There's no doubt doctors and healthcare professionals make higher incomes than the average American, but that higher income doesn't automatically mean your finances will be a breeze.

Implementing a strong financial plan can help you avoid lifestyle inflation, strategically pay off student loans and other debts, maintain a balanced lifestyle within your means, and prioritize substantial investments for your future.

Budgeting for Healthcare Professionals

During residency, you might have learned to live within your means due to low income. However, as your income grew, your spending likely increased. 

Now, as a high-income earner, if you're unsure about your financial health, Doing Well is here to help diagnose and treat your financial challenges.

Young doctors and healthcare professionals need to create a budget that outlines their monthly income, expenses, and savings goals. Regardless of how high your income might be, racking up debt and overspending is possible at any income level.

Here are some practical tips to help us get started:

1) Avoid Lifestyle Creep

Lifestyle creep occurs when your spending increases in proportion to your income. While it's natural to indulge in luxuries as your income rises, it's essential to be mindful of your spending habits and distinguish between wants and needs.

2) Have a Second Set of Eyes in Your Busy Life

Maybe it's not that you live lavishly or spend crazily, but you still don't know where your money is going.

• Being a busy professional, it's easy to forget how many subscriptions, unneeded insurances, and other unnecessary things you are paying for.
• Doing Well is here to help you keep track of your financial plan on an ongoing basis, so you can do what you do best — help save lives and keep people healthy.

3) Factor in Expenses Related to Your Profession

• These expenses are part of your business and profession, and incorporating them into your budget ensures you're not worried about where the funds will come from when it's time to pay these expenses.

Some common expenses for doctors (especially if you own your own practice) include:

• Supplies
• Building, location, infrastructure
• Medical equipment

4) Ensuring Your Money is Working for You

• By avoiding lifestyle creep, you'll have more income left over to explore investment opportunities that offer long-term growth potential, such as stocks, bonds, real estate, and retirement accounts.
• This can lead to financial success and freedom, giving you the choice to retire early if desired, set your family up for generational wealth, and live a stress-free life.

Investing and Retirement Planning for Doctors and Healthcare Professionals

Once you've refined your budget and financial plan, and your primary income sources comfortably sustain your lifestyle, it's time to turn the spotlight on investing and retirement planning. 

👉 Keys to planning for the future

• Maximize retirement accounts: retirement savings are a critical step in securing financial stability in the future, especially for doctors who often start their journey later due to longer education and training periods.
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• Life insurance: Life insurance is an essential consideration for doctors, especially those with families or significant debt. There are two main types: Term and Permanent
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• Diversify investments: Beyond retirement accounts, consider taxable investment accounts, real estate, or other investment opportunities. Diversification can help manage risk and improve potential returns. It can also help generate passive income that you can utilize for extra wants within your lifestyle.

Here's how you can leverage retirement accounts and life insurance, whether you're employed by a practice or running your own.

👉 Retirement and life insurance options

Other things healthcare professionals should keep in mind

As a physician, here are a few additional factors that may affect the overall structure finances:

💲 Costs of being a physician

‍Doctors often must pay to fulfill continuing education requirements to keep their license up to date, carry various medical malpractice insurances, and ensure all certifications are up to date

💰 Tax implications of private practice

‍If you’re a physician in private practice, it's essential to understand the tax implications of your business structure. Ensuring you are optimizing your business based on your income and deductible expenses can make or break your finances.

👀 Additional income opportunities

Many doctors explore opportunities for additional income, such as consulting, teaching, writing medical publications, or participating in clinical trials. These are great ways to use your expertise to both help people and gain additional income.

⭕️ Disability Insurance

‍It is essential for doctors to ensure that they have determined the best course of action for themselves when it comes to disability insurance. There are various perks of this insurance such as paying out if a physician is unable to perform their job duties for various reasons.

💖 Plans, incentives, and discounts

‍Working in the medical field comes with its perks. Doctors should explore available professional memberships and associations that offer benefits like insurance plans, discounts on medical supplies or equipment, and access to exclusive networking opportunities.

Establishing a sound financial foundation is important for doctors to navigate the complexities of the often high-income profession effectively. However, with your busy schedule tending to patients, we know you’ll also need support. 

Doing Well is here to help you navigate the financial complexities unique to physicians, offering a blend of expert advice with a human touch.

With Doing Well, you'll receive:

• Personalized budgeting: Tailored budgeting strategies and an accountability partner, all with a physician's lifestyle in mind, ensuring your finances are as healthy as your patients.
  
  
• Financial organization: Monthly financial clean-ups liberate you from the time-consuming task of tracking expenses amidst your demanding schedule.
  
  
• Comprehensive financial analysis: An in-depth look at your debts, retirement savings, and insurance portfolio, providing strategic advice for debt payoff, investment growth, and ensuring you're adequately insured.
  
  
• Ongoing support: Monthly calls, along with email and asynchronous support from your advisor, guarantee you have the guidance you need when you need it.
  
  
• And much more: all with Doing Well's human touch at your side

Don't let your finances flatline. It's time to invigorate your financial health and rejuvenate your budget. Visit DoingWell.io to embark on your journey toward financial wellness today!