How Do Medical Students Pay for Living Expenses?

The average first-year resident physician makes about $60,000 but medical students don’t get paid while they are in school.

So how do medical students pay for living expenses and other needs while in medical school? It’s a great question and we’ll outline the answer. In short, there are ways students can pay for living expenses, including through financial support from family members, physician loans, working, private loans, and financial aid.

Let’s take a look at some of the ways medical students can pay for living expenses.

Ways to pay for living expenses as a medical students

All medical students’ expenses vary depending on the individual needs of the medical student, just as there are various ways to pay for it. For example, one medical school student may not have to pay rent because they live at home with their parents, while another medical school student may be responsible for paying rent.

Physician loans

Physician loans, also sometimes called doctor loans, are specialized loans that can help cover tuition and loans for living expenses. A physician or “doctor” loan allows future high-income earners to access money to cover known expenses.

Work

Some students have side jobs while in school. However, many professionals, including medical school deans, recommend not working during medical school (with the exception of during breaks). It’s worth considering waiting until residency to take on a job — you will receive compensation during residency.

Family members

Family members may offer financial support during medical school. They may be able to help you work through a budget and agree on an amount that they will help you with on a per-month basis.

Private loans

Private student loans are loans that don’t come from the federal government. Federal student loans, on the other hand, do come from the federal government. Federal student loans typically have lower interest rates and better options for forgiveness and repayment, particularly the Public Service Loan Forgiveness (PSLF) program, which forgives the remaining balance on your Direct Loans after you have made 120 qualifying payments while you work full-time for a qualifying employer. Payments made under certain repayment plans (such as income-driven repayment plans) qualify for PSLF.

Living expenses of medical students

What type of living expenses might medical students need to pay for? They may be responsible for paying for school, housing or rent, transportation and car insurance, food and groceries, utility bills, cellphone expenses, pet food and care, child care, clothing and personal expenses, memberships and subscriptions, large purchases (such as cars) and entertainment.

The average costs may vary, but we’ll break down a few of these major expenses and what you might pay per expense:

• School: In 2020, the four-year cost to attend medical school for the class of 2020 surpassed $275,000 and over half of all medical schools and exceeded $350,000 at 19 schools.
• Transportation: The average cost of transportation for a household costs $9,826 per year, which amounts to about $819 per month or 12% of the average household income.
• Rent: The average American renter pays $1,326 a month and single-family houses average $2,018 a month, while a typical apartment costs $1,659. Nationally, rents are up 8.8% yearly.
• Food: The average cost of groceries costs $355.50 a month per person and the cost depends on which city and state where you attend. Residents of Honolulu, Hawaii, pay the most for food every month, at a cost of $556.76, and residents of Manchester, New Hampshire pay $183.
• Child care: In 2021, the average child care cost for one child was $694 per week for a nanny, $226 per week for a child care or daycare center and $221 per week for a family care center.
• Entertainment: The average entertainment cost was $297 in 2021.

How do medical students pay rent?

As a medical student, you may pay for living space in a number of different ways, including living at home with your parents to save money, which can be rent-free. You may also want to consider getting a mortgage.

Purchasing a home can help you because you may be able to rent out some of your living space to cover your mortgage payments. For example, let’s say you buy a house for $240,000 at a 30-year fixed rate. A 7% fixed rate would give you a $1,597 payment. If you rented out a room to three roommates for $500 each, you’d have $1,500 of your mortgage payments covered and would theoretically only have to pay $97 per month.

Many medical schools offer university-owned housing options (the cost varies from school to school) and most medical schools typically offer residence halls (dorms) and apartment-style living options, which can be on- or off-campus. It’s a good idea to consider your personal housing requirements, including the size and type of housing requirements you want, living conditions, and cost.

How medical students can reduce their expenses

How can you save money as a medical student? Along with putting together a budget (or downloading a budgeting app) and tracking spending habits, you may also want to consider a few other ways to reduce expenses:

• Look for inexpensive housing.
• Cook at home and avoid eating out.
• Use public transport and save on the expenses involved in owning a car.
• Borrow educational materials from the library or buy second-hand books.
• Pick up cheaper hobbies.
• Exercise at home rather than using a gym.
• Reevaluate subscriptions.
• Reduce electricity use.
• Pick up groceries instead of going out to eat.
• Use cash instead of credit cards.

Dealing with medical student loan debt

According to data from the Association of American Medical Colleges, the typical medical student graduates with about $200,000 in medical education debt. The median education debt for graduates was $200,000 in 2019 and the majority of graduates (73%) had education debt. Medical student loan debt figures may inspire you to factor earning potential into your career plans. You can pay for medical school with loans but it’s a good idea to think it out carefully and make sure you have your years in medical school financially well planned out.

The PSLF program may be an option later on while working to repay your student loans. Indebted physicians reported having higher levels of education debt when they took advantage of this program.