Why do physicians in training (and beyond) fail to focus on their personal finances?
This is really the question behind my whole blog. My focus is on helping physicians to get their finances in order and achieve financial well-being as I work on achieving it myself.
I like to think that is what makes my blog unique, that I am on the same trip as you!
I especially like to focus on those in training, in transition, or who have become a young attending. This is really a critical window to setting up your future (although it is never too late!).
That is why I created my course, Graduating to Success, to help others successfully transition to being an attending, personally, professionally, and financially!
But an even more interesting question is why we, as physicians, neglect our finances to begin with? Why do we fail to focus on finances?
This is a question that I recently tried to answer on a podcast called, Finance for Physicians. For the full podcast, check here.
This podcast is hosted by Daniel Wrenne. For those not familiar, Daniel is a financial advisors specializing in physicians. His rates are flat-free only. He is one of the good guys in the financial planner world and is on my recommended list. If you are looking for good advice at a fair price, you can schedule a free consultation with Daniel himself here.
Anyway, back to the question at hand:
Why as doctors are we so unwilling to own our mistakes, learn from them, and teach others how to avoid them?
I don’t think that there is an easy answer to this question obviously.
But, let’s explore.
You all know my journey by now.
I made every mistake in the book. But eventually I went from burying my head in the sand to gaining full control over my finances. I learned from those mistakes and now try to help others avoid them.
It sounds so simple written out like that. And while the actual perfunctory steps to manage finances or come up with a financial plan are not necessarily “hard”, the mental aspects of making this change are extremely difficult and very hard to quantify.
In simple terms, here is why I think physicians fail to focus on finances to our detriment
We are financially clueless
It is way too easy for us to stick our head in the sand like I did. We get no financial education at any point in our long sojourn through higher educational institutions. Meanwhile, we pay an ever-increasing amount for this limited scope of education. So, we learn to ignore our finances.
Once we do stick our head in the sand, it becomes so intimidating to pull our head out and face our situation that often we just decide not to do it until there is no other choice. Often at this point, it is too late.
We dismiss the importance of financial well-being
I could easily have written that we dismiss the important of well-being. Period.
But, if we are guilty of neglecting our own health and well-being, we are even more guilty of neglecting our financial well-being. In fact, most physicians don’t consider financial well-being to be a component of our overall well-being.
But it is. I am proof of this. By creating a financial plan and getting my house in order, I found myself feeling better overall and even becoming a better doctor. Focusing more on patient care and the reasons I got into medicine made me happier.
When we do focus on finance, we focus on the wrong things
Doctor cars. Doctor houses. Watches. The list goes on.
As a field, we tend to focus on personal consumerism rather than personal finance. We focus on what we make and what we buy/own rather than what is important.
What is important is our well-being, our fulfillment, our happiness, and our purpose. But most of all, what is important is our freedom of time to pursue all of the aforementioned.
Physicians think money is dirty
Very few to no doctors go into medicine to make money. We are all driven by something else. By the desire to help others and make a difference.
So, we convince ourselves that money doesn’t matter. And we start to feel that if a doctor thinks about money, it takes away from patient care. But that is not true. The two are not mutually exclusive. In fact, they are positively correlated.
I have found that most doctors who are financially free or work towards financial well-being practice better patient care. They are able to focus on the patient and their needs without worrying about their insurance, reimbursement, or need to see more patients to bill more.
Contrast this with a doctor who feels the pressure to increase RVUs to pay their bills because they are living paycheck to paycheck.
Doctors hate to admit they don’t know
It took me a long time to get good at this. For so long, I hated to admit that I didn’t know something, whether that was clinically or otherwise. It’s presented to us as a sign of weakness.
In reality, as I progressed through my training, I came to respect those residents and attending that could admit when they needed help. It showed a personal and professional confidence. I worked to emulate that and continue to do so today.
But, this does project onto personal finance as well. We don’t like to admit that we don’t understand investing so we don’t talk about it. Or worse, we listen to whoever is talking about it the loudest without having any real idea what they are talking about. We all know those types.
We don’t have a lot of time
This one is pretty valid. Our time in training and beyond is limited. We want and need to focus primarily on learning medicine and being the best doctor we can be. As we should.
But, if we just develop and practice simple habits, like reading one blog post a day, we can learn the 20% about personal finance that we need to get 80% of the results.
We can also accelerate our progress through coaching or investing in ourselves through courses like mine.
So, how can physicians break this cycle?
After all of this philosophical debate, we need some actionable steps.
The first key is recognizing this blind spot in our life and education. You are reading this blog so you have accomplished this critical first step that so many physicians do not. Congrats!
Now that you are in this camp, we need to work together to spread awareness among other docs who do fail to focus on finances. Imagine the incredible positive change that a world of financially well and free physicians could impact on medicine.
That’s on a global scale. But what can we do individually?
- Decrease burnout and become a better doctor
- Learn to track and grow your net worth
- Build on your financial education
- Follow these 10 steps towards financial freedom for young doctors
- Join our Facebook group to interact and learn from likeminded individuals
What do you think? Why do you think doctors fail to focus on their finances? What are you doing to achieve financial well-being?
3 thoughts on “Why Physicians in Training Fail to Focus on Finances”
Hey man good post as always. another reason for failing would be thinking, like I did, that you can hand over the Financial reins to somebody you trust who won’t screw you. Would’ve been nice if my buddy financial “advisor” would’ve been more like Daniel Wrenne above and I wouldn’t have lost 50,000 bucks to Northwestern whole life insurance.
Incidentally I think Daniel mentioned that he did work for Northwestern Mutual before he became a fiduciary fee only financial advisor.
Rikki, you’re totally right! That’s one I missed. Absolutely we are easy marks for all of the reasons I went through. So important to get good advice for a fair price. And you are right that Daniel, by his own admission, was on the dark side before becoming one of the good guys in the business!