.

“Borrowers can use the calculator while in school to anticipate different repayment scenarios upon graduation, and can house all their student loans (undergraduate and graduate, federal, campus-based, and private) on the calculator,” Garrard explains. “Federal loans can be uploaded directly into the Organizer section of DLOC each time they borrow.”

The calculator is also unique in that it customizes repayment information based on a dental student’s plans after dental school, whether the borrower chooses to go directly into practice or pursues advanced dental education (either in an academic setting or a hospital-based residency). Whether you are a recent graduate, in residency, or further along in your career, it never hurts to stop and assess repayment plans and refinancing, as there are many options available to help.

“There are amazing companies that even allow you to refinance your debt while in specialty residency (orthodontics, endodontist, periodontist, oral surgery, pediatric dentistry, etc.),” Dr Walker says. “Since loans are typically deferred and not being paid back until you graduate, this allows us to refinance to a lower interest rate for the multiple years you might be in residency, which ultimately saves you a lot of money over the life of your loan.”

Saving money on the loan also allows dentists to think about saving money for the future. While overcoming the amount of debt may leave dentists thinking they don’t have money left for anything else, it’s important for dentists to think about retirement planning, even at the beginning of their career.

“Thinking about retirement planning early takes somebody who really has vision,” Bryen says. “But it’s the kind of thing they should want to do, and it’s really not that hard to do. If they don’t start now, they’re going to be years behind. The amount you can put in can be minimal so that it won’t change your standard of living. While you’re still focused on managing the debt, you could start with a Roth IRA; it's the kind of thing that if you put away a couple thousand dollars per year, when you divide a couple thousand by 12 months, it's not that much per month. It's not that much per week. The younger person should also definitely take advantage of any retirement plans offered by a dental practice they join, because it basically doesn't really cost that much to do that, and you’re helping yourself down the road.”

The Bottom Line

While dental student-loan debt is a large burden to shoulder, in the end, the experts say the education is worth the investment.

“While students should consider the potential opportunity cost (lost income) associated with 4 years of dental school, they should also consider the strong return on investment that still is characteristic of dental school graduates who have to borrow,” Garrard says.

Ultimately, debt should not discourage anyone from pursuing dentistry as a career.

“There will always be a need for dentists and you will likely always have a job even if you do not want to be a business owner,” Dr Walker says. “This job will pay very well. If dentistry is your dream, go for it! I would not discourage anyone that is considering dental, despite the amount of debt they graduate with.”

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