Physician's Guide to Public Service Loan Forgiveness (PSLF)
By Scott Snider
Most of my physician clients prefer it when I get right to the point. Quite frankly, they don't care for all the fluff and expect a short, concise explanation. After all, they are busy people so time is of the essence. With that in mind, I created a 5-page powerpoint style guide that explains how Public Service Loan Forgiveness (PSLF) works, outlined the 5 step process so that your loans qualify for Federal debt cancelation, and what to avoid so you aren't hit with any unpleasant surprises. As a bonus, I added a slide that points you to other helpful resources.
In the event you need additional help putting it all together, don't hesitate to contact me (Scott) with your questions and I will respond to your inquiry within 24-48 hours.
Public Service Loan Forgiveness (PSLF)
The tax-free forgiveness is huge. Otherwise, private sector physicians who get debt forgiveness are looking at a ticking "tax bomb" that could cost them anywhere between $25,000 - $100,000.
How to leverage PSLF as a Physician
It is especially important to evaluate your debt savings vs. compensation offers before you become an attending and agree to sign the dotted line. Doing so gives you negotiating power and either maximizes your gross income and bonuses or reduces your overall debt burden.
5 Steps to Qualify for PSLF
There are no shortcuts. Every step must be followed as you see it spelled out above. Skipping steps could disqualify your loans from PSLF or set you back many months or years until the debt is written-off.
PSLF Pitfalls to Avoid
The worst offenders are not consolidating FFEL loans and repaying loans under the Extended and Graduated plans. Not too far behind is failing to change the loan status to repayment. Any payments made while the loan is classified under a forbearance or grace status do not qualify.
Resources & Calculators
My favorite calculator for projecting the total cost is the VIN SImulator. Heather Jarvis is a great resource for the DIY types. AAMC has an extensive PDF guide that you can download.
IMPORTANT DISCLOSURE INFORMATION
Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Paragon Wealth Strategies, LLC [“Paragon”]), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from Paragon. Please remember that if you are a Paragon client, it remains your responsibility to advise Paragon, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Paragon is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the Paragon’s current written disclosure Brochure discussing our advisory services and fees is available for review upon request or at www.wealthguards.com. Please Note: Paragon does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to Paragon’s web site or blog or incorporated herein, and takes no responsibility for any such content. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly. Please Also Note: IF you are a Paragon client, Please advise us if you have not been receiving account statements (at least quarterly) from the account custodian.