Getting Ahead of Optometry Student Loans

In a 2024 survey of 308 optometry students, only 1.96% stated student debt was a main concern during optometry school, while 179 students reported that paying off their debt was the second most important goal (behind work-life balance yet before finding a job) post-graduation. The average student loan debt for 221 students surveyed was $165,322.¹

A survey of 339 optometrists in the same year rated their confidence in loan repayments to be 4.18/5 (on a scale of 1 to 5, with 5 being confident). The average student loan debt for 334 optometrists surveyed was $86,358.²

This tells us there is a steep, independent learning curve as we transition from student to professional, especially when managing student loans. But with the right knowledge and strategies, you can take control of your repayment journey and align it with your financial goals.

By exploring resources like this guide, you’re empowering yourself to make informed decisions and build a strong financial future!

Understanding types of student loans

Before you head into borrowing, it’s important to understand the types of loans available. When initiating a loan, you enter into a contract with your lender. Each loan may vary in terms of the loan amount available for borrowing, interest rate, repayment structures, and penalties for non-payment.

The majority of loans can be categorized below:

Federal^3,4
- Direct unsubsidized: Available for graduate students like those in optometry school.
- Grad PLUS: Federal loans for graduate students with higher borrowing limits, but based on credit history.
Private: Offered by banks or credit unions with potentially higher interest rates and less favorable terms than federal loans. Unlikely to have grace periods and qualify for forgiveness.⁴
School-specific loans/scholarships: Some optometry schools offer their own loans, scholarships, or fellowships. Check with your school’s financial aid office for options.
Parent PLUS: Parents can borrow for the student, and responsibility lies with the parent, not the student. Interest rates may be higher than direct loans.⁵

Though not specifically a type of loan, students should also be aware of state loan forgiveness programs, as some states offer forgiveness for working in underserved areas.⁶

Strategies for optometry student loan repayment

Several strategies exist for loan repayment. No single strategy will be the right fit across the board for every optometrist.

Additionally, your strategy may change at any point in time based on your life circumstances (i.e., saving for a wedding, expecting a child, engaging in a career change, etc.). There are several adjustments that can be made to federal student loan payments.⁷

Standard repayment

These offer fixed payments, which stay the same from month to month and never change over the duration of your loan. While it is a more aggressive form of repayment, borrowers generally will pay the least in interest on this repayment plan. Terms are up to 10 years on this plan.⁷

The benefits of standard repayment plans include:⁷

Fixed monthly payment: Responsibility for one payment that stays the same monthly makes budgeting easier.
Lowest interest paid: The amount of interest paid over the life of the loan will be the lowest on this plan.

The downsides of standard repayment plans include:⁷

High upfront cost: Generally has the highest monthly payment, which may be difficult in the first year to month if the borrower's salary is disproportionate to debt.

Graduated repayment

Graduated repayment plans take a step-wise approach to gradually increase payments as time goes on and earning potential grows. It maintains an aggressive option for repayment while offering lower initial payments.⁷

The benefits of graduated repayment plans include:⁷

Lower initial monthly payments: This makes it easier for those starting out with lower salaries to get comfortable with budgeting, while remaining ambitious.
Payments are never higher than 3x the amount of the first payment: Offering a capped amount of expected payments.

The downsides of graduated repayment plans include:⁷

Payment amounts increase every 2 years: This requires a close eye on budgeting.
Accumulating interest: The amount of interest paid over the life of the loan is higher compared to the standard repayment plan.

Extended fixed repayment

Though similar to the standard repayment plans, with extended fixed repayment plans, the term is extended to 25 years. This plan offers lower monthly payments that are also fixed monthly payments. This plan results in higher interest paid over the life of the loan compared to the standard or graduated repayment plan.⁷

Extended graduated repayment

Extended graduated repayment plans are similar to the graduated repayment plan, while offering a lower initial rate due to their ability to extend the life of the payments to a term of 25 years.

Payment amounts increase every 2 years (similar to the graduated repayment plan), and the amount of interest paid over the life of the loan is highest compared to any other term-based repayment plan.⁷

Income-driven repayment (IDR)

These plans adjust federal student loan payments based on income and family size, making them more affordable. These plans are primarily for times of hardship, including loan forgiveness as a long-term benefit. It is important to keep in mind that at the end of the term, you may be taxed on the amount of the loan forgiven.⁸

Several highlights of IDR plans are listed below:

SAVE Plan: 10% (dropping to 5%) of discretionary income; forgiveness after 20 to 25 years. No interest growth.
PAYE Plan: 10% of income; forgiveness after 20 years. Only available if it lowers payments.
IBR Plan: 10 to 15% of income; forgiveness after 20 to 25 years. Requires financial hardship.
ICR Plan: 20% of income; forgiveness after 25 years (often used for Parent PLUS loans).

