Despite the COVID-19 pandemic, oncologists still enjoyed an increase in their income as well as an increase in their overall wealth, according to the Medscape Oncologist Debt and Net Worth Report 2021.
Overall, oncologists’ average annual income rose from $377,000 in 2020 to $403,000 this year.
Although many offices closed for periods during 2020, some physicians used the Paycheck Protection Program. Others found other methods to keep their earnings relatively stable, such as switching to telehealth, cutting staff, and renegotiating leases.
The overall net worth of oncologists also increased. This year, 55% reported a net worth of $1.5 million, compared to 42% last year. A contributing factor to this is the rise in home prices, suggested Joel Greenwald, MD, CFP, a wealth management advisor for physicians.
The rise in the stock market also played a role, he noted. “And I’ve seen clients accumulate cash, which has added to their net worth. They cut back on spending because they were worried about big declines in income and also because there was simply less to spend money on.”
The percentage of oncologists (16%) with a net worth of more than $5 million stayed pretty much the same. Oncology remained in the upper half of the list of wealthy specialties. Topping that list are dermatology (28%), orthopedics and orthopedic surgery (25%), and plastic surgery (24%).
On the flip side, the percentage of oncologists on the lower end of the net worth scale declined from last year. Oncology was the specialty with the lowest percentage of practitioners (16%) reporting a net worth of under $500,000.
Expenses and Debts
Similar to reports from previous years, this latest survey found that more than half of oncologists (56%) said they are paying off a mortgage on a primary residence. About a third (32%) are paying off a car loan. Credit card debt (19%), college or medical school loans (17%), childcare (14%), and medical expenses for themselves or a loved one (12%) were also reported.
When it comes to paying off school loans, oncology was near the bottom of the list of 29 medical specialties, along with nephrology, gastroenterology, and diabetes and endocrinology. Emergency medicine topped that list, followed by family medicine, pediatrics, physical medicine, and rehabilitation (all 31%).
Although the vast majority of oncologists (94%) were able to keep up with their bills, the pandemic did take a toll on some. Six percent said that they were unable to keep up with their bills, and 3% could not meet their mortgage. This is far superior to the American population at large ― a quarter of adults missed a mortgage payment or rent payment because of challenges associated with the pandemic.
Saving and Losses
Most oncologists did not take any extra steps to curtail spending ― 77% reported that they had not done anything to reduce major expenses. About a quarter of respondents took significant steps to lower their expenses, such as deferring or refinancing loans (11%), switching to a different type of car (6%), or moving to a different home (5%).
Savings for tax deferred accounts this year was a mixed bag. More than half (56%) of oncologists said that they put aside the same amount every month, give or take; 11% do not regularly put money into a 401(k) retirement account or tax-deferred savings account. Compared to last year, 32% put less money into their savings accounts. Having fewer patients or working fewer hours during the pandemic may have resulted in oncologists needing more of their income, or even their full income, to pay their bills.
Similar results were seen with taxable savings. Half of oncologists were putting the same amount into bank accounts; 20% reported that they do not regularly put money into this type of account. Compared to last year, 29% put less money into taxable savings.
Most oncologists (75%) reported that they did not experience any significant financial losses during the past year. This was similar to last year (77%). The percentage of those who had losses related to their practice rose from 3% to 8%. Much of this increase was due to COVID-19.
Living Within Their Means
The vast majority of oncologists live within or below their means (94%). “There are certainly folks who believe that as long as they pay their credit card every month and contribute to their 401(k) enough to get their employer match, they’re doing okay,” said Greenwald. “I would say living within one’s means is having a 3 to 6 months’ emergency fund and saving at least 20% of gross income toward retirement.”
Although most oncologists live within their means, they also have a higher than average number of credit cards. More than half (54%) have at least five; the average American has four. Nineteen percent of oncologists reported having seven or more credit cards, and none said they had no credit cards.
Mortgage payments varied considerably among respondents, from less than $100,000 (16%) to more than half a million (21%). More than a third (37%) reported having no mortgage at all. According to the Mortgage Bankers Association, the overall average size of a home mortgage loan was $344,556 in March 2020.
For household finances, 57% reported that they pool incomes to pay the bills, regardless of how much each person earns. A quarter said that they do not have joint finances with a spouse or partner, and for 13%, the person with the higher income paid a larger share.
For more from Medscape Oncology, join us on Twitter and Facebook.
Source: Read Full Article