Doctors and retirement

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me112964
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Doctors and retirement

Postby me112964 » Sat Jan 07, 2017 8:53 am

Have been reading an interesting thread on a foroum on White Coat Investor's website that asks what a doctors FI/early retirement goal might be. Many respondents talking about 5-10 million. I am a doctor, married to a doctor and look at these numbers in astonishment. It would appear that there is a significant consumption problem with physicians. With a 4% withdrawal rate you are talking 200-400k a year!! This would put them in the top 5% of wage earners even in retirement. Having spent many days with patients in the last days of their lives, I can recall of no desire for a bigger house, boat, more expensive car etc. what people really want is to share their time with.......wait for it......people, not things. That is what makes us truly happy. When things own us we are no longer living. We are simply living to consume. Thoughts?

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lthenderson
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Re: Doctors and retirement

Postby lthenderson » Sat Jan 07, 2017 9:11 am

My wife's a doctor and I see that among some of her colleagues too. Some spend like money is going out of style. But most in her practice live like we do, in conservative houses, drive ordinary cars and "slow down" by their late 40's or early 50's. In her practice, more than half the doctors now work less than six months a year. Those that work full time into their upper 50's are generally the ones with spending problems.

vencat
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Re: Doctors and retirement

Postby vencat » Sat Jan 07, 2017 9:37 am

What's wrong with aiming for a high(er) retirement net worth?
To each his own. My wife and and I are both physicians in our mid 50s with very decent incomes and I've been investing the Boglehead way for about 20 years.
So, yes, the upper target is quite possible and relatively close. Main expenses have been paid off high end house to be close to nearly completed private school education for kids. Like you we are not materialistic except that I love to travel and the lack of money worries is very uplifting.
What will we do with our money? Charity, kids' inheritance (hopefully they make it on their own) and may be business class seats :wink:

By the way, I would never would retire just because I reached my financial goal. I enjoy working so would only quit if that changes or for health reasons.

sport
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Re: Doctors and retirement

Postby sport » Sat Jan 07, 2017 9:42 am

When you refer to specific dollar amounts that seem large, it should be done in context. What seems like a very large amount in Iowa would not go nearly as far in New York City or San Francisco.

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Re: Doctors and retirement

Postby qwertyjazz » Sat Jan 07, 2017 9:47 am

Doctor is a very broad category. There are those that want to see someone grow up until death, being there to see joys and tragedies. There are those who are adrenaline junkies who try to treat and street (WCI). There are those who like to to cut, break etc hoping to get a quick win and move on. There are those who provide a service - knock em out or read a test. They all have a different relationship with patients and a different reason to get up in the morning. Unfortunately our society has for various path dependency reason decided to support their lifestyle at different levels. This is not consistent over countries or times. People like different things about their jobs and get used to different amounts (adapt). So yes a conversation like that on WCI makes sense when you have a broad definition of doctor.
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desiderium
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Re: Doctors and retirement

Postby desiderium » Sat Jan 07, 2017 10:01 am

One thing to consider here is that physicians rarely have pensions.

What is the cash value of a COLA'd government pension with generous health care benefits? What would be the value of knowing your pension is backed by the US government and not subject to the whims of the financial markets? One doesn't have to postulate big spending desires. I think physicians, like everyone else, value security when giving up their human capital.

afan
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Re: Doctors and retirement

Postby afan » Sat Jan 07, 2017 10:11 am

Not everyone views their goal in life as retiring as early as possible, minimizing the total lifetime volume of work. Having the ABILITY to spend 400k per year in retirement does not mean one intends to do that. But it does offer a margin of error for someone who expects to spend 120. Life is tough, bad things happen, plans go wrong. The greater the gap between what you have and what you need, the lower the risk of running out of money. I plan to work as long as my capacity and demand for my services permit. I could retire now, but then what? Sit around and do nothing productive for the rest of my life? I hope someone who shoot me.
Last edited by afan on Sat Jan 07, 2017 12:41 pm, edited 1 time in total.
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Ged
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Re: Doctors and retirement

Postby Ged » Sat Jan 07, 2017 10:28 am

desiderium wrote:One thing to consider here is that physicians rarely have pensions.

What is the cash value of a COLA'd government pension with generous health care benefits?


Pensions are rare in private sector jobs period.

cutterinnj
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Re: Doctors and retirement

Postby cutterinnj » Sat Jan 07, 2017 10:30 am

While some doctors may spend that much during working years (kids, house, expenses, etc...) I can't imagine anyone would need 400k in retirement, assuming one isn't paying a mortgage anymore.

Even a hugely extravagant 200k/year in retirement would mean that you would need 5 million in retirement savings- this should be possible if you follow a boglehead philosophy most of your working life (not even including SS)

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Re: Doctors and retirement

Postby stoptothink » Sat Jan 07, 2017 10:55 am

Ged wrote:
desiderium wrote:One thing to consider here is that physicians rarely have pensions.

What is the cash value of a COLA'd government pension with generous health care benefits?


