Budgeting has become an increasingly important skill to have as the cost of third-level education in the United States has skyrocketed over the past few decades, and this has been especially true when it comes to medical school. Tuition and fees are the largest aspects of this, although the cost of living, textbooks, and a variety of other things will have to be taken into account as well.
This will lead many people to wonder how to pay for medical school, as well as trying to figure out how they're going to pay it off in the long run once they've graduated and moved on to begin their professional healthcare career
. Because the price of medical school is so high, the majority of people will have to take out a student loan to pay for it.
Naturally, this leads to many people wondering how to pay off medical school debt, as well as figure out how long it takes to pay off medical school debt that they have incurred. While many people will already have their mindset on studying medicine, there are a few things that you should know before you do so to set yourself up for success. We've taken the time to outline all the important facts you need to consider when it comes to budgeting properly and figuring out how to pay off medical school debt in your healthcare career
Average Cost Of Medical School
The first thing that any potential student should know before going to university is the cost of doing so. Now more than ever with the rising education costs, students need to do some research as to how much they will be forced to pay to seek a higher education or advanced medical degree. There are plenty of schools that will provide affordable medical school degrees
, and other top medical schools
that might offer a better education at a steeper price tag.
With medical school
, there can be a variety of expenses involved, although this doesn’t mean that all colleges and medical degrees
will be priced the same. There are a ton of different things that go into how much attending medical school might cost. Like we've highlighted earlier, the cost of tuition, fees, living expenses, education supplies, scholarship opportunities, and more will heavily influence the price of going to medical school
According to the Association of American Medical Colleges (AAMC), the average cost of a year in a public medical school
is $34,592 for in-state students. For out-of-state students, this skyrockets to $58,668. Private colleges, regardless of whether you’re in-state or out-of-state, can cost over $50,000 per person.
These prices are inclusive of tuition, fees, and health insurance needed during the year, and have been going up every year. In addition to those expenses, there are often a variety of other costs that aren’t included in this price. Sometimes these expenses are a direct result of what is charged directly by the college itself.
Alongside this, you’ll need to factor in the cost of books, accommodation, food, and a variety of other things. While this can vary from person to person, these costs can’t be avoided.
It should be noted that many medical colleges won't be this expensive; in contrast, many will cost much lower
. Many medical schools in Texas, for example, cost less than $20,000 per year, with the Texas A&M Health Science Center being one of the least expensive options available
There are a variety of universities that will cost much higher than this, with Tufts University reportedly being the most expensive medical college in the United States. Also at the top of the list are Case Western Reserve University, Dartmouth University, Columbia University, and Northwestern University.
The cost of medical school doesn't have to stress you out when you're figuring out which school to attend. Even though it's an important consideration to make, you can also identify a pathway to paying off your medical school debt and budgeting properly to set yourself up for success, regardless of which medical school you wish to attend. While many people believe that cost is a sign of quality when it comes to attending medical school, this may not always be the case. As such, it may be a much wiser decision to stick with a more affordable college, as you’ll still receive the same education due to comprehensive regulations and education standards. It's important to remember that they don't just hand out medical degrees, and every college and medical school needs to be thoroughly vetted by academic boards that ensure the quality of the curriculum.
Paying for medical school
doesn't have to be an uphill battle, there are also plenty of opportunities to finance and pay for medical school through external resources. Scholarships and grants will be available to a certain portion of applications at the medical school, although these are relatively limited in their numbers. There is also an abundance of external scholarship opportunities
that medical school candidates can take advantage of with a little bit of research and effort.
These should be worth looking into, as they can drastically reduce the amount that you’ll have to pay for your medical school education. While it may not completely negate the cost of the college, they can certainly make a large impact and potentially take thousands of dollars off the bill. Outside of this, many people will have to pay out of pocket for their medical degree, although there’s a significant chance that they may not have the funds or have a clear understanding of how they're going to begin to make payments.
A considerable number of people will have to take out student loans to pay for medical school. The process of applying for a student loan for medical school is almost identical to other colleges and universities and involves filling out a Free Application for Federal Student Aid (FAFSA)
There can be a lot involved when it comes to filling out the application, which means that you’ll need to pay a significant amount of attention to ensure that everything is accurate. A mistake here and there, and you run the risk of your government aid or student aid application being denied instantly. Should your student loan application be accepted, you could qualify for the Direct Unsubsidized Loan, which covers the first $20,500 of the course’s cost.
