Physician Retirement Savings

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llessac15
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Physician Retirement Savings

Post by llessac15 » Wed May 11, 2016 10:24 pm

It's hard to find reliable information on physician's average retirement savings. The quoted average salary I see on surveys such as Medscape is much less than what I see in my region of the US (Southeast), particularly for specialists. Given that, I do not trust the quoted average retirement savings for physicians that I come across. I'm looking for some real world info from individual docs. I don't think a random survey in my current hospital's doctor's lounge would go over so well.

My request here is if any physicians on this blog would be willing to list their retirement savings? Also, if you wanna take it one step further, what is or was your goal amount for retirement? I would like to use it as a barometer for my own personal savings goals. Honestly, it would be helpful if anyone who is a high-income earner (i.e. $400,000-$800,000/yr) that started their career in their early 30's wanted to reply.

I'll start with my own:

Age: 36
Current Total Retirement Savings: $630,000
Goal: $5,000,000 and no mortgage.

Thanks.

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tludwig23
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Re: Physician Retirement Savings

Post by tludwig23 » Wed May 11, 2016 10:49 pm

Most physicians I know don't make $400k-$800k. Some busy specialists do, but most do not.
That's what I do: I drink, and I know things. --Tyrion Lannister

RosieQ
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Re: Physician Retirement Savings

Post by RosieQ » Thu May 12, 2016 12:42 am

Also net worth can be a lot different than just retirement savings. With that high of an income you max out your traditional retirement accounts pretty quickly. Is a taxable brokerage account still retirement money in your book? Unfortunately I'm not high income enough to qualify for your survey :?

Baseballmom94
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Re: Physician Retirement Savings

Post by Baseballmom94 » Thu May 12, 2016 12:56 am

llessac15, this is an interesting post. Congratulations, you are off to an awesome start with your retirement savings. Do you also not have any student loans? My husband is a physician and we are often amazed at how much other physician families in the same income bracket spend on huge homes, vacation homes, boats, etc. We wonder how they are possibly saving enough for retirement or if we are just too conservative! Not to take this post off course but in researching jobs, we have noticed that the highest paid jobs in my husband's specialty are in the Southeast which makes a move to Florida tempting. I don't understand the vast difference in regional salaries for physicians and they don't reflect cost of living since the HCOL northeastern states are the lowest paying, at least for his specialty.

So, as the money manager in our family, I'll go first. We do consider our taxable savings as part of our retirement income because when my husband decides to hang up the stethoscope and scrubs, we will withdraw from our taxable savings first.

Age 52
Current Retirement Savings: $2.5 million
Goal: $3.5 million and no mortgage

llessac15
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Re: Physician Retirement Savings

Post by llessac15 » Thu May 12, 2016 2:34 am

RosieQ wrote:Also net worth can be a lot different than just retirement savings. With that high of an income you max out your traditional retirement accounts pretty quickly. Is a taxable brokerage account still retirement money in your book? Unfortunately I'm not high income enough to qualify for your survey :?
Yes, I do consider my taxable account in my retirement savings. In fact, for reasons you stated, it holds most of my savings.

Your last sentence makes me concerned that some (not you) may take this as an 'elitist' post. That's not my intent at all. I truly want to have some kind of gauge on retirement accounts to compare to people in my same income bracket.

llessac15
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Re: Physician Retirement Savings

Post by llessac15 » Thu May 12, 2016 3:41 am

Baseballmom94, I paid off my student loans my first year in private practice 3 years ago. I agree with you and your husband. I don't see how all of my fellow physicians have all the stuff (especially vacation homes) they do and still have money set aside for retirement. Even within our income range, after I pay all of my monthly expenses and put my 20% in retirement accounts, there is no where near enough left to cover a second home or other high end items. That was kind of why I posted this question, I wasn't sure what the retirement accounts looked like of other physicians. I feel like I'm ahead of the curve but I really have no idea how I compare to other high-income folks. Reading Bogleheads Guide To Investing and finding whitecoatinvestor.com in the first month of finishing fellowship are probably the two best things that ever happened to my finances. I've gone on the read numerous more finance books and blogs, but it all began there. I even try to sit down with all new physicians and give them a copy of The Boglehead book, WCI book, and Common Sense Investing (Rick Van Ness) in an effort to pay it forward. Some listen and are grateful, others not so much.

Thanks for your reply! Much appreciated!

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lthenderson
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Re: Physician Retirement Savings

Post by lthenderson » Thu May 12, 2016 8:51 am

I don't have an answer for your question but I thought I would reply since my wife is a physician. I think you won't get too many answers to your question for a couple reasons. Most of my wife's peers spend enormous amounts of money compared to others with much smaller incomes and may be ashamed at their lack of savings. There is something about a large salary that just seems to get sucked away by "needs" from every direction. My wife and I are conservative people financially and find that it is an everyday battle to not get caught up into spending it just because we have it. This brings me to the second group of people whom we fall into who may have large retirement accounts compared to others, though not so much when compared here on Bogleheads. I think we are loathe to divulge our retirement account balances for fear of judgement from others. It is similar of why people don't talk about salaries so much to their coworkers. It just breeds resentment from certain types of people.

Even if people gave you truthful answers, they mean very little as every person's retirement is different. The amount I need to fund my retirement may be much less than what you would consider necessary for your retirement. So you may think you are doing well comparatively until you reach retirement and realize that you've saved way more than you needed and thus worked longer than you had too or find yourself living a lifestyle beneath what you had hoped because you didn't save enough. Everyone should do their own calculations on what they need for retirement and then gauge progress on your own account balances.

