5 Useful budgeting tips for Medical School
By Personal Finance Writer Amy Nickson
Medical students agree that they often deal with stressful studies and exam schedules, but the most stressful thing to deal with is money. Many feel overwhelmed while managing the tight money flow while dealing with lots of expenses during their medical school and residency. That is why knowing some realistic budgeting tips is important for medical students.
Why should you follow a budget?
A personal budget helps to control your spending. Thus, you will not face a credit crunch.If you stick to a budget, you will surely cover all the essential expenses before wasting money on optional expenses. A budget helps to build an emergency fund as well. Thus, you will get money when you need it the most.
How can you set up a budget?
Most of the people, especially students, think that budgeting can be a daunting task. Maybe! But you can make it as easy as checking a patient’s blood pressure. The first step of budgeting is – knowing the total income. For a medical student, most likely this money comes from student loans.
To formulate a budget, the first step should be determining the expenses; make sure the expenses are your necessities. If you are not sure, track your expenses for a month before formulating the budget to understand your average monthly expenses. Also, you need to determine the expenses that are fixed (Rent, auto loan payment, and health insurance premium) and variable (Groceries, shopping, educational supplies, entertainment).
After knowing the total expenses and total income, you need to calculate the difference to see whether the result is a surplus or a deficit. If you find the result is negative, adjust the variable expenses and cut down on unnecessary expenses!
Use a budgeting worksheet to formulate the budget. You can use any budgeting app available online.
How can you manage a budget while being enrolled in medical school?
Trust me, managing your own budget is easy. Follow these tips to make the task even more easier:
Keep your financial obligations in mind
A medical student needs to be aware of his/her financial obligations (For example: the cost of books, medical supplies and other necessary accessories for the school). Other financial obligations include rent, credit card bills, groceries, or any other expenses that you simply can’t ignore. Look around on websites, forums, or to your medical institutions themselves to get an idea of how much your supplies will be. Once you know your financial obligations, you can easily formulate the budget.
Start with the budget as early as possible
It is recommended for students to create their budget at the beginning of a new school year or semester. Because sorting out a budget just before a final exam can be stressful! So, try to work on the budget when you have some free time prior to starting. However, don’t forget to make necessary changes in the budget as you go along. Each much try to revise your budget as you go and make changes as needed. Thus, you will no longer have to bang your head against the wall to create a good budget.
Consider some lifestyle adjustments
Only students know how some expenses add up quickly like buying new books or hefty lab fees. So, to combat with sudden expenses, you should keep a saving cushion. You can reduce your supermarket purchase to save more bucks on groceries. Consider less partying or eating out to save on entertainment. Also, early on consider a smaller apartment or housing which is more affordable and cost saving. These types of lifestyle adjustments can help you to set aside some necessary fund for your top financial priorities.
Make a list of your expenses
Try to keep track of all your finances. Thus, you will understand where your money is going. Keeping the track of expenses in the head might be stressful as you will get confused soon. To understand how to adjust the budget, you will need a visual realization. Thus, it is recommended to write down all your expenses.
An easy way to start this is reviewing your online banking statement each month. Note the cost of the unimportant purchases that you’ve made in the previous month. You can analyze how often you had dine out and spent money on unnecessary shopping. Medical students especially need to track their expenses to make the budgeting easier. Thus, you not only can manage your personal spending, but also you can save some money for future financial obligations.
Fix your goal and achieve it
It is important for medical students to set their financial goals that they wish to accomplish. Because due to their education cost, they may not have enough money or may have to turn to unattractive loan options. It’s generally not a good idea to use credit cards for every purchase (unless this paid off each and every month). Setting a financial goal is not so difficult; you can do it with the help of budgeting.
For example, If you are trying to save a certain amount of money in a particular month, then you will need to make some cost saving adjustment in the budget like – less shopping at the supermarket, no weekend partying, no eating out for the whole month, etc. Thus, you will be able to achieve your financial goal without worrying much.
Always remember, you have already taken out a huge education loan for your studies, which is your biggest financial obligation; so, you have to stay away from any kind of additional financial burden.
No doubt you will be a great physician in the near future; but, to become a great money manager, you need to learn the basic money management lessons in at the very beginning. Also, learning about budgeting is not enough; you need to learn to live within your means. Because, usually, young doctors earn less than experienced doctors at the beginning of their career. So, to get out of your education loan debt, learning good financial lessons will be helpful long-term. This will also cultivate an attitude of generosity and peace in your mind.
Amy Nickson is a web enthusiast. She completed her graduation from Oglethorpe University, Atlanta, Georgia. She works as a financial writer and she shares her expertise through her crisp and well researched articles based on money management, money saving ideas, debt, and so on. You can follow her on Oak View Law Group where she shares her expertise on personal finance field.
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