Career and Life Planning Guidebook for Medical Residents

R E A D : Setting Goals And Boundaries: Transitioning To Your New Income As a new attending, your first pay check will likely be very different from your salary as a trainee. The difference will be especially noticeable if it includes a signing bonus. Some new doctors make impulsive decisions with the additional finances on hand. It’s very important that the decisions you make with your increased income do not inadvertently cripple your future financial security. You must get your financial house in order and a house divided against itself can’t stand. Here is a quick check list of how to create some order in this task: Prioritize the payment of your student loans. If there are contractual salary considerations to accommodate this debt, do not spend that money on anything other than debt repayment. If you leave the job early, you might be required to pay this money back. Make a budget. This is very important. Even if you think you don’t need a budget, make one! Anytime you have a big change in income, it’s time to make a budget in order to make the best use of the money. If you don’t like budgeting, you only need to do it for a little while to establish good initial spending habits. Without this tool, you are at risk to spend money carelessly and wonder where it all went when a major expense appears. Plan for the future. You will likely be offered a re- tirement plan with your new job. Since you are not yet living on all of that potentially higher income, begin contributing the maximum amount allowed into your retirement plan. If you start investing for your future now, before you change your lifestyle, you will never miss the money and your eventual retirement will be secure. Expect the unexpected. You will need to protect yourself and any dependents if something un- fortunate happens to you that curtails your income. Now is the time to be sure you have the right amount of term life insurance, and purchase your own occupation disability insurance. After you have all these important expenses in your budget, then you can slowly begin to adjust your lifestyle. I recommend that you don’t substantially increase the other areas of your budget. If you have been living on $50,000 a year, then increase your spending by 50%. Giving yourself a lifestyle raise of $25,000 a year is a nice bump. It will leave you with a lot of room to slowly make changes as you get used to this new life and higher income. Grow into your income gradually and you will likely have a good result. Grow too rapidly and you are likely to make some big mistakes. Your career in medicine should be nothing short of fabulous. Do everything you can to make that happen. Creating a budget, making informed decisions, and being patient will help you be successful and secure in the long run. Your career in medicine should be nothing short of fabulous. The Transition 341 WWW.PHYSICIANCAREERPLANNING.COM