5 Ways to Slash the Cost of Medical School

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Shreya Prabhakar grew up in Greensboro, North Carolina. A student at UNC-Chapel Hill, she is pursuing her undergraduate education in biology and economics with a minor in chemistry. In 10 years, she hopes to be a pediatric neurosurgeon, while contributing to research in diabetes. In the following article, Shreya highlights 5 ways to slash the daunting cost of attending medical school.


Have you ever begun to type a question into the Google search bar and been thoroughly amused by the results? Typing in “why” brings up “why do we yawn,” while “why is” results in “why is the sky blue.” Combine “why” and “medical school,” however, and your first hit will likely be the million-dollar question: “why is medical school so expensive?” Clearly, it’s something many students ponder.

   Note: All values in 2016 dollars using the Consumer Price Index. Source: AAMC Graduation Questionnaire and Tuition and Student Fees Survey

Note: All values in 2016 dollars using the Consumer Price Index. Source: AAMC Graduation Questionnaire and Tuition and Student Fees Survey

The cost of becoming a doctor is skyrocketing and the average debt of medical students is a perfect indicator. In 2016, the AAMC found that almost 74% of medical students graduated with tuition debt. The median load turned out to be a whopping $190,000. That’s a dramatic increase since 2000, when the average debt was only $125,372.


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In 2016, the AAMC found that almost 74% of medical students graduated with tuition debt. The median load turned out to be a whopping $190,000.

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Don't Lose Hope

However, as staggering as the numbers seem, don’t let them deter you from pursuing a true calling to medicine.

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Senior AAMC research analyst, Jay Youngclaus, confirmed in a 2013 study that physicians in all specialties could still pay back their medical school debt without incurring additional debt.

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The job security and income potential gained from a medical career can make up for the enormous front-loaded costs. Senior AAMC research analyst, Jay Youngclaus, confirmed in a 2013 study that physicians in all specialties could still pay back their medical school debt without incurring additional debt. Julie Fresne, the Director of AAMC Student Financial Services contends the same. “There is a concern that the cost of medical school will deter otherwise qualified and underrepresented candidates,” she worries. “We’ve got to get to people younger, earlier; we’ve got to help them understand that they can afford a career in medicine.” 

You may not realize it, but there are numerous resources and opportunities available to you to cut the cost of your medical school education. Here are five tips to help you lessen the financial burden.


Be Proactive

It’s never too early to start researching your financing options at your prospective medical schools. This should begin with some honest assessments. What level of financial support can your family feasibly provide? How much can you individually contribute from savings? Once these questions are sorted out, figure out how much tuition remains to be covered. A unique and financially more reasonable option to consider is attending a three-year MD program. Click here for a fairly inclusive list of such programs. Be prepared - the curricula of these programs will be substantially more rigorous; at the same time, successful matriculation will often guarantee a spot in a specialized residency.


Explore Student Financial Aid

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Educating yourself can help you from falling into the trap of accepting too much aid that will be a pain to repay later.

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Most of you may have explored financial aid options while applying to college. Remember those acronyms: FAFSA, CSS, and SAR? They’ll be relevant again when applying to medical school. Don’t hesitate to reach out to the financial aid officer at each of the schools to which you apply in order to gauge what your financial aid package may entail. These advisers know best what their institutions can offer you as well as when the funds will be available to you. They can shed light on whether need-based and merit scholarships are offered, and whether full tuition coverage is a possibility.

While you’re doing this, however, know the lingo. Make sure you know the difference between grants (no repayment) and loans (must be repaid).  Educating yourself can help you from falling into the trap of accepting too much aid that will be a pain to repay later.


Pay when you can

Once you can factor in the school’s aid, do the math. Use online calculators and figure out what amount is left. Estimate important things like whether you’ll need to find a part-time job, and how much you would ideally need to make. This is for two important reasons:  so that you can have money for other interests and so that you do not have to defer loans until residency. Pay what you can while in school, as it will help prevent your balance from exploding once the deferment ends. For instance, with a student balance of $164,800 and 6.00% rate, holding off student loans for residency can add about $30,000 in accrued interest. This would make your new balance about $194,000, and bump up your monthly payments to more than $2,000. Eventually the total cost (including interest) will be about $260,000 repaid over a decade. Make a goal to not pay back more money than you actually owe.


Get loan smart

Let’s back up a little bit. When you do choose to take out loans, it’s important to make decisions with the understanding that not all loans are created equal. Students often make the mistake of thinking that the loan with the lowest monthly payment is the best, but this is not always the case. Get as much information as you can regarding interest accrual, deferment options, add-on fees at repayment, and payment plans to make an informed decision. These are all factors that separate good deals from great ones and SimpleTuition can help you calculate all that. If federal student loans aren’t enough to cover the cost, private loans are another option to consider. However, these tend to have many caveats, such as more variable interest rates and non-tax-deductibility.

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When you do choose to take out loans, it’s important to make decisions with the understanding that not all loans are created equal.

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While finding the best loans, you can help set yourself up for the best loan arrangements by maintaining not only a strong credit score but also a good credit history. This is especially important when seeking private loans, as the credit score and credit history together inform the private loan lenders whether they can entrust you with a loan. It is important that you have no open collection accounts, delinquent student loans, or “maxed” out credit cards. Make sure you’re in good standing by reviewing your account through your free annual credit report.


Consider Repayment and Forgiveness Programs

If you are willing to commit to practicing medicine in underserved areas or serving as a military physician, there are numerous programs that will subsidize your tuition in exchange for promised work. These include, but are not limited to, the Indian Health Service Corps Scholarships, the Armed Forces Health Professions Scholarship Program, and the National Health Service Corps. There are also other loan forgiveness programs that cover a portion of debt in return for at least two years of service in underserved areas through the nation.


Conclusion

Medical student debt doesn’t have to be daunting. With research, planning and flexibility, you can cut down on your total out-of-pocket costs while managing your payments well. In addition to reflecting on the tips I’ve presented above, ask yourself some questions, like the following.

  • “Is a separate financial aid application required at my prospective school?” 
  • “If I get a scholarship for a year, will I be guaranteed to receive it in the successive years?” 
  • “How can I budget my money to cut down on my spending and borrowing?” 

Pondering the answers and planning accordingly can help you make great strides when tackling your future medical school debt.
 

About Shreya

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A native of Greensboro, NC, Shreya Prabhakar is pursuing her undergraduate education in Biology and Economics with a minor in Chemistry at UNC-Chapel Hill. In ten years, she hopes to be a pediatric neurosurgeon, while contributing to research in diabetes. In her free time, she enjoys playing the piano, soccer, traveling, and oil painting.

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