Budgeting can be a difficult task, but it also can be valuable as you prepare for medical school. Getting your finances in order and starting a budget (or a spending plan) gives you some assurance in knowing how much money you have coming in, how much money you have going out, and what you have to spend on a monthly basis.
If you carefully budget all of your expenses before entering medical school, you will have a better picture of what you need to do to prepare yourself financially while in school. For example, a budget can be helpful to have when determining the amount of student loans you may need to borrow (and repay in the future). As a good rule of thumb, you should only borrow what you need.
There are many free tools to help you create your budget. You may choose to use an Excel worksheet, an online software program, or financial literacy websites, like the AAMC Financial Wellness program. You can even access FIRST’s basic budget worksheet and other budgeting resources and fact sheets from the FIRST website.
However, no matter what method you choose, there are three key steps to follow:
1. Put your plan in writing.
2. Track your spending.
3. Review your plan and make adjustments as needed.
Also, think about incorporating some simple money saving tricks into your budget from the start, such as:
- Don’t buy bottled water — refill a bottle for free at home.
- Make your own coffee or tea and cut down on going out to coffee shops and restaurants.
- Try not to use your credit card, or if you do, pay off the balance each month.
- Pay your bills on time (avoid late fees and a lower credit score).
- Bank locally so that you won’t get charged fees; use a non-surcharge ATM.
- Bike to school or work, take public transportation, or carpool.
If you take the time now to examine your spending behaviors, you can make better choices so that your financial life may be easier to manage in the future. Remember: if you live like a student now, you won’t have to live like one later. For more financial tools, tips, and resources, visit the FIRST website.