Affording Medical School & Residency

If you've decided to study to become a doctor, you'll need to complete approximately eight years of college and continue with three or more years of residency training. Along the way, there are plenty of financial considerations since a medical education comes at a high cost, even though you can benefit from a high salary once you're licensed. Your path will involve many choices such as which schools you want to attend, what funding sources will work best for you and deciding on a specialty.

Long before you start applying to medical school, you'll need to earn an undergraduate degree and choose a major that provides the foundational coursework you'll need to get into a medical program later. It's very common to choose a premed major, but other natural science majors, such as chemistry and biology, can also provide a good foundation. In any case, you should prepare to complete biology, physics and several types of chemistry classes to meet medical school admission requirements.

During the planning phase for undergrad studies, you'll likely incur different costs as you prepare to apply to colleges. You'll probably take the SAT or ACT and pay a fee unless you can qualify for a waiver. As of publication, the SAT costs ​$55​ per attempt, while the ACT costs ​$60​ without the writing portion or ​$85​ with it. Another cost is the application fee, which can vary by school, but you may get a waiver for the cost if you qualified for a standardized test fee waiver or if your school has assistance based on financial need.

You'll also want to assess affordability when you're looking for colleges to earn your undergraduate degree and consider ways to save money before even starting official college classes. Rather than heading to a four-year university, for example, you might opt to complete ​two years​ at your local community college and save considerably on tuition. You can also look into options such as earning college credits by taking tests or even completing dual-enrollment classes while in high school.

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As you're applying to schools for undergrad, know that you have many options to fund your studies, and some of them allow you to take advantage of funds you won't ever have to pay back. You should fill out the Free Application for Federal Student Aid (FAFSA) early in your school search and include the school codes for the places you're interested in attending. This application will use your financial information and often your parents' as well to determine for which types of government federal aid you qualify.

• ​Grants​: For the 2021-2022 school year, you can get as much as ​$6,495​ in Pell Grants and ​$4,000​ for the Federal Supplemental Educational Opportunity Grant (FSEOG).
  

• ​Federal Work-Study​: This program can provide you with a part-time job that helps pay for your educational costs. These are often on-campus jobs.

• ​Student loans​: Depending on your financial situation, you might qualify for Direct Subsidized loans, Direct Unsubsidized loans or both of these to borrow money to pay for remaining educational costs. The amounts available will depend on which year of undergrad you're in as well as whether you're considered a dependent student. Direct PLUS loans may be available to your parents as well.
  

You'll also want to look into applying to scholarship programs and seeking state and school-based grants. Then you can think about whether you want to work during your undergrad studies since you can not only benefit financially from this but also get experience that helps with your medical school application later. For example, you might look for a part-time job in the medical setting that only requires a high school diploma or short certification. This might include working as a nursing assistant or caretaker.

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As you get closer to completing your premed studies, you'll need to prepare for the competitive medical school admission process so you can earn a doctorate in medicine. An important step is taking the Medical College Admission Test (MCAT) sometime during the second half of your undergrad studies. This ​$320​ test assesses your science knowledge and writing and reasoning skills. You'll want to use the many MCAT test prep resources available such as study guides and practice exams and possibly take a prep course to do well.

You should also start to research medical schools that interest you, review their requirements and consider the costs involved. Based on tuition and fee data from the Association of American Medical Colleges (AAMC), the average cost for the first year of medical school ranged from ​$41,438​ for an in-state, public school to ​$64,494​ for an out-of-state private school for 2020-2021. Plus, you have housing and other living expenses to consider.

These high costs mean you'll want to consider your budget and forms of aid. You can look into scholarships and Direct Unsubsidized and Direct PLUS loans to start. You can also consider private student loans from banks to cover the remainder.

When you know which medical schools interest you and suit your finances, you'll use the American Medical College Application Service (AMCAS) to submit a single application – with supplemental materials like recommendations – that will go to all the schools at once. This includes a ​$170​ fee to apply to one school plus another ​$42​ per school after that.

Schools usually follow up with a secondary application and interview. You'll ultimately get a decision from the medical schools that accept you.

