Many junior medical officers & dentists start their careers with a base income of around $80,000. This then moves quickly through the hundred-thousand-dollar mark, and finally into the vicinity of several hundreds of thousands of dollars per year once specialist training is complete.
After collecting student loans and other debts to see yourself through the period of training, it seems easy to start repaying those debts and getting a house, your first choice of expenditure which will not be a bad choice, but there is a myriad of other financial decisions that could be made to make you more financially prosperous in the long term.
First advice is that you need to seek a specialist financial advisor for your medical practice in Melbourne. It’s easy to attend to your tax returns once a year at the closest or cheapest franchise accounting or advice firm that you can find. As a medical professional, your needs are a great deal more complex than the many hundreds of different professions that those firms see each year.
By engaging a specialist medical tax agent or specialist Financial Planner in Melbourne, you can ensure that appropriate tax planning can be put in in place for you, to work throughout the taxation year. When the bell rings for tax, it is simply too late to implement a strategy to contend with that burdensome letter from the ATO, the planning must be done in advance.
If you are consulting, contracting or setting up your own practice, it is also exceptionally important to set up the correct business structure from the outset.
Next, you have to think of how you can meet your financial commitments when you cannot work.
As a doctor or medical practitioner, you are familiar with how an accident or sudden illnesses can incapacitate someone for a short time or on a long-term basis. Therefore you have to take precautions.
In Australia, the take up of car insurance, house insurance, health insurance and even mobile phone insurance is astronomical. So many people sign up to protect these small material items, but don’t think about how they could afford to keep paying for these things if they were removed from the workforce; either temporarily or on a long-term basis.
The cost of personal insurances will be a tiny proportion of your income and in some cases can be tax deductible. There is a great deal of many important considerations in obtaining insurance for a medical professional. It is also important to seek specialist insurance advice from a qualified professional who knows the medical industry rather than buying an off-the-shelf product. As with the health insurance industry, no two policies are the same and you must ensure that the policy you buy will provide for your needs.
Lastly, you have to start thinking about superannuation right from the start even though your retirement is 30 or more years away. These decades are vital in compounding your interest at the end.
But if you work in a public medical organization and don’t have a ‘superannuation choice’, then you should contact a superannuation expert to help you with your review.
For more knowledge of the medical tax mechanism or generally more advice on how to become more financially prosperous as a medical practitioner, contact Medvisor Consultants because we are the best in the business in Melbourne. We want your finances healthy for as long as possible.