Pensions are rare in private sector jobs period.


Outside of a few government employees, I don't think I know a single person with a pension.

bornloser
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Re: Doctors and retirement

Postby bornloser » Sat Jan 07, 2017 10:57 am

Practicing medicine for about 20 years and surrounded by colleagues with similar income levels, I've seen a number of financial paths taken that include all those mentioned. And I agree with Vencat, to each his own. However, I have witnessed another path that I consider very sad and depressing: the physician in their 70s having spent every penny on excessive lifestyle and can never retire. I have seen this latter path several times in my own physician group. It has been a big motivator to stay the course!

johncunningham
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Re: Doctors and retirement

Postby johncunningham » Sat Jan 07, 2017 11:03 am

I think that the 5-10M goal needs to be considered in context. If we are talking about 2016 dollars, I agree that seems like a lot. I read WCI regularly and judging by a lot of the commenters, I feel like his audience probably skews younger than older. Five, or even 10 million doesn't seem like that extravagant a nest egg if we are talking about 2046. I am 5-10 years out of residency and have a child still in preschool. The earliest I "plan" on cutting hours is the day she graduates from high school. The earliest I "plan" on retiring is the day she finishes college/graduate school. At that point, perhaps 2036 (ish), I am hoping to have a paid off mortgage and hopefully somewhere in the neighborhood of 5-10M in retirement funds.

YMMV

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emp2b3
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Re: Doctors and retirement

Postby emp2b3 » Sat Jan 07, 2017 11:09 am

I felt that when reading the numbers in that post that many of the physicians were hoping to leave significant sums to family or charities. It also was a common theme that someone would have "hit" their number but decided that they wanted to continue working or would feel more comfortable with a larger number, although I am sure that increased consumption must come in to play sometimes (and was even acknowledged recently by WCI).
There are some impressive net worths mentioned on that site which I think often comes from a combination of very high salary, high savings rate, lower student loan burdens in the past, and possible family assistance/inheritances.
Personally our "number" for FI will be much smaller, but at the current time we both love our jobs and there are too many unknowns such as healthcare needs/costs when looking at a more extreme early retirement. But being prepared by saving aggressively will at least allow for more options.

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Re: Doctors and retirement

Postby Bmac » Sat Jan 07, 2017 11:29 am

vencat wrote:What's wrong with aiming for a high(er) retirement net worth?
To each his own. My wife and and I are both physicians in our mid 50s with very decent incomes and I've been investing the Boglehead way for about 20 years.
So, yes, the upper target is quite possible and relatively close. Main expenses have been paid off high end house to be close to nearly completed private school education for kids. Like you we are not materialistic except that I love to travel and the lack of money worries is very uplifting.
What will we do with our money? Charity, kids' inheritance (hopefully they make it on their own) and may be business class seats :wink:
.


+1
We are in a similar scenario, but closer to 50. We don't have an extravagant house or cars, however we don't skimp on travel or dining. You can have a very comfortable lifestyle while still amassing quite a bit of wealth if you more less live on one physician salary and save the other, even if your investment life doesn't really start until the early 30s. At the same time, if you also want to retire early (mid to late 50s) and thus plan for a long retirement at the same or higher level of consumption with a good buffer for inflation and unknown future events those are realistic numbers to have as a goal. For example, $600k combined gross income with 30% to tax, 30% consumption and 30% saved annually (a decent savings rate except amongst Bogleheads :wink: ) over 25 yrs at 5% return will end up around $10M. A truly 1% problem, for sure, but not atypical for many physicians.

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Re: Doctors and retirement

Postby sambb » Sat Jan 07, 2017 11:56 am

Dont understand the concept of "consumption problem". If people want to earn and spend so be it. Doctors arent even close to CEOs of fortune 500 compaines with their private planes etc. I dont want to be judgmental.
If a successful professional wants a nice car or a bigger house, who cares. I say go for it if you can meet your retirement goals.

And 5M to 10M in 20-30 years is not the same as it was 20 years ago.

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Re: Doctors and retirement

Postby afan » Sat Jan 07, 2017 2:45 pm

For many careers and certainly for docs, once you retire for any period of time it will be just about impossible to go back to work if your finances turn south. Once you are out, no longer up to date on skills, you are done. If you are making a good mid to later career income, giving that up is an enormous opportunity cost.
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Re: Doctors and retirement

Postby minimalistmarc » Sat Jan 07, 2017 2:50 pm

afan wrote:For many careers and certainly for docs, once you retire for any period of time it will be just about impossible to go back to work if your finances turn south. Once you are out, no longer up to date on skills, you are done. If you are making a good mid to later career income, giving that up is an enormous opportunity cost.


More true for surgical/interventional specialties.

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Re: Doctors and retirement

Postby Grt2bOutdoors » Sat Jan 07, 2017 3:25 pm

lthenderson wrote:Those that work full time into their upper 50's are generally the ones with spending problems.


