Managing Your Finances as a Locum Doctor
Learn how to manage your finances as a locum doctor, from choosing the right business structure to tax planning. Discover expert advice from Grimsey Wealth and Elective Recruitment.
Managing finances as a locum doctor can be seen as daunting if you’re used to a salaried position, however, the rewards of locum work are numerous. In this blog post, we will discuss how to manage your finances as a locum, the value of locum work, and some tips on how to set yourself up for success. We will also introduce you to our partner, Grimsey Wealth, who specialises in financial advice for medical professionals.
The value of locuming
Locum work offers many non-financial benefits, alongside competitive remuneration, such as greater flexibility over when and where you work and the ability to choose working hours to fit in with your personal commitments. Locum work also offers the opportunity to travel and explore Australia. You can take in everything this country offers, whilst gaining experience in diverse and challenging clinical scenarios.
Business structures for locums
One of the critical aspects of managing your finances as a locum is determining what business structure to use. You can set up as a Sole Trader, a Company, a Trust or be paid as a PAYG. Each has its own merits and drawbacks, and the structure you choose will depend on your circumstances, goals, and the types of benefits you want to access. Our biggest recommendation when it comes to managing your finances is to keep it as simple as possible – you can always scale up to other structures as the need arises.
It’s best to consult a financial advisor who understands the nuances of working as a doctor and as a locum. They can provide you with personalised advice on how to ensure you meet your tax obligations, whether you need to register for GST, and how to optimise your finances to get your money working for you.
Set yourself up for success
It’s essential to be aware of small things that can make a big difference in the long term. For example, you’ll be required to register for GST once you earn $75k and over, but you can still register for GST if you earn below this figure. There are also several different types of insurance locum doctors may want to consider, including professional indemnity insurance, public liability insurance, and income protection insurance.
When it comes to your super, when you make contributions is just as important as how much you contribute. The key is to be strategic about the timing of your super contributions, consolidating your super accounts and being conscientious with setting funds aside. It is also crucial to have a clear understanding of your upcoming tax obligations and, just like saving for your superannuation, set aside the necessary funds in advance. Many doctors opt for opening a dedicated bank account specifically for their tax payments, which helps keep their personal and tax finances separate in a convenient manner.
Partnering with you to build your future
At Elective Recruitment, we offer our locum doctors a free, no-obligation consultation with our trusted partner, Grimsey Wealth, to help you leverage the greatest benefits from locum work. Grimsey Wealth is a boutique financial advisory firm based in NSW that specialises in working with medical professionals. They provide personalised advice on wealth creation, tax planning, and risk management, and take care of the financial administration so that you can focus on your career and personal goals.
Managing your finances as a locum doctor may seem overwhelming at first, but with the right advice and guidance, it can be a rewarding and profitable experience. If you’re considering locum work, reach out to Elective Recruitment to explore your options and partner with us to build your future.