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JDCarpenter
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Re: Physician Retirement Savings

Post by JDCarpenter » Thu May 12, 2016 9:09 am

We are in mid-50s. DW is compensated better than the norm for an OBG and I do better than the median lawyer. She entered private practice at 29 (also did lots of moonlighting in residency) and, due to our age, my scholarships, and my paying the last year of med school, our combined student loan load was less than $65,000.

We have given notice to retire next year. Excluding house, we expect to have 12 times last year's AGI, which will provide retirement spending at or above level we've planned for many years--and 60% higher than our current spending after taxes and soon-to-be-retired mortgage.

Note that our journey has been meandering. We raised three kids through private colleges, paid a 200K tail, lost over a year's income on a house sale at the same time as that tail, and had me as SAHD for well over a decade. As a result, our present free cash flow and AGI are substantially more than we had for most of our working lives and the "12x" is much larger than meets the eye.
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letsgobobby
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Re: Physician Retirement Savings

Post by letsgobobby » Thu May 12, 2016 9:33 am

Doc here, highly paid for my specialty but not compared to most docs.

We are in our early 40's and have about 7x our gross household income saved. Which is around 24x our current annual spending level. For college we have saved in the mid six figures.

My wife makes a modest salary working part time.

Factors that have helped:

I went to the cheapest good medical school I could, so I finished with less than $10,000 in debt. And my parents paid for college, though I also worked 10-20 hours per week in both college and med school.

I chose to live in a low tax area with a reasonable cost of living.

We lived pretty much like residents for the first five years or so after residency.

I have always been a saver, including my paper route money at 13 and my lawn mowing business money at 18, my tutoring income and moonlighting income. Never have saved less than 40% as a physician.

I was either lucky or good by avoiding the credit bubble and most of the fallout of the financial crisis. I have long been a vanguard customer though not until 7 years ago did I fully embrace the Boglehead philosophy.

I am a very hard and efficient worker so I chose to work somewhere that pays for production.

My employer offers a good 403b match.

Most of my physician colleagues don't blow money as far as I can see. But most know nothing about investing.
Last edited by letsgobobby on Sun May 29, 2016 2:56 am, edited 1 time in total.

am
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Re: Physician Retirement Savings

Post by am » Thu May 12, 2016 9:37 am

You should really focus on your own savings instead of comparing to other MDs who's circumstances may be entirely different. Save, invest and spend the best way you can and hope for the best. Not sure how telling you I'm 35 with 1 mil or 50 with 10 mil will help you? My retirement plans may be significantly different than yours. There are networth surveys out there which can give you an idea of how well you have built wealth compared to the rest of the population. One thing I know for sure is that by being aware of this forum, you are already miles ahead of most physicians! (Just noticed that this is my 2000 post, yea :sharebeer ).

texasdiver
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Re: Physician Retirement Savings

Post by texasdiver » Thu May 12, 2016 9:51 am

My wife is a family physician. I'm a former Federal employee now teaching HS.

Honestly our lifestyle is closer to my teacher colleagues than her physician colleagues except that we travel more. We have 3 kids, the first of whom is approaching college age and are just now reaching 7 figures in our combined retirement savings with about 15 years to go. We are aiming to hit between 2 and 3 million in combined retirement savings by our target retirement date in 15 years. With our combined social securities and my three small pensions, even $2 million will give us more that we would likely need to maintain our current lifestyle. Since we live more like teachers than doctors anyway we feel we are pretty much on track.

We know doctors who have basically saved nothing and are counting on their employer's profit sharing plan and their real estate holdings (personal estate and acreage not rental properties) to retire. I suspect they are in for a world of hurt and will be working into their 70s.

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goingup
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Re: Physician Retirement Savings

Post by goingup » Thu May 12, 2016 10:01 am

Have you read The Millionaire Nextdoor by Stanley and Danko? They coined the term Prodigious Accumulator of Wealth (PAW). There is a formula for figuring if you are one. It's 1/10 of your age (in your case 3) X income = The NW you should have accumulated.
http://www.thomasjstanley.com/2010/08/h ... ld-you-be/

It's interesting, but not too meaningful. I think a person needs to figure their own metric for wealth, comfort and retirement savings.

Hikes_With_Dogs
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Re: Physician Retirement Savings

Post by Hikes_With_Dogs » Thu May 12, 2016 10:28 am

Have you checked out the White Coat Investor? Lots of good information there.

We have 2x medical field practitioners in our household and our household income is in the range you described but we are not physicians.

Our goals: Current NW around 2.0MM including everything (home equity, etc). Goal for retirement for me is when child goes to college (early 50's). We will probably have in the 4MM range. Down size expensive house to pull out equity and buy something smaller.

Financial plan:
Max all pre-tax stuff, including catch-up when you are of age.
Contribute around 50k/year in after tax savings.
Spouse has ability to slough off a bunch of income into deferred compensation plans
pre-pay some amount extra on mortgage (around $1500/month extra)
Pay for 4 years college (estimated 250k) for child so contribute around 15k/year to 529 plan or college savings plan

Other goals:
Keep it simple. We have an expensive house but cheap cars. We eat in almost every night and I cook. Hoping to do public school for kiddo depending on gifted program availability. We travel cheaply and enjoy cheap hobbies (hiking/backpacking). Don't fall into keeping up with your peers.

