How 7 spine surgeons managed (and are managing) their debt


Seven spine surgeons share advice on managing debt and meeting personal financial goals.

Ask Spine Surgeons is a weekly series of questions posed to spine surgeons around the country about clinical, business and policy issues affecting spine care. We invite all spine surgeon and specialist responses.

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Question: What advice do you have for young physicians on how to best manage their debt?


Richard D. Guyer, MD. Co-founder of Texas Back Institute (Plano): First, remember you do not have to pay back your debt in one year. Take advantage of the time and relatively low interest rates. Live within your means and do not think that you have to buy your dream house and dream car in your first couple of years. Also remember to save a little each year and even low compounding interest will slowly build your net worth.


Don't fall prey to the erroneous thought process that "I have sacrificed my entire life and I want it now." Do not look at your older associates/partners who have been in practice for 10, 20 or even 30 years and think that you should have what they do in your first couple of years of practice. Just like your medical training took eight to 10 years, treat your debt and accumulation of assets the same way.  


Do not take excessive financial risks and fall prey to deals that sound too good to true, because they usually are! Be ethical and treat your patients like your family. Lastly get an honest financial advisor to keep you organized, grounded and disciplined on the path to meet your financial goals.


Brian R. Gantwerker, MD. Founder of the Craniospinal Center of Los Angeles: As a young physician myself, I am still in the midst of that. Most physicians like me carry a significant medical school debt. My advice is to start paying back while in residency. As the principal and interest capitalize, you can find yourself buried quickly. Now that I have a mortgage and maintain my own office and pay my own employees, I have found revenue cycle management to be critical.


But of the things you must pay, student loans should be close to the top. If you have the ability to consolidate and refinance, do it now before interest rates go up this coming year. Consider talking to your lender, as a lot of them have student loan refinancing options. Also, if you can, use a credit card to pay it back month by month, as you can accrue points and potentially get things like gift cards that you can use like cash.


J. Brian Gill, MD, MBA. Nebraska Spine Hospital (Omaha): Controlling debt and ultimately reducing debt is paramount to gaining financial independence. There are numerous articles on this topic. In particular, physicians are notoriously known for accumulating debt which can start as early as college and grows exponentially with medical school. It's a way of life for many physicians as this is what they have come to expect. However, financial debt can limit other opportunities and can severely impact retirement planning.


There are a couple of key points that young physicians should consider. First, do not live beyond your means as the majority of your income will go to pay for this way of life without any impact to your debt. I would suggest paying down your college and medical school debt as soon as possible as this is debt that you can never be free from until it is paid off completely. I would have a goal in mind to pay off the debt in three years, five years or seven years.


At the same time, I would also start contributing to eligible retirement plans such as IRAs or 401Ks. As your debt decreases, increase your retirement contributions. As Albert Einstein once said, the most powerful force in the universe is compound interest. Secondly, I would set goals with the end in mind. These goals may include retirement age, debt-free age and wealth accumulation. I would then formulate a plan and stick to it reviewing it a couple of times a year to reinforce what you are trying to do or modify it based upon "life" events.  


Richard Kube, MD. Founder and CEO, Prairie Spine & Pain Institute (Peoria, Ill.): Debt management needs to be a part of your budget just like a house payment. Set a reasonable time frame in which to pay things off and then get started. Just as important is avoiding the accumulation of greater debt. Most leaving residency will come into more money than they have had in their lives. Do not be deceived. Practice self-control and live conservatively.


While you should make a good living as a surgeon, most are not independently wealthy. Get out of debt and start saving. None of us expect to have that career-ending injury, etcetera, but I have seen it happen. First rule is to avoid the extinction event. If you have prepared for that, and managed your money wisely, you will live comfortably and sleep well.


Alan S. Hilibrand, MD. Co-Director of Spine Surgery and Director of the Spine Fellowship at Rothman Institute (Philadelphia): Regardless of what they are earning they should look to live within their means for the medium term and try to pay them back as soon as possible. Refinance if there are favorable opportunities.


Kevin Ju, MD. Texas Back Institute (Plano): Medical training is a long, arduous and expensive road to travel down. Most young physicians now graduate medical school with a six-figure debt just to jump straight into a grueling residency. A decade after finishing college, we finally enter the workforce and start earning a real salary. It's very tempting to reward ourselves and buy that sports car, fancy home or a new wardrobe. I've certainly had those thoughts!


However, I'm still "living like a resident," sticking to a monthly budget that only slightly higher than the one I had during fellowship. The remainder of my monthly incomes goes towards aggressively paying down my student debt and savings. By keeping my frugal budget for the first few years, I'm planning on paying off all my students loans while maximizing my retirement account contributions each year so that I can let compound interest work its magic.

Like many other young physicians, I borrowed money from several different lenders throughout my schooling. When possible, I recommend trying to prioritize paying off debt that is nondeductible, high-interest, variable and/or short-term first, or converting it into debt that is tax-deductible, lower-interest, fixed and/or long term. If you are not trying to go for loan forgiveness (for example, income-based repayment, public service, etcetera), refinancing your student loans at a lower rate can be a great idea. I went from paying 6.8 percent interest down to 3.5 percent by refinancing. There are now several companies that offer good refinancing deals, for example, SoFi, DRB, etcetera.


It's important to take a close look at the various interest rates you're paying. Concentrate on paying off high interest rate debts first. Then based on the actual interest rates you're paying, it may be more beneficial to maximize retirement accounts (especially if your group or company matches a portion of your contributions) than paying down low- or moderate-rate debt. If you stick to a modest budget the first few years out of training, you will be able to make a large dent in your debt, have money saved up for a home and will have put money into your retirement accounts so that they can compound over the next 30 years of your career.


Bonventure Ngu, MD. Premier Spine Institute (The Woodlands, Texas). The goal is not to increase the debt. Don't immediately buy the big house and expensive cars. Manage your finances carefully. Coming out of residency you are tempted to buy a big house and car, but first save and have a financial plan. A big percentage of your income should focus on estate planning and financial planning, and then make big purchases at the right time.


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