Author: Josh Lumbley, MD, MBA
How does my credit score compare to other doctors? I’ll admit, I’m a competitive person. Like many of you, this has served me well in my professional and personal life. For doctors, a competitive spirit is critical for a career in healthcare – and helpful for personal finances.
Comparing your credit score to your professional peers is not just about competition: the best reason is to confirm you are on track with your credit health.
How Credit Scores Are Different for Doctors
New doctors often have distinct credit profiles compared to other college graduates due to their extended education and hands-on training. The combination of significant student loan debt and delayed earning potential can make it feel like you’re falling behind. However, we understand the unique financial circumstances doctors face.
While many graduates start building credit earlier in their careers, doctors encounter specific challenges, such as managing six-figure student loans and navigating loan forgiveness programs, which impact their credit differently.
A doctor’s financial situation can change dramatically when they secure a job, start a practice, or grow their personal investments. At this stage, financial management becomes just as crucial as it was during periods of lower income.
Why a Credit Score Is Important for a Doctor
Doctors who have maintained their financial health during their years of training and developed strong financial habits will be better equipped for long-term success. For instance, doctors with good credit scores may find it easier to secure personal loans, like mortgages, and commercial loans to start a practice. While credit scores are generally not a direct factor in gaining employment, they can influence terms when securing financing for business or personal needs.
A strong credit score can lower the cost of borrowing by reducing interest rates, as it signals lower risk to lenders. Regularly checking your credit score helps ensure you’re financially competitive, whether you’re refinancing student loans, purchasing a home, or investing in a private practice. Monitoring your credit score is essential for securing favorable loan terms and maintaining the financial flexibility needed to focus on your career and patients.
Average Credit Scores for Doctors
The average credit score for doctors at different stages in their careers, several key factors such as length of credit history, credit mix, credit utilization, and payment history impacts a credit score.
Early Career (Medical School and Residency): 580-700
During medical school and residency, doctors typically carry significant student loan debt, with the average medical student owing around $250,000 at graduation. Student loans, as installment debt, can positively impact credit scores if payments are made on time.
However, the high debt-to-income ratio during this period, along with modest earnings, generally keeps credit scores relatively low compared to their peers in other professions.
Medical residents and junior attendings may often have credit scores in the “Fair” to “Good” range (580–700). Doc2Doc is aware of these financial circumstances and serve doctors in training by offering loans that can’t be obtained at traditional banks.
Mid-Career (Practicing Physicians): 670-799
As doctors move into mid-career, their income typically rises substantially, and many begin paying down their student loans and other debts. With added financial stability, doctors in this phase often take on mortgages and personal loans, further diversifying their credit profile. As debts are reduced and timely payments are maintained, credit scores generally improve, often reaching the “Good” to “Very Good” range (670–799).
Late Career (Established Doctors and Pre-Retirement): 740-850
For more established doctors, typically in their late careers, income is high, debts are minimal, and financial situations are more stable. With student loans fully repaid and a long credit history, credit scores tend to reach the “Very Good” to “Exceptional” range (740–850). Consistent financial habits, like maintaining low credit utilization and paying bills on time contribute to these high scores
Regardless of the life stage, maintaining timely payments, keeping a healthy credit mix, and refinancing student loans when appropriate can help improve credit scores. By actively managing debt, doctors can achieve stronger credit profiles as their careers progress.
Reference
American Medical Association. (2019). Overview of student debt and how to improve your credit score. Retrieved from https://www.ama-assn.org
Federal Trade Commission. (2023). Consumer Sentinel Network Data Book 2023. Retrieved from https://www.ftc.gov