My doctor works full time, not because he has a spending problem, but just likes practicing. A rare gem, in the world of all these posts talking about early retirement.
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Re: Doctors and retirement

Postby delamer » Sat Jan 07, 2017 3:37 pm

"what people really want is to share their time with.......wait for it......people, not things. That is what makes us truly happy. When things own us we are no longer living. We are simply living to consume. Thoughts?"

OK, there is the stereotype of "whoever dies with the most toys wins." No appeal to me either. But there is a huge gap between letting "things" control your life and being financially comfortable.

I want to live in a safe neighborhood in house that is big enough for my family members to have some breathing room. I want to not have to think twice about buying easy-to-prepare, good quality food to eat. I want a car with good safety features that doesn't give me a backache. I want to be able to take a couple nice vacations each year and fly business class to Europe for one of them. I want to be able to pay someone else to mow the lawn because our allergies act up when we do it ourselves. I want to be able to pay for my kids' college education and help them buy their first homes. And I certainly want a nest egg that will enable us to be taken care of in a high-quality assisted living or nursing home if the need arises (a parent's stay in a $12,000/month nursing home will make you prioritize that if you hadn't already considered it).

The theme here is that I want to be able to retire without worrying about money or how much things cost. And, maybe ironically, that means that I need to have lots of money in the bank. Now, I probably don't need a $5 million dollar nest egg to eliminate that worry, but I am not going to argue with someone who says they do.

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Re: Doctors and retirement

Postby LarryAllen » Sat Jan 07, 2017 4:26 pm

delamer wrote:...The theme here is that I want to be able to retire without worrying about money or how much things cost. And, maybe ironically, that means that I need to have lots of money in the bank. Now, I probably don't need a $5 million dollar nest egg to eliminate that worry, but I am not going to argue with someone who says they do.



I agree with this. Well said.


Also, I have to say I love the generalizing and sterotyping in this thread. LOL is all I can say.

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Re: Doctors and retirement

Postby Perkunas » Sat Jan 07, 2017 5:30 pm

My wife is a doctor and at age 34 (last year) she cut back to 3 days/week. No way in hell will we get anywhere near 5MM... even 2MM is highly unlikely for us, unless we work all the way to 65+.

She made a decision to have a life, and to be able to care for a child if/when we have one.

At 3 days/week and the fact that she is not a partner in the practice, she has pretty low stress in her work life and thus she isn't too worried about achieving an early retirement because she feels a good balance already.

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Re: Doctors and retirement

Postby gilgamesh » Sat Jan 07, 2017 6:01 pm

sambb wrote:Dont understand the concept of "consumption problem". If people want to earn and spend so be it. Doctors arent even close to CEOs of fortune 500 compaines with their private planes etc. I dont want to be judgmental.
If a successful professional wants a nice car or a bigger house, who cares. I say go for it if you can meet your retirement goals.

And 5M to 10M in 20-30 years is not the same as it was 20 years ago.


I don't understand 'the consumption problem' either. If it fits with the retirement goals, I don't see a problem either. Toys and spending time time with people are not mutually exclusive.

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Re: Doctors and retirement

Postby goodenyou » Sat Jan 07, 2017 6:15 pm

I have several friends who have amassed a mid to high 8-figure net worth. Nobody ever questions their consumption. They did not save any lives or ever do any surgery. They are not doctors. Why do we question how much a doctor makes, saves or doesn't save? There are fools that waste their money in every walk of life. There seems to be a fascination with doctors' income, savings and wealth especially by other doctors. Now I know why many soap operas have had medical/hospital themes. It is a curious fetish with doctors' incomes.
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Re: Doctors and retirement

Postby Sandtrap » Sat Jan 07, 2017 6:47 pm

Ged wrote:
desiderium wrote:One thing to consider here is that physicians rarely have pensions.

What is the cash value of a COLA'd government pension with generous health care benefits?


Pensions are rare in private sector jobs period.


Yes.
Is it more common that those in professional private sector jobs work at a chosen career with specific skills?
And, those with COLA'd government pensions (worth millions in total value) have a career more specific to "government work" in general?
Because, oftentimes a major goal of choosing government work and staying in it and playing the "game" is the pension itself.. . . .
whereas a physician's chosen career goals lay in the specific profession and contribution to society?

I come from a large extended family of doctors and other professionals without pensions. Post retirement, it seems the government pensioners with 2-3 income streams on top of social security have a more solid income base.

FWIW, I've known many retirees in Hawaii who are generationally awash with multiple pensions because such a high percentage of the population relies on government work as a career(top heavy).
Last edited by Sandtrap on Sat Jan 07, 2017 8:08 pm, edited 1 time in total.

sambb
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Re: Doctors and retirement

Postby sambb » Sat Jan 07, 2017 7:13 pm

goodenyou wrote:I have several friends who have amassed a mid to high 8-figure net worth. Nobody ever questions their consumption. They did not save any lives or ever do any surgery. They are not doctors. Why do we question how much a doctor makes, saves or doesn't save? There are fools that waste their money in every walk of life. There seems to be a fascination with doctors' income, savings and wealth especially by other doctors. Now I know why many soap operas have had medical/hospital themes. It is a curious fetish with doctors' incomes.