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1210sda
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Re: Physician Retirement Savings

Post by 1210sda » Thu May 12, 2016 10:35 am

llessac15 wrote:It's hard to find reliable information on physician's average retirement savings. The quoted average salary I see on surveys such as Medscape is much less than what I see in my region of the US (Southeast), particularly for specialists. Given that, I do not trust the quoted average retirement savings for physicians that I come across. I'm looking for some real world info from individual docs. I don't think a random survey in my current hospital's doctor's lounge would go over so well.

My request here is if any physicians on this blog would be willing to list their retirement savings? Also, if you wanna take it one step further, what is or was your goal amount for retirement? I would like to use it as a barometer for my own personal savings goals. Honestly, it would be helpful if anyone who is a high-income earner (i.e. $400,000-$800,000/yr) that started their career in their early 30's wanted to reply.

I'll start with my own:

Age: 36
Current Total Retirement Savings: $630,000
Goal: $5,000,000 and no mortgage.

Thanks.
Is your $5M goal in current dollars (2016) or future dollars (approx 2046) ??
1210

furnace
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Re: Physician Retirement Savings

Post by furnace » Thu May 12, 2016 10:39 am

texasdiver wrote:My wife is a family physician. I'm a former Federal employee now teaching HS.

Honestly our lifestyle is closer to my teacher colleagues than her physician colleagues except that we travel more. We have 3 kids, the first of whom is approaching college age and are just now reaching 7 figures in our combined retirement savings with about 15 years to go. We are aiming to hit between 2 and 3 million in combined retirement savings by our target retirement date in 15 years. With our combined social securities and my three small pensions, even $2 million will give us more that we would likely need to maintain our current lifestyle. Since we live more like teachers than doctors anyway we feel we are pretty much on track.

We know doctors who have basically saved nothing and are counting on their employer's profit sharing plan and their real estate holdings (personal estate and acreage not rental properties) to retire. I suspect they are in for a world of hurt and will be working into their 70s.
The need for retirement income drops even more for those who can be a little handy around the house and the car. The thing with doctors and many office workers is-- they like to buy new and to pay someone else to do the work.

chicagoan23
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Re: Physician Retirement Savings

Post by chicagoan23 » Thu May 12, 2016 11:01 am

I truly want to have some kind of gauge on retirement accounts to compare to people in my same income bracket.
You almost certainly are doing better than most of your peers, and there are always going to be those who are doing much better than you.

The question is whether you are doing everything right, and it sounds like you are. That will get you where you need to be. If you have more saved than 95% of your physician peers at your age level, would you change your behavior at all? Probably not.

pedsEDdoc
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Re: Physician Retirement Savings

Post by pedsEDdoc » Thu May 12, 2016 11:10 am

mid thirties (soon to be moving into the late thirties :shock: )

save about 45% of gross income per year

we hope to have somewhere around 4-5 million by retirement--although if FIREcalc is true we could be above that by a bunch--here's to hoping it comes out like that predicts!

other goals: mortgage gone, college partially paid for

student loans paid off within 2 years of finishing fellowship

and by the way, you are ahead of me in the investment number--but as others have said that is all relative to what your income is, mine isn't near the range you proposed.

texasdiver
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Re: Physician Retirement Savings

Post by texasdiver » Thu May 12, 2016 11:22 am

furnace wrote:
texasdiver wrote:My wife is a family physician. I'm a former Federal employee now teaching HS.

Honestly our lifestyle is closer to my teacher colleagues than her physician colleagues except that we travel more. We have 3 kids, the first of whom is approaching college age and are just now reaching 7 figures in our combined retirement savings with about 15 years to go. We are aiming to hit between 2 and 3 million in combined retirement savings by our target retirement date in 15 years. With our combined social securities and my three small pensions, even $2 million will give us more that we would likely need to maintain our current lifestyle. Since we live more like teachers than doctors anyway we feel we are pretty much on track.

We know doctors who have basically saved nothing and are counting on their employer's profit sharing plan and their real estate holdings (personal estate and acreage not rental properties) to retire. I suspect they are in for a world of hurt and will be working into their 70s.
The need for retirement income drops even more for those who can be a little handy around the house and the car. The thing with doctors and many office workers is-- they like to buy new and to pay someone else to do the work.
Exactly. I mostly grew up on a farm and still basically do everything around the house myself, even stuff I probably shouldn't. Cars are different though. I don't even change my own oil anymore much less do actual engine work. I don't know anyone who actually does serious work on their own cars anymore, at least not modern cars. I'm not counting the guys who collect and work on old vintage autos.

bigred77
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Re: Physician Retirement Savings

Post by bigred77 » Thu May 12, 2016 11:48 am

texasdiver wrote:
furnace wrote:
texasdiver wrote:My wife is a family physician. I'm a former Federal employee now teaching HS.

Honestly our lifestyle is closer to my teacher colleagues than her physician colleagues except that we travel more. We have 3 kids, the first of whom is approaching college age and are just now reaching 7 figures in our combined retirement savings with about 15 years to go. We are aiming to hit between 2 and 3 million in combined retirement savings by our target retirement date in 15 years. With our combined social securities and my three small pensions, even $2 million will give us more that we would likely need to maintain our current lifestyle. Since we live more like teachers than doctors anyway we feel we are pretty much on track.

