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The 2015 Report on U.S. Physicians’ Financial Preparedness: Young Physicians Segment paints a clear picture of the financial challenges young physicians face. They typically begin their first year of practice 10 years behind their undergraduate peers in other professions, having lost an estimated $71,000 in potential savings1 during those years of training. Then, as their income builds with a maturing career, so do their family responsibilities, and added to that, many are paying off a medical school debt of $150,000 to more than $200,000.2 

Young physicians cite their top personal financial concern as having enough money to retire followed by funding their children’s education – but they often have minimal savings. In short, they are at a financial crossroad as they jump-start their career.   

Despite these challenges, the report sheds light on opportunities for young physicians - offering insights and advice from financial planning professionals and words of wisdom from established physicians, all designed to help young physicians gain a strong financial foothold in their early years of practice.

OTHER KEY FINDINGS ABOUT YOUNG PHYSICIANS:

  • WORK: 79 percent of physicians under 40 are employed
  • HOME AND FAMILY: 75 percent are married; 60 percent are working parents
  • FAMILY FINANCES: 78 percent are their family’s primary breadwinner, earning 75 percent or more of their family’s total income
  • Less than 25 percent have an updated will, power of attorney, and medical and end-of-life directives 
  • FINANCIAL ACUMEN: 50 percent use a professional financial advisor; and those that do are ahead of the other half in savings, emergency funds, use of retirement tools, and sense of confidence  
  • RETIREMENT: 41 percent have less than $100,000 in retirement savings
  • An additional 41 percent have between $100,000 - $500,000 in retirement savings
  • INSURANCE PROTECTION: Only 11 percent feel ‘very prepared’ in the event of a disability; 76 percent believe disability insurance is essential

The report includes insights gleaned from three national AMA Insurance studies representing 1,937 respondent physicians under age 40. It includes two special sections: Five Strategies for a Strong Financial Foothold and The Advisor Advantage for Young Physicians.

We welcome your feedback.

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Denise S. Friday, CLU
Vice President Sales & Marketing, AMA Insurance  
physiciansinfocus@amainsure.com 

1 Assumptions: Based on a $60,000 year salary; 401k plan with an employer match of 50% on first 4% of contributions; employee saves 4.0% ($2400/year) in years 1-5; and 10.0% ($6000/year) in years 6-10. Projected return 6.00%.

22014 Work/Life Profiles of Today’s U.S. Physician ©2014 AMA Insurance 

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