Financial situation after IM residency, my story

Hi jacksparrow82,

I am a recently minted attending physician and I started working July 2013. I think I have done some things correctly, and of course I could have done somethings better. However, like many things, I think the first step is denial... which you seem to have been doing for the past few years. The next step (where you are) is acceptance.

Lets run some numbers real fast:

260k debt
275k gross combined salary
288k mortgage
85k retirement accounts
10k savings

Seeing all the numbers like that are cathartic in the sense that they should now be "real" to you. There are plenty of doctors who have or will save better or pay off their loans sooner than you, and there are also plenty who will take much longer than you.

The single most important question in order to optimize your savings plan is: What are the interest rates on your debt and mortgages? Hopefully they are less than 4%. If not, there is something that needs to be looked at further.

The next thing you need to do is you need an emergency fund. This is usually 3-6 months of monthly expenses. People who are more conservative prefer to have 9-12 months of expenses sitting in the bank. I think 10k is probably too low for you, so you need to calculate how much more you would like to save.

The house itch is an itch a lot of young doctors really want to scratch I think. Luckily your house was relatively inexpensive, even if the renovations were pretty expensive. Where I am you can't buy a house for anything less than 700k, which is one of the reasons why I am still renting. Whether you felt it was a good idea or not to renovate is now irrelevant. The money is already gone and the house is already refinanced. Just accept the 288k mortgage as it and try to enjoy the renovations you made to the house.

Would it have been better to pay off some more student loans? Probably. Can you do anything about it now? No. So once again, it's irrelevant. Find out the interest rate and then you can decide on a payment plan for it. How conservative or aggressive you can be will be likely based on the interest rate.

It's hard to say whether your financial advisor is giving you good advice or not since I don't know the interest rates on your loans. However, from what I can tell, they all read the same handbook of: 1) save more money -- 2) put your money into the investments I say to -- 3) take a % every year from your investments. I am generalizing here, but not harshly. That is how they make a living.

The board certification is an important matter. You know the most about your specialty right after finishing residency. As you well know, how we practice medicine is not exactly the same as the questions we are asked. Medicine is never as black and white as a multiple choice question. This places you at a significant disadvantage. Talk to your hospital and/or other hospitalists. Try to work out a schedule such that you have enough time to study for the boards. At this moment in time, there is nothing more important than passing it, this like Step 1 all over again. Live and breathe the test and pass it. None of the above matters if you can't secure your pay check.

The other questions about life satisfaction and wanting to be a hospitalist or physician at all require a long discussion with your wife. Maybe consider going back to do a fellowship in an area of interest or something of that nature. Additionally, there are other jobs out there that an MD can be used for, but it will require a big life change. The kids are also a discussion between you and your wife, and planning changes based on whether you stay in medicine or leave it.

With all the above said. You aren't "screwed" necessarily. You just have a lot of things to take care of. Big boy money, big boy toys, big boy problems.

-Sensei

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Financial situation after IM residency, my story