6 effective ways to finance your medical education
Tapping into these resources at the right time can make a big difference when it comes to financing your studies.
Cheshta Mann
Jan. 01, 2022
5-minute read
Many chose to enter the healthcare industry because they have a passion to serve others. But taking the plunge into medical or dental school comes with a hefty price tag. If you haven’t created a plan for paying these expensive school or college fees, you might end up repaying debt for many years to come.
It’s important to note that your tuition fees are just one element of the costs that you incur when studying. You’ll be incurring additional costs in the form of accommodation, registration and exam fees, study materials, etc., which may vary depending on the type of institution selected.
It’s always a great idea to have some money saved to help offset your school fees, but will it be enough to last you the next 3 to 4 years? Besides savings, here are a few other resources that can help you fund your education and ease the burden a bit.
Applying for scholarships is an incredible way to boost your finances — you get financial support that requires no repayment.
Most scholarships are provided based on academic performance. In addition, the size and frequency of amounts may vary depending on the institution or organization. So, it’s vital to know what the eligibility criteria are and whether it’s a one-time or renewable scholarship.
When it comes to applying, have a look at various scholarships provided by your medical school and those that are government based. Refine your search based on ethnicity, gender, financial condition, due dates, etc. and apply for the ones that meet your requirements. It’s also helpful to keep a record of your applications including scholarship name, amount, date of application, etc.
Similar to scholarships, bursaries don't require any repayment. They're offered depending on your financial condition or return-of-service contracts, where you commit to render services for a certain time period.
To know if you qualify, contact your school to determine what bursaries you can apply for, and based on their deadlines, you may speed up your application process.
Grants offer financial aid to those whose family income tends to be below the set threshold levels. They don’t have to be paid back and can be easily applied for on provincial, local and institutional levels.
Whether full-time or part-time, students can browse through a variety of grants online depending on their province, ethnicity, student category, dependants, etc. You can also search using relevant factors or keywords and increase your chances of receiving financial assistance.
Similar to scholarships, bursaries and awards, grants have different criteria and due dates for applying. So, make notes of the deadlines and apply for them on time. Also, filter your research based on the frequency of grants offered because some grants might be offered once, while others may renew on an annual basis.
Students can register for many student loans offered online at federal and provincial levels. However, note that every province has a different program to offer loans, such as Ontario Student Assistance Program (OSAP) for Ontario.
If you’re enrolled in an accredited institution in Canada as a full-time student, you may be eligible to receive financial support from the government. Applicants receive an exemption on paying interest on loans until they complete their studies, plus for an additional 6 months upon completion.
Further, you receive a tax credit of 15% on the interest amount paid on Canada Student Loans. This can either be used for your current year’s income tax purposes or can be carried forward for a maximum of 5 years.
Also, if it's been over 6 months since you completed your graduation, you can also receive repayment assistance from the government Opens in a new window.. This plan reduces the balance of your loan amount, and you can pay off your debts within 15 years of finishing your education.
Apply for a student line of credit
A student line of credit works differently than a conventional loan. It’s a form of loan that allows you to repeatedly borrow money up to a certain limit set by your financial institution. And once you’ve paid off the borrowed amount, you can again start withdrawing amounts using your line of credit.
Not only does this smart option help you pay your tuition expenses, but it also allows you to meet basic expenses such as accommodation, food, travel, etc. As opposed to federal loans that begin charging interest rates 6 months after you’ve completed your education, a line of credit doesn’t offer this exemption. That means you're charged interest right when you borrow money from your line of credit. Also, the prime rate will directly influence the line of credit’s interest rates. The higher the prime rate, the more interest you’ll be paying on the amount you borrow.
Loan forgiveness and relief programs
Family physicians or residents who practise in rural locations, can apply for loan forgiveness through the Canada Student Loan forgiveness program Opens in a new window.. These programs offer up to $40,000 in Canada Student Loan forgiveness for a maximum of 5 years. You’ll only receive an exemption on the outstanding amount of your loan (not the interest) after completing your 12-month service.
Based on the location where you wish to continue your practice, you may be eligible to enjoy exclusive financial benefits. For instance, you may be freed from paying any interest on your student loans while you practice in provinces like Prince Edward Island. You can find the right relief program provided by your province or territory and read its terms and conditions carefully to ensure that you qualify.
Besides opting for the above funding methods, it’s noteworthy to create a budget depending on which school you want to pursue your medical studies. Once you’ve got a budget in place, anticipate the overall costs and what financing options you’ll rely on to cover those costs. Keep track of your monthly expenses by comparing anticipated costs with actual costs, and see if there are any deviations. If there are discrepancies, it’s prudent to assess where the extra expenditure occurred and how you can manage that going forward.
Medical studies can bring about a whole slew of questions when it comes to your finances. Contacting a financial advisor can be helpful and set you off on the right foot. They offer customized solutions and can explain all the various financing options at your disposal to help with your medical school expenses from day 1.
Written by
Cheshta Mann
Cheshta Mann is a freelance writer based in London, Ontario. She works with a diverse range of clients across industries. With her financial background and a seven-year writing tenure, she takes pride in supporting content development for CIBC. Cheshta is also pursuing her career in the accounting field.