Updates under the current administration:

As of Friday, February 21, 2025, two student loan forgiveness and repayment applications were removed from the Department of Education website.⁹

The online application portals for both the income-driven repayment form and the federal direct consolidation loan form are no longer accessible. These plans include ICR, IBR, PAYE, and SAVE.⁹

Public Service Loan Forgiveness (PSLF) for Optometrists

Individuals may qualify for PSLF if working in a nonprofit, VA hospital, or government setting, which forgives remaining federal loan balances after 10 years (i.e., 120 qualifying payments) under an IDR plan. Please consult your employer for qualifications/requirements prior to employment.¹⁰

The benefits of PSLF include:¹⁰

Lower monthly payments
Loan forgiveness after 20 to 25 years (or 10 with PSLF)
Adjust with financial changes

The downsides of PSLF include:¹⁰

Loan balance may grow due to interest
Longer repayment period
Forgiven balance may be taxed (except in instances of PSLF)

Loan repayment strategies: Avalanche, snowball, and more

Have private loans? No problem! Creative strategies like the avalanche, snowball, and hybrid methods can be utilized for both private and federal loans. These methods offer a personalized approach to repayment by focusing on where you dedicate extra income to tackle debt.

The benefits of these strategies can include repayment faster than the term amount while offering additional flexibility despite the terms of repayment. To further emphasize how these strategies differ, we’ll use the following student loans, principles, and interest rates outlined below:

Table 1: Example loans to aid in understanding different student loan repayment strategies.

Student Loan	Principle	Interest Rate
Student Loan A	$100,000	5.0%
Student Loan B	$40,000	6.2%
Student Loan C	$30,000	5.8%
Student Loan D	$20,000	5.2%

^{Table 1: Courtesy of Emilie Seitz, OD.}

Avalanche method (interest-based approach)

The “avalanche method” refers to tackling the loans with the most interest head-on. In this method, you’d make the minimum required payment on each loan, while contributing extra in the order of the highest interest. In our example, the order of loan repayment would be Loan B → Loan C → Loan D → Loan A.^11,12

The benefits of the avalanche method include:^11,12

Saves money: By tackling high-interest loans first, you pay less in interest over time.
Faster debt elimination: Less interest means more of your money goes toward reducing principal balances.
Mathematically optimal: Compared to other methods, this minimizes the total repayment cost.

The downsides of the avalanche method include:^11,12

Slower progress of repayment: Higher-interest loans may have larger balances; therefore, progress may feel artificially slow compared to other repayment strategies.
More strict, less emotionally engaging: While this method is financially efficient, progress can feel less emotionally motivating.

Snowball method (motivational approach)

The “snowball method” refers to tackling the loans with the smallest balances first. In this method, you’d make the minimum required payment on each loan, while contributing extra towards the loan that is most achievable by balance.

Once the smallest loan is paid off, the next target is the next smallest loan that exists, independent from interest. In our example, the order of loan repayment would be Loan D → Loan C → Loan B → Loan A.^11,12

The benefits of the snowball method include:^11,12

Focuses on small wins: Paying a whole loan provides a huge motivational boost early on.
Yields motivation and quick progress: Like a snowball rolling down the hill, this method yields momentum through engagement.

The downsides of the snowball method include:^11,12

May result in more interest over time: Smaller loans may or may not have the higher interest rates. Despite quick progress, it may result in paying more over time.

Hybrid approach (mixed snowball + avalanche)

Due to the nature and extent of most student loans, many students may find the opportunity to take a hybrid approach, which incorporates both methods mentioned above.

In this method, one would likely start with a snowball method to get some quick wins initially, then switch to an avalanche method later on to save on interest. In our example, the order of loan repayment may look like Loan D → Loan B → Loan C → Loan A.¹³

The benefits of a hybrid approach include:¹³

Best of both worlds: Provides a motivational boost early on while allowing you to save in the on-interest term (compared to 100% snowball).

The downsides of a hybrid approach include:¹³

Requires discipline: Smaller loans may or may not have the higher interest rates. Despite quick progress, it may result in paying more over time.
Will pay more in interest: In comparison to the 100% avalanche method, more interest would be paid over time.

