As a doctor, you typically have a lucrative compensation package, but with today’s demanding healthcare industry, you have little time to concentrate on your own financial affairs. At times, this can cause debt to accumulate.

Doctors and Debt

As a doctor, you tend to accumulate a large amount of debt because of your long, costly education process. This is an industry issue you should understand and plan for in the beginning of your career to avoid problems later. Just like everyone else, it is very important for you as a doctor to do careful cash flow planning, and the education debt you start with after medical school needs to be part of the big planning picture.

Warning Signs

The first thing you should do after graduation is work to eliminate medical school and other university debt. Ask yourself, are you earning enough for your lifestyle? The beginning of your career as a doctor is normally a survival period, and cash flow planning is very important. From our work helping doctors with their finances, we see that during residency you are usually spending more than you are earning because residencies, sadly, don’t pay well. This issue, however, is larger than debt management – it’s about budgeting.

Getting Yourself Out of Debt

The best graduation gift you can give to your financial future is to establish and follow a good financial plan and pay off your school debt as soon as you can. If you are past that stage, however, here are some tips to help you get out of debt as a physician.

  • Change your spending habits to allow you to live within your means until your debt reaches a manageable level. For example: Limit the number of times you eat out each week, and go to see a movie on Friday evening, instead of buying orchestra seats at the opera.
  • Consolidate your debt and create a payment schedule that is reasonable.
  • Create and stick to a long-term financial plan. Have a professional help you plan a reasonable cash flow, allowing you to stay on track and enjoy your good income while focusing on your demanding medical career.
  • Don’t use your credit card unless you can pay cash for the purchase.
  • Some institutions of higher learning have financial planning education available. If you are a student, check to see if this is an option for you and, if it is, take advantage of it.
  • Even though you have a great education and great prospects for the future, do not anticipate your future – prepare for it.


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