Physician Career Planning - a $1,000,000 Decision!
Editor’s Note: Early physician career planning with the advice of an expert, appreciating the accumulative effect of negotiating an offer, and using physician organizations for support can result in successful physician career management strategies.
After the completion of medical training and literally "paying it forward", many senior residents and fellows start down their professional career by joining a private practice, academic, or hospital based setting. Although this is an exciting time- it is also the first time a physician is exposed to the business side of medicine.
A physician's first career planning decision tends to gravitate more towards what community am I going to live in, what type of home am I going to reside in, or what amenities will I have access to or better said "location, location, location". Many times the importance of location outweighs the importance of income potential.
It is important to understand the longer term impact of accepting a $190,000 offer versus a $200,000 offer.
The $10,000 doesn't seem like a significant difference especially when the $190,000 is a dramatic increase from the earnings in residency; but let's look at what would happen if you invested the difference in a retirement plan.
We assume you begin your career at age 35 with $0 in any type of retirement account and then continue to add $10,000 each year until you reach age 65.
"Your annual contribution of $10,000.00 will total $1,000,776.49 at 7.32% interest; by the age of 65 or typical retirement age."
According to Zeldis Research Associates, "How Young Physicians Search for Jobs", commissioned by the New England Journal of Medicine; physicians aged 35 years and younger rank "Geographic Location" #1 and "Compensation" #4 on their list versus physicians aged 41 and older who rank "Compensation" #1 and "Geographic Location" #3.
Making a career decision is definitely not just about the money; however, it seems to become a more important consideration as your career progresses.
Below is a great link to help get you started down your career path.
- Association of American Medical Colleges FIRST (Financial Information, Resources, Services, and Tools) program, available at www.aamc.org/first. A newly launched AAMC initiative, FIRST offers a comprehensive array of education debt resources and tools for students and trainees at all stages of the spectrum, from those contemplating medical school to physicians who have completed their residencies.
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