We know doctors who have basically saved nothing and are counting on their employer's profit sharing plan and their real estate holdings (personal estate and acreage not rental properties) to retire. I suspect they are in for a world of hurt and will be working into their 70s.
The need for retirement income drops even more for those who can be a little handy around the house and the car. The thing with doctors and many office workers is-- they like to buy new and to pay someone else to do the work.
Exactly. I mostly grew up on a farm and still basically do everything around the house myself, even stuff I probably shouldn't. Cars are different though. I don't even change my own oil anymore much less do actual engine work. I don't know anyone who actually does serious work on their own cars anymore, at least not modern cars. I'm not counting the guys who collect and work on old vintage autos.
I had a minor fix that had to be done recently on my garage door opener (the safety sensors needed to be replaced). I called the repair man and he told me to at least TRY to do it myself because it was too minor to send someone out to fix.

I walked around the house with my chest puffed out for the rest of the week when I was finally able to get it to work myself. In case it's not obvious, I am not very handy around the house.

texasdiver
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Re: Physician Retirement Savings

Post by texasdiver » Thu May 12, 2016 12:06 pm

bigred77 wrote:
texasdiver wrote:
furnace wrote:
texasdiver wrote:My wife is a family physician. I'm a former Federal employee now teaching HS.

Honestly our lifestyle is closer to my teacher colleagues than her physician colleagues except that we travel more. We have 3 kids, the first of whom is approaching college age and are just now reaching 7 figures in our combined retirement savings with about 15 years to go. We are aiming to hit between 2 and 3 million in combined retirement savings by our target retirement date in 15 years. With our combined social securities and my three small pensions, even $2 million will give us more that we would likely need to maintain our current lifestyle. Since we live more like teachers than doctors anyway we feel we are pretty much on track.

We know doctors who have basically saved nothing and are counting on their employer's profit sharing plan and their real estate holdings (personal estate and acreage not rental properties) to retire. I suspect they are in for a world of hurt and will be working into their 70s.
The need for retirement income drops even more for those who can be a little handy around the house and the car. The thing with doctors and many office workers is-- they like to buy new and to pay someone else to do the work.
Exactly. I mostly grew up on a farm and still basically do everything around the house myself, even stuff I probably shouldn't. Cars are different though. I don't even change my own oil anymore much less do actual engine work. I don't know anyone who actually does serious work on their own cars anymore, at least not modern cars. I'm not counting the guys who collect and work on old vintage autos.
I had a minor fix that had to be done recently on my garage door opener (the safety sensors needed to be replaced). I called the repair man and he told me to at least TRY to do it myself because it was too minor to send someone out to fix.

I walked around the house with my chest puffed out for the rest of the week when I was finally able to get it to work myself. In case it's not obvious, I am not very handy around the house.
YouTube is awesome for this kind of thing. take pretty much any kind of household repair task you can imagine and there is someone out there who has taken the time to make a nice explanatory video on how to do it. I'm sure there are probably 25 videos on youtube on how to replace your garage door sensor or opener.

coalcracker
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Re: Physician Retirement Savings

Post by coalcracker » Thu May 12, 2016 12:24 pm

Wife and I are 37. I am a specialist, she is primary care. Combined salaries are in your range.

Current net worth: ~$1.2m
Goal at FULL retirement: $5m
No mortgage, still have student loans (factored into net worth)

However, we don't see ourselves both working full time and then both retiring completely in, say, 10 years. Rather, we tentatively plan to both work until our nest egg is ~$3m, and then drastically cut back for a prolonged indefinite period. This would likely mean my wife stops working and I work part time (I like my job, she don't :D )

eggraid101
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Re: Physician Retirement Savings

Post by eggraid101 » Thu May 12, 2016 1:04 pm

coalcracker wrote:Wife and I are 37. I am a specialist, she is primary care. Combined salaries are in your range.

Current net worth: ~$1.2m
Goal at FULL retirement: $5m
No mortgage, still have student loans (factored into net worth)

However, we don't see ourselves both working full time and then both retiring completely in, say, 10 years. Rather, we tentatively plan to both work until our nest egg is ~$3m, and then drastically cut back for a prolonged indefinite period. This would likely mean my wife stops working and I work part time (I like my job, she don't :D )

I'm 41,

current retirement savings ~ 750k
goal:4MM

We have the same outlook: work 12 more years or so, then scale back quite a bit while still working to enjoy some time, then fully retire whenever we feel like it after we hit our goal. I like my job, too, but would like some more time to do other things as well.

am
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Re: Physician Retirement Savings

Post by am » Thu May 12, 2016 1:11 pm

42

Retirement savings + cash= 820k, house equity 650k, college accounts 180k, zero debt

Goal= 2.5 mil (3 would be better), have pension 20k with cola at 62 (poorly funded state), SS at 62 than 1/2 wife a few years later

Feel like I am miles away. By no means do I feel like I am wealthy even though according to income and networth statistics many would count me in that category! Work in congested saturated market and specialty :(
Last edited by am on Thu May 12, 2016 1:26 pm, edited 1 time in total.

anil686
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Re: Physician Retirement Savings

Post by anil686 » Thu May 12, 2016 1:23 pm

I am in your range too - with my spouse who works part time as a PCP - both just turned 40

Total retirement savings -1.2MM, equity owner of 2 entitities - valuations of about 2 MM combined. Goal would be about 4 MM. Late starter as finished fellowship at 32 and I took loans and started my own practice with very low income first couple of years which made us live differently than other specialists in our area - had many difficult conversations with my spouse about spending and why we were doing this. Lots of hard work later, many of these have paid off and much is in taxable accounts.

