It’s often said that multiple streams of income are not only helpful, but perhaps necessary, for most folks to achieve financial independence, and to make their dreams of retiring early come true.
Our interviewee today has a heck of a second income, and that side hustle is making it possible for him to have a greater than 50% savings rate.
At that rate, he’ll be able to FIRE in no time, which may be something he’s interested in as he begins to settle down and start a family.
If you’re interested in participating in one of three interview series, please download the most appropriate form for your life situation: FIRE Starter, FIRE Crossroads, or Post-FI Notes. To see other posts in the series, visit our Q&A archive.
Getting to Know You
Where are you on your financial independence journey? Have you reached a positive net worth? It’s OK if you haven’t! Most of us started out in the red.
I am an orthopedic surgeon in private practice on the west coast roughly two years out of training. My current net worth is roughly $800,000.
I started reading more about FIRE and personal finance with all the extra free time I had during my final year of training during the start of the COVID-19 pandemic.
Tell us about your household. How many people? Are you supporting anyone outside of your home? Where do you live?
I am planning on getting engaged and moving in with my long-term girlfriend later this year. I currently live in a multi-unit home that I bought together with my mother after training.
I help cover half of the $4,000 mortgage and will plan on continuing to do this after I move out later this year. My girlfriend and I have not yet decided on whether we are going to buy or rent. She is also a high-income professional.
In what field are you working? How is your career going? What do you like best and least about your chosen profession?
I am an orthopedic surgeon. My career is overall going well, and my practice has been slowly growing. I love the increased sense of autonomy being outside of training and the gratitude that comes with helping patients from different types of orthopedic ailments get back on their feet.
What I dislike most about my job is the amount of call I am currently taking. I would like to decrease my call burden as I get ready to start a family.
What is the most challenging obstacle to making progress towards financial independence?
My biggest obstacle is undoubtedly my student loan burden that I am paying off aggressively. My burden is currently $207,000 (down from $287,000) post-training.
I have refinanced and my current interest rate is 3% with monthly payments of $5,000 with a five-year repayment plan, of which I’ve completed a year and a half. I am frugal in nearly all other aspects of my life and have always made travel and experiences a priority instead of material things.
How is your money invested? Approximately what percentage is allocated to stocks, bonds, real estate, and alternatives?
- Taxable Account = $86,000
- Roth IRA = $61,000
- IRA = $50,000
- 401(k) = $10,000
- Deferred Pay Call Compensation = $25,000,
- Same Day Surgery Center Partial Ownership = $45,000
All low cost index funds, no bonds.
I have an investment property from residency that I lived in but continue to rent out to other residents. I’ve been managing this property myself and fortunately have had a 0% vacancy rate for the entire 3 years I have been renting it. I don’t make any cash flow on this property after maintenance costs but do increase rent every year and have held onto it with the rationale that I am continuing to build equity.
Current value: $625,000, Mortgage Loan: $260,000 Current equity: $364,000
Current property that I bought with my mother: Value: $1.3 million, Mortgage Loan: $670,000
Do you have investments in an HSA? How about 529 Plans?
What has been your best investment?
My best investment has been real estate with both my investment property and current property benefiting from the bullish market.
Your worst investment?
I jumped on the Bitcoin bus at its maximum peak last year; fortunately, I only invested $5,00, but I have lost about 20% currently. I do not truly consider that an investment.
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What attracts you to the FIRE movement? Do you think you’ll retire early when you’re in a position to do so?
As I get ready to start a family, I am realizing the true value of time and not falling trap to the “hedonic treadmill.” I am also drawn to autonomy over my time.
I don’t think I would completely retire from orthopedics when I am in a position to do so, as there are aspects of my work that I truly enjoy. I would want to tailor my work to include more of these things.
How do you anticipate your life changing post-FI?
I see myself spending more time with my family and pursuing my passions outside of medicine. I also hope to travel more. I want to dedicate more time to my own mental and physical health, too.
What steps have you taken to hasten your time to FI?
I have tried my best to live well below my means and continue living like a resident while still investing my time and money in things that bring me true joy.
I have also taken on a consulting side gig that currently takes up a couple of my weekends each month and many weeknights, but has provided me with an additional $300,000 annually. This has been one of the smartest decisions I have made post-training from a financial standpoint, and it has provided me with leverage both in terms of my job opportunities as well as investment choices.
This lucrative side gig has allowed me to keep my savings rate well above 50% monthly.
Are your friends, family, or coworkers aware of your interest in financial independence?
I openly discuss this with my family and friends. They are all supportive.
What advice do you have for others beginning their own FIRE journey?
I don’t believe I am quite in a position to offer advice as I am still trying to figure this out, but I would say that knowledge is power. I am an avid reader and spend most of my time outside of work reading about personal finance and development.
Finally, is there anything under the sun that you’d like some help with? The hive mind would be happy to weigh in.
My biggest dilemmas at the moment are what to do regarding my investment property and my student loan situation.
Should I continue to hold on to my current investment property despite the lack of cash flow or does it make more sense to sell it and use the equity to pay off my student loans and free up the extra $5,000 a month for other investment opportunities? Both my student loan and investment property interest rates are 3%.
Lastly, based on my current situation, do you think it is possible to reach FI in 10 years?
Thank you for your time. I am a huge fan of your work. Reading your “Sunday Best” has become a part of my Sunday morning routine.
[PoF: Glad to hear it! Be sure to follow Ether to FI’s journey. He had a goal of FI within 10 years and has been updating his progress for nearly 5 years now.]
PoF: Catch all the future interviews from those just getting started, at a crossroads, or at the end of their FI journey with a free subscription to Physician on FIRE.
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I thank today’s interviewee for sharing their story, and I’ve shared my feedback privately with them. I wouldn’t want my opinions to influence yours. Please give your take and answer any questions they have had in the space below!