Who Cares? Why Write About It?
My friend John wrote an article detailing his spending for one random week in his life. This daily ledger wasn’t his idea, but rather that of a national media outlet that likes to portray the typical spending patterns from people of many different walks of life.
Many people were interested to see how John spends his money. Why? Well, the headline for his article, written by the people who write headlines for national media outlets, states that he retired in his early fifties with a net worth of $3 Million. Those headline writers know how to grab people’s attention!
Expecting to see how much it costs to get a Lamborghini detailed or the going rate of caviar-stuffed truffles, readers were treated to the costs associated with a man who goes to the neighborhood gym most days, picks up the occasional Chick-Fil-A or pizza slice, and travels with his daughter to drop her off for college.
Who Cares? Why Write About It?
When most Americans think of rich people, they picture a life filled with designer clothing, pimped-out rides and cribs, private jets, and house staff to attend to every need.
There are people like that, and they’ve got more than a few million dollars or at least they’d better or they’ll run out of money right quick. But there are also rich people who live like everyday people. Because they are everyday people. Everyday people with above-average salaries and pretty average spending. That’s precisely how they became rich.
John sent me a message and told me his article reached quite a few people, and other than a number of people being concerned about his fast-food intake that week, the article was well-received. The article also sent a number of new readers to his blog; that fact helps answer the question of “why write about it?” but that’s just part of the answer, as I will elaborate below.
At his suggestion, I reached out to the editors of Business Insider and offered to write my own article for their Real Money series that also featured a mutual friend Brandon (the Mad Fientist), Jerry (the Peerless Money Mentor) and several other men and women in various places and professions. My offer to record and relate my own spending habits was accepted on a Thursday and we started our week of detailed tracking the following Monday.Personal Capital, which automatically compiles our credit card and checking account expenditures, but for the purposes of the article, I paid a little closer attention, making sure every purchase down to $1.62 for rock-candy-on-a-stick was on the ledger.
I wrote an introduction and accounted for our activities and daily expenses as we traveled to our second home and had some family fun for a week in northern Michigan.
The resulting article, given the catchy run-on sentence of a title “I’m a part-time doctor earning $250,000 a year and I plan to retire next year at age 43 — here’s what a week of my spending looks like” was published on Business Insider, picked up by Doximity, and shared by The White Coat Investor to his 20,000 email subscribers.
The Average Indebted Medical Student Has About $200,000 in Student Loan Debt at Graduation
Med students rack up serious debt in eight years of schooling, and for most, that debt will only grow despite making income-based payments in residency. It’s not uncommon for a graduate of private schools to have a half-a-million dollars in debt, and a $1 Million in student loan debt is not unheard of.
Thankfully, Business Insider does not have a comment section. Doximity, on the other hand, does. When my weekly spending article was featured there, there were some less-than-complimentary responses. I responded to some of the comments in a recent post, but there was one flippant comment that I felt deserved more than a one-liner. What was that comment, do you suppose?
“Who Cares? Why Write About it?”
I shared my budget from one random week as an example of what life can be like spending “only” a five-figure sum each year. With a similar budget, most physicians with six-figure student loan burdens can be debt-free within five years or less.
I write about it with the hope that younger physicians may be inspired to get out of debt more quickly.
A Quarter of Physicians Over 65 Are Worth Less Than a Million Dollars
According to a Medscape survey of over 20,000 doctors, the average physician earns about $300,000 a year. Yet, 24% of those 65 and over are not worth $1 Million. 71% of those in the 35-49 age bracket are not yet millionaires, either. Note that net worth includes equity in your primary home (and any other home you own).
By age 65, most physicians have been working in the profession for 30 years or more. Over the last 30 years, the S&P 500 with dividends reinvested has returned an annualized 10.5% per year. According to my compound interest calculator, $5,000 a year invested over that timeframe would net you $1 Million. $5,000 per year. Any home equity would be icing on the net worth cake.
45% of physicians feel they cannot afford to max out workplace retirement savings plans, such as a 401(k) or 403(b), according to one Fidelity study, and 71% are not contributing to a 457(b).
I hear divorce can do some serious damage, as can failed business ventures or really expensive children. So can spending nearly as much as you earn, and I fear that’s an issue for far too many people.
But who cares? Why write about it?
The Correlation Between Spending and Happiness is Weak, at Best.
There’s this thing, though, known as hedonic adaptation or the hedonic treadmill. It’s a very real psychological phenomenon that prevents us from having the same exuberant result each and every time we repeat some grand experience or acquire a better gadget.
