When you’re just getting started as a locum tenens physician, you’ve got a new lifestyle to figure out – and that includes figuring out your finances. As an independent contractor, you have different benefits to take advantage of, as well as different responsibilities from regular permanent employees. Here are a few tips for managing your money as a locums tenens.
Create a budget
When you’re traveling for work, it’s tempting to spend as if you’re on a vacation. That’s not a sustainable year-round lifestyle, though. While you should by all means enjoy the new areas you visit as a locums, consider your long-term financial goals and create a plan for how you want to reach them BEFORE you start spending your hard-earned cash on souvenir snow globes for all your nieces and nephews.
Plan for taxes
Unlike permanent employees, your taxes aren’t withheld from your paychecks. Instead, the IRS expects you to pay your taxes QUARTERLY, in addition to filing an annual return in April. Take time to educate yourself on how much you will be required to pay, and include saving for taxes in your budget. Learn more about taxes for locum tenens here.
Pay down debt
According to Becker's Hospital Review, locum tenens doctors are paid very well. When you combine salary with the cost-of-living benefits provided by staffing agencies, locums can earn considerably more. Take advantage of this added income by paying down your student loans, credit cards and other debts as much as possible. You’ll be glad to be free of that debt later on.
Set up automatic bill pay
If you haven’t done this already, now is the time to set up as many of your bills as possible to be paid automatically, either through a designated bank account or via credit card. It’s also a good idea to get your statements online. When you’re traveling, you don’t want to risk a bill getting lost in the mail or your payment arriving late.
Save for emergencies, vacations and dreams
After you’ve paid your taxes, debts and bills, pay yourself. Create a separate bank account that is set aside to take care of unexpected expenses and to meet your needs during your time off between assignments. You may also want to save for a home or other large purchase – there’s nothing more motivating than working toward a dream!
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