As we near the end of June, tens of thousands of medical students and residents have already or are getting ready to move to their next stage of medical training. Whatever your transition may be, this represents another milestone in your long journey to becoming a fully-fledged physician. While this is a time of excitement and hope, it can also be a period of chaos and confusion. It is important to take a moment to reflect on your personal finances. Let me share with you some of the items I'm currently working on as I prepare for my transition to fellowship.
Long time FPMD readers know that I am a PGY-5 radiology resident transitioning into an interventional radiology fellowship. What you may not know however, is the fact IR is only a one-year fellowship. While IR is also transitioning from a fellowship based subspecialty training to a residency based specialty training, it is important to realize my financial checklist is shaped by my own set of circumstances and may not fit your particular situation.
FPMD Residency-to-Fellowship Financial Checklist
- Plan to Move - depending on how much stuff you have and how far you have to travel to get to your new training institution, your moving options will differ. Personally, I rented a U-Haul truck, hired movers for loading/unloading and drove everything down myself given the short drive between Miami and Orlando. The total cost including gas and tips came to $556, which to me was worth it. But if you are traveling across the country and it's going to cost you an arm and a leg to move, then you should seriously consider selling/donating everything and purchasing new once you get to the new place.
- Have a Plan for Student Loans - even if the plan is to stay on whatever repayment plan you are currently on, it's important to just think about it. Personally I plan to stay on REPAYE throughout the entirety of fellowship training. A couple of pointers:
- If you are on an Income Driven Repayment (IDR) plan like me, be sure to submit your annual income re-certification before the deadline to avoid being kicked off your plan.
- If you will experience an income drop in your next stage of training, remember to re-certify your income as soon as the new paycheck shows up to get a lower calculated monthly payment.
- Re-certify Employment Eligibility for PSLF - given all of the political handwringing surrounding PSLF, it is more important than ever to properly document your eligibility for PSLF. Since I am moving to a new institution for fellowship training, I have reached out to my residency HR office to get the employment certification form (ECF) updated prior to my departure to avoid any lapse in my eligibility.
- Buying vs. Renting - an age old question affecting medical trainees who tend to move frequently. In my particular case, given the short fellowship training period of 1 year, it was an easy decision to rent. Of course, if you're going into a more lengthy training program of 3 years or longer, then there is definitely an argument to be made for purchasing.
- Understand New Employee Benefits - if you are switching to a new training institution, chances are good the employee benefits will differ. Now most large academic medical centers will provide a similar list of employee benefits such as paid time off and health insurance, but there will definitely be differing details. For example, does the employer pay for your health insurance premium or do you have to at least pay for a part of it? It behooves you to understand your new benefits so you can take advantage of them to the fullest extent.
- Optimize Employer Sponsored Retirement Plans - If you have been a prolific saver during residency, you may have accumulated a nice list of tax-advantaged employer-sponsored retirement accounts. For example, I now have a Roth 403b, 457 and 401a account through my residency which combine for a sizable balance. I will need to decide whether to leave my money with the current plan or to roll everything over into my new employer's plan. But I need to see the different investments and costs available through my new employer in order to make an informed decision. Stay tuned.
- Modify Investments - if you will experience an income change, you may need to modify your investment plan. For example, I will experience a significant pay cut in fellowship. Combined with the increased cost of living in Miami, I will probably have to slow down my automatic investments. I don't know how much cutting back exactly I will need to do, but I'm prepared to sacrifice one year's investment returns to focus on becoming a competent interventional radiologist.
These are the 7 financial items that I consider most relevant to myself as a resident transitioning to fellowship training. I hope you will find some of these items helpful in your own transition as well. Best of luck!