Thursday, July 3, 2008

Graduating residents and fellows: financial challenges

Now when the old academic year is over (and the new one just begun with the influx of freshly baked interns), the newly baked attendings, after being "institutionalized" for so many years, face financial challenges they never dealt with before: making on their own.
No more resident's salary. No more ignorance of the issues of one's health or malpractice insurance. Maybe moving to the new place. All of these issues can be tackled successfully based on their previous experience of moving from a college to a med. school and on to the residency, often in another part of the country.
What our residents are utterly unprepared for is what to do with their sudddenly (and seemingly) larger paycheck. The theme I hear over and over again is " What should i get now when my old Honda gave up the ghost: Lexus or Infiniti?" All these years of semi-voluntary and semi-imposed from outside financial self-restraint are catching up with our residents... er, attendings. And it is hard not to go on a spending spree with your first real paycheck in 11-12-13 years. And it's fine , I guess, to get some stuff you're really craving, as long as you keep the bigger goal in mind: financial freedom.


Nikki said...

I actually think the first real paycheck might be my largest stumbling block. I wonder if my slow boat to debt would have gone faster or deeper if I had more of a paycheck. Right now, I practice fiscal conservatism because I have to. But I always wonder, what if I didn't? Would I really live like a resident and get rid of the debt during that first year or would I spent because I didn't have to worry?
From discussions with other residents and fellows sometimes the only thing that keeps you going is the fantasy of the big check and what you will do when you get it.
I always think that before we complete residency, there should be a financial exit interview. From what I have learned, the vast majority of physicians just don't have it together.

Docblogger said...

Very interesting idea-financial exit interview. I think it might help the residents keep things in prospective, so that even if they go on the binge spending initially, they might start practicing fiancial conservatism a bit later.

Nikki said...

I remember when we had our financial aid exit interview just prior to med school graduation. Much of what they said was very useful, however it didn't last past the glee and wonder that was my first real paycheck. There is the initial binge and then the horror six months later when you realize you should have listened and stuck with your budget. The problem I think for the resident to attending transition is that the toys you can binge on are far more expensive. Upgrading your shopping from Payless and Walmart to Famous Footwear and Gap is nowhere near as bad as purchasing a $50K car, a boat, a house, etc etc on your newly plump salary. A resident I know mentioned that he wished he hadn't upgraded his lifestyle so much, now he was working in a group he hated because that money was maintaining the lifestyle he couldn't step back from. I am hoping, whenever my first check arrives, I am still listening to my spreadsheet. :)

Thank you for responding