Fraud Blocker


Tips for Financial and Career Success for Young Doctors and Med Students
November 7, 2022 0 Comments

Tips for Financial and Career Success for Young Doctors and Med Students

The economic circumstances facing young physicians and medical students are quite different than they used to be 30, 20, or even 10 years ago. When starting your career  as a physician, student loan debts and an unfavorable insurance reimbursement environment, among other things, make it important for you to take an active approach to understand your financial and career choices. Educating yourself early on will improve your long-term financial success. Below, we explore some of the most significant challenges you may face when building a medical profession. We have also included tips on how to overcome them. 

Hurdles Faced by Young Physicians

A Changing Healthcare Environment

More and more hospitals are in charge of employing doctors, which makes it hard for young doctors to start their own practice. Most choose to work for others rather than for themselves.

But you don’t have to start from scratch and spend a lot of time and money to establish your own clinic. You have the option to seek out succession plans—working with older physicians who want help practicing medicine so they may enjoy their golden years. You may also seek out opportunities to serve as a medical director in addition to working in a private clinic to generate additional income.

Significant Debt Burden

A large proportion of medical students graduate with sizable student debt.

But instead of thinking of your debt as a burden, think of it as equivalent to a startup company’s capital investment. Calculate the short- and long-term revenue potential of your preferred specialty as you would with any business venture. 

After completing your residencies and fellowships, you should consolidate your student loans and devise a plan to pay down your debt while avoiding the temptation to live a luxurious lifestyle (at least until you have significantly reduced the amount you owe. You may also explore government employment opportunities to have your student loans forgiven. The IRS has recently issued a ruling that allows employees 401(k) student loan benefits. Because employers are more likely to adopt a student debt repayment benefit as part of their retirement plan, explore the details regarding the new IRS ruling and see if you can find employers who offer it, or who might be willing to negotiate around offering it as a benefit.

Lots of Red Tape

Practicing medicine today carries substantial bureaucratic burdens, including onerous paperwork demands and extensive licensing and standards requirements. Medical schools rarely address the issue of how to productively run a medical practice. 

In light of this, it is critical to use practice management services and software to remain compliant with the numerous bureaucratic regulations of modern medicine. You can also join an established medical practice or hospital which will have policies and procedures in place around compliance.

Lack of Financial Literacy 

Doctors may find it difficult to manage their personal and professional finances due to a lack of financial education during medical school or residency. It is important to assemble a team of specialists in order to properly manage your finances without having to become an expert yourself. A financial planner, a CPA, an attorney, and an assistant to run interference should be present. You can serve as the CEO while the rest of the team functions as the board of directors.

Reduced Reimbursements from Insurance Companies

As healthcare costs have been rising, and insurance companies have become increasingly strict in their attempts to reduce payments to service providers.

Joining or working with a larger medical group may be the optimal solution in this era of reduced reimbursements, but it is best to investigate a range of these options to determine if one is right for you.

The Need for Financial Advice in Line with the Times

The advice given to young doctors as they begin a career in medicine should change as the financial and business landscape has. The two main areas that should be addressed are:

  • A shift from believing in instant gratification
  • Effects of increased student loan debts

When you’re just getting started, be cautious about participating in private equity opportunities before you’ve established the financial foundations for doing so. Your financial foundation is built on:

  • Insurance against loss of income.
  • Having 3-6 months of expenses set aside in cash reserves either in a savings/checking account, money market fund, or similar products.

Living a luxurious lifestyle after residency/fellowship may be significantly limited if you have student debt to deal with. If you aren’t encumbered by student debt, your options both from a lifestyle and investment perspective will be much wider. 

In today’s healthcare environment, young doctors no longer find it suitable to divide administration and clinical duties among physicians, a strategy most often found in small and medium-sized medical practices.

These methods are thought to operate most efficiently when one partner acts as the practice manager while others see patients. However, decreased reimbursements and constantly evolving billing environments have made this approach less effective than in the past. Working for a larger institution or hospital is often more beneficial nowadays than operating your own company.

There are numerous challenges to starting a career as a physician, but being proactive about managing your professional and personal finances can help you take them on and grow both your practice and your bank account. 

Start Your Research Process. 

Find a Dr. Home Finance Verified Banker Today. 

We are not a lending company. We help you find the best physician loan on the market.  

You can find doctor loans through an online tool like Dr. HomeFinance that compares multiple lenders for you. Simply select which state you are looking at living in and get the best physician mortgage you can.

Apply now to begin the process of owning your dream home.


Hans Hegge