Financial well-being is something that most doctors never really consider. On the contrary, most physicians feel that money is taboo to care about in this field. “That’s not why I got into medicine,” is what I often hear. And with all of the focus on improving physician well-being and preventing physician burnout and moral fatigue, I have yet to see a healthcare system, private, academic, or public, talk to its physicians about finances.
And yet here I am, proclaiming that financial well-being, or in other words, “money,” has made me a better doctor
How can I be so confident saying this? It’s because I’ve lived it.
Like too many physicians, I experienced burn out first hand. My love of medicine waned. My well-being plummeted.
The reasons for this were multifactorial. And through a support system, I worked hard to improve the symptoms I was experiencing. However, I never considered my financial well-being, or lack thereof.
At least, I never considered my financial well-being until the very end. The end of my 7 years of training that is. It was at that point that a light bulb went off in my head and I realized one of the biggest stressor contributing to my burnout…my finances.
Like many, I never had any formal or informal education regarding personal finance in my decades of education
Personal finance seemed intimidating and scary. It was not “the reason I got into medicine.” So, I ignored my finances. Naturally, I made some big mistakes. And now, these mistakes were really stressing me out and affecting my well-being.
While everyone around me congratulated me on my impending graduation, on getting a well-paying attending job, and telling me, “it’s all going to be great,” I didn’t feel that way.
- >$500,000 of student loans
- Credit card debt
- No savings
- No investments
- And worst of all, no idea or plan on how to start saving and investing
I finally realized that a huge yet ignored part of my burnout was a lack of financial well-being
So, I set out to change this. My wife and I sat down, determined to create a plan to improve our financial well-being. But the most important part of developing our plan was to make sure it was feasible within the bust schedule of a full-time practicing physician.
This was our plan:
- Read 1 personal finance book together each year
- Read one personal finance blog post each day
- Sit together and develop a budget
- Review the budget once a month
- Create a written financial plan
- Follow that written financial plan
These were the big steps and the order in which we took them.
I’ll go a bit more in depth about each of these steps that you can take if you are feeling the same way that I did…
1. Read one personal finance book together each year
This can seem really intimidating because the topic itself seems intimidating. But what I’ve found is that the best of these books are really manageable.
Here’s my list of the top books for a beginner (or really any level) to start with.
And note that my wife and I read these books together. At the same time. It became a bonding exercise. We would read and discuss and disagree. But this practice really helped us to get on the same page financially. And remember, money is the #1 cause of divorce in America. So being on the same financial page is important.
2. Read one personal finance blog post each day
I still do this. And it can be any blog, not just mine.
It takes about 5-10 minutes to do. I read them in the morning when I wake up or in between OR cases. Doing this once a day for a month will increase your financial knowledge exponentially. Doing it for a year…forget about it!
3. Sit together and develop a budget
People hate budgets. But not me. My budget is like a treasure map. It makes sure that I reach my financial goals.
Here are some simple steps to create a budget:
- Review your past month’s expenses and group them by category
- Compare your total expenses to your monthly income
- Revise your budget for monthly expenditure goals that allow you to save at least 20% of your income
This is a full guide to creating a budget in 20 minutes or less.
4. Review the budget once a month
This may seem compulsive. But it’s something that takes 10-15 minutes every month and again, ensures that we reach our financial goals.
It keeps us in check and has helped us to save 45-50% of our income every month.
5. Create a written financial plan
As you read your personal finance book and blog posts, you’ll start to develop a sense about how you want to invest save and invest your money.
My recommendation is a simple 3 part plan:
- Save at least 20% of your gross income
- Invest those savings in broadly diversified index funds
- Let time and compound interest do their thing
Regardless of what plan you decide on, make sure to write it down. If you have a partner, definitely do this together.
This is our actual written financial plan if you want to use it as a template.
6. Follow that written financial plan
And then review the plan every once in awhile.
Make sure you are adhering to what you said you would do.
This plan will keep you on track to reach financial freedom, practice medicine on your own terms, and retire when and how you want. Pretty powerful!
If you’re looking for more information, then check out my free masterclass webinar, 12 Steps to Financial Freedom for Physicians!
What happened to me
It took my wife and I a few months to complete these tasks that we set out for ourselves.
After we did, it still took me a few weeks to realize what had happened. I hadn’t started making a cent more. I still have >$500,000 in debt. And we still have no savings or investments at that time.
But we did have knowledge and a plan. A plan that we knew, if we followed, would guide us to financial freedom, practicing medicine on your own terms, and retiring when and how we want. My financial well-being shot through the roof!
But what was even more unexpected was what happened to me professionally.
I was no longer stressed that I would never dig out of my financial hole, bitter about the loans I had acquired to chase my dream, angry at others who didn’t face such challenges, intimidated by an undeserving taboo, or embarrassed about the naive mistakes that I had made. My focus, attention, and efforts could center completely on what I love…patient care.
I actually became a better doctor. Or better said…caring about money and finance made me a better doctor.
I challenge you to do the same
Or if you already have done so, I challenge you to help spread the word. Help others to shake off the perception that to take care of your finances is somehow an undesired trait for a physician.
And help create a world of financially free doctors that can change the face of healthcare in ways that we cannot even imagine!
What do you think? How big a part of overall well-being in financial well-being? Can it lead to burn out? Have you experienced this? Let me know in the comments below!