Personal finance lesson borrowed from doctors and lawyers
In the New York Times last month Wealth Matter columnist Paul Sullivan analyzed the money habits of doctors and lawyers. It was part of a series in which Sullivan looked at such personal finance habits for various fields and industry types. The piece begins,
“InÂ most places in America, doctors and lawyers are at the top of the career pyramid. Theyâ€™re often the top earners in town. And they usually live in the nicest neighborhoods and drive expensive cars.
But their attitudes toward money and investing can create financial challenges later in life.”
What can others learn from the success and the failures of doctors and lawyers?Â “Doctors generally get two important things right,” Sullivan explains. “Doctors, particularly those with a unique specialty, buyÂ disability insuranceÂ because they know that if they canâ€™t work as a hand surgeon, for example, their income will plummet, even if they can still work as a doctor in a different capacity.”
They also save a big chunk of their income for retirement. Which is good, but needs to be managed properly.
However, he notes doctors are often big spenders, assuming the money will flow forever and to make up for what they see as lost time in medical school. And more anecdotally he feels doctors have a hard time handing control to a financial planner.
Click here to read Sullivan’s full article and to learn what financial lessons you can borrow from lawyers.