3 Tips for managing life and medical school debt during medical residency

By Kate Gillan | Citizens

If you’re a medical school resident, you’re probably both overworked and overtired. You might even be on your fourth or fifth cup of coffee right now. We want to lessen your burden, while also helping you explore your student loan options, so you can (hopefully) ditch medical school debt sooner. After all, you spend your entire day helping others. It’s time for some self-care, and that could include looking at your time commitments, financial options, and student loans in a holistic way.  By making sure you have the time to do the stuff you love and getting a little type-A with your personal finances, we can start helping you. Wouldn’t that be a great start to an amazing career?

1. Your time: Take care of yourself and not just others

When you're so busy taking care of others during residency, you may neglect your own health.  Some tips for prioritizing your time are to set limits, develop stress-management skills, and schedule activities into your bustling week that help you relax. Namaste, anyone? According to the CDCⁱ, physical activity is anything that gets your body moving. Adults should move more and sit less during the day. Here are a few more ideas:

• Exercise daily for 30 minutes: Just as your family and friends have a hard time fitting exercise into their busy lives, doctors are ironically sometimes the last to prioritize their own health, dedicating their lives to healing others. However, it may help to think of exercise as something that can be used to reach a larger goal, such as lowering blood pressure, training for a marathon, or keeping up with an active spouse or partner.
• Mentorship: Another way to alleviate stress related to medical residency is to get a mentor. It helps to have someone to bounce ideas off of regarding not only your student debt, but other hurdles you face in medical residency. There is also the importance of building relationships with mentors to prevent burnout, who can provide both advice and professional connections that can help with fellowships and other opportunities. They might also help you gain the broader, holistic view to think about your future after residency, which could include doing a research project, volunteering in the community, or even making connections for jobs.
• Meditation: While it may seem intimidating at first, meditation can take as little as two minutes, and has been shown to reduce stress levels. Even simply spending a few moments alone daily can help alleviate stress. There are also apps that can help you get started, such as Calm or Headspace. You don’t need a yoga studio or home gym to meditate. Simply place a pillow on the floor of your bedroom or office and sit cross-legged. Journaling for a few minutes a day is another form of mindfulness, even if you are jotting down simple reflections on your day, or snippets of conversation that interested you.

2. Financial options: Look at your finances in a holistic way

The good news? What you are earning now as a resident in medical school is probably much less than you’ll be paid down the road. With your future earnings in mind, it’s great to get a handle on your finances now. That includes your monthly expenses, student loan debt and savings goals. You may want to buy a house, invest, or build up your savings. Your hospital or medical school may offer a financial advisor who could help you with budgeting and your fiscal profile. The important part is to handle your larger obligations so that you can focus on helping others. Refinancing your medical school loans can be a big weight off your shoulders and can allow you to postpone paying them until you complete residency. Once you’ve done that, you can begin to budget money for those larger life goals.

3. Medical School Debt: A prescription for managing medical school loans

It’s not news to you that medical school is expensive. According to the Association of American Medical Colleges (AAMC), in 2020 the average student loan debt of medical school graduates was around $207,000ⁱⁱ.The median education debt for indebted medical school graduates in 2019 was $200,000, and 73% of graduates reported having education debt.

To make things even harder, the cost of attendance for medical education increases an average of $1,030 per year.  It also depends on whether you attend public vs. private, as total costs vary by institution type and location, ranging from $159,620 (in-state, public school) to $256,412 (out-of-state, private school).

Then there is your residency, which can take anywhere from three to seven years. There is a stipend, but there are also costs you’ve incurred already, such as residency application fees, travel to residency interviews and possibly even moving expenses — it adds up. But there are options for managing and paying off your medical school debt: 

• Public Service Loan Forgiveness: If you are considering a career in public service, there may be some financial advantages, namely, through Public Service Loan Forgiveness. This federal student loan forgiveness program, PSLF, enables the cancellation of your federal Direct Loans after you have made 120 qualifying monthly payments while working full-time for a qualifying employer. You can also qualify for PSLF if:
  • You’re employed with a U.S. federal, state, local or tribal government. Federal jobs include U.S. military service.
  • You get a job with a non-profit organization. These organizations must be tax-exempt under Section 501(c)(3) of the Internal Revenue Code.
  • You have direct student loans or can consolidate your other federal † student loans into one direct loan.
  • You are employed full time.

Note that student loans from private lenders don’t qualify for PSLF. Only qualifying payments that you make on the new Direct Consolidation Loan can be counted toward the 120 payments required for PSLF. Keep in mind that making higher monthly payments, unfortunately, won’t qualify you for PSLF any faster; you still must make 120 separate payments.

• Refinancing: For private medical school loans, repayment may begin as soon as six months from graduation and while you’re in residency you may not have the money to make full payments. Never mind, the interest that accrues as you’re making your rounds. Refinancing your student loans while in residency allows you to have a fixed monthly payment, $100 a month†, a six-month grace period after residency, and any interest accrued during your residency will capitalize at the end of your residency and grace period. If the $100 monthly payment exceeds the interest you’ve accrued for the month, Citizens simply will apply the remainder to your principal. And if you’re curious when your full loan repayment begins, it’s simple — six months after your residency completion.

Considering a Citizens Medical Residency Refinance Loan?

The Citizens Medical Residency Refinance Loan offers competitive rates. It provides a 0.25% interest rate discount for borrowers who sign up for automatic payments. An added benefit is a 0.25% interest rate Loyalty Discount for Citizens customers^†. This means that if you hold a checking or savings account, money market, certificate of deposit, credit card or another student loan with Citizens, residents and fellows who refinance with us can save even more on interest. Combined with Autopay, you’d save a total of 0.50% on your rate. Bonus? There’s a generous loan limit of $750,000. By paying $100 a month^† during your residency, this could help free up money to use towards living expenses (such as groceries or rent), and also help pay down debt on credit cards.

Medical residency can be stressful, busy, and chaotic. It’s important that you simplify other aspects of your life such as paying off your medical student debt with a simple $100 a month payment during your residency, so you can save for whatever else life brings. That sounds like a prescription for success to us. If refinancing your medical school student loans sounds like a good option for you, learn more about the Citizens Medical Residency Refinance Loan.