A scholarly work of mine, something from my day job, was featured today by Jim Dahle, who blogs/podcasts/runs an empire at The White Coat Investor, so if you made it to this blog from there, welcome!
This is a survey I conducted of residents and fellows at two universities to understand their personal financial knowledge and condition. Jim contributed to the study (make sure you read to the next section to learn more about the study) and the findings reinforce why his own site/empire, teaching finance to physicians, exists and needs to exist. I’ll delve more into the study in a moment.
Connecting this study with my blog also means this blog is no longer anonymous (for the handful of readers who aren’t family), as my name is the first author on the article and in the first sentence of the WCI blog writeup. I’m keeping a clear demarcation between my work life and my blog life to the extent that’s possible. While events/interactions/relationships at work inspire some of my blog writing, this is a personal blog, and not affiliated with my employer. I do not currently plan for my day-job related output to be a regular feature here, but it may happen occasionally.
Before today, my immediate family, a few friends, and a few co-worker knew I was writing the blog — I’ve kept the circle small. I decided to let WCI connect the two when he published his piece — I’ll find out soon enough if that was a smart/dumb/inconsequential move. Given my small readership, it’s probably inconsequential.
This blog is about more than money/finance (though I’ve written about money a few times) — if you’ve found your way to this site for the first time, read a little about me here. Then check out both the money and non-money related topics via the Archives widget that you can see on every page (or the category pages you can see in the menu), or go to the Archives page. If you like what you read, please sign up for email notifications of new posts (and eventually a newsletter). Also follow me on Twitter to receive notifications of new posts or other tweets. I’ve highlighted some selected readings for you:
- My first post — Country Road — about country music and politics and religion
- The post w/the most reads: Love And Marriage (And Money) — about those things
- The Graveyard Shift — about sleep deprivation
- The post w/the fewest reads: My Deadbeat Uncle — just published last week, and not what it sounds like
If you want to interact with me about anything related to the blog, please contact me via the blog. The research article we’re discussing today is a work product, so it blurs the lines a little. Even if the blog makes you want to ask questions that may be related to my day job, contact me via the blog so these things stay separated. We can always interact via other means/accounts if the discussion warrants it.
A little bit of background on this study that isn’t in the article itself or on the WCI website.
I’ve had a long standing interest in business, personal finance, and the business of medicine. A few years ago, a co-worker/friend asked me to give a lecture to the peds emergency medicine fellows in our division (6 people) on personal finance, since this education was not provided to them in any form. He knew of my interest in the topic and thought I could provide them some informal help. Like a good academic physician with an interest in research (I work for a university that loves research), I took a small project and made it much bigger and way more unwieldy (and hopefully better).
I decided when preparing the lectures, I should survey our fellows in advance to discover what they know/need-to-know. Then I decided if I was going to survey our fellows and create lectures, I should do the same for the residents in our department (~100 people). Then I thought I should try to send the survey to all the residents and fellows at our university (over a thousand residents/fellows), even if I wasn’t giving them the lectures, to see what was happening around our university.
When preparing the survey, I asked Jim to review the questions and provide his input, as he is the expert in understanding physicians and personal finance — you’ll find him in the acknowledgment section of the article. He also put me into contact with faculty at the University of Arizona who wanted to do something similar (adding several hundred more residents/fellows), making this a two-center study. While he did contribute to the questions, he did not participate in the study, and was not privy to any preliminary results or the manuscript. I have, however, read his blog almost since its inception and am active on his forum. In one way or another, his work has inspired a bit of my own.
So what started off as something tiny became a survey with over 400 responses. While our response rate was low, the data are fairly compelling.
The survey contained a 20-question “quiz” — if you want to see how you would do on this quiz, click on the following to download a copy that doesn’t have answers marked: Quiz questions.
Then click here to read the official Appendix to see the correct answers, how our survey respondents fared, and the other questions we asked.
I think WCI’s breakdown summarizes things well — if you don’t read the original article (though please do, as it is a very easy and quick read with no medical jargon at all), then read his overview.
Simply put: residents and fellows are ignorant of many fundamental personal financial topics, have way too much debt (not just student loans), are not performing basic estate planning, and are not satisfied with their personal financial status.
Doctors in training don’t know the details of Health Savings Accounts, aren’t sure about Roth IRAs, don’t understand bonds and mutual funds, and most of those with children have not made a will. People do seem to be able to cover emergency expenses, but they also have way too much credit card debt.
Despite our low response rate, I am confident our findings can be extrapolated to many physicians in training at my university and elsewhere (and probably other high-income professionals, and frankly most of the American population).
That kind of statement is somewhat verboten in research journals — if you don’t perform huge multi-center studies and cannot prove you’ve represented a wide swath of the population, you will often be hammered by journal reviewers and editors for having results that are not considered “generalizable” and thus difficult to trust or use to take action. While we said something about this in the published manuscript, we couldn’t prove our results could be generalized to a broader audience.
In fact, our low response rate and only having two-centers made this manuscript very difficult to publish despite it being relatively novel (and I think very relevant to medical education).
However on my own blog I have the freedom to say what I want without reviewer #2 yelling at me, and I think training institutions across the country need to look harder at this, and they don’t necessarily need to reproduce this survey with their trainees to decide to take some action.