5 ways to get ahead of loans while still in school

While it seems far away, there are small but serious steps you can take to get ahead of payments right now. These are the three things I wish I had known while in optometry school.

1. Consider your long-term goals and be flexible.

It’s important to consider what your long- and short-term goals are. I always remind myself that once a payment is made towards a loan, the money is gone. I know that statement is seemingly redundant, but to me, it serves as an important reminder that my repayment strategy should be in balance with my personal life goals.

You may have larger lifestyle goals in the near future, which include things like getting married/planning a wedding, purchasing a house, buying into a practice, and/or getting a new car, perhaps before your college 2005 Toyota Camry goes out on you.

If any of these situations apply to you, you may personally require MORE cash flow, and it may not be advantageous to plan an aggressive repayment system. On the flip side, if you can find ways to bring your cost of living down and would prefer to be financially free as soon as possible, an aggressive strategy may be advantageous.

Life and, thereby, financial circumstances are bound to ebb and flow. That’s why I’m keeping my long-term financial strategy flexible. I’ve considered several factors like refinancing, student loan forgiveness, and amortization schedules and how they may play a role in current and future repayment options.

It’s important to remember that long-term strategies may change, but keeping your mindset flexible and moving forward is the best action you can take today.

Need some help crunching numbers? Our Student Loan Calculator can help you find out which payment strategy may be best suited to your personality and plans!

2. Know thyself.

One of my biggest regrets from optometry school is not financially knowing myself. HOW I spend, WHEN I spend, and WHAT I spend money would have allowed me to be better prepared for this next chapter of repayment. Regardless of whether this is something you did or didn’t master then, budgeting is just as fruitful now.

Going through your bank account statements or using financial apps like Mint (a personal favorite) or EveryDollar will help you find spending trends to adjust for appropriate budgets. From there, you can work either backward or forward to readjust how much you can put toward tackling student loans.

Whether you plan to cut up credit cards, rule your purse strings with an iron fist of cash-only spending, or watch cautiously as a virtual budgeter, getting to know your habits as a consumer will allow you to feel a sense of control in the otherwise long marathon that can be student loan repayments.

3. Never borrow more than you need and return what you don’t use.

A widespread mistake borrowers make is borrowing the maximum amount allotted. From experience, I can say it's easy to end up with $200k+ in student loan debt. Budgeting as much as possible and cutting expenses while in school is a proactive way to avoid this.

Not a huge fan of budgeting or unsure what expenses will be? At the end of the semester, if you have $500, $2,000, or $5,000 leftover, subtract that amount from the next amount you borrow by returning that amount to the Office of Financial Aid. This tip will make a difference in the accrued interest, which is the biggest post-graduation hurdle.

4. Work part-time and make payments toward the accrued interest.

Federal unsubsidized and private loans accrue interest while you're in school. This means that right out the gate you have a hefty bill to pay before getting to pay down the principal. If no action is taken ahead of time, you’ll notice that most of your extra payments will go towards paying your past accrued interest, all while interest is accumulating in real-time.

It can leave you feeling like you’re swimming against the riptide—lots of effort yet going nowhere. Working part-time can help offset this initial cost and sail you ahead in your repayment journey.

5. Take advantage of student loan discounts.

An "auto debit federal discount" refers to a small interest rate reduction offered by the federal government on student loans when you sign up to have your monthly payments automatically deducted from your bank account (auto-debit).

On average, the federal government offers a 0.25% discount, which seems small but can save big on interest in the long run.

Resources for student loan repayment

Still looking for more? Check out these helpful social media resources to gain more insight:

Facebook Groups:
- ODs on Finance offers webinars and personalized evaluations of student debt and partnership discounts if considering consolidation
Instagram favorites:
- @JustYourAvgDoc for income transparency
- @MrsDowJones and @Your.RichBFF for financial inspiration
- @EyeSeitz (myself) for insight into my student loan repayment journey

In closing

At times, repayment can be a mental obstacle more than anything else, so creating a mantra can help reframe the process.

Now that I’m in active repayment and making financial decisions, I often remind myself of this: When in debt, the money I have today is worth more than the money I have tomorrow. When out of debt, the money I have tomorrow is worth more than I have today.

With this in mind, I know the actions I take today are being made for a brighter tomorrow. With the right mindset, information, and confidence, you can achieve the same!