So well said. Doctors have been so good to me, etc. I am so thankful for your profession. And I am smart enough to know that the billing issues are related to my insurance, not your medical skills.
Sometimes on this board there is subtle negativity towards doctors (but Warren Buffet, a stock picker, is looked at differently?). Let me tell the doctors - thanks for your service. And as long as you can fulfill your retirement, i dont care if you drive a mercedes or live in a nice mansion. Go for it. You gave up the best years of your life, from age 18-35 in libraries, studying, and working >80 hours a week in residencies so you could save my life.

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Re: Doctors and retirement

Postby johnra » Sat Jan 07, 2017 9:06 pm

For me as 63 year old active physician with a decent but rather modest salary compared to what is discussed on this forum and WCI forum, what makes me uncomfortable in the comments are the inherent potential for conflict of interest! Doctors talking about large incomes should be very clear that their earnings are free from their financial self-interests as physicians and their patient's interests. This forum is very strong in recognizing, commenting and understanding the conflict of interest in the financial sector and the critically important role of fiduciary standards. But very analogous conflicts of interest exist in healthcare, and like those in the financial sector, these are not often apparent since health care finances are enshrouded in obscurity (and getting moreso). There is essentially no financial transparency in healthcare. I shudder at some of the comments by physicians-- they can seem very self-serving and self-righteous."Hippocratic" is only a few letters away from "hypocritic".
Last edited by johnra on Sat Jan 07, 2017 9:08 pm, edited 1 time in total.

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Re: Doctors and retirement

Postby hmw » Sat Jan 07, 2017 9:08 pm

Doctors who post on the WCI board is a self selecting sample. They are interested in savings and investing.

A PCP who makes 200k a year but started his/her career with a 300k educational debt will have a hard time reaching 5 to 10 million at retirement. But a high earning specialist who makes 600k a year with no educational debt can easily have a net worth of 5 to 10 million and retire in his/her 50's.

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Re: Doctors and retirement

Postby White Coat Investor » Sat Jan 07, 2017 9:31 pm

I think a significant part of wanting $5-10M is being able to have $5-10M. Once that sort of thing becomes possible, one starts thinking about what he would do if he had $200-400K a year in income in retirement. I'm confident I could spend/give that sum away fairly easily.

But when you're making $100K a year and like a good Boglehead saving $30K a year, at 5% real for 30 years, that only works out to be $2M. And if you want to retire early (20 years), $1M. So from that sort of perspective, $5M seems like gobs of money. But if you're making $400K and saving $150K a year, you can hit that sort of sum by age 50. It doesn't seem so out of reach.

So how do you spend 5 times as much money? It's actually pretty easy. We had pizza last week. I drove down to Domino's and picked up two mediums. $12. Today, my wife ordered pizza from the local fancy pizza joint and had it delivered- $40. 3 times the price for the same thing. Okay, not quite, but awfully similar. Now look at cars. You can get perfectly acceptable transportation for $5-10K. But you can also buy a brand new full-size SUV (not even luxury) for $60K. 6-12X as much. Now consider vacations. You can camp out at the local state park for $100. Or you can take the family on an Alaskan cruise for $15K. 150X as much. How about education? You can go to the local public schools (already covered with property taxes) or you can fork out $10-30K per kid for private high school. Same story in college. You can go to the local state U for $10K a year, or fancy-pants liberal arts college for $50K. 5X as much. And I haven't even gotten into the issues with HCOL areas.

If you can't figure out how to spend 5X what you're spending now, I would submit you need to use a little more imagination. I get that some people have trouble spending money, but for most the real difficulty is figuring out how to live on less than they earn. Even if you can't think of a way to spend it on something that would make you at least marginally happier, I bet you could think of a charitable cause you would like to support with it.
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Re: Doctors and retirement

Postby goodenyou » Sat Jan 07, 2017 9:42 pm

White Coat Investor wrote:I think a significant part of wanting $5-10M is being able to have $5-10M. Once that sort of thing becomes possible, one starts thinking about what he would do if he had $200-400K a year in income in retirement. I'm confident I could spend/give that sum away fairly easily.

But when you're making $100K a year and like a good Boglehead saving $30K a year, at 5% real for 30 years, that only works out to be $2M. And if you want to retire early (20 years), $1M. So from that sort of perspective, $5M seems like gobs of money. But if you're making $400K and saving $150K a year, you can hit that sort of sum by age 50. It doesn't seem so out of reach.

