Retired from Medicine at 37: The Finances Behind Her Decision

Physician Financial ServicesToday’s article is a guest post from Valerie A. Jones, MD, a way early retiree who left behind a medical career at the ripe young age of 37. To learn why, check out her post at OB Doctor Mom entitled Retired at 37: Breaking Up With a Career in Medicine. To learn about the finances that allowed her to do this, read on.

 

I am a 37-Year Old Retired OB/Gyn

 

Usually, when I tell people I retired from my physician career at age 37, they respond with shock. Some look at me like I am the most foolish person they have ever seen. Some with disdain (“all that medical education wasted”). Some doubt that my future will be secure without having a steady paycheck.

However, as it is only my close friends/family I discuss this with, they mostly respond with sincere happiness as they understand this is a life choice I made after much deliberation and know that it is the right decision for me and my family in pursuit of the life I want to lead. There are many factors that led to this decision and I have written about some of it in previous articles. However, this article focuses on the financial aspect.

Finances can be a tough subject for physicians. We are notorious for being poor money managers. Most of us don’t have the time or desire to commit to understanding personal finances in detail. Who has time to learn about 401(k)s, the stock market, and budgets while learning about anatomy, pharmacology, and immunology while in medical school? Or while working 80+ hours per week in residency?

Besides, we won’t be earning an attending physician paycheck for years. By the time we earn a real paycheck, we are so exhausted by the delayed gratification of our twenties that we want to splurge a little, right?

Obtaining Financial Independence

 


I don’t proclaim to be an expert by any stretch. However, I found the freedom that comes with financial independence to be life changing and something that should be attainable for all physicians.

I am not here to encourage everyone to retire in their thirties from medicine, but to gain financial freedom. I hope you can continue practicing medicine into your sixties (if this is what you want), but to not feel trapped in a situation when encountering unsustainable job structure, illness, divorce, etc.

Of course, finances did factor into my decision to retire. I have three kids and wouldn’t stop working if I needed a steady paycheck to support them. Luckily, some decisions along the way helped me not to rely on this paycheck moving forward.  here are many different paths to financial independence. Here are some steps that led me down my path to financial freedom and ability to retire early:

    1. Kept medical school loans to a minimum

 

Yes, you do have some control over this. Most people outside of medicine are shocked to find out that medical students are essentially able to get loans for as much as they want.  You can determine your own “living expenses” and someone will be ready and willing to give you this loan as medical students are typically good about ultimately paying it back (although years down the road and with a ton of interest).

I was lucky my parents paid for my undergraduate studies but medical school was on my own. I probably started my frugal mentality at this time. My husband, who I was dating at the start of medical school, would often make fun of me for my bare cabinets with canned green beans and ramen noodles as my main staples.

Of note, he also had loans from undergraduate school that we had to factor in as well. Don’t worry, we didn’t eat like that forever!

    2. Started paying off loans immediately after forbearance ended

 

We paid the maximum amount we could, not the minimum required.

    3. Lived well below our means

 

We continued living in my residency townhouse for a while, even after accepting an attending job.

 

    4. Looked for job with highest earning guaranteed earnings

 

Many positions I was offered entailed low salary the first few years and then potential for partnership and jump in salary but not until 4-6 years down the road.  This was downright scary to me.

What if I didn’t like the job? What if they never actually promote to partner?

The writing was on the wall for private practice in ob/gyn with soaring malpractice premiums and it seemed unsustainable to me for most of these private practices.  I wasn’t willing to take the chance. I had also heard that many people may leave their first job after two years.

So, I figured why not at least get a large salary those first two years while I get a better feel for the landscape? Luckily, my job did not have a non-compete agreement, so I knew I would have options if I decided to leave (I actually stayed with my first job as I was initially very happy with my choice out of residency for about 5 years).

 

    5. Maxed out yearly contributions to retirement vehicles

 

403(b) during residency, 401(k) with new job (which also had a pension that vested after 5 years), and started a Roth IRA.  I had to devote some time to learn about what all of these things are and why they are important!

    6. 529

 

My first child was born in residency, but I did not start a 529 at that time as wanted to maximize retirement account yearly contributions first.  Once those were being maxed out, I started 529 for oldest child and then when subsequent children were born funded those too.