A couple of quick comments and request
1). Many of those posting here are like minded which is fine - but you are not going to see the physicians who over spend and under save so to speak. Those you find in the doctors lounge and talk about all the stuff they did over the past three months and the new SUV for the spouse which happens to be a Porsche because the spouse needed something sporty too in matching the physician who is driving a Ferrari... Thus much of the responses are going to fall into what has already been described. I also am aware of how few people do save a lot (physicians or not) and thus this forum is not representative in general. Substitute teacher for physician and teachers lounge or substitute police officer for physician and police officers break room and my supposition (which could be wrong) would be a similar reaction amongst bogleheads in those areas as physicians.

2). I notice a signficant change in attitudes amongst younger doctors (who I presume have more debt in the form of school loans) vs physicians in their early 50s both in respect to real wages going forward and investment styles. Many of the older physicians I either golf with or talk with in the lounge have invested primarily in individual stocks, real estate holdings (often their own office buildings or other's office buildings) and with financial advisors. Younger physicians my age (40) or younger seem more apt to invest in taxable accounts and pass on the opportunity to invest in the "can't miss" physician owned hospital. Whether that is because we have less to invest or are more aware that we will need to save and invest wiser than our older counterparts is up to debate (yes that is a huge generalization).

Request: I would love a working example of something Livesoft has described before of tax efficient placement of assets. For example, logistically, how do you manage keeping all of your equities in taxable account and your bonds in tax advantaged accounts - I understand if you need to sell some equities - you buy them in the tax advantaged account with bonds - and I get that for one year - but going forward - how do you handle more buying or selling in the future? What is the goal - just maintaining your desired AA or something else?

Thanks in advance and thanks for the thoughtful thread start...

coalcracker
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Re: Physician Retirement Savings

Post by coalcracker » Thu May 12, 2016 2:04 pm

anil686 wrote: Request: I would love a working example of something Livesoft has described before of tax efficient placement of assets. For example, logistically, how do you manage keeping all of your equities in taxable account and your bonds in tax advantaged accounts - I understand if you need to sell some equities - you buy them in the tax advantaged account with bonds - and I get that for one year - but going forward - how do you handle more buying or selling in the future? What is the goal - just maintaining your desired AA or something else?
I struggled with this as well when creating an IPS. We purchase only bonds in our tax advantaged accounts, and purchase only equities in our taxable. By luck more than design, the amount we save per year approximates our desired equity:bond allocation.

At some point in the future, when we increase our bond allocation, we will likely need to purchase (muni) bonds in our taxable.

letsgobobby
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Re: Physician Retirement Savings

Post by letsgobobby » Thu May 12, 2016 2:04 pm

Request: I would love a working example of something Livesoft has described before of tax efficient placement of assets. For example, logistically, how do you manage keeping all of your equities in taxable account and your bonds in tax advantaged accounts - I understand if you need to sell some equities - you buy them in the tax advantaged account with bonds - and I get that for one year - but going forward - how do you handle more buying or selling in the future? What is the goal - just maintaining your desired AA or something else?
For us it eventually became impossible. I couldn't fit all our fixed income into tax-advantaged accounts, even after buying I and EE bonds. I ended up buying munis (VWIUX).

And then when stocks fell 10-15% and I had to rebalance into stocks, rather than selling the munis at a gain, and paying taxes, I just sold off some bonds in our 403bs and bought stocks. So now, just as you said, it's all mixed up.

But this is a problem that results from having your investments either do too well or grow too large or both. So it's not a bad problem to deal with.

kayli69
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Re: Physician Retirement Savings

Post by kayli69 » Thu May 12, 2016 2:10 pm

39 y/o, procedure oriented specialist. 8 years out of training

Taxable and investment accounts 3.5 million, goal is 5 million and then start to work part time

Save 85% of after tax income each month and invest in index funds. Live well below my means. Do all my own car repairs and home repairs which I enjoy. Drive older vehicles and laugh at my partners brand new Mercedes and BMWs that they buy every year. Some are 70 years old and still need to work

am
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Re: Physician Retirement Savings

Post by am » Thu May 12, 2016 2:15 pm

kayli69 wrote:39 y/o, procedure oriented specialist. 8 years out of training

Taxable and investment accounts 3.5 million, goal is 5 million and then start to work part time

Save 85% of after tax income each month and invest in index funds. Live well below my means. Do all my own car repairs and home repairs which I enjoy. Drive older vehicles and laugh at my partners brand new Mercedes and BMWs that they buy every year. Some are 70 years old and still need to work

Did you start working at 18 y/o or get an inheritance?

kmurp
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Re: Physician Retirement Savings

Post by kmurp » Thu May 12, 2016 2:16 pm

Rather than relying on a very unscientific sample here of people who self report, you should try one of the many online retirement calculators out there.
Figure out what percent of your income you want at retirement as a goal, put in your savings and expected future savings and assess where you are.
Last edited by kmurp on Thu May 12, 2016 2:57 pm, edited 1 time in total.

kmurp
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Re: Physician Retirement Savings

Post by kmurp » Thu May 12, 2016 2:18 pm

am wrote:
kayli69 wrote:39 y/o, procedure oriented specialist. 8 years out of training

Taxable and investment accounts 3.5 million, goal is 5 million and then start to work part time

Save 85% of after tax income each month and invest in index funds. Live well below my means. Do all my own car repairs and home repairs which I enjoy. Drive older vehicles and laugh at my partners brand new Mercedes and BMWs that they buy every year. Some are 70 years old and still need to work

