To reach financial independence quicker than their salaries allow, many docs look for other sources of income. Maybe it’s because you’re wanting to pay off your house or the debt on your office building or your student loans. Perhaps you’re saving up for an early retirement, a sabbatical year, a trip around the world, or your kid’s college/wedding expenses. Whatever the need, there are quite a few options to boost your revenue.
The good news is that you can actually use the medical training you already possess to make more money. You can take paid medical surveys, or you can become an expert in medical coding. You could expand your horizons into another field entirely with a non-medical side gig, like writing or getting into real estate. You could study hard and become a DIY investor. Or you could find ways to earn a bigger salary at your current job by negotiating a new contract.
Taking surveys isn't ever going to overtake your clinical practice as your main source of income, but you can make a surprising amount of money doing them as a physician, especially compared to non-physician online survey companies. One white coat investor even made $30,000 in a year from completing surveys.
If you are an employee at your practice, one big advantage of taking surveys is that you get some self-employment (1099) income. Since you and your employer are completely unrelated employers, that means you can start an individual or solo 401(k). Yes, that's right, you can have more than one 401(k). Assuming you're maxing out the 401(k) at your main gig, you can contribute 20% of what you make doing surveys into the solo 401(k). You can also roll traditional, SEP, and SIMPLE IRAs into it, allowing you to do a Backdoor Roth IRA.
Be sure to treat the enterprise as a real business. Get an Employee Identification Number and a separate business bank account. Treat its finances separately from your own. Report the income and put any expenses on Schedule C and SE each year.
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One of the most valuable hobbies for any physician is learning to do their own financial planning and investing. While some doctors invest haphazardly, dedicating the time to understand personal finance and developing the discipline to manage investments can pay off significantly. Hiring an advisor comes with costs that can eat into your returns, but by managing your own investments, you could save millions over time.
A physician investing $100,000 per year for 30 years could end up with $10.1 million using an advisor, but by managing the investments themselves, they could have $12.2 million—$2.1 million more. Even with a smaller investment of $50,000 per year for 20 years, avoiding a 0.5% advisor fee could save $125,000—enough for a nice vacation every year.
Even in retirement, reducing expenses can mean retiring earlier or with more financial freedom. Learning to invest wisely isn't as difficult as medicine, and it can result in significant financial gains over time.
If you want to get better at billing, you need to get better at coding. Know the rules of the game inside out. Physicians routinely undervalue services they are already providing. Taking a coding training course might help you become more confident in the worth of the work that you are doing.
As part of the quality strategy to reform how healthcare is delivered and paid for, CMS is implementing initiatives to assure quality healthcare. These value-based programs reward healthcare providers with incentive payments for the quality of care they give to their patients. Your group may receive annual incentive payments from insurers based on quality measures that are used to calculate that pay.
It’s important to pay attention to any quality incentive measures that you may have in your office, as this might represent a bonus in your salary. This might mean documenting or clicking the right box for your diabetic foot exam and ordering an annual microalbumin lab, recording in the EHR that controlled blood pressure reading from home, and making sure you don’t prescribe an antibiotic if your ICD-10 code is acute bronchitis. If these ensure you a $30,000 quality bonus in your paycheck, for example, suddenly it doesn’t become an annoyance anymore.
The variation in intraspecialty pay dwarfs the variation in the averages between specialties. There are family physicians and pediatricians who bring home seven figures a year by running efficient, high-volume practices with associate physicians and APCs. It is relatively easy to determine the approximate average income for a given specialty in a given area, but breaking that down into percentiles or comparing it to hours worked or patients seen per hour is a lot more difficult.
However, there is little reason for a doctor to work for less than the average in their specialty unless they are given a particularly sweetheart deal in a particularly awesome location. Doctors typically have “people pleaser” personalities, and they are often willing to work for much less than their employers are actually willing to pay them. Thus, a large percentage of doctors are underpaid. Surveys of doctors show that about 50% of them feel like they're underpaid.
Spending a few hundred bucks upfront to get your physician contract reviewed is often well worth it.
Medical school may not have taught you about money, but we will.
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