Financial Wellness

Paying Down Debt for Nurses

The Trusted Team
October 28, 2020
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We recently hosted an event, titled “Healthy Finances: Paying Down Debt for Nurses,” with the goals of giving nurses the education, resources, and know-how to achieve financial wellness and growth.

You can watch the full recording below!

Doctors and business professionals alike are routinely offered financial tools and advice — through retirement planning, wealth building, custom investments and beyond. But what about nurses, the 5th most popular career in the United States? We want to help nurses in every facet of their career, and that most certainly includes establishing a sound financial future.

Imagine having the capability to retire when you want, having complete control and freedom of your time, and living your happiest healthiest life without worrying about your finances. The first step of financial freedom is becoming debt-free.

During this event, we learned a step-by-step guide to pay off debt, and while still having fun doing so. Six years ago, our host, Lauren Mochizuki (an ER Nurse of 11 years), and her husband paid off $266,329.01 of debt in 33 months. She shared all of the insights she learned along the debt-free journey that will set you up to be successful in your own journey to financial freedom.

So, what is debt? Essentially, debt is the antithesis of financial freedom. But is financial freedom?

What Is Financial Freedom?

It’s simple. Financial freedom is no longer living paycheck to paycheck, being in control of your time and money, and achieving more of your personal financial goals (paying for vacations with cash, funding your child’s education, etc).

More specifically, what does financial freedom look like? 

  • A life where you’re in control of your time, and you live your life on your own terms without worrying about earning a certain amount of money each year.
  • More time to spend with loved ones, taking up hobbies, volunteering, or pursuing your dream job (and anything in between). 

An article from Forbes revealed that 78% of workers live paycheck to paycheck, including nurses. However, the nursing profession entails unique strengths with lots of potential to help us live a debt-free life. 

For example, one of the greatest job securities out there, competitive income compared to the national average (the median salary of registered nurses in the US was $71,730 in 2018), and oftentimes, more flexibility than the typical 9-5 job.

So, how much can you make over your entire nursing career?

  • 10-year career — $717,300
  • 20-year career — $1,434,600
  • 30-year career — $2,151,900 

Of course, this is before tax and other expenses, but you can see the trend.

laptop and credit cards on rug nursing debt

Facing Financial Challenges Within the Nursing Profession

As mentioned above, expenses faced by nurses are real. Whether it be student loan debt, credit card debt, all kinds of debts, or even lifestyle costs, you will need to be consistent in your ways to counter these challenges. How? Good habits.

Habits of Financially Successful Nurses

Again, consistency is key. Financially successful nurses follow these basic rules:

  • Keep promises they make to themselves
  • Spend less than they make
  • Don’t try to “keep up with the Jones’s”
  • Budget routinely
  • Practice gratitude
  • Plan for emergencies

Budgeting Methods for Nurses

  • 50-30-20 — 50% after-tax income to needs, 30% to wants, and 20% to savings. This system can be difficult to implement because of its one-size-fits-all structure.
  • Envelope System – Withdrawing cash for certain budget categories. This can be used in conjunction with a zero-based budget.
  • Zero-based budget — My preferred method: budgeting every dollar until you have $0 left over; income - expenses equals zero.

Where Should You Start?

  • Form your plan and purpose.
  • Reinforce your goal by writing it down and post it somewhere visible.
  • Establish a rainy-day fund.
  • Establish a zero-based budget.
  • Decide on an accountability partner.
  • Organize a regular budget meeting.
  • Maintain consistency and regularly pay extra toward your debt(s).

Ultimately, your debt-free journey will be your own. Create a plan that you will stick with, and don’t compare yourself to anyone else! Happy saving!

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