Graduate school can open doors to better job opportunities and higher salaries — but it often comes with a hefty price tag. According to a 2023 report from the National Center for Education Statistics, nearly half of graduate students borrow to fund their education, racking up an average debt of $77,300.
That kind of debt load can derail your financial goals fast. And managing it isn’t as straightforward as it is for undergrad loans. All graduate loans start accruing interest while you’re still in school, whether federal or private — and there are fewer repayment options available.
If your grad school loans feel like a financial ball and chain, here’s how to take back control with strategies from student loan professionals.
🎯 Step 1: Get Clear on Your Student Loan Situation
Before you make any moves, understand exactly what you owe. The type of loan you have determines what repayment or forgiveness options are on the table.
“Start by knowing your debt inside and out,” says Glenn Sanger-Hodgson, a certified financial planner in Tallahassee, Florida, who specializes in medical school debt.
Here’s how to get the full picture:
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Log in to StudentAid.gov to view balances, interest rates, loan types, and available federal repayment plans.
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Use the Loan Simulator tool on the site to compare monthly payment estimates.
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For private loans, dig into your loan documents or contact your lender directly.
Once you have the numbers, you can compare repayment strategies and tailor a plan that aligns with your career goals and financial future.
🤝 If Your Debt Is 2x Your Income, Explore Forgiveness
If your student loan balance is about double your annual income, you’re likely a strong candidate for loan forgiveness, either through:
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Public Service Loan Forgiveness (PSLF) — forgiveness after 10 years of qualifying payments in a public service job
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Income-Driven Repayment (IDR) forgiveness — forgiveness after 20 to 25 years of payments based on income
“Your goal needs to be paying as little as possible over the life of the loan,” says Sanger-Hodgson. “Anything extra you pay is money you might have gotten forgiven.”
Key strategies for maximizing forgiveness:
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Enroll in an IDR plan, such as Income-Based Repayment (IBR) — the only IDR plan guaranteed to stick around past 2028, due to recent policy changes.
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Minimize your monthly payment to maximize the amount that gets forgiven.
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Don’t pay extra unless your forgiveness strategy changes.
Pro Tip: Check out all available forgiveness programs — including career-specific ones for teachers, healthcare workers, and nonprofit employees.
🔥 If Your Debt Is Equal to or Less Than Your Income, Pay It Off Aggressively
If your student loan debt is roughly equal to or less than your income, you probably won’t benefit much from forgiveness. Why? Because your income-based payments could cover the full loan before you’d ever hit a forgiveness milestone.
In that case, consider going full throttle on repayment:
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Stick with the standard 10-year repayment plan (lowest total interest).
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Make extra payments — and request they go toward principal, not interest.
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Use the avalanche method: Pay off high-interest loans first.
🔁 Consider Refinancing — But Only If You’re Sure
Refinancing could help you get a lower interest rate and pay off loans faster. But it comes with a major caveat:
“If you refinance federal loans, you’re out of the federal system for good,” Sanger-Hodgson warns. “You lose access to forgiveness, income-driven plans, and other federal protections.”
Refinance only if:
✅ You’re confident you’ll pay off the loan in full
✅ You don’t need IDR or PSLF
✅ You qualify for a significantly lower interest rate
📢 Stay Ahead of Student Loan Policy Changes
Student loan rules are changing fast — especially for graduate borrowers. The recent federal budget reconciliation billhas already led to the phaseout of several IDR plans by 2028.
“There are tremendous changes on the horizon,” says Sanger-Hodgson. “You’ve got to stay informed if you want to make the best decisions.”
What you can do:
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Sign up for official updates at StudentAid.gov
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Follow CreditVana for plain-English breakdowns of policy changes
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Reevaluate your repayment plan whenever your income or goals shift
💡 Final Take: Choose the Strategy That Matches Your Future
The best way to repay grad school loans depends on your personal numbers:
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High debt-to-income? Aim for forgiveness.
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Lower debt load? Knock it out fast and save on interest.
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Not sure where to start? Run the numbers on each repayment path using the federal loan simulator or talk to a certified student loan planner.
🎓 Want more strategies for mastering student debt, boosting your credit, and building wealth?
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