The Critical Financial Years for Young Physicians

doctors financial planning

The average age of a first-year practicing physician in the U.S. is 31. This puts young physicians nearly 10 years behind their same-age peers when it comes to their number of earning years. Because young physicians can quickly go from very low pay during school and residency to very high amounts of pay, the first 10 years in practice are critical for building a solid financial foundation.

Lifestyle of Physicians

Young physicians are extraordinarily busy. Not only are they getting their careers started, they often do so with many other factors that require their time and attention. Nearly 47% of young physicians work 51-80+ hours a week and 60% are working parents. They own homes, sometimes own a second vacation home and are their family’s primary breadwinner. They face a delayed start to their earning years, medical school debt, malpractice and liability concerns, and lack of time and financial training to get them started on the right foot. According to the 2015 Report on U.S. Physicians’ Financial Preparedness, young physicians ranked their long-term goals as:

  1. Providing a comfortable retirement for self/spouse
  2. Providing education funds for children/grandchildren
  3. Funding long-term health needs for self/spouse
  4. Minimizing estate shrinkage/taxes
  5. Ensuring an inheritance for children/grandchildren
  6. Leaving a legacy gift to community or profession

Financial Preparedness

When it comes to financial responsibility, 59% of young physicians say they are solely responsible for the financial planning decisions of their family but only 5% consider themselves very knowledgeable about financial issues. Take into account the 53% who feel they don’t spend enough time on financial planning because they don’t have the time and they don’t consider it their area of expertise, you can see how young physicians can quickly get behind during those critical first years. So how are physicians supposed to juggle their professional responsibilities, parental responsibilities and financial responsibilities?

About half of young physicians today work with a financial advisor. Results of this decision show that those who do work with an advisor have more money saved, are more diversified in their investments, have adequate emergency savings and feel more confident in their decisions. Finding an advisor who has experience working with medical professionals may help ease concerns as they should understand the lifecycle of a physician and the challenges faced along the way. From the first years as a medical professional, through a seasoned career and into retirement, physicians will face many questions regarding their financial health that others in different careers never have to consider.

Consider the six goals young physicians said were important to them. Accomplishing those goals will not happen by chance. It takes planning and incorporating the right tools to keep those goals as priorities in life and to make sure they are realized. As a young physician getting started, are you working with an advisor to help you take care of the items outside your expertise? For a free guide to finding an advisor that’s right for your needs, visit

Sources Available Upon Request

Michael J. Searcy, ChFC, CFP®, AIFA®, is president of Searcy Financial Services Inc., a fee-only registered investment advisory and financial planning firm located in Overland Park. Searcy has been listed by Medical Economics in “Best Financial Adviser for Doctors.” For additional information, visit or call 913.814.3800.



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