So how do you spend 5 times as much money? It's actually pretty easy. We had pizza last week. I drove down to Domino's and picked up two mediums. $12. Today, my wife ordered pizza from the local fancy pizza joint and had it delivered- $40. 3 times the price for the same thing. Okay, not quite, but awfully similar. Now look at cars. You can get perfectly acceptable transportation for $5-10K. But you can also buy a brand new full-size SUV (not even luxury) for $60K. 6-12X as much. Now consider vacations. You can camp out at the local state park for $100. Or you can take the family on an Alaskan cruise for $15K. 150X as much. How about education? You can go to the local public schools (already covered with property taxes) or you can fork out $10-30K per kid for private high school. Same story in college. You can go to the local state U for $10K a year, or fancy-pants liberal arts college for $50K. 5X as much. And I haven't even gotten into the issues with HCOL areas.

If you can't figure out how to spend 5X what you're spending now, I would submit you need to use a little more imagination. I get that some people have trouble spending money, but for most the real difficulty is figuring out how to live on less than they earn. Even if you can't think of a way to spend it on something that would make you at least marginally happier, I bet you could think of a charitable cause you would like to support with it.


Put 3 kids through private college and it will cost close to $1 million soon if pay for you kid's education. You won't receive any aid because you will be considered rich. You can burn though a lot of money, not just in pizzas and suvs.
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Re: Doctors and retirement

Postby livesoft » Sat Jan 07, 2017 9:53 pm

White Coat Investor wrote: We had pizza last week. I drove down to Domino's and picked up two mediums. $12.

Since you mentioned pizza, …. my son woke up yesterday around noon and texted me from upstairs: "Dad, want to do something for lunch?" After a little wrangling to see if Mom would meet us for lunch, he ordered a couple of large 3-topping Domino's pizzas for $16 and went to pick them up. So I've eaten pizza for lunch, dinner, lunch, dinner. But I had the usual oatmeal for breakfast, plus a couple of salads to augment the slices of pizza. Oh, leftover pizza is for lunch tomorrow, too.
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Re: Doctors and retirement

Postby delamer » Sat Jan 07, 2017 10:02 pm

livesoft wrote:
White Coat Investor wrote: We had pizza last week. I drove down to Domino's and picked up two mediums. $12.

Since you mentioned pizza, …. my son woke up yesterday around noon and texted me from upstairs: "Dad, want to do something for lunch?" After a little wrangling to see if Mom would meet us for lunch, he ordered a couple of large 3-topping Domino's pizzas for $16 and went to pick them up. So I've eaten pizza for lunch, dinner, lunch, dinner. But I had the usual oatmeal for breakfast, plus a couple of salads to augment the slices of pizza. Oh, leftover pizza is for lunch tomorrow, too.


Pizza keeps! Not need to drown in pizza for three days straight. Have a burger or a crabcake or something in between pizza meals :shock:

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Re: Doctors and retirement

Postby kmurp » Sun Jan 08, 2017 6:36 am

lthenderson wrote:My wife's a doctor and I see that among some of her colleagues too. Some spend like money is going out of style. But most in her practice live like we do, in conservative houses, drive ordinary cars and "slow down" by their late 40's or early 50's. In her practice, more than half the doctors now work less than six months a year. Those that work full time into their upper 50's are generally the ones with spending problems.

Sounds like a lucrative practice.

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Re: Doctors and retirement

Postby Quark » Sun Jan 08, 2017 7:14 am

me112964 wrote:Have been reading an interesting thread on a foroum on White Coat Investor's website that asks what a doctors FI/early retirement goal might be. Many respondents talking about 5-10 million. I am a doctor, married to a doctor and look at these numbers in astonishment. It would appear that there is a significant consumption problem with physicians. With a 4% withdrawal rate you are talking 200-400k a year!! This would put them in the top 5% of wage earners even in retirement. Having spent many days with patients in the last days of their lives, I can recall of no desire for a bigger house, boat, more expensive car etc. what people really want is to share their time with.......wait for it......people, not things. That is what makes us truly happy. When things own us we are no longer living. We are simply living to consume. Thoughts?

In another thread, someone writes that he spends about $200k a year on netjets to fly his family on vacations. He finds it very convenient and allows his family to spend time with each other without the hassle of modern commercial air travel.

You may be falling into the trap of assuming your experiences are universal.

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Re: Doctors and retirement

Postby afan » Sun Jan 08, 2017 8:20 am

lthenderson wrote:...more than half the doctors now work less than six months a year....


I would not want a doctor who practiced six months a year taking my blood pressure, let alone delivering medical care. Either you take it seriously, putting in the time and effort to be excellent, or you should retire. Maybe flip burgers or something, but not take peoples' lives in your hands.
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Re: Doctors and retirement

Postby qwertyjazz » Sun Jan 08, 2017 9:32 am

afan wrote:
lthenderson wrote:...more than half the doctors now work less than six months a year....


I would not want a doctor who practiced six months a year taking my blood pressure, let alone delivering medical care. Either you take it seriously, putting in the time and effort to be excellent, or you should retire. Maybe flip burgers or something, but not take peoples' lives in your hands.


How would you know? Medicine is the prototypical asymmetric information field. You have no idea if the doctor was ever any good let alone at presently
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gasdoc
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Re: Doctors and retirement

Postby gasdoc » Sun Jan 08, 2017 9:51 am

afan wrote:
lthenderson wrote:...more than half the doctors now work less than six months a year....