You may also qualify for the Direct PLUS Loan to cover the remainder of the cost. However, this loan requires a credit check and will typically take longer to receive approval. If you qualify for any other academic aid and scholarships, you will also be notified at a later date.
Now that you understand the average cost of medical school, you might have a variety of other questions that still need to be answered before you decide to submit your medical school application. One question might be, "How long does it take to pay off medical school debt?"
In addition, the question of which student loan to pay off first when you can. Another question you might be having is how to effectively budget to properly pay off medical school debt
in a reasonable time. While some might be intimidated by the thought of budgeting or penny pinching to effectively pay off medical school debt in a reasonable time frame, it doesn't have to be.
The Importance Of Budgeting To Pay Off Medical School Debt
Budgeting is vital for your financial livelihood, regardless of whether you have any student loans. This is because it’s a proactive approach to managing your finances in the future, which can make it essential to begin budgeting as early as possible. Learning how to budget properly is an important skill to have throughout your life, as it'll play an important role in how you accomplish both your professional and personal goals and dreams.
Budgeting is an important skill to possess and learn, as much of this is driven by the fact that it allows you to put money aside for both short-term and long-term expenses while still having enough set aside for your daily life. While you may not be earning much money when you’re at college if at all, budgeting should still be something that you’ll need to look at, especially as you enter your final years in medical school and look towards creating plans to pay off your medical school debt after graduation.
If you’ve taken out student loans, then you’ll be in debt from the moment you leave college, which is something that nobody wants. As such, you’ll want to get these loans paid back as quickly as possible. The faster you pay off the medical school debt you've incurred, the more money you'll save in the long run because of the interest you no longer have to pay. Even if you submit one more payment a year than necessary, the impact can be astronomical. There’s no set answer to the question of how long does it take to pay off medical school debt, but budgeting does play a large role in determining this.
Simply put, you’ll have to pay this back with the earnings you make once you’re a qualified doctor. In other cases, you might have to begin making payments on your student loan regardless of whether or not you have a full-time job upon graduation. That's why it's always important to figure out how to budget properly and pay off medical school debt regardless of whether or not you'll have a full-time job immediately upon graduation. As a result, you’ll need to sit down and start figuring out your budget.
If you don't know how to sit down to craft a good budget plan, you can rest assured because this is a common problem, as many people going to college for the first time haven’t had to budget before. We will walk you through the effective steps you can take to begin budgeting properly and pay off your medical school debt in no time.
How To Budget Properly
A lot of people will want to know how to pay off medical school debt efficiently and effectively. The general answer to this is budgeting, which involves a variety of things to consider that might also potentially confuse those newcomers. This doesnt' have to be the case, as budgeting
can be simpler than you realize.
The first of budgeting properly is to ensure that you have realistic goals in paying off your medical school debt. Part of this will be identifying which student loan to pay off first, alongside a few other goals. While the majority of loans will have a certain timeline for when it has to be paid back, you may be able to do so faster, depending on your income and the ability to submit some additional payments each year to speed up the loan repayment and cut down on the overall interest payments.
For example, while you may not be earning a large amount when you first graduate from college, your wages should go up each year. This should be factored into your budget as you expect your income to grow, although you need to be realistic and should keep your budget in a reasonable time frame. You shouldn't expect your earnings to double or triple each year. Instead, you should keep your annual and monthly income realistic using salary trends
information for your healthcare career after medical school.
When you're trying to figure out your goals, think about important considerations that you can accomplish over time. Some realistic goals you can accomplish include submitting an additional payment each year, putting forward a certain percentage of your income towards your medical school debt each year, paying off a certain portion of debt each year, etc. These are all reasonable goals you can attain. Your goals should also be reflective of your personal goals like making reasonable rent payments, spending some quality time with friends and family, having a rainy day fund, and more.
When you're trying to figure out your goals in your personal and professional life as it relates to budgeting, you also need to remind yourself to be flexible with your budget. While your income should naturally go up as you gain more experience in the field, your expenses will also rise. This means that you should be prepared to adjust your budget as circumstances change. In some cases, this could mean that you’ll be able to afford higher payments, which will speed up your overall debt repayment. Another thing to remember is that things happen in your life, and you won't be able to tow to your budget properly every time. Some months might you might spend a little bit over your budgeted allowance, and in other months you might have a little money left over.
