The Sunday Best (7/23/2017)


The Sunday Best is a collection of articles I’ve curated for your reading pleasure.

Expect most of the writing to be from recent weeks and consistent with the themes presented on this website: investing & taxes, financial independence, early retirement, and physician issues.

 

Presenting, this week’s Sunday Best:

 

My friend J. Money and Mr. 1500 made my ears burn this week, talking about our family and lifestyle over on Budgets are Sexy. Lifestyles of the Rich and Frugal. [note: this has since been published with a new title at Business Insider]

 

Dr. Charlie from Life of a Med Student has moved on from residency and started his career as an anesthesiologist. What he’s learned so far is highlighted in Life as an Attending: First Impressions!

 

Dr. Jim Dahle of The White Coat Investor moved on from residency eleven years ago. Like me, he decided he was ready to be done with the mortgage and all other debts. We’re Debt Free!!!

 

Joe Udo @ Retire by 40 isn’t just debt-free. He’s retired. An update on life as a SAHD 5 Years After Early Retirement.

 

ESI Money is also early retired, and he tackles a common complaint. Why $3 Million is Not Enough to Retire On. Or is it?

 

Of course, you don’t have to be a multimillionaire to retire. You don’t even have to be financially independent to take a sabbatical. Ms. Montana @ Montana Money Adventures has gleaned 10 Lessons from a Mini Retirement (of 20 months with her husband and five kids!)

 

What’s better than an early or mini retirement? A job you don’t want to retire from. The Wealthy Doc has made 34 changes to his day-to-day work routine, listing them all in a fantastic post entitled How High Is Your Professionals Satisfaction? Could It Be Higher?

 


The Boss MD has similar ideas about retirement, as outlined in Financial Independence Retire Never (FIRN).

 

I often feature travel hacked trips on these pages, but Harry Sit a.k.a. the Finance Buff has a different take that I thought was intriguing. Why Reward Flights Or Hotel Nights Are Not Free.

 

Guess who just got married? The Big Law Investor. Congrats, buddy! Wedded bliss will change his life in many ways, some of them financial. Getting Married and Taxes. p.s. Sorry I didn’t get you a wedding gift, Josh. Please accept this Sunday Best feature as my offering.

 

I Spend Too Much?

 

The Budgets are Sexy post generated a lot of positive comments, but the responses weren’t all sunshine and rainbows. Mark pointed out:

“There’s a pretty huge caveat in this story and I’ve never really gotten the attraction to PoF. Yes, he’s the perfect example of not falling into the lifestyle inflation trap, but he’s still not particularly frugal. At least not compared to the average American that can’t afford to pay for a huge house in cash, vacation in europe, etc. His story is not even that translatable, in that he basically fell into the perfect storm of working in an industry that demands extreme salaries while being able to live in an area with extremely low cost of living.”

It’s true that although we make some frugal choices, we are not exactly frugal as compared to the average American family. Our spending of $62,000 for a family of four last year bought us a pretty good life, since we’re no longer paying a mortgage, carrying life or disability insurance, and health insurance is supplied by my employer.

Of course, my target audience is not the average American family. I’m writing for my colleagues and peers. The high income professional who may be looking to get off the hedonic treadmill and consider a divergent life and career path.

I would also like to point out that I didn’t exactly “fall into” any perfect storm, but made many good choices along the way to be in this position. The comment went on to talk about how much luck was involved, and my friends addressed that appropriately.

What do my colleagues and peers think?

 

I Spend Too Little?

 

My first 12-month spending report landed on the pages of Doximity, an online portal for health care professionals. The comments there were a mixed bag, but there were more than a few physicians who felt I needed to loosen the purse strings and “live a little.”

From Alan:

“This is way too frugal. Life is short and those bucks you saved aren’t as much fun to spend when you are 90! Also, try living near NYC or San Fran on this budget. My wife would love only 2 professional cuts a year, PUHLEESE. However, saving a defined percentage of ones paycheck is very wise. Pay yourself first is what smart retirement advisors say. I aim to save 15-20% of gross income or 25-35% of net. Of course it took me until my late 40s to be able to put away such high percentages.”

 

From Elena:

“I do not know where exactly these numbers are coming from … certainly not from NYC and suburbs of NYC

family of 4 sees more something like:
property taxes here average $30,000 per year
mortgage suburbs of NYC $6000-10,000 per month
rent of apartment the same
food approx 400-500 per week so approx 1200-1500 per month
income of a pediatrician – not enough to sustain a 4 people family and have a retirement plan”

The article states that I live in the upper Midwest, and there are reasons I chose not to live in or around New York City — some of them are outlined in Elena’s comment.