I would not want a doctor who practiced six months a year taking my blood pressure, let alone delivering medical care. Either you take it seriously, putting in the time and effort to be excellent, or you should retire. Maybe flip burgers or something, but not take peoples' lives in your hands.



I would not be so quick to judge. For the first ten years of my career I was in a four person practice. We worked like h-ll to cover every night and weekend for three weeks and then had a week off. It could be said that we "only practiced nine months a year." I worked harder in those years than I do now, and I now take 3-4 weeks off per year.

Gasdoc

afan
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Re: Doctors and retirement

Postby afan » Sun Jan 08, 2017 10:14 am

qwertyjazz wrote:
How would you know? Medicine is the prototypical asymmetric information field. You have no idea if the doctor was ever any good let alone at presently


In emergencies you are stuck. For anything else, there are plenty of sources of information. There are maintenance of certification requirements. One could meet them while practicing part time, but they take a substantial amount of time and effort. The practice schedules are not that hard to access. You can look at a doc's position in the practice, status with local and national organizations...

You do not have to give them a pop quiz to find out whether they are active and up to date.
We don't know how to beat the market on a risk-adjusted basis, and we don't know anyone that does know either | --Swedroe | We assume that markets are efficient, that prices are right | --Fama

afan
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Re: Doctors and retirement

Postby afan » Sun Jan 08, 2017 10:20 am

gasdoc wrote:

I would not be so quick to judge. For the first ten years of my career I was in a four person practice. We worked like h-ll to cover every night and weekend for three weeks and then had a week off. It could be said that we "only practiced nine months a year." I worked harder in those years than I do now, and I now take 3-4 weeks off per year.

Gasdoc

Totally different. Someone who is really working 3/4 of the days in a year is definitely working full time. At that level I would worry more about burnout and inability to keep up with CME. Working 5 days a week with no vacation, meeting time or holidays is 261 days/year. Three quarters of the year is 274 days. Definitely full time. On the other hand, 180 days per year, again assuming no vacation, meeting or holidays, which I doubt is what was meant, is hardly full time.
We don't know how to beat the market on a risk-adjusted basis, and we don't know anyone that does know either | --Swedroe | We assume that markets are efficient, that prices are right | --Fama

qwertyjazz
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Re: Doctors and retirement

Postby qwertyjazz » Sun Jan 08, 2017 10:23 am

afan wrote:
qwertyjazz wrote:
How would you know? Medicine is the prototypical asymmetric information field. You have no idea if the doctor was ever any good let alone at presently


In emergencies you are stuck. For anything else, there are plenty of sources of information. There are maintenance of certification requirements. One could meet them while practicing part time, but they take a substantial amount of time and effort. The practice schedules are not that hard to access. You can look at a doc's position in the practice, status with local and national organizations...

You do not have to give them a pop quiz to find out whether they are active and up to date.


MOC only seems to help the people making them. It may be the only field with less science than personal finance. The best clinicians have no time for practice politics, local or national organizations. Although they could be contrarian markers ...
The best clinical docs I know do it because of some inner drive. Medical quality metrics suck IMHO
Although I do like your thought of looking at schedules, I could imagine it has a correlation with quality (surgeon data on procedure number). IRL it might be interesting to see if that also applies to non-procedural fields. I would imagine true to a point then the spending less time per pt would dominate.

Thank you
QJ
G.E. Box "All models are wrong, but some are useful."

staythecourse
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Re: Doctors and retirement

Postby staythecourse » Sun Jan 08, 2017 10:44 am

If one hasn't realized it yet doctors are one of many professions that a group of folks who are highly motivated, hard working, competitive with themselves and others and always a bit fearful of everything.

So no surprise the 5-10 million for many is not really what they need in relation to a SWR we discuss on this site, but more of 1. Status symbol, i.e. "I have a net worth of 5 or 10 million so I am successful" or 2. "Boy I am not sure what will happen in the future so I have been told by my seniors I need 10 million to live comfortable."

You won't find many doctors supporting that "Yes I need 10 million, becuase I have done the calculations and that is 25x my annual expenses".

I would venture to guess doctors are one of the leading professions with dying with the most money so it isn't like they are popping champaigne and jetting to Paris every weekened like many think.

Good luck.
"The stock market [fluctuation], therefore, is noise. A giant distraction from the business of investing.” | -Jack Bogle

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gasdoc
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Re: Doctors and retirement

Postby gasdoc » Sun Jan 08, 2017 11:57 am

afan wrote:
gasdoc wrote:

I would not be so quick to judge. For the first ten years of my career I was in a four person practice. We worked like h-ll to cover every night and weekend for three weeks and then had a week off. It could be said that we "only practiced nine months a year." I worked harder in those years than I do now, and I now take 3-4 weeks off per year.

