Just as I remind parents to schedule their children’s annual check-ups, I recently realized I needed my own financial wellness visit. After finding a concerning “lab result” (my credit card statement after the holidays), I knew it was time for a thorough financial examination. Let me share what I’ve learned about conducting regular financial check-ups and why they’re crucial for your fiscal health.

Why Financial Check-Ups Matter: Prevention is Better than Cure

As physicians, we understand the value of preventive care and regular screening. The same principles apply to financial health:

Early Detection of Problems

Let me tell you about me buddy Linus. Linus was spending $400 monthly on food delivery – money that could have gone toward his student loan payments. Just as catching medical issues early leads to better outcomes, identifying financial problems before they become severe allows for easier corrections.

Tracking Progress

Like monitoring a patient’s growth chart, regular financial check-ups help you track progress toward your goals. Are your savings growing? Is your debt shrinking? Are your investments performing as expected?

Adjusting Treatment Plans

Financial plans, like treatment plans, need regular adjustment. Your financial needs will change as you progress from residency to attending, start a family, or switch practices.

Financial Vital Signs: Key Metrics to Monitor

Just as we have standard vital signs in medicine, here are the critical financial metrics to track:

Net Worth (The “Blood Pressure” of Finance)

• Assets minus liabilities
• Track quarterly
• My personal example: I use a simple spreadsheet to track my net worth, which helped me realize I was still $380,000 negative two years into practice due to student loans

Spending Patterns (Your “Daily Activity Level”)

• Monthly income vs. expenses
• Fixed vs. variable expenses
• Warning signs: consistently exceeding income, increasing credit card balances
• Real example: My monthly fixed expenses were 70% of my take-home pay, leaving little room for savings or emergencies

Savings Rate (Your Financial “Respiratory Rate”)

• Emergency fund status
• Retirement contributions
• Debt repayment progress
• Target: Aim to save 20% of gross income
• My journey: Started at 5% savings rate during training, now I maximize my work retirement savings and am looking to further increase my savings rate

Debt-to-Income Ratio (Your Financial “Temperature”)

• Total monthly debt payments divided by monthly income
• Warning sign: ratio exceeding 40%
• Personal experience: Started at 65% (thanks, medical school!), now down to 35%

Simple Tools to Get Started: Your Financial “Medical Kit”

Basic Tools (Like Your Stethoscope)

1. Budgeting app (Mint is popular)
2. Spreadsheet for net worth tracking
3. Bank account alerts for unusual spending
4. Credit monitoring service

Regular Monitoring Schedule

• Daily: Check account balances
• Weekly: Review recent transactions
• Monthly: Complete budget review
• Quarterly: Net worth calculation
• Annually: Comprehensive financial review

When to Seek a “Specialist” (Financial Advisor)

Just as we refer patients to specialists, sometimes we need professional financial guidance. Here are the warning signs that it’s time to consult a financial advisor:

Red Flags

• Feeling overwhelmed by financial decisions
• Major life changes (marriage, children, practice purchase)
• Complex tax situations
• Inheritance or sudden wealth
• Need for estate planning

The Referral Experience

After struggling with questions about disability insurance and how to allocate my investments (stocks vs bonds vs real estate?), many physicians realize they need professional help. Just as they wouldn’t want their patients doing their own surgery, they recognize that some financial decisions require expert guidance.

Conducting Your First Financial Check-Up

Step-by-Step Guide

1. Gather Your “Lab Results”
   • Last three months of bank statements
   • Credit card statements
   • Student loan documentation
   • Insurance policies
   • Investment account statements
2. Calculate Your Vital Signs
   • Use spreadsheet or app to track metrics
   • Document starting points
   • Set baseline for future comparison
3. Create Your Treatment Plan
   • Set specific, measurable goals
   • Establish regular monitoring schedule
   • Identify areas needing immediate attention
4. Schedule Follow-Up
   • Set calendar reminders for regular reviews
   • Plan quarterly check-ins
   • Annual comprehensive review

Moving Forward: Maintaining Financial Health

Remember, like physical health, financial wellness requires ongoing attention and care. Start with these basic check-ups, and adjust your approach as you become more financially savvy.

Don’t be discouraged if your initial “lab results” aren’t perfect. My first financial check-up revealed some concerning vital signs, but with regular monitoring and appropriate interventions, my financial health has significantly improved.

About the Author: Dr. BWMD is a practicing pediatric subspecialist who believes in the power of prevention – both in medicine and personal finance. He shares practical financial advice drawn from personal experience and continuous learning in both fields.