Just because you’re a medical practitioner doesn’t mean your financial life will go smoothly from the moment you start your clinical practice. In fact, spending years scraping and scrimping to get through med school could leave you with massive debt. Plus, there are financial traps that you could fall in if you’re not careful! So to help you out, below is a list of money mistakes commonly made by doctors at the start of their careers. And for everyone’s sake, also included are tips on how to avoid them.

Spending Too Much Too Early
Medical practitioners experiencing a spike in their income tend to increase their spending in turn. This is not a wise thing to do, especially if you still have to pay off your debts from your student loan or medical equipment loan. Furthermore, if you want to build your wealth as a doctor, you need to live below your means after residency. And you need to use any funds left after your expenses to pay off your loans.

Not Having Insurance
Another mistake you need to avoid in your medical career is not having adequate life, liability, and disability insurance. These insurances can provide you and your family financial protection in case of any economic catastrophes like accidents, illnesses, and death.

Saving Less Than 20%
Not saving enough money during your heyday as a doctor, could leave you in financial trouble in the future. As a rule of thumb, you need to keep at least 20% of your gross income as a medical practitioner if you want a nice financial nest during your retirement. And if you’re going to retire rich, you’ll need to save more than that. Don’t just rely on fancy investing, since it won’t be able to make up for an inadequately funded portfolio.

Picking Bad Financial Advisers
Bad financial advisers may cost cheaper, but their financial tips could cost you dearly. On the other hand, the right financial adviser can serve as a doctor’s money ally, and they will help you achieve your financial goals while still adhering to a fiduciary standard. So don’t hesitate to shell out your cash for these good advisers; they’re worth every penny.

The Takeaway

Even if you’re enjoying a high income as a doctor, you can still be very prone to making financial missteps that can be costly both professionally and personally. By following the tips mentioned, above, though, you’ll be able to avoid stumbling into these pitfalls.


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