 

    7. Lived off one income

 

I feel this one factor made the absolute most difference!! Certainly not all, but most of my colleagues are in a dual income household.  We always lived off one income (mine) and paid off loans with the other.  This always forced us to live within our means. This may be hard to accept initially as many physicians feel that the delayed gratification never ends, but trust me it’s worth it! I do have to admit, our one splurge was a nice vacation every year.  “Work hard, play hard” is my motto and I probably wouldn’t have made it without those necessary times of respite to recharge. Travel is one of my passions.

 

    8. Got Creative

 


For those who have a partner who does not have a career in medicine, there may be options opened for them since a physician job is very secure.  You will always be able to find work as a physician and it is quite unlikely you would lose your job. In addition, health benefits are common with employed physician jobs and therefore you can take a big burden off your partner to worry about this.

This can free up some room for ingenuity with your partner if their job allows for different payment structures. Commission based jobs with a low salary and no health benefits may be unsustainable for someone supporting a family. However, if you use the idea of living off one person’s salary (your physician salary) and allow your partner to get creative it can really pay off.

Employers may jump at the opportunity for this type of pay structure which would have very little risk for them but could have huge potential upswing for the partner. We chose to take this risk. We couldn’t have done it without the stable physician salary/benefits component.  It was possible my husband would make barely anything certain years or alternatively, make large sums depending on the work flow.  Nothing was guaranteed to last and so any windfall that came from his work was immediately placed into debt repayment or kid’s college funds.

 

Financial Independence Changed Everything

 

When starting out of residency at my first attending job, I planned to continue to practice medicine until my sixties, cutting back on hours if needed, but I assumed my love for medicine would keep me wanting to work indefinitely. Several things changed my mindset, including financial independence.

Once I knew I didn’t “have” to work, I started to view my career a little differently.  Maybe I wasn’t honest with myself previously with how the stresses of on call nights, sleep deprivation and increasing administrative workload was negatively impacting my life and health. It sometimes feels like you are on this treadmill that keeps going and you don’t have the time or energy to ever stop and think about what you are doing and if you are leading the life you envisioned for yourself.

 

newborn baby

pof: this one came along in the middle of the night and changed my life forever

 

Once financially independent, it became my choice whether or not to work.  The frustrations of salaried work in ob-gyn, the negatively changing healthcare climate, and missing time with my young children was weighing on my mind.  I wanted (needed) out for myself and my family.

However, I needed a push to get off that treadmill and realize what was going on.  “Luckily” for me, I had a major health scare that also occurred at the same time that I reached financial independence. Decision made.

Now, the choice can be mine if I decide to ever return to medicine. I’ll never close that door completely, although I don’t see it in my future if you ask me now.  There is so much out there I am still excited to explore.

 

[PoF: What do you think of Dr. Jones’ story? In a number of ways, her story parallels mine. Early retirement wasn’t a goal, but became a rather enticing option once it appeared to be a genuine possibilty.

While she has had some advantages that you may or may not have (financial help with school and a working spouse), that doesn’t mean you can’t do what she or I have done. It might take you a few years longer, but financial independence can be attained by age 45 or 50 for most physicians, and up to a decade earlier for others.

I want to thank Dr. Valerie A. Jones for responding to my request for this post and for detailing how she was able to put herself in this enviable position. Her original article explaining why she made the choice got my attention, but I still had questions. She did a great job answering them, don’t you think?]

61 comments

  • This is a great story and it’s clear that smart money decisions and frugal habits made a huge difference in getting to FI so quickly. I love that others can read this and learn before making the mistakes so many people seem to think “need” to be made to get their finances in order. I didn’t actually have a health scare, but three women peers my age had major events in one year (one death from an aneurysm, one massive stroke, and one benign brain tumor) and it totally changed my outlook on life. I had similar habits as you and I’m “giving up” my doctorate in Educational Leadership to retire early in 43 days. Our plans are in motion – so much we want to do ahead! Thanks for sharing your story!

    • congrats on your plan for early retirement in 43 days, Vicki! Yes, sometimes unfortunate events can make you reevaluate what you want to do with your life. In my case it was a wake up call and luckily finances were in order. Best of luck!

  • hatton1

    Hi Valerie,
    I quit ob 3 years ago. I think our speciality is really changing. The laborist/hospitalist model is going to turn it into people who do prenatal care and everyone else works for a hospital. Pros and Cons to this model. In looking back ob is really underpaid when you consider the time and medicolegal risks involved. Most of the female physicians at my hospital are the primary breadwinner and SAHDs taking care their kids. I suspect you are enjoying your sleep and do not miss the lifestyle of an OB all that much.

