Learn about finance. I get it. Finance can be boring. You don’t want to spend the free time you barely have studying a subject you don’t really like. Regardless, it’s extremely important. When you learn how to better manage your money, you will have the ability to reach financial independence much sooner and spend more time doing the things you love.
In fact, how well you manage your finances plays a huge role in your overall quality of life. In order to truly create the life you desire, you’ve got to have a financial plan in place. It all starts by learning the basics of money management.
Insure against the unknown. Now. Tomorrow is not guaranteed. As much as you think you will live for the next 80 years, truth is, you never know what may happen. Getting “term” life insurance will virtually ensure that your family is taken care of [financially] should your life end sooner than you anticipate. Although life insurance may be included in the salary and benefits package for most residents (aka new doctors), it is up to you to ensure that it is there, especially if you are in a different career field.
Whether you have a family or not, disability insurance is a must for everyone. Specifically, you need “own-speciality” disability insurance with riders (added protection) for mental health disorders, pregnancy complications, etc. Although it’s rare for people to become permanently disabled, lots of people encounter short-term disabilities from car accidents, mental health flare ups, and other unforeseen events. Disability insurance will make sure that you still have an income during these times.
The goal is to make sure that your salary is not affected and your quality of life is not changed if something were to prevent you from working at your full capacity. You’ve come too far to let some freak accident or random illness keep you from earning the wage you’ve come to expect and enjoy. Protect yourself. Get insurance.
Pick your specialty/career wisely. I can’t stress this enough. And this is coming from me, someone choosing to go into family medicine (one of the lower-paid medical fields). Many of you have been in school for over 20 years and have sacrificed so much to get to this point. Don’t throw it all away by pursuing a career you don’t love.
Even if you choose something that doesn’t pay as much as you would like, your happiness and longevity in the field matters way more than impressing people who haven’t had to make nearly as many sacrifices as you have. Many people who choose a career field just for the salary end up burning out a few years into the job. Don’t let that be you. Choose a career you love.
Stop trying to keep up with the Jones’s. If there’s one thing college made you good at, it’s comparing yourself to others. Graduate school can be the same way. Trust me. Many of the times, our grades and test scores were based on the law of averages with no one wanting to be placed in the bottom half. Newsflash, the real world isn’t like that.
Whether it’s the newest cars, swankiest clothes, or flyest vacations, you need to reach a point where you make personal decisions based on what would be best for you, not what would make you look better in front of others.
You don’t need to splurge on a new car just because everyone else seems to be driving something nicer. You also don’t need to purchase the most expensive clothes or the most upgraded Iphone simply because other people think you can afford it. Stay in your lane, focus on yourself, and stop buying things to impress other people.
Get into the habit of saving. Many people who have just started their careers view saving as something that seems nice to do later in life when they have more money. They are wrong. The key is to get into the habit of putting money aside right now.
Not only does saving create good habits, but it also adds a layer of protection for you in case an unexpected expense occurs. Why rely on credit cards you may already be struggling to pay off, when you could use money you’ve already set aside, interest-free?
Plus, saving money helps you learn to live below your means. The practice of living on less than you make will allow you to pay down debt quicker, save up for your dream home, and start putting money away for a future wedding, your kids’ education, or retirement.
My point? You need to learn a little something about personal finance right now, even if it’s for the sole purpose of making sure you don’t go broke. Next, get the insurance you need to protect yourself against unforeseen events. Everyone should have disability insurance and those with a family should also get term life insurance. Choose your career wisely and make sure you are doing something that brings you happiness and satisfaction. Lastly, you have to stop comparing yourself to others, get into the habit of saving money, and learn to live below your means.
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