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Debunking 7 Financial Myths Overheard in the Doctors’ Lounge

There is a lot of advice out there, and a lot of it is wrong.

Financial myths abound everywhere – at lunch, at dinner, at a holiday party.

Most of them aren’t true.

What are some of the most common myths that doctors run into in their offices, lounges, coffee breaks, and such?

Prudent Plastic Surgeon reveals all in this post.


The doctors’ lounge or surgeons’ lounge is a really interesting place to hang out and just listen. It’s a great place to get friendly with your colleagues and even to network professionally. Unfortunately, it is also just a terrible, terrible (insert Charles Barkley voice) place to try and improve your financial knowledge. In fact, I have heard more financial myths discussed in the lounge than in any other single location – maybe even including the internet (Ok, just kidding; the internet still holds the crown!).

But the fact remains, financial myths grow and spread like wildfire in the doctors’ lounge. It is probably the #1 or #2 topic of conversation in there outside of medicine. For long stretches, it even outpaces medical discussion.

I want to dig into these financial myths and debunk them here. If I am hearing them thrown about all the time, chances are that they exist in doctors’ lounges across the world.

So let’s stop them in their tracks!


Why is the doctors’ lounge a breeding ground for financial myths?

Well, it’s really for the same reason that doctors in general have low financial well-being despite having a really high income.


financial myths
We have no formal financial education and very low literacy scores related to personal finance. This means that:

  • We don’t know what we are talking about most of the time
  • We take advice from bad advisors
  • Our financial situation is often not good and therefore we are not qualified to give advice
  • We have a huge negative bias toward money given the financial taboo that still hangs over medicine

It’s no wonder that a gathering of doctors (A flock? Maybe a gaggle…) inherently lends itself to the spreading of financial non-truths and myths.

Here are some of the best ones that I’ve heard along with my explanations of why they are wrong…


Debunking 7 financial myths overheard in the doctors’ lounge


In no particular order…

1. You can’t get rich as a doctor anymore

I have to admit that when I was beginning my financial journey with $500K in student debt, no savings, no investments, and no financial education, I kind of felt that it was impossible to become rich as a doctor.

But I was wrong. And in reality, this myth is just laughable.

At a median physician’s salary, doctors still make in the top 1% of income in the U.S., forget about the world.

Try telling someone making $65,000 annually that it’s impossible to get rich (i.e. achieve financial freedom) by making a median salary of $200,000. I wouldn’t even be able to get the words out.

The bottom line remains that if you cannot achieve financial well-being, you have a spending problem, not an earning problem. Remember, the bare minimum that you need to do is save and invest 20% of your gross income. You can find more on this basic formula for wealth here.

No matter where you are beginning now, you absolutely can achieve financial freedom and be rich as a doctor.


2. Die with debt so that your debtors don’t win

I think I dry-heaved when I heard this one.

This was one doctor telling another that they planned to die with their student loans so that they would be discharged. In their mind, this was winning. Because they never fully paid off their lender.

The reality however could not be further from the truth. When you are a lender, your ideal scenario is that your borrower never pays you back fully. That way, you just keep collecting more and more and more interest.

Related Post:
The Wrong Way for Doctors to Think About Loans

If you want to stick it to your lender, pay off your debt aggressively and ahead of schedule. That way you pay back as little interest as possible. That’s how you win!

Don’t be fooled by small monthly payments that add up and slowly eat away at your financial freedom. Before you know it, you may be working because you have to, not because you want to…


3. Taxes are killing doctors

I feel I may get some pushback on this. But it is still one of the big and most popular financial myths.

It’s true, we live in a country with a progressive tax system. Meaning that the more money you make, the more you get taxed. In general.

Because of this, I hear doctors complain all the time about taxes. Saying things like, “I get taxed so much, I should just make less money.”

This is absurd. At the highest tax bracket, let’s say you get taxed 40%. You really don’t want the extra $60,000 you can make by earning an additional $100,000? I understand that we would all rather have $100K, but you’re going to sneeze at the $60K? I really hope not.

But this isn’t even my main argument for this financial myth. Doctors always complain about taxes but then take no interest or action in learning about legal tax reduction. Things as simple as:

No one likes taxes. But they do serve a purpose. You also only need to pay the amount you legally owe. So start learning and taking action and stop paying more than you owe!

That’s what I did. And you can see my actual personal tax plan right here.


4. My employer doesn’t do enough to help me build my nest egg

As a high-income earner and doctor, there is no way that your employer can do enough to build your nest egg. You simply make too much money. And that’s not a problem.

Even if your employer offers a 401k with a match, a 457, and an HSA, you will likely still have leftover savings to invest if you save at least 20% of your gross income like you should.