 

Finally, Melissa says:

“Fun article! My advice? Your travel budget is way too low. Those are memories that last a lifetime. I have three boys so I dedicate a sizable portion to travel.”

For the record, the travel expenses that year added up to $8,649. Not included are CME travel (which are partial vacations) and food while travelling, since you’ve gotta eat no matter where you are. This is how I described our travel (in the third person, before I revealed I was talking about my own family:

“We all know that rich people love to travel, and this family is no exception. In the fall, he flew halfway across the country for a college football game, and she visited a close friend in New York. There was a couples’ getaway in Puerto Rico in November, where they kayaked in the world’s brightest bioluminescent bay, hiked through the Rio Camuy caves, and took in a college basketball game. In March, the whole family took a Disney cruise to the Bahamas, and spent a long weekend at Universal Studios in Orlando.”

I went on to describe spending a substantial portion of the summer at our cabin (a year-round expense that is tracked separately from “travel”). But apparently we need to get out more.

 

 


You’re still not using Personal Capital? Track all your accounts in one place like I do.


 

As Ricky Nelson once said at a Garden Party, “You can’t please everyone, so you’ve got to please yourself.” I’m a live and let live kinda guy — I’ll keep doing what works for me and my family, and you keep doing what works for you.

Meanwhile, I’ll do my best to convince the masses that we’re living at least relatively frugally, while trying to prove to my colleagues and peers that we’re living a fulfilled and comfortable life without a six-figure annual outlay. It’s a tough balancing act some days.

 

Have a great week!

-Physician on FIRE

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32 comments

  • Love the addition of RB40 update. I somehow missed that so thanks for including it here! Hope traveling went well and you were able to unplug.

  • I don’t understand why people feel the need to be so critical of someone’s personal finance decisions. Just because PoF doesn’t spend money exactly how you would spend money doesn’t mean the article isn’t worth reading or you should leave a critical comment.

    Attending physicians often tell their residents to become their own physician by integrating the qualities and practices of their mentors. Any one mentor may have qualities you like (e.g. super book smart) and things you don’t like (e.g. too serious at the bedside). Another mentor might be the opposite (e.g. not as book smart but great at the bedside) There is no perfect doctor, and the goal is to integrate the qualities you admire (e.g. be super book smart and great at the bedside) into your own practice you observe in your mentors, while avoiding the bad things.

    The same thing goes with personal finance advice. You like how PoF lives in a modest house for his income and retired early? Great. But maybe you’re a WCI person and want to spend a little bit more and work longer. Or maybe you’re a MMM person and want to spend a little bit less. Each person needs to pick their personal finance “mentors” and use the advice they like and forget the advice they don’t like.

  • I can sum up my thoughts on your spending habits comments pretty succinctly. If you have that many people worried about your personal travel budget, then you must be doing alright. Keep up the good work and thanks for the share!

  • Frugal is relative. The situations we face are different then those scrapping by, but they are no less important. I for one appreciate reading about those in a similar positions to me. I also realize that higher income does often require higher expenditure. Even ignoring life style inflation in general you have more time demands, education costs, stress, ect. In addition you have different push and pulls. Different temptations, investing options, and even spending options to consider. This is all before you get into how personal finance is. Every perspective is another interesting data point.

    • Interestingly, we seem to be getting more frugal as time goes on.

      My first 12-month spending report (September to end of August) showed $73,000 in spending. Three months later, I released a full calendar years’ spending of $62,000.

      This year, we’re on pace to spend $52,000 if the last half of the year matches the first.

      We seem to be having fewer “one time” expenses, and have fully realized that we have more than enough (aka too much) stuff!

      Best,
      -PoF

  • Millenial Doc

    Happy Sunday PoF!

    Given that you are being criticized by both sides of the aisle, you must have struck some kind of balance.

    To the people who say you are not “frugal”, you are probably saving a similar % of income they are, its just your income is significantly higher than theirs. Could you have become FI a few years quicker if you spent only 30k per year? It may have saved a couple years, but you still got to “your number” at a very young age and enjoyed the journey.

    To the people who say you are not spending enough, I would simply say that I am spending a ton, and that my “time” is the luxury item that I am buying.

