Five budgeting tips for healthcare professionals
Many people assume cash flow and budgeting isn’t much of a concern for physicians and others working in the healthcare sector, as high salaries should mean minimal worries.
However, cash flow can become quite interesting as a higher salary often means significant expenses, such as student loan bills and increasing lifestyle costs.
And when you consider that it’s not at all uncommon for student loan repayments to be as much as four times your rental payment, budgeting can be somewhat challenging. However, with these five tips, you will be able to get on track with your finances.
1) Opt for insurance policies
As a medical professional, there are several essential policies that you should consider, such as medical malpractice policies, health insurance, disability insurance, and even supplemental coverage, among others.
These policies offer you the ability to enjoy peace of mind while only having to budget for a fixed monthly premium. Rather than hoping you never have to endure crippling medical debts should you become ill, policy plans such as Aetna Medigap can be beneficial for your finances.
Medical professionals should consider all relevant policies to best cover for potential costs associated with working in the healthcare sector.
2) Prioritize student loan debt
Your student loan repayments are likely your most significant debt, and when considering just how crippling interest rates can be, it is always best to pay off debt sooner rather than later.
So your student loan debt should be a prioritized monthly expense, and if you can, paying a small amount extra each month will help you diminish the cost much faster.
3) Retirement savings is important
Countless budgeting recommendations suggest that a general average of 20% of your income should be set aside for retirement. Saving for your retirement is vital for several reasons, although, discounted tax is one of the most notable for younger medical professionals.
Far too many professionals assume that a higher income indicates wealth when the reality is that even the highest incomes can be overspending, neglecting savings and retirement funds. Therefore, how you handle your income signifies wealth.
4) Use budgeting tools
Whether you are a baby boomer who prefers old-school pen and paper, or a millennial that has a phone full of apps, budgeting tools are crucial to staying on track with your finances.
Whether you opt for a traditional paper budget list, an excel spreadsheet, or a trendy budgeting app, you should be using a tool that suits you best. Simply memorizing your budget and assuming you will stick to it won’t be enough to keep you on top of your finances.
5) Adjust your budget approach when expenses change
Ideally, it is best to adjust your budget monthly according to any changes, even if they are quite small.
However, you should make a point of modifying your budget significantly when your expenses change. It simply won’t work well to assume your budget will be relevant for years or even months as costs of goods vary within a small bracket continuously.