If you're overly critical about your spending habits and budget restrictions, it can wear you down mentally which will cause you to stray away from your budget over time. It's important to remember that your budget is going to act as a guiding hand instead of functioning like tight handcuffs that cannot be removed.
When you’re budgeting, you should track all income and expenses, no matter how minor they may be. Doing so will ensure that you have an accurate idea of your finances, which is key to the budget itself as it'll help you stay closer to the budget overall. Once you’ve determined this, you’ll then be able to make adjustments as needed.
For example, if you’re spending more than you’re bringing in, then you’ll need to cut out some of your expenses where you can. A good example of cutting expenses where you can might be those pesky monthly subscriptions that have added up over time. As you're looking through your expenses, make sure that you're taking the time to truly evaluate if what you're spending money on is worth it — because the more money you save each month will allow you to make more contributions to your medical school debt. In addition, as your income grows, you’ll be able to increase your debt repayments as required, which will have a large impact on how long you’ll end up paying the debts.
You shouldn’t just be covering your expenses, however. Instead, it’s recommended that you put away a certain amount of savings every month
for when they’re needed. While nobody expects various expenses to come up, you should still be prepared for them, as they can often be unaffordable otherwise which is why it's important to be flexible in your budget.
The majority of budgeting can be done on a computer using a spreadsheet, although there are a variety of other pieces of software designed specifically for this. It’s recommended that you take advantage of these, as it could prevent any errors being made when you’re creating it. Some of these applications or software packages can make it easy for you to track your expenses automatically, upload new information and expenses, and more.
You should check and update your budget regularly. While many suggest doing so daily, you should ensure that you do so at least weekly. Doing so will ensure that you can stay on top of everything, hold you accountable to following your budget each week, and help you to ensure that your finances are in order.
How To Prioritize Which Student Loans To Pay Off
Figuring out which student loan to pay off first might seem like a challenge, but it doesn't need to be. There are quite a few ways that you can prioritize which student loans to pay off first. To help with this process, you’ll need to know a few specific details about your debt first; namely, the remaining balance, payment due dates, interest rates, and the minimum payment. In addition, you'll have to see if there are any hard limits as to when your entire balance must be repaid. For instance, some loans will indicate that the entire student loan balance must be repaid by a certain date or there will be substantial financial penalties that are incurred.
Once you have each of these in-hand, you’ll then be able to begin prioritizing which ones to pay first. You could do this by organizing your debts based on the interest rate, from highest to lowest. By doing so, you’ll be able to pay off the debt with the highest interest rate first, which means that you should save a considerable amount of interest and money over time.
Organizing them by balance is another way to do so, as many people will want to pay off their least significant loans first. By paying off the lowest balance items first, you can reduce the number of different student loan payments you have to make and essentially consolidate your debt to the larger balances. In some cases, this may be the debt that has the highest interest rate, which means that you’ll be able to tackle two issues at once.
Being able to pay off the majority of your loans and only having one or two loans left can be something that many people will want to focus on. Many people may also want to take advantage of what’s called the debt snowflake method
, which should be used in conjunction with either of the above approaches.
This typically involves adding small amounts to your debt repayments whenever you have extra money lying around. For example, if you’ve won $20 on the lottery, received some money for your birthday, or somehow came into any unexpected funds, then these should be put towards your debt.
Many people might believe that this shouldn’t make a large impact, but it's important to remember that it can over time, especially if it happens on a somewhat regular basis, or as regularly as possible. When it comes to which student loan to pay off first, it can be a personal decision, although there's no wrong answer.
When you first start paying off your student loans, there will be a large chance that you may not be able to afford large payments. This should change over time, however, as you’ll begin to earn more money and your payments become smaller through the gradual repayment of other student loans. This is what’s known as snowballing your student loan payments, which means that your repayments get steadily larger over time and you'll become closer and closer to paying off your student loans over time.
As such, it’s a method that comes highly recommend, and it can be used with any of the other approaches mentioned above, which could make it even more beneficial to paying off your medical school debt.
Trying to pay for medical school can be a difficult thing to do and will take a significant amount of time. By budgeting correctly and ensuring that you’ve prioritized your debts appropriately, then you shouldn’t have many issues in paying them back over time.