    • Hatton1, I couldn’t agree more. Even in the short 7 years I was practicing as an attending in OB/GYN, the field is struggling and physicians are losing control rapidly with the changes occuring. I don’t necessarily advocate for early retirement (and actually hope most physicians WANT to keep working in their field because they enjoy it). I am hoping to be an advocate and voice for change in the field as I don’t wish to keep losing ob/gyn’s but to maintain physicians in the workforce with sustainable working conditions that don’t make people feel there is no better option than early retirement. On the other hand, I am personally somewhat surprised I don’t regret my decision to retire early one bit.

  • OMMD

    Is this really evidence of FIRE or a story about a two income household deciding they can now live off one income?

    • I will let Dr. Jones elaborate, but my understanding is that they are now financially independent based largely on the salary that she made. Her husband enjoys his job and continues to work, but could afford to retire also.

    • Good question OMMD. We have reached financial independence as a couple. Meaning, he could also retire from his job tomorrow. However, he personally is not ready to stop working and enjoys his job. Therefore, he may work a few more years. He is also enjoying the freedom to know that if desired, he can stop working also. So in that sense, I believe it is reaching financial independence and not requiring any income from either partner. Hope this clarifies.

  • SG

    Thanks for sharing your story, I would be interested in knowing what your FI number was. Was it 25x annual expenses? Also does your husband continue to work?

    • Megan Quaker

      Yes I agree with this question. I think we all know the reasons why we want to retire early, but we need to know the math that makes it possible for different families. Yearly expenses, which debts, how much in a taxable account etc.

    • SG and Megan, we basically nerded out with a huge spreadsheet and figured out expenses, balanced against investment accounts, 529 accounts for the kids, savings, etc and calculated the number we needed with projected living expenses until 90+ years old. We tried to account for everything and therefore the spreadsheet is huge! One big factor is health care costs when you don’t have anyone in the workforce that can provide an employer sponsored plan. This will be, by far, our biggest expense over the years.

  • Thanks for sharing – it’d be helpful to have more specifics if you’re willing to share – what FF/FI meant for you (the number that is). How much in loans you actually had and how much you were paying towards these.

    • Kirk

      Agree. Specifics would be helpful (how much in loan payoff, finished 529 funding?, nest egg amount, if she feels like sharing). It is more of a switch to one income. Most physicians don’t start practicing until age 30, so 7 years out doesn’t leave a lot of time to build up your nest egg ( including loan payoff during that time). But well done in living off one income the continued delayed gratification after residency is tough.

      • It took me about 9 years to get to FI as a family of four on one income. Granted, it was the income of an anesthesiologist working a very busy schedule, but it can happen within a decade if the markets cooperate, your debts aren’t immense, and you save about 2/3 of your take-home pay.

        This is how I did it.

        Best,
        -PoF

    • I did have a low 6 figure amount of loans after med school (probably a little under average for most, and was lucky to lock in 2.6% interest rate). We didn’t have a set amount we paid each time. Simply, whatever came from the other income was evenly split between debt and investing/saving, with zero spending. That amount fluctuated over time, but the plan was constant and kept us on track to pay off debt. In the end, I think it took about 4 years. Obviously not every family has 2 incomes, so a similar strategy would be to live off half the one income with same goals in mind. It took a few more years to get to FI, but investing helps get there much faster than salaried income!

  • Nice work! I think most of us have trouble keeping the initial costs down once we become attendings. That first misstep sets us up for failure in the FI path early. Luckily we can get there because we are high earners, but that first step likely puts us back 5 to 10 years.

  • Chris

    I’m confused, is Dr. Jones considering her “retirement” merely living off of one physician income? This is hardly an accomplishement when many of the financially independent physicians are able to retire off of one physician income with a stay at home spouse. Does she mean that both her and her husband have retired?

    • Hi Chris, hopefully I answered your question in above reply to OMMD. I agree, I don’t think its quite the same thing as having a stay at home spouse which many physicians do, but still require another income. I view it a little differently.

      • Chris

        I read it above, that’s an amazing story. Congratulations on your freedom and I am also happy to hear that your husband enjoys medicine enough to stay in the game even after FI.