Did you start working at 18 y/o or get an inheritance?
No. He makes a lot , saves it all and invested into a tremendous bull market at likely 100% stocks due to his age.

am
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Re: Physician Retirement Savings

Post by am » Thu May 12, 2016 2:22 pm

kmurp wrote:
am wrote:
kayli69 wrote:39 y/o, procedure oriented specialist. 8 years out of training

Taxable and investment accounts 3.5 million, goal is 5 million and then start to work part time

Save 85% of after tax income each month and invest in index funds. Live well below my means. Do all my own car repairs and home repairs which I enjoy. Drive older vehicles and laugh at my partners brand new Mercedes and BMWs that they buy every year. Some are 70 years old and still need to work

Did you start working at 18 y/o or get an inheritance?
No. He makes a lot , saves it all and invested into a tremendous bull market at likely 100% stocks due to his age.

I make a lot also, but would only be where he is without family, living in a studio in a low cost living area, no travel, beat up car, etc. what's the point of that?

anil686
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Re: Physician Retirement Savings

Post by anil686 » Thu May 12, 2016 2:26 pm

letsgobobby wrote:
Request: I would love a working example of something Livesoft has described before of tax efficient placement of assets. For example, logistically, how do you manage keeping all of your equities in taxable account and your bonds in tax advantaged accounts - I understand if you need to sell some equities - you buy them in the tax advantaged account with bonds - and I get that for one year - but going forward - how do you handle more buying or selling in the future? What is the goal - just maintaining your desired AA or something else?
For us it eventually became impossible. I couldn't fit all our fixed income into tax-advantaged accounts, even after buying I and EE bonds. I ended up buying munis (VWIUX).

And then when stocks fell 10-15% and I had to rebalance into stocks, rather than selling the munis at a gain, and paying taxes, I just sold off some bonds in our 403bs and bought stocks. So now, just as you said, it's all mixed up.

But this is a problem that results from having your investments either do too well or grow too large or both. So it's not a bad problem to deal with.
Thanks so much! That was helpful

leonard
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Re: Physician Retirement Savings

Post by leonard » Thu May 12, 2016 2:29 pm

What action are you planning to take based on this information?
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goodenyou
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Re: Physician Retirement Savings

Post by goodenyou » Thu May 12, 2016 2:31 pm

Physician investing and spending behavior seems to be a hot topic on this forum. Considering physician income and behavior differently draws a lot of criticism from non-physicians here because physician like to compare themselves to each other and not to the general population even if income is equivalent. Maybe it's a fallback to the "pre-med" behavior where "pre-med" students become competitive in an insular way. Showing off financial success later in life becomes a substitute for earlier academic success. That being said, many physicians have a propensity for conspicuous consumption at their peril. They also make poor investment and business decisions. Many will never save 25x yearly current spending and therefore they work much longer because they cannot fathom a reduction in lifestyle. I was fortunate to get to my number before 50 because I chose to move to opportunity in a LCOL area. There were abundant opportunities in surgery centers, hospitals and real estate during the first 15 years. It provided fantastic additional investment income to a very busy practice in an under served area. I was somewhat frugal (I have owned all the fancy cars and have a big house), but I still lived well below my means (there were fewer "temptations" because there was less to do and the costs of lifestyle was significantly less). My status symbol is now the ability to quit at any time. :sharebeer
"Ignorance more frequently begets confidence than does knowledge" | "The best years you have left are the ones you have right now"

texasdiver
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Re: Physician Retirement Savings

Post by texasdiver » Thu May 12, 2016 2:33 pm

kmurp wrote:
am wrote:
kayli69 wrote:39 y/o, procedure oriented specialist. 8 years out of training

Taxable and investment accounts 3.5 million, goal is 5 million and then start to work part time

Save 85% of after tax income each month and invest in index funds. Live well below my means. Do all my own car repairs and home repairs which I enjoy. Drive older vehicles and laugh at my partners brand new Mercedes and BMWs that they buy every year. Some are 70 years old and still need to work

Did you start working at 18 y/o or get an inheritance?
No. He makes a lot , saves it all and invested into a tremendous bull market at likely 100% stocks due to his age.
How do you know Kayli69 is a guy? sounds more like a female handle. Do you just assume that doctors who save a lot and work on their own cars are guys?

beezquimby
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Re: Physician Retirement Savings

Post by beezquimby » Thu May 12, 2016 2:35 pm

Dual physician family 40/38
Retirement savings approx 2.5m
College savings 200k
No debt

kayli69
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Re: Physician Retirement Savings

Post by kayli69 » Thu May 12, 2016 2:43 pm

Love the critisizm because of my success

You assume I lead a miserable life because I have invested wisely and work my tail off and have not bought the Mcmansion or fancy european cars

I have a happy wife and 3 children who have everything they need within reason

I live in a beautiful suburban town with great schools and a 2800sq ft house.

I also have a restored farmhouse with 120 beautiful wooded acres that sits above one of the lakes outside of town where I pursue my hobbies of hunting and forestry. I restore 67-69 camaros and do all the work myself

I did not inherit anything. I lived like a resident for several years out of residency, paid off all debt, and invested wisely. I am enjoying life to the fullest and will be fully retired by age 50. Dont assume someone is leading a miserable meager life beacuase they are more successful than you

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goodenyou
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Re: Physician Retirement Savings

Post by goodenyou » Thu May 12, 2016 2:48 pm

kayli69 wrote:Love the critisizm because of my success

You assume I lead a miserable life because I have invested wisely and work my tail off and have not bought the Mcmansion or fancy european cars

I have a happy wife and 3 children who have everything they need within reason

I live in a beautiful suburban town with great schools and a 2800sq ft house.

