Financial Management Tips for Healthcare Professionals
Healthcare professionals earn more than the median annual wage for all occupations, but they still have financial challenges. Physicians reported struggling with their finances due to a combination of factors like student debt, budgeting, housing, and a lack of time for financial planning. This is also applicable to other workers in the field of healthcare. Healthcare professionals' education and training generally incur high costs. They also experience burnout from working long hours, which often puts financial planning and goal setting at the bottom of their priorities.
While there are plans for federal student debt relief and refinancing options, being in the healthcare industry still entails financial literacy and responsibility. Aside from achieving long-term security, financial management can offer significant benefits to one's well-being, productivity, and job satisfaction. Here are a few tips to help healthcare professionals better manage their finances and live stress-free lives.
Take note of discounts for healthcare workers
One of the most straightforward ways to stay on top of your finances is to budget well and avoid impulsive spending. But it also helps to take advantage of the benefits and discounts afforded to healthcare professionals to maximize your budget, especially for essential expenses like food and clothing. There are businesses that offer special deals on specific days, such as National First Responders Day, but there are also year-round discounts for purchases made online or in-store. You simply have to verify your professional status by presenting your badge or undergoing the ID.me authentication process.
Look for tailored advice for financial planning!
It takes time and effort to set goals and manage your finances comprehensively, but enlisting the professional help of a financial advisor can make the process much easier. Financial advisors can help clients develop plans across various areas such as repaying debts, planning taxes, strategizing investments, and mitigating risks. They are qualified and accredited to review your unique financial status as a health professional, while also possessing the analytical and interpersonal skills to communicate with you the right kind of financial product that yields high returns and long-term results. Working with a personal financial advisor allows you to dedicate more of your time to personal and professional growth without compromising your financial needs and goals.
Prepare for your retirement!
There is a growing trend of health professionals working beyond retirement age to fill the gaps in the workforce and maintain financial stability. However, the declining health that comes with aging can put the quality of care delivered at risk, so you need an effective financial plan to transition from practice to retirement more seamlessly. Depending on your employment status, there is the employer-sponsored 401(k), the 403(b) for those working for nonprofits, and the individual retirement account if you're self-employed. It's usually recommended that you save 10-15% of your income for retirement, but if you have a financial advisor, there's a good chance that your savings will be tailored to your specific retirement goals.
Look into getting malpractice insurance!
As a healthcare professional, it is essential to have adequate liability coverage to protect your finances, investments, and reputation in case of medical malpractice. The liability can come in the form of a misdiagnosis, an inappropriate treatment decision, or any other alleged error or negligence related to the professional services you provide. Since employer-provided insurance can have limited coverage, individual malpractice insurance provides greater coverage for legal fees and medical damages while protecting your personal assets like inheritance if a plaintiff decides to go after them. Malpractice insurance policy can be occurrence-based, which covers incidents that occurred during the active policy period; or claims-made, which covers any claim that was filed or lawsuit made when the policy was in effect.
On December 22, 2022, we had a virtual session in which we addressed the clinician's worries about financial management and went over the alternatives for student loan forgiveness programs. We questioned Victoria Masilang and Yim Chin, our nurse practitioners and seasoned medical experts, on what a clinician may do to manage their finances. Watch the complete video by clicking here: DirectShifts Hosted Student Loan Repayment & Financial Management Event