When we continually upgrade our lifestyle and the objects that accompany it, what was once sufficient becomes inadequate and what was once amazing becomes… well… adequate. When a treat becomes the norm, living without that treat becomes uncomfortable. Enjoy that thing rarely, and you can keep it a treat.
There have been studies that suggest people earning big-time doctor money aren’t much happier, if any happier, than those earning a wage of about $75,000. The research is imperfect and in need of an update, and the definition of “happiness” may vary from one person to another, but based on what I’ve lived and seen, a lot more money doesn’t tend to make people a lot more happy.
It’s counterintuitive, I know. But who cares. Why write about it?
Physician Burnout is at an All-Time High
Pay based on performance-based metrics and patient satisfaction scores.
More face time with the computer screen than the faces of your actual patients.
A beeper that won’t stop beeping.
Declining reimbursements for increased efforts.
All work and no play make Dr. Jack a dull physician.
I’ve hardly scratched the surface, but it’s clear that physicians have never felt so overwhelmed and underappreciated. Yet, we don’t feel we have options to do things differently because we need the income.
As Dr. Peter Kim said, a common solution to this frustration is to work even more in order to get ahead so we can find our way out of this mess.
A better solution might be to spend a bit less so we don’t require the income that results from the sometimes soul-crushing work.
Yeah, but who cares. Why write about it?
Physicians are More Than Twice as Likely to Die from Suicide
Compared to the general population, medical doctors kill themselves at a rate more than double that of the general population. It’s tough to know exact numbers, but on average, we lose a physician to suicide nearly every single day in the United States.
I’m an anesthesiologist. We excel at lethal injection; in fact, I give most of my patients enough medication to kill them. None of them have died under my care. Those having a general anesthetic survive because we breathe for them after giving enough medication to cease all breathing or muscular activity. Those receiving sedation live because we typically don’t give the dose all at once; we titrate to effect. And occasionally, we breathe for them.
We’re also experts at finding veins and cannulating them with intravenous catheters, allowing for swift drug delivery.
When the anesthesiologist doesn’t respond to multiple pages and phone calls, and is later found dead in the call room with a tourniquet and an empty syringe, will we know the motivation? Was it an attempt to escape reality with a quick high, or was it an attempt to escape life with a quick but permanent solution to a temporary problem?
In many cases, we’ll never know. In some cases, I doubt the doctors wielding the needle actually knew. They were just looking for an escape.
I do know that in her tally of over 1,000 physician suicides in recent years, Dr. Pamela Wible has found that male anesthesiologists are at the highest risk for suicide death. I am a male anesthesiologist.
September is suicide awareness month. According to Melanie Lockert, those who die from suicide are eight times more likely to be in debt. As highlighted above, many physicians transitioning into practice have massive levels of debt.
Earning a high income clearly doesn’t solve all of our problems. The joy of spending on luxury tends to be fleeting. Financial independence is one luxury that can offer a safer way to escape.
Who cares? Why write about it?
Financial Independence is the Escape Hatch
When you achieve financial independence, or are making good progress towards it, you have the power to live your life differently. You can afford to work less and earn less. Taking a different job with fewer demands but lower compensation can actually improve your life; the money doesn’t matter much anymore.
If you’re truly financially independent, you don’t have to work at all or can work solely on a volunteer basis at your own discretion. You can venture out on your own and take risks that you never could have considered when you were reliant on a paycheck. You can be your own boss instead of answering to a dozen bosses.
The way most of us achieve financial independence is by spending a lot less than we earn, year in and year out. The bigger the gap, the quicker the path. Live on half your takehome pay, and you can expect to reach your goal in about fifteen years if you’re starting from scratch.
I write about my budget because it’s a big part of what helped me become financially independent by my 40th birthday. I write about money and investing because they play a meaningful role in our lives and our pursuit of happiness.
I’m not saying money is everything — OK, I did say that — but it is a fact that money is the key component of financial independence. Financial independence gives you autonomy, and lack of autonomy in our profession is a leading cause of burnout. I’m trying to help others find more autonomy in their personal and professional lives.
I’m not saying this venture is 100% altruistic. I’ve been transparent about the way this site earns money for me, my shareholders, and the site’s charitable mission. I may not be saving lives, but I’m trying to help people live better lives. Between the financial educating and donating tens of thousands of dollars to no-kill animal shelters, the local food shelf, and the Salvation Army among other charities, I feel I’m doing some good here.
But who cares?
Why write about it?
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