Update: I thought I should add in why (I think) we had a 21% response rate.
- The GME offices (overseeing training programs) didn’t let us email invites directly to trainees and the IRB didn’t want me reminding people at conferences
- At WashU, the invites/reminders came from an administrator in the GME office, making it more likely to be overlooked/deleted.
- At UofA, individual program directors had to send the invites, and we had no way to track if/when invites or reminders were actually sent. A lot of people may never have received an invite
- UofA also enrolled when the academic year changed, so some people left and new people came and could’ve been missed.
- Because we couldn’t send the invites ourselves, we couldn’t track who completed surveys or send targeted reminders
- We included all potential trainees when making the response rate, even though some people may never have received an invite at UofA (or only 1 invite), artificially lowering our response rate
- In general it’s hard to survey physicians, even residents, for non-mandatory surveys, without a nice financial incentive. We offered Amazon gift cards via a lottery, but not a bag of gold.
- We probably could have hit a 30% response rate (or higher) easily had we been able to send the surveys ourselves, but I don’t think the data would’ve changed dramatically
Just this week I read about Suntrust, a bank, realizing its own employees were ignorant. The New York Times describes their chief executive’s realization:
Even his own workers — who he had assumed were more knowledgeable about money and in better financial shape than most people — were making poor financial choices, like borrowing against their 401(k) plans. And many of them were ill-prepared for a financial emergency.
Suntrust, as are many other companies, are providing more benefits to their employees to help with financial issues. Most medical students and doctors in residency & fellowship, as well as those recently out of training, will attest, need more of this education as well. I’ve become a huge advocate for this at my own institution.
The medical education system is largely deficient in teaching personal finance. Trainees are receiving bad advice, paying for bad advice, overpaying for bad and good advice, and are being targeted by financial planners who realize they don’t know anything.
Sometimes trainees convince themselves they can’t/shouldn’t learn this, and some are being convinced by advisors who profit from their lack of knowledge.
There are many good advisors out there, and some charge reasonable fees, but you can’t find them if you don’t already know something. I think most trainees can handle many things without paying much, if anything, for most things. Sometimes you do need an advisor, but you need to understand the questions and the price you are paying, and how to identify a good one. It’s very possible place ads on this site, and given that I write about finance, I will consider ads from financial advisors. However I wil only do so if the prices are reasonable and the advice of good quality.
If you can’t tell — I’ve overpaid for reasonable advice and had a bad experience with an advisor that focused on doctors.
While I conducted this study with the backing of our local graduate medical education office (which oversees the residency/fellowship program), when I had preliminary data demonstrating the lack of knowledge, no one was interested in making a medical school wide curriculum for trainees, or mandating any education at our institution. It just wasn’t a priority, given the other things they already deal with. So I made it a personal goal.
Fortunately, after sharing my data internally and delivering multiple lectures on personal finance to the residents in my department (pediatrics), I found some willing partners to expand the teaching. I’ve partnered with enthusiastic members of the internal medicine department and from my own department to create a personal finance/business of medicine curriculum for the residents in pediatrics/internal medicine.
Our result was a four-part lecture series that we started in 2016, and which in 2017 is expanding to five-parts. Two of those parts feature my talks on finance, which I update periodically. We also cover loan repayment, physician practice structure, and contract negotiation. Nothing exotic, but that isn’t necessary at this stage.
We could delve a lot more just into those topics, or add a lot more, but trainees still have to learn some stuff about drugs and procedures and patients and stuff like that. Fortunately our residency directors are supportive of this education (one of them co-authored the manuscript), and we’ve integrated these lectures into the regular noon conferences that the trainees are expected to attend. We’re working on a manuscript related to the effect of that education, so keep an eye out for that in the future. If they want to give us more lecture slots, we’ll take them.
In addition, I’ve given my lectures to our trainees in general surgery as well as graduating medical students, and have heard from other groups on campus that they are starting to do similar things or want to do so (I may get asked to give more talks after this).
Personal finance, while the smallest part of my day job, is perhaps the most enjoyable thing I have an opportunity to teach. I enjoy public speaking, and in developing these talks from scratch, I connected the “mundane” details of finance to to examples from my own life to make it more enjoyable and relevant to theirs. I also know its something our trainees are not receiving anywhere else, making for a more captive audience, which helps.
There is a grassroots/groundswell of enthusiasm for this education at many other institutions (and in other professions). My belief is that this should be mandated, and should be built into the medical curriculum in some fashion. I’ll quote my own article here:
[W]e recommend, at a minimum, that every trainee receive specific instruction in the following aspects of financial education during medical school and residency:
1. How to make a monthly budget
2. Debt/loan management and credit scores/reports
3. Savings and retirement planning options
4. Life, health, and disability insurance
5. Estate planning strategies
In summary — go forth and learn about finance. Read the WCI blog, read other blogs, listen to podcasts, get some short/simple books, take advantage of what your university/hospital offers. If they don’t offer anything, force them to start! It’s easier to learn the basics than you think, and unlike in medicine, you can and should learn to do some things on your own without the direct supervision of a paid expert.
Update: I discovered that this research article was written about by blogger WealthyDoc a few days ago.
Please comment here or over at WCI’s blog post on your thoughts on the study or thoughts on providing financial education to trainees!