When people think of doctors, they often picture the TV-version: above-average-looking people with dramatic cases, demanding schedules (but with plenty of time for workplace romances) and a hefty salary. But what Grey’s Anatomy doesn’t show you are the less glamorous aspects, like the long, stressful and expensive process of simply applying to medical school.

When my husband, Emerson, decided to apply to medical school last year, I knew we’d take on some serious debt for applications, interviews and, of course, tuition. To help ease the financial burden and reduce our stress, we wanted to get our finances in the best shape possible before adding another significant expense. Here are the four financial decisions we made when my husband applied to medical school to prepare for the next eight-plus years of schooling and residency.


When my husband decided to quit his job and take a gap year to study for the MCAT and apply to med school, we went from two incomes to one. While my salary covered our current expenses, there wasn’t much room in our budget to cover the additional $4,000 to $5,000 that applications and interviews were going to cost.

To avoid taking out a loan or putting it all on credit cards we couldn’t pay off, we decided to cut back on our biggest expense: our housing costs. We were currently paying about $800 plus utilities each month, and while we loved our apartment — and living alone — we couldn’t ignore the most obvious way to save. My aunt had graciously offered to let us live in her basement rent-free, and we accepted. It wasn’t the “fun” decision, but we knew it was the right one for us financially. Saving about $1,000 each month allowed us to pay for all applications and interviews upfront, while avoiding debt.


When we got married, we each brought along some debt. I owed $1,000 on my credit card and Emerson owed roughly $8,000 for his last semester of school. In the grand scheme of things it wasn’t that much, but it was important for us to pay off our existing debt before we took on thousands more.

We knew we wouldn’t be able to avoid future loans for medical school, but having our old debt paid off helped us feel more comfortable and secure.

Luckily, since we had already cut our housing costs and freed up a significant amount of income each month, paying off our balances wasn’t too difficult. We committed to eliminating our debt and paid it all off in about six months. We knew we wouldn’t be able to avoid future loans for medical school, but having our old debt paid off helped us feel more comfortable and secure as we started the med school journey. Plus, unlike credit card debt that carries a hefty interest rate, we hope that our med school loans will be more favorable.


Once our debts were paid off, we turned our sights to our savings. Previously, we weren’t contributing regularly to a savings account, and we didn’t have an emergency fund or retirement savings. Now that we had more disposable income, we set a goal to save $10,000 in an emergency fund and contribute to an IRA and 401(k) monthly.

Just like we’d treat a rent or credit card payment, we treated our savings as a monthly bill we needed to pay. We reached our $10,000 emergency fund goal in about a year and put this money into a savings account with a high interest rate. I’m contributing 4 percent to my 401(k) to receive the company match and we’re also saving an additional $250 a month in an IRA, which I opened before I had access to a 401(k) plan.


The cost of tuition for med school is notoriously high, but it’s expected that your salary upon graduation will be comparably high so that you can manage the payments. But I realized if anything happened to Emerson, I would be left with the massive student loan bills — without the doctor’s salary. Those who co-sign are at an even bigger risk, as the death of the borrower can send the loans into default and require the co-signer to pay the balance immediately and in full.

It’s not fun to think about worst-case scenarios, but we needed to be prepared. So, we bought a life insurance policy so that if anything happens to Emerson, I won’t be on the hook to pay back thousands of dollars in loans. It wasn’t something we’d previously thought about, but it made sense to spend a few hundred dollars a year on insurance to give us both peace of mind and security should something happen in the future.

Recommended Reading