        This makes me wonder if I should dump the teacher I’m considering popping the question too….lol jk

        • Haha, I would keep the teacher and maybe live off her salary!!
          Also, I didn’t mean to imply that my husband was also in medicine (sorry, was just answering the prior question of comparing it to two physicians living off one salary).

  • Awesome read – thanks for sharing. It’s interesting that the points you make are similar to a lot of other personal finance suggestions… hmm…

    It doesn’t matter how much you make, it’s how much you save.

    Thanks for sharing Valerie 🙂

  • RetiredDoc

    I think a lot of the comments saying this is not “really” retiring, but living on one spouse’s income shows the sexism inherent in our society. Several of the male FIRE bloggers have working spouses and even state that this has made early retirement more secure; however, if a woman retires from a lucrative profession while her spouse continues to work, all of a sudden, it is no longer FIRE but just her living off of her spouse. I believe she said above that her spouse was not a physician but that they were able to take big risks in his career because of her stable income and benefits as an employed physician. In my case, I have just retired while my husband will continue working. His work is his calling, his hobby, his life. There is nothing he wants to do more. He could retire now as well, but he is happy and has very flexible hours. The benefits that come with his continued employment certainly make my FIRE plan more stable. Our nest egg came from living a frugal lifestyle and my years of having a high income. If not for our nest egg, I would still be working (but probably would have moved to a different job). So, it is certainly possible for a female physician to FIRE and not just stop working and live off of her spouse’s income.

    • Marilyn

      +1 She has already said twice they are FIRE as a family.

      Madfientist’s wife still works. They don’t have combined finances. He is FIRE based off of his needs. Her expenses aren’t figured into his FIRE number.

    • Dr. Mo

      Cheers to that. Very well said.

  • Kudos on your newfound freedom Valerie! I too have heard the “all that medical education wasted” comments when doctors retire early or stop working to be a stay-at-home parent. But people forget what can be gained: time. Time to exercise, read, play with your kids, try something new, or nap.

    Plus, if you get bored or miss the work, there is always the option to come back. Do you have plans to maintain your licenses for a period of time? How long of a break would you consider before you felt “too rusty” to return to medicine?

  • Marilyn

    I have the hope the FIRE physicians will be able to positively impact medicine. That extra mental bandwith and margin in your life opens opportunities. Who knows what interesting things you’ll be open/able to do in the next 5 years.

    • Yes! Marilyn, this is how I am approaching the upcoming years. I feel for my friends/colleagues who feel trapped in their current jobs and believe there are no better options in medicine out there. I think we can do better and can improve the environment for practicing physicians so that they WANT to keep practicing. The problem is that practicing physicians are so overworked, tired, and stressed that there is no time for focusing on this. Any extra energy is going to their families, so I do believe it will help to have people who have left clinical practice but still have “fire” left in them from knowing what it is like and want to make a difference. I think having conversations like this helps get things started. Also, you are right- there are so many opportunities out there and at 37, who knows what I will be doing 10 years from now.

  • VagabondMD

    I read your blog first on KevinMD and reread it again this morning (in addition to what you posted here). Congrats for making a shrewd, but difficult decision, one that I grapple with constantly.

    I am 51 (21 years post training) and easily FI, but having trouble cutting the cord (apologies for OB pun 😉 ). I am going to try part time and giving up the most punishing part of my job on the next few months to see how that feels.

    One thing I repeatedly ask myself, and will ask you, too, is it possible that your specific job was not the right fit and that there may be a better job fit in your field that you would find rewarding (reference to Hatton above who discarded the OB part of her practice and still enjoys the GYN)?

    Thank you once again for telling your story. Doing so truly makes a difference for other people, especially your colleagues.

    Cheers!

    • Vagabond MD, thank you for your thoughtful comments. I indeed wrote my first article about why I left medicine in the hopes it may resonate with someone else struggling with the decision to stay in a career that is no longer a good fit. I truly felt “called” to be an ob/gyn initially, but so much has changed over the last 10 years. Even in my short career as an attending I could see how medicine was changing and physicians were increasingly losing control. Its a good point that maybe it would be different with a new job structure or change of focus. However, once reaching financial independence and with the current health care environment, experiencing my own health scare, my priorities were changed.

