Bryce Mortera is a final-year PharmD candidate at the University of Cincinnati James L. Winkle College of Pharmacy and a member of the 2024–2025 APhA–ASP Policy Standing Committee.
Student pharmacists are asked to do a lot. From helping volunteer in community health fairs and wellness events to making sure medications are made and delivered on time, all while learning the core competencies to become a licensed pharmacist. Students hear, see, and may even be experiencing stress and burnout that can lead to failing to take the necessary steps to address and take care of our physical and mental health and well-being. One area though that is not always mentioned in these conversations is financial well-being.
Financial wellness is extremely valuable. In addition to having a fulfilling and vital role to play within the health care system and community, a pharmacist job salary is substantial, with real U.S. median income approaching $81,000 in 2023, and pharmacists on average making $136,030 in 2023.
However, you can start preparing a successful financial foundation by taking the crucial first steps to learn about how to manage and grow your wealth. This issue, along with several others, was why in 2024, the APhA–ASP House of Delegates passed Resolution 2024.4 focusing on financial literacy. The resolution states:
2024.4 Financial Planning Education: APhA–ASP advocates for the inclusion of financial planning education early and throughout the curricula of schools and colleges of pharmacy to equip student pharmacists with the essential knowledge, resources, and skills needed to manage personal finances proactively and responsibly.
What is financial literacy?
According to Investopedia, financial literacy is “The ability to understand and effectively use various financial skills, including personal financial management, budgeting, and investing.” Getting the basics down about financial literacy might seem challenging at first, but like many new skills or habits, once you’ve sustained them, they can become another tool in your toolbox for financial wellness.
To help me with education on these topics, I recently spoke with two pharmacists to help answer some questions about financial literacy and highlight its importance—Salwa Arafa, PhD, PharmD, a pharmacist at Cincinnati Children’s Medical Center, and Your Financial Pharmacist (YFP) Timothy Ulbrich, PharmD.
I asked Arafa to discuss why she believes financial literacy is so important and some key ways she’s applied her knowledge over the last several years’ postgraduation.
“New pharmacists often lack knowledge about maximizing their financial benefits. They graduate with significant debt, and peer pressure can lead them to spend on items like new cars or expensive trips once they start earning. Basically, they never get out of debt!” she said. “Pharmacy school graduates should learn about tax-saving strategies such as 401(k)s, health savings accounts, and individual retirement accounts. These topics could be more thoroughly introduced during the onboarding process at hire.”
YFP is here to help
I also had the unique experience of interviewing Dr. Ulbrich, who is the cofounder and CEO of YFP.
Bryce: How can students start out down an early financial wellness track and start building an emergency fund? And what are strategies to maintain that fund for true emergencies?
Dr. Ulbrich: For most students, there isn’t a lot of discretionary income available to start saving aggressively toward an emergency fund. While the goal is to create an emergency fund with 3 to 6 months’ worth of essential expenses, that can feel overwhelming as a student. Therefore, I encourage students to focus on a smaller goal, such as 1 months’ worth of essential expenses and then build from there. I encourage students to put the emergency fund into a high-yield savings account separate from any other savings. This helps keep it ‘out of sight, out of mind’ and to establish a clear purpose for that bucket of funds.
Bryce: That’s great. Thinking more along the lines of goal setting, what sorts of pitfalls do people new to the practice of starting, maintaining, and changing their budget process often fall into, and what are some common ways to amend or avoid those pitfalls?
Dr. Ulbrich: The biggest mistake being made when getting started with budgeting is getting overwhelmed with all the various tools, apps, and resources available. This results in paralysis by analysis. I recommend starting with a zero-based budget using a simple spreadsheet and then modifying the process from there to meet your needs. Once you establish the budget, you can then easily update it or transfer it to an app for easy tracking and maintenance. Use YFP’s budget process and template to get started: https://yourfinancialpharmacist.com/5-steps-to-creating-your-best-budget/.
Bryce: If you could go back, what would be one piece of financial advice you would tell yourself as a student pharmacist to either promote financial wellness in pharmacy school or set yourself up for success at graduation?
Dr. Ulbrich: I graduated in 2008 with about $200K of student loan debt and had no clue about the various repayment options available. Therefore, I would tell myself to spend the time to learn more about the various repayment options—including the pros and cons of each—and not to wait until after graduation to figure this out. Furthermore, I would encourage myself to minimize the amount borrowed each semester, even if by only $1,000, since any money borrowed through unsubsidized loans, which were most of my loans, was accruing interest while in school that would later compound, leading to the high amount of debt to be repaid.
Bryce: Developing a plan for postgraduation is definitely top of mind for me since I graduate in just a few months. From the perspective of a new or soon-to-be new graduate, how much time should be spent investing versus trying to pay back student loans as quickly as possible?
