Money Matters

Unbiased education in personal finance should start early in a doctor’s training.

By Yuval Bar-Or

Illustration by Andre Da Loba

Research shows that the average physician suffers from poor financial literacy. Many physicians are aware of, and wish to remedy, this deficiency, but few avenues exist for doctors to obtain an unbiased expert education in personal finance.

While solid financial decision-making is important for all households, physicians face special challenges. Compared to the general population, their earnings are significantly delayed due to very long educational career paths; they often carry large debt burdens; their careers are all-consuming, leaving little room for a financial education; and they are constantly hounded by professionals peddling financial products.

Preoccupied by other priorities, many doctors resent having to make financial decisions. Nevertheless, decisions must be made. As an added complication, many decisions must be made early, as young physicians grapple with budgeting, balancing assets and liabilities, managing debt, selecting life and disability insurance, funding children’s college plans, investing for retirement, negotiating employment contracts, and making decisions regarding estate planning and asset protection. Procrastination is the enemy when it comes to financial planning, so every time a doctor puts off an important financial decision (or hastily makes an uninformed one), her family’s finances and well-being are harmed.

For decades, financial advisers and insurance agents have volunteered to offer personal finance education sessions on medical campuses. Unsurprisingly, these events often turn out to be thinly veiled marketing efforts.

In my years teaching financial literacy to physicians at Johns Hopkins and elsewhere, I’ve found that doctors, desperate for knowledge from unbiased sources, turn to each other for advice. But while physician peers may be brilliant medical professionals, they’re not experts in finance. Their advice, however well-intentioned, reflects their personal experiences and circumstances. This may render their advice somewhere between inapplicable and downright dangerous. 

I grew up in a physician household and witnessed these challenges firsthand. In response, I spent several years developing and testing a curriculum for medical professionals with the explicit mission of providing unbiased, expert personal finance education. Over the past five years, I’ve offered this curriculum (dubbed Pillars of Wealth) to faculty and staff physicians at Johns Hopkins. For accessibility, the content is available through various media: face-to-face workshops (courses on comprehensive personal finance and basic investing are both offered through the Office of Faculty Development), online videos, books and webinars. To maintain objectivity, no financial advisers are involved.

Money-related decisions are rarely independent. The key to constructive long-term financial decision-making is to gain an overarching view of all the major personal finance topics along with an appreciation of how decisions impact each other. Isolated teaching sessions can be helpful but may be inefficient if made without a strategic overall household perspective. For example, a young doctor may be motivated to buy a policy after a one-hour session on life insurance, but three months later, she feels stymied upon realizing there isn’t enough money left in her budget to fund a retirement account or her child’s 529 college savings plan. So, while a solitary one-hour session on insurance can be helpful to many doctors, their decisions and actions may be suboptimal if they have not also learned about all other personal finance topics.

While my content is available through multiple kinds of media, face-to-face workshops are by far the most effective. They allow direct interaction with the instructor and real-time feedback, which is invaluable for efficient learning by busy physicians. Right now, the courses I teach in person are available only to staff and faculty physicians. I am still seeking a solution for residents and fellows, who aren’t eligible for faculty development courses.

I believe it is crucial to overcome existing barriers and ensure that graduate medical education programs offer comprehensive financial literacy education to all residents and fellows, provided by experts free of incentives to sell financial products and services. Providing this training will go a long way toward giving doctors a greater sense of control over their future and improving their well-being and outlook—both now and in the future.

Yuval Bar-Or, Ph.D., is an associate professor at Johns Hopkins Carey Business School.