      I can’t speak to how I might feel in 10 years, but for now, I needed out. Best of luck to you as you decide what makes most sense in your own life!

  • VagabondMD

    One other question that I ask to the community–when a 37 year old bright, successful MD retires early, and many other bright, successful, forward thinking younger docs, along with her, what does that leave us with in the future? Tired, worn out docs, just hanging out in the field because they planned poorly and still need the money? I shudder to think about it!

  • Liz

    She is my new hero. This is my dream although I’m past her retirement age (I’m 38). I’m a dentist and working toward retirement, hopefully by 45

  • Dr. V. Investor

    Congratulations! It resonates to me that because of the stability of your job, your husband was able to become more creative. I am in a very similar position. Though we have saved aggressively, no debt but mortgage, I do not consider retiring. My question is for the FIRE community, what about health insurance? it is a huge expense and my entire family is dependent on my employment to get good coverage. I am weary of giving up my career early and need to shelter a big chunk of our budget for health insurance. Thank you if you get the time to answer this.

    • Yes, I would also love to hear if anyone has a better solution for health insurance. That is by far going to be our biggest expense moving forward with a family of 5. However, we did factor this expense into our budget/projections for yearly outflow expenses.

  • thekey

    There was a post on PoF and on other forums last week about whether it was morally acceptable for a doc to retire early. I don’t think there’s any obligation whatsover.

    I do however think it doesn’t make sense financially to go through medical school and residency for a seven year career as an attending. The opportunity cost of medical school (with 200k in debt) and a low salary as a resident puts you miles behind peers who started with a low six figure salary right out of college. You can only really catch up by having a long career in medicine in decent paying specialty.

    If your goal is FI as soon as possible, you’re better off in tech or finance or consulting instead of medicine.

    • thekey, I completely agree with you. Medicine is not the field to go into if your plan is FI as soon as possible. That was definitely not my plan. I love medicine, used to love ob/gyn (I would even say it was “my calling”), but life happens and things change. I think its always good to have the goal of financial independence no matter what your job is so that if you need to make a life change, you can.

    • Drbob

      Well as a doc who blew FIRE entirely, doing every possible thing wrong, it is actually quite refreshing to think that with a new attitude I could retire in 7 more years!

      I calculated that I earned 15 million (pretax) over 25 years and only have 2 million saved to show for it. Costly divorce, 6 kids through college , risk averse investing and always getting out before the boom. I guess I had some nice cars and vacations too.

      I have no choice but to get it right this time. But every time the market dips by 1 percent I “lose” 20 k, and I feel the panic setting in. Staying put requires a certain personality. For people who haven’t seen 1999 or 2006, they are always playing with the houses money! Without that fluff, downturns can be brutal.

      • Thanks for the comment, Dr. Bob.

        I’m not sure you’ve done every possible thing wrong. You could have made some different choices, but the fact is you helped raise 6 kids and put them through college, helped a whole bunch of patients, and you do still have $2 million to show for it even after the costly divorce.

        You’ve also learned from your mistakes, and I’ll bet you can retire in fewer than seven years if you really want to. The math supports you retiring as soon as now if you’re willing and able to live on $60,000 to $80,000 a year like we do.

        Cheers!
        -PoF

        • Drbob

          PoF I looked and I think my insurance costs alone exceed 40k. Life, disability, health, car, house, umbrella, for 2 people and a kiddo or two.

          I guess could jettison disability in retirement but then health costs go up without employers subsidy.

          My new plan to FIRE is to hope one of the kids strike it rich. I had enough of them to throw the odds in my favor!

          • EnjoyIt

            Once you get lifestyle creep, it is very difficult to dial it down. You can easily retire on $2 million but choose not to because you are making the decision to continue the lifestyle you are currently in. Downgrade into a house half the cost, downgrade your car[s], and get rid of disability and life insurance since now you don’t need either. I am sure you can retire today if that was your goal.

            There is no reason a couple can’t live a very happy and comfortable life on $80k/yr if they are debt free.

      • VagabondMD

        DrBob,
        I am roughly your vintage (have not calculated how much I have earned over the last 21 years) and expect that you are about 55. There is no reason to feel ashamed.

        There is more to life than FIRE, and you have sampled quite a bit of the other side. Furthermore, if you enjoy your medical career, all the better.

        Based on your sentiments re: market drops, you might be best served working with a financial advisor.