Dr. Ulbrich: The most common question I get is the decision to pay down debt versus invest for the future. The best answer is “it depends.” It depends on the type of debt, the interest rate on the debt, how someone feels about the debt, and the vehicle used for investing, for example, a Roth IRA. One important consideration to remember is that when you are paying off a fixed-rate interest student loan debt of say at 6%, you know exactly how much you are paying and the interest you are saving by paying extra on the debt. Depending on the type of investment, there is typically more variability and unknowns based on how the investment performs.
Bryce: Interesting. How would someone's strategy maybe change, say if they were just starting out in pharmacy school? How or when should they start planning out how they’ll tackle paying back their student loans?
Dr. Ulbrich: Ideally, the decision on how to pay back student loans should start as early as possible when someone is in pharmacy school. The reason this is important is that there are some repayment options that can be maximized based on someone's career choice. I’m referring to programs such as Public Service Loan Forgiveness and tuition reimbursement programs such as those offered by the Indian Health Service, the VA, or various military programs). If these programs are of interest, planning as early as possible is helpful.
Bryce: I’ve heard discussion from other students and pharmacists around the benefits of a financial adviser. When is a good time for new or soon-to-be new graduates to consider finding a financial advisor or planner?
Dr. Ulbrich: When to hire a financial planner and whether or not to hire one at all is a personal decision. Working with a financial planner typically requires an investment of time and money, and therefore, I typically recommend students and brand-new graduates focus on learning as much as possible through various free resources, and then, as the plan becomes more complex, they can engage with a financial planner.
Financial planning is like the wild west. Unlike completing a PharmD degree, residency, or board certification where there’s a certain level of consistency, the same does not apply to financial planning. The terms financial adviser, financial planner, or any other commonly used term such as wealth adviser or wealth manager give you little insight into the type of planner, the quality of the offering, how they get paid, and whether or not the relationship is in your best interest. Therefore, it’s important to do your homework and be prepared to ask good questions when hiring a financial planner.
Bryce: As a second part to that, what questions should they consider asking to make sure they are well vetted or are getting a well-qualified adviser?
Dr. Ulbrich: Here are 10 questions you should ask when hiring a financial planner:
1. Are you fee-only?
2. How are you compensated, and what services are included in your fees? How are your fees calculated?
3. What is your investment philosophy?
4. What are your conflicts of interest when working with a client?
5. Are you associated with any brokers or receive any consulting fees, kickbacks, or other incentives for recommending specific products?
6. Are you licensed as a stockbroker, insurance agent, or investment adviser? Are you a registered investment advisor, broker, or dually registered advisor?
7. Are you acting as a fiduciary all the time?
8. Can I see your form ADV Part 2? Part 2 of the ADV is where planners must disclose information about fees, the types of services provided, and whether the planner is acting as a broker-dealer to provide transactions on securities.
9. Are there any regulatory actions against you (or your firm) and/or any client disputes I should be aware of?
10. What experience do you have working with clients such as myself who are focused on X, Y, and Z. Insert your top two to three goals)?
Bryce: Great stuff. Turning back over to the student side of things, what in your experience is underutilized or potentially free resources do universities or colleges provide to student pharmacists that you would recommend they explore or research further?
Dr. Ulbrich: The financial aid office and provided resources are an underutilized resource for student pharmacists. If you ask, financial aid offices are usually equipped with knowledge and resources on topics beyond student loans. Furthermore, some colleges have various online resources and financial coaches ready to assist students. Make the most out of these resources that are at your fingertips!
Bryce: What are some innovative ways that schools and colleges of pharmacy have implemented financial wellness programming into their curriculum that might serve as an example for other institutions to consider incorporating into their program?
Dr. Ulbrich: While personal finance education is expanding in colleges of pharmacy, it’s not required by accreditation standards. Therefore, its application is sporadic and, understandably, competes for available time in the curriculum with other courses and subjects. The programs I have worked with that are thriving in helping students improve their financial literacy and wellness have found ways to integrate it as both required and elective curriculum. Ideally, the curriculum would be longitudinal, with at least one touch point per semester.
Bryce: I want to ask one last question related to financial literacy after graduation. Can you briefly discuss lifestyle creep, what it is, and how it can negatively impact pharmacists' financial well-being?
Dr. Ulbrich: Lifestyle creep occurs when people gradually increase their spending as their income rises, often without realizing it. This can negatively impact pharmacists’ well-being by leading to financial stress, reduced savings, and unplanned debt. As pharmacists earn more through promotions or bonuses, they may adopt higher spending habits—such as upgrading their lifestyle or purchasing luxury items. This shift can divert funds from long-term goals like retirement or emergency savings, resulting in anxiety or burnout if financial security is compromised. Maintaining a budget and automating your finances are two important ways to protect against lifestyle creep.
Bryce: This has been great Dr. Ulbrich. On behalf of all APhA–ASP members, I want to thank you for all this financial planning information.