Working with a financial advisor for doctors will help you avoid some common financial planning for physicians mistakes. Continue reading to learn more.
Doctors need financial planning for physicians to secure their financial future. Some simple mistakes can ruin your future and make you live a miserable life. Knowing some of the most common financial mistakes will motivate you to find the right advisor.
- Frivolous and excessive spending
Good fortunes are lost one dollar at a time. This may not seem like a big deal when you choose the double mocha cappuccino or when you take dinner in an expensive hotel. Every item will add up in the long term. Spending twenty-five dollars per week on dining out will cost you one thousand three hundred dollars per year. This will go toward an extra credit card or even auto payment or more extra payments. Avoiding this mistake will help you a lot if you’re enduring financial hardship. Every dollar counts if you are a few dollars from bankruptcy or foreclosure.
- Never-ending payments
You should ask yourself if you need items that keep you paying monthly or yearly. Things such as music services, cable TV, or high-end gym membership will force you to pay more money and leave you owning nothing in the long term. Creating a cleaner lifestyle goes a long way to cushioning yourself from hardship or fattening your savings when money is tight or if you just want to save more money.
- Living on borrowed money
It is very common for people to use credit cards to purchase their essentials. You can find yourself in a mess without the help of a financial advisor for doctors. It is not wise to do so even if a high number of consumers want to pay double-digit interest rates on groceries, gasoline, and a host of other things that are gone before you pay the bill in full. Interests on your credit card can make the prices of charged items more expensive. Using credit can also mean you will spend more money than you earn.
- Purchasing a new car
A lot of cars are sold every year. Very few buyers can afford to buy the cars in cash. The inability to pay for your car in cash can mean the inability to afford it. Being able to afford the car payment isn’t the same as being able to afford to buy the car. The consumer pays interest on the depreciating asset by borrowing money to purchase a car. This amplifies the difference between the car value and the price paid for the car. The worst part is when people trade in their vehicles every few years and lose a lot of money on every trade. You may have no choice but to borrow money to purchase a vehicle but maybe you don’t need that expensive car you are eyeing for. Expensive cars are fuel guzzlers and you will pay even more money for the fuel.
Getting the best financial planning for physicians will help you know when to buy a car and which type of car to buy to avoid putting yourself in financial hardship.