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When you begin medical school, you'll go through two years of classroom education and lab studies to become familiar with various fields of medicine. For example, this can include learning about topics such as anatomy, neuroscience, physiology, biochemistry, pharmacology and pathology. Your studies prepare you for taking the first part of the United States Medical Licensing Examination (USMLE) that tests your knowledge of the foundations you've learned. During this phase, you might also work a part-time job to supplement the loans and other aid you're receiving.

Your third and fourth years of medical school focus on practical experience with clinical rotations. While you don't get paid for this work experience, it's necessary for completing the second part of the medical licensing exam and will help you determine in what area you want to specialize during your residency.

While the experience can vary by school, often you'll rotate through different specialties and learn what it's like to work with patients. By the fourth year of the medical school program, you'll take the second part of the USMLE to test your clinical skills and knowledge.

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After you graduate from medical school, you're not yet ready to work as a doctor since you'll need to do a residency to get your medical license. That means you'll need to have your specialization chosen based on your interests throughout the program and your experiences during the clinical rotation.

You'll also want to consider the financial consequences of your choice since your future earnings depend on your specialty. For example, the Bureau of Labor Statistics (BLS) reported median salaries in May 2020 of ​$251,650​ for surgeons, ​$184,570​ for pediatricians, ​$214,370​ for general practitioners and ​$239,120​ for gynecologists.

You usually start researching residency programs in your chosen specialty and preparing applications when you start the clinical part of your medical school program. You begin by submitting the application with materials like letters of recommendation, resumes, transcripts, licensing exam results and a statement on why you want to be admitted into the residency program. The Electronic Residency Application Service (ERAS) is the central system you'll use for residency applications.

You'll typically interview with residency programs that interest you and wait to hear about the match you end up with. You'll want to keep in mind there's a limited number of spaces in each specialty and that residency programs limit the number of doctors they can accept. So, you'll want to consider multiple options, make sure you meet all the requirements and prepare a strong application for the best results.

When you get into a residency program, you'll spend at least ​three years​ studying and working as a doctor under supervision, and some specialties can last as long as ​nine years​. The goal is to provide practical training and experience so that you're ready to practice independently as a physician in your specialty. Since a residency is necessary to complete the requirements for getting your medical license, you can expect to complete the third and final part of the USMLE after around a year of residency training.

During your residency, you can expect to work demanding hours – possibly even a ​28-hour​ shift – but the good news is that you'll get some financial compensation for this phase of your journey. Your salary will depend on your residency program and the year you're currently in, and you can expect to see salary bumps as you progress.

However, you'll want to keep in mind that the salary usually is far less than what you'd receive if you worked as a physician. For example, a 2020 report showed an average first-year residency salary of ​$58,921​, while those in the fourth year made ​$66,226​ on average.

You'll need to find a way to use your residency salary to fund living expenses along with the student loan payments you probably have to make. Since medical school debt can be so high, consider taking advantage of more flexible repayment options like the income-based repayment plans available for federal student loans along with options like deferments and forbearance if necessary.

If you owe private student loans, you'll need to check with the lender since these loans usually have less flexibility for repayment. Other financial options you might consider are seeking loan forgiveness programs, cutting down on expenses and refinancing your loans for a more manageable payment.

After you've finished your residency program and passed all parts of the medical licensing exam, you can move forward with getting your medical license so that you can find a job as a doctor. You'll go through your state for this process where you'll have to meet all the eligibility requirements.

The process usually involves paying fees, proving your education and experience and demonstrating you completed the medical licensing examination process. You'll have to fill out an application, get a background check done and wait for approval. Once you've got your license, you can seek opportunities to work as a doctor in your specialty.

Along with working as a doctor, you might decide on moving forward with pursuing board certification or doing a fellowship. Getting certified requires showing proof of education and experience in a specialty plus passing an examination process; you complete continuing education to keep your board certification. A fellowship, on the other hand, is a post-residency work training program where you're paid to learn about a particular subspecialty, and it can last up to ​three years​.