  • Joe

    Thanks for sharing. I think you have a great story. Anyone can make a life change if they really need to. I had a health scare too and I realized I needed to get off the track I was on. That push will wake people up.
    My brother is an ER physician and I can see the job wearing him down. It’s a tough field to be in.
    PS – come by and take my pop quiz. How serious are you about early retirement? 🙂

  • Anne

    Thanks for sharing your story. I am also in my late 30s, married to a non-physician spouse, and we are close to financial independence. I’m lucky in that I have a great job with a really good work-life balance, and I’m not ready to give up practicing medicine yet, but there are so many other things I am interested in I also doubt I’ll want to do this for the next 30 years. I like the idea of taking a prolonged sabbatical in a few years to explore other interests but am afraid that if I decide to return to patient care after a few years away I won’t be able to find a job–I know several women who left medicine (mostly to be SAHMs) and had a really hard time when they were ready to re-enter the workforce. You say that it’ll be your choice if you ever want to practice clinical medicine again–do you really think this is the case?

    • Anne, congrats on getting yourself to that financial position where you will have choices. I’m not sure of your field, but at least in ob-gyn I found no shortage of jobs- everyone is looking to hire as more and more people retire early or do gyn only. The new trend appears to be “hospitalists” where you can choose how many shifts per month you want to work as an OB only attending. I think the tough part will actually be keeping updated with advances in medicine, licensing, and not feeling rusty. I would worry more about not keeping up surgical skills as an ob-gyn. Some hospitals also require a reentrance program if you have been out of medicine for a while, so you may want to look into what would be required if you took several years off. Either way, its not really in my plans nor do I see it in the future, but I will never be foolish enough to completely close that door.

    • EnjoyIt

      Being on a hospital credentialing committee, I will admit that taking more than 6 months off without a good explanation is usually considered a red flag that requires deliberation. I personally would not agree to credentialing anyone with several years off unless they can somehow prove they still know how to practice their specialty. A physician out of practice is too high a liability for the hospital.

  • Great story. I hope to retire early too at 40. God willing. I find your persistence through every stage encouraging and how intentional you were from residency. I didn’t get on this band wagon until I became an attending 2 years ago but thanks for the tips.

  • As a partner to a female specialist OBGYN trained physician, I’d love to hear more about your thoughts on taking a year or two off and then reentering. Is there an “acceptable” amount of time out of the field where employers will be fine with it and not ask questions? She works in a more academic lower income setting with split bw research and clinical

    • I’m not female nor an OB/Gyn, but within a year should not be an issue. Less than 2 years can be explained and acceptable as long as all licensure and certification has been maintained. Beyond that, some remediation may be required.

      Best,
      -PoF

    • CM

      If you want to return to medicine after an extended absence, you will be able to re-certify and obtain a license to practice, though it will require substantial effort.

      However, that is not the primary barrier to re-entry. No one will want to hire you.

      When I finished residency I had many offers. When I finished fellowship, everyone wanted to hire me. I sent my CV out again three years after burning out in a solo cardiology practice, and the offers poured in.

      I didn’t take those offers. Instead, I eventually took a job as a healthcare equity analyst. I had been out of practice for 3 years when I saw a job post that promised no call or weekends. Nirvana. I applied but this time the employer had zero interest.

      Years later I decided I would return to practice one way or another. Again, no one was interested in an anonymous physician who had been away from day-to-day practice–except the community where I had practiced years earlier. Many of the physicians I knew were still there and they thought highly of me.

      Do not burn any bridges.

  • AnesthesiaMD

    Great perspective. I wish I had read this article right out of residency. Especially taking on a high paying job right off the bat.

    I went through couple of practices that dissolved after several years and never became an equity sharing partner. This has limited my wealth accumulation.

    I too had a health scare last year. It made me realize 3-4 sleepless nights a month while on call plus leaving home early and returning after dark is not conducive to healthy living.

    Some people’s body can withstand the high pressure and demand of medicine while others cannot and start to break down after 2 decades of med school, residency, and busy practice.

    I am behind in my road to FI, but now a days I have a few thousand dollar in passive income a month I have chosen to work about 3/4 part time.

    For Docs who contemplate part time work just be aware that your salary will not stay proportion to your full time pay. For example a full time job pays you $400,000. Working 75% of full time doesn’t guarantee $300,000 more like $200,000. Of course you have more autonomy in scheduling and no calls !!!

