Increasing Importance of Personal Finance For Early Career Cardiologists
We are at a time where physician burnout is increasingly recognized as a serious matter. The Medscape National Physician Burnout Report of 2018 stated that about one in three early career physicians report burnout symptoms. While the roots of burnout for early career physicians are multifaceted, they are surely worsened by financial stress fueled by growing student debt and ever-longer specialization training. Despite these acknowledged realities, there is no required personal finance education provided to medical students, residents or fellows in the U.S. Instead, trainees and early career physicians are left to figure out how to manage finances on their own, with predictable consequences.
Despite the high salary that can accompany a cardiology career, inadequate personal financial education can contribute to costly decisions at a time when early career physicians are getting settled into their new lives. Some early career physicians may purchase expensive homes right out of training, even though many individuals leave their first jobs within the first few years and thus never recoup transactional expenses. Others hire expensive financial advisors who may steer them towards expensive and generally inefficient products such as whole life insurance, while leaving them underinsured for disability coverage. Many Fellows in Training and early career physicians have limited understanding of their student loan terms, refinancing possibilities and/or forgiveness policies. Finally, many early career physicians quickly get used to their suddenly-higher salaries and find that they need to take on more debt to maintain their lifestyle before their net worth even hits zero.
These decisions often begin a cycle that is difficult to break. Significant student loan debt, expensive purchases or specific lifestyle choices (e.g. a high cost-of-living city, non-working spouse, etc.) contribute to an ongoing need for high salaries. Some physicians even live paycheck to paycheck. Without keeping expenses low for the first few years out of training, physicians can quickly find themselves indentured to their job. Cutting back to 80 percent employment, lowering one's RVU goal or taking a few weeks off is difficult to do when the bills keep on coming, debt is high and savings are low. The stage is set for burnout, which only exacerbates the pernicious cycle.
We propose that there is a need for personal finance education for cardiologists at all career stages, but especially for trainees and early career physicians. A basic understanding of taxes, insurance coverage, why doctors need to pay attention to their expenses, paying off student loans, various retirement plans, investing and stock allocation, and whether home ownership is right early into one's career can make a tremendous difference. Thankfully, there are numerous high-quality online sites that provide much of this education. By acting on such knowledge, the vast majority of cardiologists ought to become reasonably financially stable by mid-career, giving them options to ameliorate burnout.
We aim to elaborate on these topics at the first-ever live ACC session on personal finance, which will take place Saturday, March 16, at 4 p.m. CT in the Early Career Lounge at ACC.19. We hope this is the first chapter in an expanding effort to ensure the financial literacy of the next generation of cardiologists.
This article was authored by Joshua Schulman-Marcus, MD, FACC, cardiologist at Albany Medical Center in Albany, NY, and Eiman Jahangir, MD, MPH, FACC, cardiologist at Vanderbilt University Medical Center in Nashville, TN.