The Financial Moves to Make in Intern Year

Intern year is overwhelming. But a few financial decisions made in the first few months set the tone for your entire residency. Here is what to prioritize.

Get Your Benefits Election Right From the Start

When you start residency, you will be asked to make benefits elections within your first few weeks - often during orientation when you are already overwhelmed with clinical responsibilities. These decisions matter and are usually locked in for the full plan year. Take the time to make them thoughtfully even when everything else feels urgent.

Health insurance: if your program offers both a traditional plan and a high-deductible health plan (HDHP), compare the premiums and out-of-pocket maximums carefully. HDHPs paired with a health savings account (HSA) can be advantageous if you are generally healthy and want to build tax-advantaged savings. The HSA triple tax benefit - contributions are pre-tax, growth is tax-free, and withdrawals for qualified medical expenses are tax-free - makes it one of the most efficient savings vehicles available. If your program offers an HSA-eligible plan, contributing to the HSA is usually worth doing even on a resident salary.

Set Up Your Student Loan Repayment Before the Grace Period Ends

Federal student loans have a six-month grace period after graduation from medical school before repayment begins. For most interns, this means repayment kicks in around November or December of intern year. Do not wait until then to figure out your plan. Enroll in an income-driven repayment plan - SAVE is currently the most favorable for most borrowers - before the grace period ends to ensure your first payment is based on your resident income rather than a default standard repayment amount that could be significantly higher.

If you are pursuing PSLF, submit your first Employment Certification Form as soon as you start your program. Do not wait until later in residency. Early certification confirms your employer qualifies and begins building your documented payment count. Catching a problem with employer eligibility in intern year gives you time to address it. Catching it in year four does not.

Do not let your loans enter default or forbearance unnecessarily. Months in forbearance do not count toward PSLF and extend the time before forgiveness. Income-driven repayment with a qualifying employer is almost always the right structure for PSLF-eligible residents, even if the payment feels unnecessary at that income level.

Build Your Financial Foundation in the First Six Months

Intern year is not the time for sophisticated investing. It is the time to establish the basics. Open a checking account if you do not already have one set up to receive your residency paycheck. Open a high-yield savings account and begin building an emergency fund - aim for at least one month of expenses by the end of intern year, and two to three months by the end of residency. Automate a small transfer to the savings account each pay period so it happens without requiring a decision each month.

If your program offers any retirement match, contribute enough to capture it. A match is an immediate guaranteed return that no investment can replicate. If no match is offered, a small Roth IRA contribution is worth making during residency while your income - and tax rate - is at its lowest point in your medical career. Even $100 or $200 per month into a Roth IRA during residency adds up over a long investment horizon and locks in tax-free growth at a favorable rate.

Protect Your Income With Disability Insurance

Intern year is the right time to apply for individual disability insurance, not because the risk of disability is high in your 20s, but because your health is likely at its best and premiums are lowest when you are young. A true own-occupation disability policy purchased in intern year at a low rate stays with you for your entire career. Many insurers offer resident discounts and student loan riders that increase benefit amounts to account for loan obligations during a disability period.

Do not wait until fellowship or attending year to address this. Health changes - even minor ones that seem insignificant - can result in exclusions or higher premiums when you apply later. The cost of a policy in intern year is typically $150 to $250 per month depending on specialty and coverage level. That is a real expense on a resident salary, but the risk of going without it on a $300,000 loan balance with a career not yet fully launched is significant.