I also have a restored farmhouse with 120 beautiful wooded acres that sits above one of the lakes outside of town where I pursue my hobbies of hunting and forestry. I restore 67-69 camaros and do all the work myself

I did not inherit anything. I lived like a resident for several years out of residency, paid off all debt, and invested wisely. I am enjoying life to the fullest and will be fully retired by age 50. Dont assume someone is leading a miserable meager life beacuase they are more successful than you

We're still not convinced you're a guy :P LOL.
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LateStarter1975
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Re: Physician Retirement Savings

Post by LateStarter1975 » Thu May 12, 2016 2:55 pm

kayli69 wrote:Love the critisizm because of my success

You assume I lead a miserable life because I have invested wisely and work my tail off and have not bought the Mcmansion or fancy european cars

I have a happy wife and 3 children who have everything they need within reason

I live in a beautiful suburban town with great schools and a 2800sq ft house.

I also have a restored farmhouse with 120 beautiful wooded acres that sits above one of the lakes outside of town where I pursue my hobbies of hunting and forestry. I restore 67-69 camaros and do all the work myself

I did not inherit anything. I lived like a resident for several years out of residency, paid off all debt, and invested wisely. I am enjoying life to the fullest and will be fully retired by age 50. Dont assume someone is leading a miserable meager life beacuase they are more successful than you
I like this response to the criticisms of your tremendous success. Assumptions can be dangerous in life, more so in an anonymous internet forum like this.
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Momus
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Re: Physician Retirement Savings

Post by Momus » Thu May 12, 2016 2:59 pm

kayli69 wrote:39 y/o, procedure oriented specialist. 8 years out of training

Taxable and investment accounts 3.5 million, goal is 5 million and then start to work part time

Save 85% of after tax income each month and invest in index funds. Live well below my means. Do all my own car repairs and home repairs which I enjoy. Drive older vehicles and laugh at my partners brand new Mercedes and BMWs that they buy every year. Some are 70 years old and still need to work
If you make 600k+ a yr, getting a BMW once in a while is totally reasonable... Not gonna affect you one bit. Don't live like a miser with your income. There is only so much money can buy. Live a little, you are doing well.

kmurp
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Re: Physician Retirement Savings

Post by kmurp » Thu May 12, 2016 3:01 pm

texasdiver wrote:
kmurp wrote:
am wrote:
kayli69 wrote:39 y/o, procedure oriented specialist. 8 years out of training

Taxable and investment accounts 3.5 million, goal is 5 million and then start to work part time

Save 85% of after tax income each month and invest in index funds. Live well below my means. Do all my own car repairs and home repairs which I enjoy. Drive older vehicles and laugh at my partners brand new Mercedes and BMWs that they buy every year. Some are 70 years old and still need to work

Did you start working at 18 y/o or get an inheritance?
No. He makes a lot , saves it all and invested into a tremendous bull market at likely 100% stocks due to his age.

How do you know Kayli69 is a guy? sounds more like a female handle. Do you just assume that doctors who save a lot and work on their own cars are guys?
I don't know the posters sex.

kayli69
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Re: Physician Retirement Savings

Post by kayli69 » Thu May 12, 2016 3:08 pm

Momus wrote:
kayli69 wrote:39 y/o, procedure oriented specialist. 8 years out of training

Taxable and investment accounts 3.5 million, goal is 5 million and then start to work part time

Save 85% of after tax income each month and invest in index funds. Live well below my means. Do all my own car repairs and home repairs which I enjoy. Drive older vehicles and laugh at my partners brand new Mercedes and BMWs that they buy every year. Some are 70 years old and still need to work
If you make 600k+ a yr, getting a BMW once in a while is totally reasonable... Not gonna affect you one bit. Don't live like a miser with your income. There is only so much money can buy. Live a little, you are doing well.
I have absolutely zero desire to get a BMW. This is one habit that has allowed me to accumulate my wealth
I am much happier driving a self-restored big block 4 speed 1969 camaro

furnace
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Re: Physician Retirement Savings

Post by furnace » Thu May 12, 2016 4:05 pm

goodenyou wrote:Physician investing and spending behavior seems to be a hot topic on this forum. Considering physician income and behavior differently draws a lot of criticism from non-physicians here because physician like to compare themselves to each other and not to the general population even if income is equivalent. Maybe it's a fallback to the "pre-med" behavior where "pre-med" students become competitive in an insular way. Showing off financial success later in life becomes a substitute for earlier academic success. That being said, many physicians have a propensity for conspicuous consumption at their peril. They also make poor investment and business decisions. Many will never save 25x yearly current spending and therefore they work much longer because they cannot fathom a reduction in lifestyle.
Doctors think they are a special breed. I say this in a neutral tone without prejudice. Doctors have tremendous dedication and can absorb enormous amounts of info, and work long and hard to achieve physician status. Once they are "there" the urge to spend freely is irresistible. And why not? They can afford it with their high incomes, right?

But the law of money says in order to have savings with which to invest, you have to spend less than you earn. Even if you are a high income doctor! Many high income doctors, by now used to their upgraded lifestyles, may conveniently choose to ignore this. Their rationale is -- I make a lot, so I don't need to save.