Gasdoc

Totally different. Someone who is really working 3/4 of the days in a year is definitely working full time. At that level I would worry more about burnout and inability to keep up with CME. Working 5 days a week with no vacation, meeting time or holidays is 261 days/year. Three quarters of the year is 274 days. Definitely full time. On the other hand, 180 days per year, again assuming no vacation, meeting or holidays, which I doubt is what was meant, is hardly full time.


You may be partially correct. But I would guess anyone with a high enough income to be able to take off six months out of the year is working nights, weekends and holidays. That is pretty much the rule.

gasdoc

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Re: Doctors and retirement

Postby toofache32 » Sun Jan 08, 2017 12:30 pm

afan wrote:
qwertyjazz wrote:
How would you know? Medicine is the prototypical asymmetric information field. You have no idea if the doctor was ever any good let alone at presently


In emergencies you are stuck. For anything else, there are plenty of sources of information. There are maintenance of certification requirements. One could meet them while practicing part time, but they take a substantial amount of time and effort. The practice schedules are not that hard to access. You can look at a doc's position in the practice, status with local and national organizations...


:oops: Another layperson duped...

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Re: Doctors and retirement

Postby goodenyou » Sun Jan 08, 2017 12:47 pm

toofache32 wrote:
afan wrote:
qwertyjazz wrote:
How would you know? Medicine is the prototypical asymmetric information field. You have no idea if the doctor was ever any good let alone at presently


In emergencies you are stuck. For anything else, there are plenty of sources of information. There are maintenance of certification requirements. One could meet them while practicing part time, but they take a substantial amount of time and effort. The practice schedules are not that hard to access. You can look at a doc's position in the practice, status with local and national organizations...


:oops: Another layperson duped...


Every year, I get an email stating that I've been chosen as an exceptional doctor. For $150, I can purchase a plaque that states that I am exceptional with the ability to display it proudly for my patients to see. It is a small price to pay for me to feel good about myself and to broadcast my excellence, but I have resisted. My only regret is that I didn't think of this important way to communicate exceptionalism to patients myself.
"Ignorance more frequently begets confidence than does knowledge" | "The best years you have left are the ones you have right now"

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Toons
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Re: Doctors and retirement

Postby Toons » Sun Jan 08, 2017 1:05 pm

Seven Figure Portfolio here.
Live well and couldn't be any more content.
Needs and Wants have been met.
Spend around 40k a year. :mrgreen:
"One does not accumulate but eliminate. It is not daily increase but daily decrease. The height of cultivation always runs to simplicity" –Bruce Lee

Spooky
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Re: Doctors and retirement

Postby Spooky » Sun Jan 08, 2017 1:16 pm

I would submit that the expectation for doctors to support family is higher than that of the general population. I certainly consider the lack of retirement planning of certain family members in my retirement planning. I don't intend to be making cash payments, but I may need to consider having a 4 or 5 bedroom house as an empty nester, when I otherwise wouldn't. There is also a lot of economic outpatient care for children of physicians, in my experience.

Five
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Re: Doctors and retirement

Postby Five » Sun Jan 08, 2017 2:02 pm

Hello everyone. I have been reading this post and I wish to make a few comments. First of all, I am a physician....a specialist. I also did a fellowship and practice in that specialty as well, an interventional subspecialty. I am in the top 6 medically reimbursing specialties. I am also 52 years old. Now, here are some points for discussion.

1. Income. I make more than the average professional, be it accountant, lawyer, pharmacist, school teacher. BUT I didn't start practice til I was 32 years old....and with a lot of school debt. Most had 10 good years of retirement savings on me with very minimal/no school debt when I was 32! So a physician needs a much larger salary/income to make up for "lost years". Furthermore, when I was in the library studying during the Summers ( for my inservice exam and later for my actual board certifications), my friends were getting married, buying homes, starting families, and buying fairly nice cars......they were living the "good life"! My friends who were in training with me and I didn't experience this til we were done with our training programs! Also, to get through medical school and residency/fellowship, one has to be very focused, hardworking and willing to sacrifice---time (which no amount of money can buy more of), late nights, family life, significant job stressors. BELIEVE ME when I tell you that if someone goes to become a physician for the money, they will be very, very angry and very disappointed when they finally earn an income after many long years of training.....these long hours and stressors continue into your medical practice as well until the day you finally retire! it cannot be just for the money!

2. Maintenance of certification. I have 4 board certifications, all earned with top exam scores. Two boards are in my main specialty and two others are in my subspecialty. Last year, I spent $8,000 for CME courses to stay updated. These courses are expensive because they are cadaver courses. My family only came with me on one of my trips....they are not a tax deduction.
The courses are paid for out of my own money, but they are a tax deduction. This is part of the price to stay current. Maintenance of certification is a scam...money making for those in the ivory towers. MOC is expensive and very time consuming....more time away from the family. Less time for doing things with my kids when they are young (remember, no one can buy more time with your their children when they are small) to study for a meaningless test....there are NO STATISTICALLY SIGNIFICANT STUDIES out there that show performing MOC directly correlates to less malpractice cases or fewer poor results clinically in patient care. From my experience, it all comes from the heart....the best clinicians are not necessarily from Ivy League programs with high test scores. The best clinicians really do care....they study because they know they want to be good, they attend to every detail, they stay an extra 15 minutes to make a phone call about an ambiguous test result to clarify it, they take an extra few minutes to explain things to a patient or their falmilies. It has to come from the heart, not because a pocketbook is involved of someone is threatening your boards with an exam (and insurance companies WILL NOT pay a physician who is not board certified or board eligible).