    • Like the author, I also went for guaranteed income, doing locum tenens work in 5 states for nearly two full years before taking a full time job as chief of anesthesia in a small hospital where I had been doing locums.

      After nearly 11 years working full time, I’ve decided to cut back to part time. Fortunately, the reduction in work will be commensurate with the reduction and pay, and I’ll keep full benefits working a 0.6 FTE job. Factoring in the benefits and the higher taxation of the last 40% of the salary earned, I’ll take home significantly more per hour worked. Here is the math and the story behind my part time job.

      Cheers!
      -PoF

      • AnesthesiaMD

        That is wonderful. I think you took all the right steps.

        Unfortunately I work in Southern California. Other than kaiser and the academic hospitals, no other groups pay for benefits.

        One key element for physician FI you may have mentioned but not emphasized enough is Location, location, location. Working in cities with physician over supply means lower salary, no clear path to partnership, and higher cost of living. If I had gone to one of the underserved Kaiser hospitals I would be a partner in 2 years, then I can cut back to part time possibly retain all the benefits. I believe after 10 years of vesting you also get a pension.

        As it is. I am a freelancer which means gaps in my work schedule and a decreased hourly pay compare to the partners.

        • Thanks, fellow anesthesiologist!

          SoCal is not a tough place to live, but the cost of housing and just about everything (except heating your home) combined with potentially lower salaries makes it tough to reach FI early. I’ve written about taking advantage of geographic arbitrage, which is a phenomenon pretty unique to medicine — the highest paying jobs tend to be in the lower cost of living areas.

          Cheers!
          -PoF

  • EnjoyIt

    People considering going part time and cutting their take home may not realize just how this may really affect you. When you go to part time not only are you removing the pay that is most highly taxed, you may also fall below the Pease exception and itemized deduction phaseout making the decision much better than a 1:1 comparison. Also, by going part time you are not overworked and maybe for efficient at your job allowing you to be more productive and make more money on the days you actually work. For those who also get benefits, the numbers may look different, but it is still worth it to work out the math using tax software or excel.

    Personally, the more I think about it the more I like going part time as opposed to just calling it quits.

  • ZC

    Glad to hear about a personal success story like this. However, without context (i.e., numbers) it’s hard to draw many conclusions as to personal applicability beyond, saving is good and so is making money.

    Is her husband knocking down six figures now? Are they living in a $150k house in a LCOL area? Do they live on 20k/yr or 200k/yr?

    The guy that just rolled into the ER from a homeless shelter is ‘financially independent’ too. No mortgage, no student loan payments…but not a path I’d go down. If the lesson is ‘marry someone else who is able to earn a sizeable income’, well, yeah.

    • CM

      I had the same thoughts.

      The title is misleading, PoF. “The Finances Behind Her Decision” are not included in the article.

      • ZC is right. There are no numbers. Dr. Jones is using her name and may not want her family, friends, and the rest of the world to know her net worth and income precisely.

        I think there is quite a bit of personal finance in her story — high income, paying off debt, “living like a resident,” and the ability for her husband to take more risk with his career. And they are no longer dependent on his income, although I imagine it played a role in their achieving FI as a couple.

        I think of financial independence as the ability for you (and your family if you’ve got one) to live comfortably off your investments indefinitely, or at least for the rest of your life. The homeless guy probably doesn’t have that, but it depends on your definition of comfort, I suppose.

        Best,
        -PoF

  • These days life is been stated at 30’s, but you are really superb one to get retired at 37. That shows you how organized you are.

  • Great story Dr. Jones and thanks Dr. POF for the spotlight. What made this possible is clearly 3 factors as I see them:

    1. Living well below their means regardless of income growth
    2. High income with occasional windfalls from variable income, accelerating FI.
    3. Head start with relatively low loan for a doctor, paid off quickly at low interest.

    All of this speaks to superior financial management skills, so you richly deserve the FIRE Dr. Jones. Kudos!

  • Ms. MS4

    I’m confused about the job she took – she says most of her offers were a low paying salary and potential for partnership a few years later…so she simply “found a high paying job right out of residency”—how? Was she lucky enough to find a private practice job that offered a high paying salary right off the bat? Was finding that job a stroke of good luck or were there other strings attached?

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