As we bid farewell to the past year and step into a new one, why not make this the perfect time to talk about something that impacts all of us: Finances?
What worked before? What didn't quite hit the mark? Maybe you made some progress with paying off your student loans or managed to beef up your savings account.
Or perhaps you realized you could've handled certain expenses more efficiently.
Don't worry, we've all been there!
However, now it's time to lace up those financial decisions and prepare for the new year. Think of it as an opportunity to hit the reset button.
Maybe you want to increase your investments, map out a strategy to tackle debt, or finally create that emergency fund you've been putting off. Whatever your goals, now's the time to jot them down and commit to making them happen.
But you don’t have to do all of this alone. This blog has a checklist of financial to-do’s that can help you make the best out of 2024.
Your New Year Financial Planning Checklist
Here’s a financial planning checklist with tasks that you can undertake to shape your financial future:
Calculate your net worth:
Doctors benefit from calculating their net worth to understand their financial situation better. It's not just about what you earn—it's about looking at what you own, like property, investments, and savings, and comparing that to what you owe, such as loans or mortgage debts from training. It's like taking a wide-angle picture of your finances to see where you're at and from where to start your financial planning for the new year.
Revamp retirement accounts:
Physicians often have access to retirement plans such as 401(k) or 403(b) through hospitals or clinics. Maximizing your contributions to these plans is essential. Additionally, you can explore individual options, like IRAs (individual retirement accounts), which can provide extra flexibility. Regular contributions, especially considering the uncertainties in healthcare, can significantly strengthen your retirement entity.
Stay on track with your goals.
Ensure you're still moving in the right direction with your money goals, like saving for retirement or other plans. If recent changes in the economy or other things have affected your plans, talk to your financial advisor to figure out how to get back on track.
Tackle debts strategically:
Medical school debt or other loans might be a significant burden for you. Prioritize strategically managing these debts. While making your regular payments, consider allocating surplus funds towards high-interest debts. Balancing these payments alongside contributions to retirement accounts helps optimize both short-term financial health and long-term security.
Rebalance your portfolio:
Financial planning for physicians might be challenging due to time limitations. However, re-evaluating investment portfolios periodically is crucial. Consider reallocating assets based on market changes or seeking professional advice to diversify your holdings. A diversified portfolio can reduce your risks and improve returns, contributing positively to your financial future.
Pay your credit card balances:
Credit card debts can happen because of irregular work hours or sudden expenses. It's important to handle them wisely. Create a plan to pay off high-interest debts step by step. Look into options like balance transfers or consolidations to lower interest rates. This helps you pay off debts faster and boosts your financial stability.
Review Insurance Coverage:
As you move forward in your career, it's really important to check and update your insurance. Take a look at your life and disability coverage to make sure it still fits your life right now. Because being a doctor is demanding, having enough coverage protects you from unexpected problems and keeps your money safe for the future.
Prepare emergency funds for unexpected situations:
Make sure you have enough money set aside for unexpected situations, like if your job situation changes suddenly. It's always a good idea to have an emergency fund, especially when the economy might not be as strong as before. Professionals suggest saving enough money to cover three to six months' worth of living expenses in an account that's easy to access. This fund can help you stay financially secure during uncertain times.
Remember, stepping into a new year is not just about setting goals; it's about making them happen.
Here's to a financially sound 2024! May your decisions be informed, your goals within reach, and your wallet a little happier. Let's make this year a stepping stone to a brighter financial tomorrow.
We host FREE Seminars to educate physicians like yourself on topics that determine your financial future. Get more details here: https://www.pfinancialservices.com/seminar-request
Diversification, Asset allocation and rebalancing are strategies designed to help manage investment risk. It does not guarantee a profit or protect against investment loss in declining markets.