  • Thanks for featuring my post, POF!
    It really bothers me when people claim luck for achievements and results that are clearly driven by conscious choices and long efforts. Even choosing to live in a low cost of living area is a choice – one I also have highly valued (and am seeing the benefits of already). Personal finance IS personal – and I think your life choices (not luck) is something I relate to and look up to – even if I don’t plan on doing everything exactly the same. Cheers!!

    • You could say I was lucky to be born in the 20th century to loving parents in the USA, etc… Sure beats being born as ant wherever anteaters live.

      But assigning any success I’ve had to luck is rather silly. The same goes with this site. It’s not the second most popular physician authored personal finance blog by chance. I’ve worked hard to make it so.

      Cheers!
      -PoF

  • Thanks for the mention! And random judgment comments always crack me up (when they are about someone else!) The whole, “Our lives aren’t exactly the same, so I’m going to disagree with any or all of your choices.” We all do what we feel works for us, so I suppose the proof is in the pudding. Either we are happy and thriving or not. From what I can glean you all have a really happy, thriving family, despite your “too frugal/not really frugal enough” lifestyle. =)

  • JSA

    No need to defend yourself from any of those criticisms, those comments you highlighted just make my eyes roll and sometimes I despise the pedestal and critiques people have on travel and “experiences.” Growing up my family took vacations, some of them I don’t remember, and the cultural/sight-seeing vacations that I now enjoy were utterly boring back then. The actual “fun” vacations I had are just non-specific memories now, neither good nor bad, had I not had them I’d have other memories in their place, I’m not better or worse for having had that experience.

  • You are making it big time now PoF. As the critics role in it means you are making an impact and at least hitting a nerve. It implies you are reaching people outside of your dedicated readers (cough cough…). Haters gonna hate. So let them hate and keep on trucking.

    Great round up as always. Going to head over and read a few I missed this week right now.

  • Frugality is finding a balance that works for you, and your finances! There are no fast and hard rules, it’s more subjective than… pineapple pizza.

    But I’m glad it sounds like you’re not letting anyone else influence your own opinions on that. You’re never going to be able to please everyone. The best thing to do is just please yourself, try to please the people you care about, and not worry about everyone else.

    Thanks for the good read!

  • Humans have a tough time with relative concepts and then judge them when they don’t fit their values. Frugality is by it’s definition relative to some other hypothetical spending decision. It is pretty funny to see people attack your frugality from both sides.

    PS: That article by Wealthy Doc was pretty fantastic.

  • Gift accepted! Thanks PoF, happy to finally join the married crew. I’m told I just extended my life expectancy by a few years and boosted my ability to save by doubling up on retirement accounts.

  • OMMD

    In response to some of the critics, isn’t the topic this blog mostly covers personal finance? PoF isn’t telling us how to live our lives but giving us some perspective and ideas to mull while educating many of us about tax laws, 401 (k)s, IRAs, etc…

  • Hatton1

    I suspect that POF is fine with this criticism. As a doctor we get used to it from all sides. What we choose to spend our dollars on is well personal choice. Mindful spending. I spend a lot of money on my animals. I can afford it and it is my choice. I plan to sit on my deck this afternoon and watch some boats go by as I sip on a craft beer. Cheers

  • Dr NightFIRE

    I agree with the above comments…personal finance is personal and I doubt PoF was much bothered by the haters.

    I very much appreciate this thoughtful blog written for “colleagues and peers”. I love the different takes on achieving FI and maybe or maybe not RE. I visit this site not only for the advice on 401k, but also for the honest and thoughtful posts and comments on being a physician. It can be scary (one of my favorite posts–no one ever says that!), many of us get burned out, should we go part time, retire early vs an obligation to work forever, etc.

    And…I really, really appreciate that PoF and some other male colleagues here want to either retire early or work less to spend time with their families or other life pursuits. The culture where I practice is very old school (deep South), so I am very thankful to have this modern community of colleagues to help keep some perspective. (BTW, female hospitalist working FT with 14 years post residency work life under my belt.)

    Thanks all!

  • I don’t think you should worry about what the internet critics think PoF.

    If you’re happy with what your spending then that’s good enough!

    If you were unhappy with some aspect of your life, then you could spend a little money to solve that… but it’s a slippery slope and eventually leads to Lazyville and Brokeville.

    I say “Stay the course!”

  • I liked our non-click-bait version much better 🙂

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