Residency is a whirlwind – long hours, steep learning curves, and let’s not forget: a modest paycheck paired with a mountain of student loan debt. The good news? You don’t need to be a financial expert to set yourself up for success.

With some smart habits, you can start building a solid foundation now, even on a resident’s budget. Here is some advice on how to navigate finances during residency:

1. Live below your means
2. Start saving
3. Know your loans
4. Build your credit
5. Find a financial mentor
6. Think and plan for the future

Live Below Your Means (Mostly)

Residency isn’t the time to try to keep up with the Joneses. Yes, you’re finally earning a salary, BUT it’s still a fraction of what you’ll make as an attending.

• Avoid lifestyle creep: resist the temptation to upgrade everything just because you finally have income.
• Choose housing you can comfortably afford.
• Meal prep when possible.
• Find joy in free or low-cost fun (resident trivia night, anyone?).

That said, don’t deprive yourself entirely! Celebrating small wins or indulging occasionally is part of maintaining sanity in residency. Just make sure the splurges are intentional, not habitual.

Start Saving (Seriously!)

Saving even a little bit helps. Even during residency, a flat tire, a broken phone, or unexpected travel can hit your wallet HARD. That’s not even accounting for costs associated with board exams, licensing, and other educational fees that may not be fully covered by your institution. Aim to gradually build an emergency fund with 3-6 months’ worth of funds to give yourself a financial cushion and peace of mind.

A high-yield savings account (HYSA) can be a valuable tool during residency. These accounts typically offer significantly higher interest rates compared to traditional savings accounts, so your money actually grows while you sleep. Start small: set up an automatic transfer from your checking to your HYSA after every paycheck and watch your money thrive!

Know Your Loans

This one is HUGE! Most of us graduate with loan balances that could buy a house (BUT ACTUALLY) and ignoring them won’t make them go away. Start by understanding your repayment options:

• IDR: Income-driven repayment plans can help keep your monthly payments affordable.
• PSLF: If you work at a nonprofit hospital, you may also qualify for loan forgiveness programs such as Public Service Loan Forgiveness (PSLF).
• Refinancing: Even if PSLF isn’t your path, there are other strategies to explore, including refinancing down the line (once you have a stable income and no longer qualify for forgiveness programs).

Importantly, loan policies are constantly evolving, with frequent changes to repayment plans, forgiveness criteria, and servicer transitions. Stay informed by checking reliable sources, monitoring your loan servicer account regularly, and signing up for updates.

Certify your employment annually if you’re pursuing PSLF, and keep your paperwork organized. Be proactive. Your loans won’t disappear on their own, but with a clear plan, they don’t have to control your life either.

Build Your Credit

Whether you want to buy a house someday or just get approved for an apartment, your credit score matters. Pay bills on time, keep credit card balances as low as possible, and consider using a credit card for regular purchases (as long as you pay it off each month).

Building good credit now sets you up for future financial freedom. Open a credit card if you don’t already have one, preferably with no annual fee and good rewards. Use it for predictable expenses (gas, groceries, utilities) and pay it off each month. Avoid maxing out your card or making late payments; these hurt your score. Also consider using a free credit monitoring service or your bank’s app to track your score.

Find tips for improving your credit score »

Lastly, make sure your student loans are in good standing. Even though they’re deferred in med school, missed payments during residency can tank your credit.

Find a Financial Mentor

Medicine is full of mentors, but few of us are taught money management in training. Don’t be afraid to ask for help! You don’t need to hire a full-fledged financial planner during residency (unless you find a no or low-cost advisor), but ask around—maybe a friend, attending, or even a financially-savvy co-resident can help you think through budgeting, saving, or investing basics.

There are also free resources like Panacea Financial’s Resource Library that offer great beginner-friendly advice. You can even explore free or low-cost sessions through your hospital’s employee assistance program or resident wellness services (if they have them).

Think and Plan for the Future

It’s never too early to start thinking about life after residency! Think ahead about how you’ll approach big post-residency expenses: moving costs, board fees, that well-earned vacation or car upgrade. Planning now reduces stress later.

If your program offers the option to contribute to a 403(b) or Roth IRA, consider contributing; even small amounts add up over time due to compound growth. And if you’re not in a place to invest just yet, that’s okay! Just keep the bigger picture in mind, whether it’s buying a home, traveling more, or paying off loans early. Start planting the seeds now so your future attending self can THRIVE!

Financial Resources for Residents

Residency isn’t forever, but the financial habits you build now will follow you into attending life. Save when you can, spend intentionally, and don’t be afraid to ask for help. A little planning today can mean a lot more freedom (and a lot less stress) tomorrow!

Find free articles, guides, webinars, and more to help make managing your finances easier in Panacea’s Resource Library or check out one of our picks for you:

• How Much Should You Contribute to Retirement During Residency?
• Federal Student Loan Updates: Key Changes Impacting Doctors in 2025
• How Doctors Can Avoid Lifestyle Creep

And be sure to check out how other residents and fellows feel about their finances in Panacea’s Residents & Fellows Survey Report »