Transitioning from medical school to residency can be tough. From relocation to a new schedule, there are many adjustments to be made. Additional financial stress can make the transition even tougher. 

More than half of medical students owe over $200,000 in student debt and take on even more debt during residency due to moving costs, general spending and unanticipated expenses, coupled with inadequate pay. If you are struggling to have the time and budget needed for necessities, there are several options for obtaining extra funds while in medical residency.

Options for covering expenses during residency

There are several options for managing expected and unexpected costs while in residency. It is important to understand your options and how they will affect you long term before selecting what is right for you.

Option #1: Credit cards

One way to manage expenses is by getting a credit card. This is one of the quickest and easiest options, but that does not mean it is the best. Credit cards have high interest rates — the national average rate being 24.14% for new cards at the time of writing. 

If you are planning to put excess expenses on a card without the ability to pay it off each month, you will quickly rack up hundreds, if not thousands, of dollars in interest. For example, if you put $1,000 on a credit card and only paid the minimum, your total payment would balloon to almost $1,500 by the time you paid it off almost four years later. Because of high interest rates, this debt can quickly become toxic and cause even greater financial stress. 

Option #2: Friends & family

Borrowing money from friends and/or family can be a great way to avoid paying exorbitant amounts of interest when navigating your financial needs in residency, but for most people, this is not an option. Even if it is an option, you may not want to be indebted to those in your life as it has the potential to change dynamics between the two parties and lead to relationship damage.

Option #3: Moonlighting

Some medical residents opt to find a side gig to begin to pay off educational debt and/or afford day-to-day expenses. Many programs do not allow residents to pursue secondary employment while in training — or only allow it in later years of residency. For those whose programs do allow it, the likelihood of being spread too thin often outweighs the benefits of a relatively small increase in income.

Option #4: Personal loan

Personal loans are another option for dealing with the expenses of medical residency, but many banks make them hard to obtain due to residents’ high debt and limited work and credit history. Sometimes they require a co-signer on your loan. Just like credit cards, personal loans can charge high interest rates that will put you even deeper in debt, but there are personal loan options that may be right for you.