For those high income doctors that can save, they are in a great position to control their financial destiny.

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JDCarpenter
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Re: Physician Retirement Savings

Post by JDCarpenter » Thu May 12, 2016 4:38 pm

furnace wrote:...

Doctors [and lawyers] think they are a special breed. ...

For those high income doctors [and lawyers] that can save, they are in a great position to control their financial destiny.
From my admittedly anecdotal personal knowledge, we lawyers are at least as bad as doctors. Knowledgeable outliers from each profession do quite well, but too many are either a) too busy and focused on work; b) feel like they make a lot, so why not spend a lot; and/or c) realize that they are smarter than the average bear and fail to realize that high g and mastery of knowledge in a tough field doesn't translate into universal competence.
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chicagoan23
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Re: Physician Retirement Savings

Post by chicagoan23 » Thu May 12, 2016 4:49 pm

Love the critisizm because of my success

You assume I lead a miserable life because I have invested wisely and work my tail off and have not bought the Mcmansion or fancy european cars

I have a happy wife and 3 children who have everything they need within reason

I live in a beautiful suburban town with great schools and a 2800sq ft house.

I also have a restored farmhouse with 120 beautiful wooded acres that sits above one of the lakes outside of town where I pursue my hobbies of hunting and forestry. I restore 67-69 camaros and do all the work myself

I did not inherit anything. I lived like a resident for several years out of residency, paid off all debt, and invested wisely. I am enjoying life to the fullest and will be fully retired by age 50. Dont assume someone is leading a miserable meager life beacuase they are more successful than you
Respectfully....You went from zero to a $3.5 million portfolio in eight years by investing in index funds, while also buying a large primary house (let's say $500k at least) and a 120-acre farm with a farmhouse (another $500k at least), all debt free, plus student loan payoffs, which means you've put close to $5 million away in those eight years. Plus you save 85% of your after-tax income with a five-person multi-home household to support and maintain. I mean, I understand that you can save some cash by restoring old cars, but this doesn't seem to add up.

I know cardiologists for example that make about $1 million annually (after 20 years of practice) and that goes down to $650k-$700k or so after taxes. At 85% of that I think it would be hard to live on $100k per year with two large houses and a wife and three kids to support, and that's assuming a much higher income than the one that the original poster noted.

I would guess you either make a phenomenal income for a physician ($1.2 million plus) or your spouse is also making heavy contributions to your family's financial situation. It seems like there is no possible way for you to get to the position you are by making a $500k or $600k salary.

And please note--this is not meant to be a criticism or an assumption about you personally; I'm just trying to understand what I'm missing on your numbers if you care to share. It seems like you are quite an outlier.

kmurp
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Re: Physician Retirement Savings

Post by kmurp » Thu May 12, 2016 5:38 pm

300k saved per year since 1/1/2009 invested in a stock index fund would come close. The timing was excellent to achieve this kind of result.

livesoft
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Re: Physician Retirement Savings

Post by livesoft » Thu May 12, 2016 5:46 pm

chicagoan23 wrote:Respectfully....You went from zero to a $3.5 million portfolio in eight years by investing in index funds, ....
The years starting in 2009 have been quite good for the stock market. Don't forget that US equities have more than tripled in value since March 2009, but some of that was in the first few months.

Frankly, I think the high-net-worth physicians are keeping their mouths shut and not reporting in this thread.
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coalcracker
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Re: Physician Retirement Savings

Post by coalcracker » Thu May 12, 2016 5:58 pm

kayli69 wrote:39 y/o, procedure oriented specialist. 8 years out of training

Taxable and investment accounts 3.5 million, goal is 5 million and then start to work part time
beezquimby wrote:Dual physician family 40/38
Retirement savings approx 2.5m
College savings 200k
No debt
livesoft wrote:
chicagoan23 wrote:Respectfully....You went from zero to a $3.5 million portfolio in eight years by investing in index funds, ....
The years starting in 2009 have been quite good for the stock market. Don't forget that US equities have more than tripled in value since March 2009, but some of that was in the first few months.

Frankly, I think the high-net-worth physicians are keeping their mouths shut and not reporting in this thread.
What would you consider a "high-net-worth" physician :shock: ?

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goodenyou
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Re: Physician Retirement Savings

Post by goodenyou » Thu May 12, 2016 6:07 pm

coalcracker wrote:
kayli69 wrote:39 y/o, procedure oriented specialist. 8 years out of training

Taxable and investment accounts 3.5 million, goal is 5 million and then start to work part time
beezquimby wrote:Dual physician family 40/38
Retirement savings approx 2.5m
College savings 200k
No debt
livesoft wrote:
chicagoan23 wrote:Respectfully....You went from zero to a $3.5 million portfolio in eight years by investing in index funds, ....
The years starting in 2009 have been quite good for the stock market. Don't forget that US equities have more than tripled in value since March 2009, but some of that was in the first few months.

Frankly, I think the high-net-worth physicians are keeping their mouths shut and not reporting in this thread.
What would you consider a "high-net-worth" physician :shock: ?
And why would they keep their mouth's shut?
"Ignorance more frequently begets confidence than does knowledge" | "The best years you have left are the ones you have right now"

livesoft
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Re: Physician Retirement Savings

Post by livesoft » Thu May 12, 2016 6:11 pm

coalcracker wrote:What would you consider a "high-net-worth" physician :shock: ?
That's easy: Anybody with a net worth more than ours. :)
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