Myth 1: I can get financial aid to cover medical school application costs.
Federal student aid is only available to cover the cost of attendance for the school where you enroll. Federal student loans cannot be used to pay for the MCAT® exam or for submitting medical school applications through the American Medical College Application Service® (AMCAS®). However, for those who qualify, the AAMC Fee Assistance Program can help with some of the application expenses. The benefits of the program include:
- Official MCAT prep materials ($268.80 value).
- Reduced MCAT exam registration fee ($130, rather than $325).
- Complimentary two-year subscription to the Medical School Admission Requirements™ (MSAR®) database ($36 value).
- Waiver of all AMCAS fees for up to 20 medical school submissions ($968 value).
- Free registration for the AAMC PREview™ Professional Readiness Exam — a new exam designed to assess personal competencies such as resilience, service orientation, ethics, and teamwork. Some schools will add the PREview exam to their admissions processes for the 2022-2023 admissions cycle ($100 value).
But what should you do if you’re not eligible for the Fee Assistance Program? In that case, you can estimate your application costs and start planning and budgeting for them in advance.
Beyond the items mentioned above, other possible expenses may include:
- Secondary application fees charged by a medical school.
- College service fees for items such as your official transcript.
- Travel and accommodations when visiting a medical school.
- Appropriate attire for a medical school interview.
The bottom line is this: There will be expenses to apply for medical school that you will need to cover; however, by preparing, budgeting, and saving money for these expenses, your financial stress can be reduced.
Myth 2: I won’t be able to pay for medical school.
Federal student loans are available to most medical students. As a medical student, you are considered a graduate/professional student, which means you will be able to complete the Free Application for Federal Student Aid (FAFSA) on your own — without needing information from family members.
The information on your FAFSA will be released to the schools that you list on the application. Once it is submitted, the schools listed will review your information, notify you if they need additional information, and then determine what type of aid you qualify for. It’s a good idea to review the financial aid websites of the schools where you will be applying so that you can verify their processes and procedures and learn about their available financial aid programs. You will also want to know who to contact if you have financial aid questions or need more information.
Nearly all medical students qualify for federal student loans, which may include the Direct Unsubsidized Loan and possibly the Direct PLUS Loan. These loans will cover the entire cost of attendance, including tuition, fees, room and board, and all other official miscellaneous expenses.
During the financial aid application process (and throughout medical school), you will want to look for grants and scholarships; they can help reduce the need for loans. However, as you may have experienced as an undergraduate student, finding and applying for scholarships and grants often takes time, but the payoff can be beneficial.
Consider this: While you can borrow up to the cost of attendance, it might not be in your best interest to do so. You should evaluate your aid offer, determine what expenses you need to cover, and then borrow wisely. As always, the more you borrow, the more you will need to repay, so budgeting and limiting your expenses during medical school will help make future repayment more manageable.
You can also explore the AAMC’s State and Federal Loan Repayment, Forgiveness, and Scholarship Database. It contains information about programs that may help with financing medical school or loan repayment.
Remember that the financial aid office staff are there for you as a resource. They will answer all your financial aid questions and help you navigate the process of paying for medical school. If you need assistance or have questions, they are there to help you.
Myth 3: I won’t be able to manage my student loans while I’m a resident.
After graduating from medical school, you will likely spend several years training in your specialty. As a first-year resident, you will earn a stipend, which has been between $55,000 and $60,000 (with some regional variation) in recent years. It’s likely that the stipend will be enough to cover your monthly expenses, including housing, insurance, car payments, food, utilities, and a student loan payment. There are several federal repayment plans that base the borrower’s monthly payment on their income — not their debt — so a student loan payment during residency is feasible. As a matter of fact, you may want to review this infographic that details a typical resident’s budget.
Some residents might be unable to make a student loan payment, and some may choose not to make a payment for various reasons. If this is the case, they can choose to postpone payments during residency with a mandatory medical residency forbearance.
The choice to pay or postpone payments is a personal decision and will need to be made after graduation when you have a much clearer picture of your financial situation. You will either choose one of the federal loan repayment plans and make a monthly payment or choose a forbearance, but no matter what choice you make, you will be able to successfully manage your student loans during residency.
Myth 4: I will never be able to repay all my medical education debt.
This simply is not true. By creating a strategy to manage your loans, you will be able to tackle your student loan debt, whether you borrowed $100,000 or $300,000. It may take some time, but you will be able to repay all your loans, although it might seem improbable as you read this today.
Some medical school graduates choose to pay their loans aggressively, while others may opt for a different strategy and plan for loan forgiveness or loan repayment assistance. Borrowers who are interested in loan forgiveness or loan repayment assistance programs will want to learn about the federal Public Service Loan Forgiveness program, civil service programs like the National Health Service Corps and the Indian Health Service, or the military.
To determine your best repayment strategy, you will need to evaluate your goals, devise a plan, and put your plan into action. You will want to continue to reevaluate your financial situation and your goals and pivot when necessary. You will be successful — personally, professionally, and financially.