All Australians, low- and high-earning citizens alike, are affected by patterns in the national and global economies.
Even if you are a medical professional with a sizeable salary, there’s no escaping the impact of financial ups and downs. This brief guide can help you understand what economic trends to expect this year and plan accordingly.
2020 Economy: The Predictions
Economists generally agree on a few important points when it comes to predicting the 2020 Australian economy:
– While 2020 is expected to fare better than 2019, experts don’t anticipate there being much growth (estimates currently range from 2 – 2.75%)
– There won’t be much change to the value of the Australian Dollar
– The cash rate should finish at 0.25 per cent in 2020
Australians spent less in 2019, putting money they received from tax breaks towards paying off debt or padding their savings accounts. Current tax cuts probably won’t be enough to boost spending in 2020, either. While cutting back on household consumption is generally healthy for individual economic stability, it doesn’t do much to contribute to the economy as a whole.
So while you don’t need to fear a financial disaster in 2020, the outlook still isn’t stellar. This year should present a slow and uneventful recovery from 2019. Hang in there and don’t expect a lot of growth. Even still, it might be good to have a plan in place that will help you ride the wave, if positive change does come.
2020 Economy and Australian Doctors
As high-income earners, many doctors in Australia have some investments in the property market.
2020 could be a good year for you if you likewise have an investment property or two to your name. The housing market may see a boost as prices start to rise. This is bad news, however, if you were hoping to break into the market this year but don’t have much saved up.
And while the unemployment rate still hasn’t gone down, the good news for you is that doctors are still in demand.
There are still some financial challenges that doctors face, however. These problems will likely persist long into 2020 as the economy stagnates.
First of all, there’s been an increase in the number of medical school graduates. This leads to competition. In an effort to stand out from the competition, doctors are compelled to pay more for extra schooling in specialised fields of medicine.
Also, the medical professionals who seek employment with hospitals may have to settle for smaller salaries than they had anticipated due to tight hospital budgets.
Lastly, while doctor earnings are going up, your patients may be doing it tougher due to the rising cost of private healthcare insurance. Some doctors may find it more difficult to draw in more patients who may be forced to tighten up.
One more important point to keep in mind is that more patients are living longer than past generations and we’re seeing an increase in patients living with chronic diseases. Keeping in mind such population trends can help you identify an area of practice that will meet the most needs and generate the most income.
The Takeaway
While we’re not likely to see a recession in Australia in 2020, the chances of a positive upturn in the economy are equally slim. If you’re a doctor, you shouldn’t depend on your salary alone to see you through another year in a stagnant economy.
It’s not easy to foretell exactly what the future holds. But it’s always good to be prepared with a multi-faceted financial plan.
The key is to get reliable financial advice that’s customised to your unique circumstances and wealth creation goals.
Get advice
Working with an expert accounting and financial planning team will revolutionise your life, giving you great advice and setting you up on the path towards financial success. And it pays to work with experts who understand the unique needs of medical professionals.
Contact Nitschke Nancarrow, specialists in accounting, financial planning, loans and finance, investment and business for medical professionals. We operate in Adelaide, Sydney, Melbourne and throughout Australia. Managing partner Kym Nitschke is available for a free initial discussion about your situation. Call us on (08) 8379 9950 or send me an email.
– Kym Nitschke
The information contained on this web site is general in nature and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from a financial adviser.
Taxation, legal and other matters referred to on this website are of a general nature only and are based on Nitschke Nancarrow’s interpretation of laws existing at the time and should not be relied upon in place of appropriate professional advice. Those laws may change from time to time.
Nitschke Nancarrow specialises in accounting, tax and financial advice for superannuation. Contact us now for a no obligations discussion about your needs.
