Public Service Loan Forgiveness (PSLF) is a government program that forgives federal student loans after 10 years of qualifying work at a nonprofit or government organization. For this article, I’ll assume you’re at least somewhat familiar with the program (if not, you can read more about it here).

There are several factors to consider when evaluating a PSLF-eligible job. These roles are often in more remote locations, and the dentistry may not be as exciting as private practice. But let’s set aside lifestyle preferences and ask the core financial question: How valuable is Public Service Loan Forgiveness, economically speaking?

A Real-World Example

I recently worked with a new graduate who was offered a job at a public clinic in central California—one that qualified for PSLF. Let’s call him Dr. Holliday.

Base salary: $100,000

Potential bonus (based on patient volume): $20,000–$30,000

Assumed total compensation: $120,000

AGI: $110,000 (used to calculate income-driven loan payments)

Student debt: $450,000 at an average 7% interest

Annual income growth assumption: 3%

To qualify for PSLF, Dr. Holliday would need to enroll in an income-driven repayment (IDR) plan such as PAYE, RePAYE, or IBR. (Quick side note: some residency programs also qualify for PSLF, but only if they’re salaried—definitely worth checking into if you’re heading into a residency.)

According to the federal loan calculator, Dr. Holliday’s monthly payment under PAYE would start at $768. Over 10 years, factoring in income growth, he’d pay about $105,000 in total. By year 10, his monthly payment would increase to around $1,000.

After making 120 qualifying payments, the remaining balance would be forgiven—tax-free. While his average loan payments would be around $10,000 per year, he’d need to earn roughly $13,000 in gross income annually to cover them, once taxes are considered.

The Comparison: PSLF vs. Private Practice

Now let’s look at a hypothetical peer, Dr. Earp, with the same debt profile but a private-sector job offer of $180,000. Like Dr. Holliday, he wants to be debt-free in 10 years—but he plans to pay off his loans without PSLF.

Assuming Dr. Earp refinances at 5.5%, his monthly payment would be $4,890, or $58,680 per year. That’s a major commitment—especially when you account for taxes.

At a $180,000 salary, Dr. Earp’s effective federal tax rate would be around 25%. To net enough take-home pay to cover $58,680 in loan payments, he’d need to earn about $80,000 in gross income just for loan repayment.

Meanwhile, Dr. Holliday only needs to set aside $13,000 in gross income annually for his PSLF-based loan payments.

Bottom line: Dr. Earp needs to earn $67,000 more per year than Dr. Holliday just to be in the same financial position at the end of 10 years.

What’s the Economic Value of PSLF?

In this example, the economic value of PSLF is approximately $67,000 per year. That’s how much more a private-sector job would need to pay—on average—just to break even with a PSLF-eligible position, assuming all other factors are equal.

So if you’re comparing offers and your main concern is paying off student debt, you can use that figure as a reference point: the private job needs to offer at least $67,000 more per year to make up for the loss of PSLF benefits.

Final Thoughts

Of course, these are assumptions based on a hypothetical scenario. I’ve worked with grads earning $140,000+ in PSLF-eligible roles and others making $120,000 in private practice. State taxes, loan structure, family goals, and other factors can shift the equation significantly.

And honestly, there are far more meaningful reasons to choose a job than student loan repayment. I hope your career decisions are driven by purpose, passion, and calling—not just economics.

Still, if you’re trying to make a smart financial decision, this framework can give you clarity.

Need help comparing options? I’d be glad to walk through it with you.

*This article originally appeared on the Mouthing Off Blog written For Dental Students.