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Are you planning your journey to financial independence?

Posted by Sean O'Kane on 1 October 2019
Are you planning your journey to financial independence?

Upon finishing their years of training, many medical specialists make hasty financial decisions that they live to regret (and that get in the way of their long-term financial success).

In our whitepaper, "Are you planning your journey to financial independence?" we identified key financial challenges faced by medical specialists. Chief among these is that practitioners are either complacent about the fact that they're now earning good money and therefore don't feel the need to adhere to a solid financial plan, or they're eager to finally enjoy the rewards of all their hard work and want to spend money now!

A good friend of mine, who's very successful, coined the phrase 'toy fever' to describe the urgent desire to make impulse, often expensive, lifestyle purchases the second there's some extra cash lying around.

One of the doctors we interviewed for our whitepaper said, "It's very tempting when you're surrounded by people on good incomes, driving around in new sports cars and living in multi-million dollar properties. It can be tricky to keep it real and live within my own capabilities and with my personal financial goals in mind, without getting caught up in what others are doing."

First of all, it's important to keep in mind that as a doctor you're in training for almost half your working life - much more than most other professions - and this puts you well behind many others on your journey towards building wealth and gaining financial independence.

Committing to new cars and an expensive house too soon after finishing your training can add unnecessary pressure, especially while you're trying to establish yourself as a specialist or a GP. What we see is that it usually takes a year or so to build a good idea of how things look financially and what you can reasonably expect your income to look like ongoing.

Our advice
If you're not careful, you can easily go from a situation where you're tight for money because you're in training, to one where you're tight for money because of the financial decisions you've made.

However, if you delay these important financial decisions to a point where you understand your pattern of income, especially if you're setting up in private practice, then you'll be in a much better position to make those decisions with confidence. This removes the stress caused by over-commitment and strengthens your ability to achieve financial independence.

In order to help you enhance your financial future, our team of financial planners advise you to:

  • delay making any big financial decisions until you've established yourself as a specialist/in private practice;
  • understand what your goals are and what they will cost to achieve;
  • model different financial scenarios with realistic returns to see the bigger picture and assist with decision-making; and
  • develop a financial strategy to get you where you want to be over time.

We can't overstate the importance of this topic, which is why we're hosting a small event next month which will touch on some strategies to help you manage your money effectively once you're training is over. The session will cover financial planning, lending, and real estate and vehicle purchases and will be a chance for new doctors to get some practical tips that will set them up for success.

You can read more about the event here and register.

If this sounds like you or you know someone who would benefit, please pass on.

Author: Sean O'Kane Connect via: LinkedIn
Tags: Wealth Creation Budget Financial planning Financial independence

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The information on this site is of a general nature. It does not take your specific needs or circumstances into consideration, so you should look at your own financial position, objectives and requirements and seek financial advice before making any financial decisions.

The financial planning services are provided by Medical Financial Pty Ltd trading as Medical Financial Planning (AFSL 506557)