Does it happen to you that when you visit a hospital and see a young doctor, a Grey’s Anatomy character comes to your mind driving home in his Porsche after a hectic day of performing emergency surgeries?
Despite the stereotype, many physicians start their career in medicine at a disadvantage and struggle financially even after the degree completion. The truth is that a degree in medicine does not guarantee financial success. Even though healthcare tech service providers like Clinicast help make the work easier for physicians, they still need a proper plan to have a financially successful career.
Fortunately, the pressure to plan a successful future can be avoided with the help of our comprehensive guide for physicians sunk in a puddle of financial troubles.
Practice Strict Budgeting:
Physicians who are going through a rough financial patch need to begin practicing strict budgeting. They can start by making a list of their monthly expenditures and allocate budgets to each expense. This is how they will know where their funds are going. Doing so will also help cut on things consuming extra money. After paying off monthly expenses, whatever is left will be funneled into a savings account. That amount can also be invested in profitable business ventures.
Practicing budgeting can be overwhelming. Thereby, several tools like Personal Capital or Mint are there on the web willing to help you with the process. Via these apps or tools, you can keep track of your funds and plan accordingly.
Make the most of retirement plans and save:
Despite struggling financially, most physicians often overlook retirement plans and saving options. Initially, it might not feel like the end of the world. However, it would lead to a financial crunch down the road. Therefore, it is advised to save whenever possible and as much as possible.
A convenient way to do this is by investing in 401k and pension plans offered by healthcare systems. Physicians who are part of renowned health care systems are often offered generous retirement and pension plans. Apart from that, you can save on your own by opening your personal savings account with a high-interest rate to reap greater benefits. As a general guideline, it is best to put aside at least 10 to 15% of your income regardless of how much you earn.
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Seek profitable investing options:
Due to the tough nature of this job, having a side career is completely out of the question. Though, there are other options as well that can pave the way for passive income. A viable option for physicians to earn side income is investing in stocks. With physicians having the right mindset to make split-second decisions, investing in stocks sounds like an ideal option for them. However, this option might not appeal to everyone, given the time and commitment it requires.
An alternative option could be to create a Certificate of Deposit (CD) ladder. For those who don’t know, it is a saving strategy in which you invest multiple CDs with staggered maturities to benefit from long-term CDs with higher rates. This long-term and immediate investing approach allow people with busy lives to save big. This one is considered a better investment option than others as your money won’t be just sitting in your bank account but out there in the market, hence more chances of increasing revenue.
Guide for new physicians – envision professional life stages:
Students who are about to become physicians or those in their early stages of the profession must visualize their professional life cycle in stages in order to avoid being consumed by the student loans.
Physicians’ biggest challenge is paying off their debt while maintaining marginal cash flow. This is the critical stage of your career where you must plan for the future accordingly. Starting a family or purchasing a property at this point may lead to a delay in financial planning for the future and, eventually, a loss of thousands of dollars or even more.
At this stage, most physicians start evolving in their profession and might drink to the end of their student loans. That said, with great success comes great responsibilities and not to mention new personal expenses like car payments and mortgages. While physicians at this stage of their careers are well-compensated, not having a saving plan for the latter stages may not lead to a good happy ending. Therefore, it is advised to make extra contributions to your retirement plans. No matter how much you spend, you must have a fixed hefty sum for your retirement plan.
The last stage of a physician’s career can be compared to a fine wine – the older it is, the better it tastes. By this time, physicians are at their maximum earning powers and enjoy the peak of their profession. Celebrations continue in the form of ‘end of mortgages’ and ‘Empty Nest’.
Those who had invested well in their retirement plans would be enjoying a stable and comfortable life than those who went with the flow and made no future plans.
Take professional advice:
With the growing challenges that started in 2020, it is getting extremely difficult for physicians to have a stable living. Especially after the introduction of online consultation, the situation for bottom-line physicians has worsened.
In such difficult times, getting professional help is a must to navigate the current financial landscape. Some of you might find it an unnecessary expense, but it will definitely compensate you well in the future.
Financial planning takes time and investment. Start from a one-year plan, then gradually moves to more long-term ones. This will help you monitor your financial progress as well as keep you aware of your unnecessary expenses.
Lastly, if you are in that stage of your career where you think you might use some outside help to focus solely on your primary work, then head to Clinicast health care tech experts. They will take all the burdens off your shoulders so that you can solely focus on providing the best services to your patients.