FIT Finance 101: Filling Gaps in Financial Wellness
Throughout training, most of us receive little to no financial education. And if we do, it tends to be minimal and surface level. In a profession where 50% of us start training with more than $200,000 in debt, we have very little education on how to deal with this debt while living within a trainee salary. And in another 3-7 years, a majority will make more than $250,000 annually and will still be woefully unprepared to handle this change – that is, unless they take the time to educate themselves now. At a time when so much attention is given to trainee wellness, financial wellness still seems to be undervalued, despite its key role in wellness now and in the future.
To that end, this will be a multi-part series focusing on the progression of financial education from early training to becoming a young career faculty member (and everything in between, including your time as a FIT). The information and opinions that you find here will be representative of our experiences and those that we discuss the ensuing topics with.
We will dive into the following areas of finance within medicine:
- Dealing with debt during early training: to Public Service Loan Forgiveness (PSLF) or not to PSLF?
- Outline the basics of PSLF programs
- Discuss repayment plans and when to use each one
- What do I do with extra funds? Basic investing principles for trainees and FITs
- Focusing on the benefits of the Roth IRA in comparison to 401(k) and 403(b)
- Tax-sheltered vs tax-deferred investments
- Advanced Investing: Beyond the Roth IRA and 401(k)/403(b)
- Basic stock investing, highlighting the differences between individual stock investments vs index funds vs managed funds
- Discuss the risks and benefits that come with each
- Transitioning from FIT to early attendinghood
- Discuss how to optimize your financial goals in relation to how long you plan to work
- Highlight the benefits of utilizing a certified financial planner for achieving your financial goals
- Discuss the use of a certified public accountant to ensure optimization of your tax return
- Choosing what to fully fund on an annual basis and maximizing employer contributions to your retirement accounts
While this is not a comprehensive list of the possible financial situations that may arise for individual trainees and FITs, it should help provide a basic framework for what one can expect over the next 3-7 years. Everyone's specific financial situation will differ – not only in debt burden (22% of trainees have no debt), but also in disposable income available for long-term investing (i.e. contributing to a Roth IRA or other retirement account). We will provide resources so that one can educate themselves further if they wish to do so.
We look forward to providing more information based on our personal experiences. We welcome all feedback and hearing all questions you may have.
This article was authored by Nicholas Arnold, MD, an FIT at Washington University in St. Louis with career interests in critical care, echocardiography, and administration.
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