3. Even though I am a specialist/subspecialist, there is NO WAY I will ever save $5--10 million dollars. I live below my means and invest wisely using the Bogleheads approach. Yet, I cannot generate enough money to invest to get to $ 5 million. That is a huge amount!! After paying off school loans, a wedding, a honeymoon, a house (that is very nice but less than 1x my gross income), three cars ( Camry and two Hondas), saving goal of $250,000/child for college, and all credit cards/all debt every month, there is not enough cash to invest. Don't forget....doctors don't start at $200,000--$400,000 directly out of residency. It takes a few years to ramp up. Yet, their school loans and other expenses await!! The average Primary Care doc makes $150--200,000....Not many docs make $350,000 to $400,000..... I am speaking of salary only, not the whole compensation package.
So do the math.....if a doc retires with $2.5 to $3.5 million, that is very, very good.....after paying off their loans, house, childrens' school loans and all other debt. Very, very few can do this by the time they are 50--55.....unless they have an inheretence or hit the lottery. Do the math!! Don't let others snowball you.

4. Lastly, society always thinks a doc is "loaded". Not true. Many live extravagant lifestyles and spend money like water. There is not enough money that can be made to spend it like water!

afan
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Re: Doctors and retirement

Postby afan » Sun Jan 08, 2017 2:20 pm

One need not travel to get CME for MOC. Nearly all professional societies offer CME online. If you belong to your specialty societies you have already paid for this. One could get 50 hours per year by investing the time, but never leaving home. Go to one or two national meetings a year and actually participate, not hang out at the beach, and you could get almost all your CME without travel.

People who do not keep up are dangerous. It would be better if you could get CME for reading your journals every week, but no one has figured out how to police it to prove it happened.

For those who teach, they contribute a lot more than 50 hours of instruction every year, but usually that does not count.

MOC is not a scam. But self assessment is silly and a waste of time. Again, one needs a way to prove one is staying up to date.
We don't know how to beat the market on a risk-adjusted basis, and we don't know anyone that does know either | --Swedroe | We assume that markets are efficient, that prices are right | --Fama

afan
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Re: Doctors and retirement

Postby afan » Sun Jan 08, 2017 2:27 pm

goodenyou wrote:
Every year, I get an email stating that I've been chosen as an exceptional doctor. For $150, I can purchase a plaque that states that I am exceptional with the ability to display it proudly for my patients to see. It is a small price to pay for me to feel good about myself and to broadcast my excellence, but I have resisted. My only regret is that I didn't think of this important way to communicate exceptionalism to patients myself.


Those awards are meaningless. But the other factors I listed do matter. The "best doctors" lists are a joke to doctors, but lay people are impressed. At $150, which is cheap, it might be worth it. But remember that the organization selling the plaques need not be the one issuing the award. Once some company has announced you a top doctor, you can make your own plaque. It is just announcing the fact you were chosen..

The real problem is the ridicule to which you may subject yourself if your fellow doctors see it hanging in your office.
We don't know how to beat the market on a risk-adjusted basis, and we don't know anyone that does know either | --Swedroe | We assume that markets are efficient, that prices are right | --Fama

qwertyjazz
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Re: Doctors and retirement

Postby qwertyjazz » Sun Jan 08, 2017 2:31 pm

Interesting argument - AMA became irrelevant when they opposed Medicare - MOC is great in theory but no psychometrics behind it - professional societies are great in theory but just another mechanism of funneling funds - patients believe seeing fellow of x or master of x has meaning - but the rules vary by society except they all include money
Curious how this will all play out over the next few decades
BTW many MOC programs include tests on journals for credits - teaching and research can likewise be credited with the proper paperwork and payments (depending on ABMS field - have done it in mine)
G.E. Box "All models are wrong, but some are useful."

Five
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Re: Doctors and retirement

Postby Five » Sun Jan 08, 2017 2:35 pm

Dear afan,
A physician cannot "go to a cadaver lab online" nor learn or improve their skills with interventional procedures by sitting on their computer at home. Also, many malpractice insurance companies and hospital credential committees nowadays want to see certificates of completion from high-quality, real-time instructional cadaver courses if a doctor wants privileges for invasive procedures In their practice.

And yes, MOC is a money-making hoax, a scam for those with nothing better to do than think up esoteric questions to test others on and waste their time and money. It is a shame that those in ivory towers of test making aren't given exams made up by those physicians working day-to-day as clinicians. I am sure that many of these so-called elitists couldn't diagnose their way out of a wet paper bag!


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