That means you need to invest in other vehicles like a taxable investment account or real estate. By the way, please don’t invest significant portions of your nest egg in things like crypto…

Too many times I hear people complain about their employer while they are not even taking advantage of the retirement benefits that the employer does offer. So start there.

Now, in the case of an employer that offers poor or no matching, or bad funds in their retirement accounts, just take things into your own hands.

Maybe you only invest in a backdoor Roth IRA and a taxable account. Maybe you put more into real estate. There are still many, many avenues to reach financial freedom. So use them!

Establish your retirement account waterfall so you maximize all of your tax-advantaged accounts.


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5. You need to get lucky to invest

This is purely a statement that comes from a lack of financial education. I know because I used to think this.

Hearing about investing in the stock market from short clips from TV shows or newspapers or online headlines sure makes investing seem risky. Random ups and downs. Stories of people losing it all or making a huge windfall on a single investment.

That’s because these outlets make money from attention. And boring stories like “Index fund investor reaches financial freedom after 30 years of staying the course” don’t sell.

Once you recognize that passive investing in low-cost, broadly diversified index funds over the long term outperforms active investing like stock picking and timing the market 80% of the time, investing seems less like risk and/or skill and more like patience. And everyone has the capacity for patience.

Related Post:
5 Reasons Index Fund Investing is Better Than Stock Picking


6. My financial advisor says this stock is a sure thing

This is a common one. And whoever said it pretty much always just got played by an active advisor or salesperson whose goals do not align with the investors.

Remember, investing in a single stock is a gamble. Studies show experts cannot reliably predict winners. Just ask those who touted Enron years ago. Ask those who recently invested in the ARKK funds just to see their value return to the original after many years of perceived gains.

Invest in the entire market for the long run. Rebalance once a year. Pay advisors only a fair, ideally flat fee if you decide to use one. Otherwise, you are paying them too much.

Related Post:
7 Questions to Ask Before Hiring a Financial Advisor


7. Money doesn’t matter

This is the king and queen of all financial myths. And I’ve heard it in many forms. Most recently, it was two doctors chatting with each other. One was telling the story of another doctor who had a lucrative private practice. The employed doctor being told the story scoffed, “Well, I’d rather be doing work that matters. Money isn’t everything.”

Now, I know nothing of the private practice doctor being discussed. But nothing from the conversation led me to believe they were doing work that doesn’t matter.

This struck me as a bit of jealousy emanating from someone who likely isn’t satisfied with their compensation. And the reason most people aren’t happy with compensation is that they perceive it is not enough to help them achieve their financial goals.

I would venture that if this same doctor was on the road to or achieved financial freedom, their response would be much more gracious.

The bottom line is this: Financial well-being increases our overall well-being. Improved well-being makes us better doctors. Money is not everything. But it is an important part of the puzzle. Especially because it is so often overlooked and made taboo by physicians.

In fact, here are 9 Powerful Ways Financially Free Doctors Can Improve Healthcare!


My goal

This post is not to shame or embarrass anyone who has said or thought similar things. As I mention throughout, most of these myths were ones that I believed before beginning my financial comeback.

They are not borne out of malice or deception. They are the result of misunderstanding and ignorance.

Like any similar case, the answer is awareness and education. That is why I truly believe that financial education should be a part of medical education. However, as of now, this is rare.

So, in the meantime, here are some great resources if you are looking to expand your financial education and achieve financial freedom!


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What do you think? What financial myths have you heard spread in the doctors’ lounge? Did you debunk them? Let me know in the comments below!


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2 thoughts on “Debunking 7 Financial Myths Overheard in the Doctors’ Lounge”

  1. Great read. I agree with all of the above. I am sure there is a polling bias as most who comment on these articles or sites are motivated about money, but so many of these ring true. Physicians are notoriously poor investors. Taking advice from a physician just because you like them, or they drive a nice car, or have a nice house, doesnt make it good advice. Taking the time to self educate, live below your means, save at least 20% (or more), and paying down debt quickly (or pursuing PSLF) can afford a physician a great life, and likely an early retirement too if they wish. Cheers!

  2. Subscribe to get more great content like this, an awesome spreadsheet, and more!
  3. That’s very interesting. I know people like to throw shade on MD’s, often out of jealousy, so I assumed the cliche that doctors were bad with money was a myth in itself. But it is obviously not based on your first hand experience. I’m a chemical engineer and by contrast I rarely heard any engineers spreading money myths. Most of them were fiscally prudent and ended up with very comfortable retirements, some retiring quite early. My guess is that the economic analysis we do in school on business cases and on capital investment projects drill into us both the time value of money and the absolute necessity of income exceeding expenses for a business to survive. It isn’t hard to apply those same principles to your personal life, maybe that’s the difference. Or maybe it’s the kind of relentless drive it takes to get a medical degree. A four year engineering degree is pretty much a walk in the park if you are good at math and science, but nobody sails through medical school and residency with little effort.


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