How I borrowed for Medical School

Once I was accepted into medical school I had to apply for student loans. I was fortunate that my family was able to pay for my undergrad, only $9,774 for tuition and fees my freshman year so tuition was new to me.

Fresh out of college, I was earning about $25,000. Initially living at home, I had enough spending cash to splurge on camping and climbing gear. So when I sat down with the FAFSA and had to calculate how much to request for medical school, I didn’t know where to begin. I could calculate my annual budget for rent, gas, car insurance, but there were so many other expenses I didn’t know how to budget or what to include. I was utterly overwhelmed so I didn’t even try. Sound familiar?

Financial Aid Office Steps in to Help

As I was trying to forget about the inevitable FAFSA application a letter came in the mail. Our medical school’s financial aid office sent me a letter. They figured out how much money I would need to make ends meet for the year. While I was recently purging our old financial folders, I found the letter for our third year of medical school.

In-state tuition was $31,916 for the academic year 2008-2009 (out-of-state was $90,398). It was estimated that I would need $58,493 for the next 12 months. This included tuition, room and board, personal, transportation and other anticipated expenses. Terrified of needing so much money, I applied for the maximum amount and received it, a mere $47,167.

I could not receive enough financial aid to cover estimated expenses. If I knew how to apply for another $10,000 in financial aid I would have. The financial aid office had worked with medical students for decades and must know what I would need for a year of bills, right?

I had to hide from the numbers and accumulating debt.

My life was packed with classes, clinical rotations and studying that I didn’t have time to get a job to make up the difference. At the end of every day I was too drained, mentally and emotionally and physically, that I didn’t have the interest or brain power to budget, retroactively or prospectively. It didn’t even occur to me that I should have a financial mentor, even if it meant asking for suggestions on I just pushed through maxing out my student loans and ignoring my rapidly accumulating debt. 


Here’s a breakdown of what I received from the office of financial aid and what I remember actually paying as a third year medical student (MS3).

Tuition $31,916 $31,916
Rent ($805/mo) $9,660 ($450/mo) $5,400
Food ($311/mo) $3,732 ($250/mo) $3,000
Utilities ($176/mo) $2,112 ($100/mo) $1,200
Phone ($72/mo) $864 $0
Clothing ($70/mo) $840 Maybe $200/yr
Laundry ($29/mo) $348 $0
Entertain. ($133/mo) $1596 (~$75/mo) $900
Car Maint. ($74/mo) $888 Maybe $600/yr
Gas ($122/mo) $1464 (~$60/mo) $720
Car insur. ($111/mo) $1332 (~$120/mo) $1,440
Books $1,100 $1,100
Disability Insurance $70 $0
Insurance $945 $945
Instruments $60 $0
Boards $1420 ~$610
Travel* $104 ~$100
Uniforms $42 $0
TOTAL $58,493 $48,131

In retrospect, I knew the $47,167 was more than enough. I bought a $1,000 road bike that year, and all the gear a new cyclist needs. I could have applied for $42,000 and been fine. Since I spent about $10,000 less than what they quoted me, maybe I could have gotten by on $35,000 if I was willing to watch my budget.

If I received only $42,000 in financial assistance I could save $13,413.41 in loan repayment. To break it down, those loans are 6.8% compounding interest. After 15 years (our projected path to being debt free from MS3) it’s over $13,000. That’s 4.5 months of loan payments at the rate I’m paying now. If I received $5,000 less than the maximum for four years, I could pay off my loans 18 months sooner!

If I took $10,000 less my MS3 year (since I retrospectively calculated $10,000 less than what the financial aid office told me I would need), I could have saved $28,826.79 in loan repayments. Money would have been tight, but with focus I probably could have done it. Instead, I took out an additional $10,000 at 8.5% interest my fourth year, known as the Stanford PLUS loan. This was to cover application fees to dozens of residencies and travel for 11 interviews everywhere from Seattle (twice) to Boston. Again, I was scared I wouldn’t be able to make ends meet. But I was fine, some of my PLUS loan unintentionally went towards our wedding that spring.


How did I spend less?

I lived with a roommate all four years of medical school. My rent was only $450/month. I rarely purchased clothes. When I did, I made sure it could be laundered at home and not dry cleaned. I wasn’t aware of my cash flow, but I just wasn’t a big spender.

Required exams were nearby. There are three medical licensing exams (aka “STEPs”) every medical student must take before getting their doctorate in medicine (USMLE) or osteopathy (COMLEX). We were the first class to take the USMLE clinical skills portion (CS). The CS was only offered in a few places nationally. Many students have to fly to take the one day test. Fortunately, I was able to drive to a nearby big city offering the test for the day and stay with friends.

When I had extra money, I spent it. After our first year of medical school we spent a week in Colorado. I got a new road bike as an MS3. As an MS4, I got married and didn’t feel restricted financially (with significant help from family).


Are you overwhelmed?

My advice to overwhelmed students applying for financial aid: take an afternoon and calculate your fixed expenses (rent or mortgage, utilities, average spent on groceries every month, etc). Figure out a way to track general monthly spending while in school, either through an app or spreadsheet or on paper. At least once a year look over your monthly expenses to help determine how much financial aid to apply for the following year. Use the table above to itemize your expenses.

Or, more simply, how much do you have anticipate you will have left after a year? Subtract that from the loans you took out and apply for less loans the following year. Do this every year when your financial aid application is due.

Ask your financial aid office. I found a similar Cost of Attendance (COA) table for other medical schools on their Financial Aid website.

Remember that you don’t have to borrow the maximum amount of money suggested. Those dollars you borrow are going to have to be repaid with interest in a few years. That $1,000 road bike just might cost you $1,500 when bought with student loans.


How did you calculate how much financial aid to apply for? Did you over- or under-apply? What advice do you have for students now?


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