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Do you ever wonder what personal finance habits separate the most successful young physicians from everyone else?

In my experience helping hundreds of young physicians with their finances, I’ve observed three main habits that are almost always present in the most financially successful. The good news is that each one of them is simple. You could even begin implementing them today! The bad news is that while they’re each simple in concept, they may not be easy in practice. Each requires discipline, but the trade-off is worth it.

Solid personal finance habits bring huge rewards. Life changing differences. Things like having an additional 15 years of the flexibility to live anywhere and do anything anytime you want. Not being reliant upon your job to live. Having the ability to develop & maintain great relationships with your spouse, children and friends because you’re not restricted by work. Being able to give to causes you value. Traveling anywhere on earth. Playing golf all day.

These simple habits can set you on a course to accomplish your goals and then some:

1) Keep Score of Finances

High cholesterol doesn’t have any symptoms, at least early on. Many people are just walking around unaware of any issues. They don’t go in for a checkup until the symptoms start, and by this point, there’s not always an easy solution. If they had caught it early on, though, it would have likely been a simpler fix. Tracking your finances is like doing your own financial checkup.

Over time, this habit becomes like your financial journal. You can always go back and take a peek to see how things were “back then.” As you begin to visually see the ups and downs you go through in your financial life, it brings a new level of financial awareness and maturity. Your experiences become a powerful teaching tool for yourself and others.

How To Keep Score

For starters, we suggest tracking two areas of your personal finances monthly:

1) Net Worth
2) Cash Flow

Part 1 – Net Worth Tracking

Net worth = Assets (what you own) – Liabilities (what you owe). It’s a snapshot in time of your overall financial profile. When you have many months recorded, it provides insight into how your wealth is changing over time.

One of my favorite bloggers, J. Money from Budgets are $exy, has been publicly tracking his net worth for over 8 years now. Check out how his net worth has changed over time below. You can see full details on his journey by clicking here.


Updating your net worth each month only takes a few minutes if you have a solid system in place.

As an example, here’s the system I use:

1) Start by setting up a tool to aggregate your online accounts (like
2) Use this aggregator to link up as many online asset and liability accounts as you can (the KEY with these online aggregators is to use them for what they are – a tool to bring all your stuff into one system – and NOT to count on them to solve your personal finance problems).
3) Create a spreadsheet for tracking your net worth (or save yourself hours of time and simply use ours – here is a link to it – you can see a snapshot of it below).
4) Every single month (put it on the calendar!) open your aggregator & spreadsheet and update all your balances.
5) If you don’t have certain numbers handy, estimate and move on (highlight estimates in case you want to correct in the future)


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The key is getting started today and working to develop the habit. You can fine tune your process over time. Don’t get hung up on the details. This should not take more than 30 minutes per month.

Part 2 – Cash Flow Tracking

Cash flow involves tracking the following: Cash at beginning of the period + Total cash inflows – Total cash outflows = Cash at the end of the period

Simple, right? People always get hung up on outflows or how much is spent. It’s easy to become overwhelmed by the details associated with tracking spending. To clarify, this system does not include tracking your categories of spending every month. It does involve backing into your total spending for the month. The key to our system is to not get caught in the weeds, especially early on when you’re developing the habit. Think big picture spending.

The cool thing about tracking cash flow is it allows you to see how much income you are spending, and how your cash balances change over time. And it doesn’t take much time. Most systems start with tracking every little expense each month, which is going to take hours, and some never even get around to the “big picture” of your cash flow. I prefer to start with the big picture and drill down only if necessary.

Here is a link to our spreadsheet we use for tracking cash flow. Once you get the hang of it, it should only take 15 minutes each month.


As you begin tracking your net worth and cash flow, focus on developing the habit of updating your numbers first. There are tons of cool things you can do with these tools once you’ve developed the habit and have good data on your situation. Not to mention the fact that it’s going to help you become financially independent sooner. Let that motivate you to get over the hump of getting started.

2) Prioritize Saving Over Spending

Income – Spending = Savings

Income – Savings = Spending

Which of these two equations resemble your situation? Do you spend first and save what’s left, or save first and spend the remainder? When you buy a home, how do you make your decision? Do you decide based upon what you can afford, or do you carve out savings first and decide based upon what’s left? Big difference!

This is more of a mindset. And it doesn’t make you a “scrooge” if you think about saving first. It’s about understanding the “why” behind saving and using your vision of tomorrow to motivate your actions today. People who prioritize saving over spending are able to think beyond one day at a time.

If you haven’t taken a minute to envision your ideal future, that’s your starting point. Figure out where you want to go and when you want to get there. Once that’s clear, determine how you’re going to get there. If you’re not on track, it’s going to require decisions and change. If you’re overspending, don’t just tell yourself you can’t cut anything out of your budget and stop there. That’s one of those mind games we like to play with ourselves. Go find someone who is living in poverty and ask them if they think you can cut anything.

You have two choices here: either make necessary adjustments now or change your long term vision.

3) Follow Simple Investment Plans

This is challenging in a different way than the other two habits. The first two habits required you to choose to do something regularly. This habit requires you to choose to do nothing (most of the time). There’s SO much noise in the world of investing. And young physicians face an especially high volume. Everybody wants to sell you the next “unique investment opportunity”.

Creating a great investment plan is a great start! But the hardest part of this habit is to stick to the plan long term. This requires intense discipline to NOT change.

But even if you get the whole “investing is a long term deal” idea, there’s still a ton more to it – especially for young physicians.

Here are a few points to consider when investing:

  • Have plenty of cash reserves first
  • You’re not going to get rich quick
  • Invest in yourself (you are your most important asset!)
  • Don’t invest with your college buddy
  • Be aware that many investment plans are more of a gamble than an investment – understand the difference
  • Your stock trading buddy is only telling you about his winners – people don’t talk about the losers they picked
  • Don’t buy from people selling “investment opportunities” – if it was that good, it would sell itself
  • Understand if your investments are set to try to beat the market or match it (active vs passive)
  • Always take tax minimization into consideration, but “don’t let the tax tail wag the investment dog” – taxes should be secondary to your investment plan
  • Keep in mind that it’s extremely difficult for people (even the “experts”) to beat a very basic passive low cost investment (or “the market”)
  • Understand what the absolute worst case scenario looks like on any investment – if you’re not okay with it, don’t invest

So there you have it. The three habits of highly successful young physicians:

1) Keeping Score of Finances
2) Prioritize Saving Over Spending
3) Follow Simple Investment Plans

If you’re not doing any of these, I encourage you to commit to starting at least one today. Good luck!

If you’re ready to start planning out your future, check out our young physician’s complete guide to financial planning. It’s filled with all kinds of time and money saving systems and strategies that will take your personal finances to the next level. You can download it by clicking below.

WFP Physician’s Guide

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Wrenne Financial Planning LLC (“WFP”) is a registered investment adviser with the U.S. Securities and Exchange Commission. Registration does not imply a certain level of skill or training. All written content on this site is for information purposes only. Opinions expressed herein are solely those of WFP, unless otherwise specifically cited. Material presented is believed to be from reliable sources and no representations are made by our firm as to another parties’ informational accuracy or completeness. All information or ideas provided should be discussed in detail with an advisor, accountant or legal counsel prior to implementation.