Staying the course is so hard (support thread)

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
Topic Author
ERguy101
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Staying the course is so hard (support thread)

Post by ERguy101 » Wed Jul 03, 2019 7:50 am

Hi all -

I'm trying my best to stay the course. I'm 38, I'd love to retire in 13 years. I say 13 years because my mortgage (15 year bi-weekly payments) finishes then, and thats the same time my kid turns 18, so no more child support, and she'll have a healthy 529 by then. I'm trying to stay the course. I have a very nice house, it's 2400 sq ft, beautiful interior. I have a truck I lease, but will buy at end of lease, then pay cash to pay off.

I'm trying so hard to stay the course.

I've made multiple near mistakes. I almost purchased a Porsche sports car, just for a fun vehicle. I even bought it, then returned it the same day (CarMax.)

I started to try to buy rental property, but the cash flow was so bad I just couldn't justify it. I was able to scratch the itch by investing the same money I would use as a down payment for the property into FRESX. That seems to have helped.

Unfortunately, while looking at rental houses, I came across some beautiful houses for sale in my town. I found one in an old beautiful neighborhood, on a beautiful southern pond. A well known house. Its stunning inside, with hand scraped wood plank floors, high ceilings, gorgeous kitchen, pool, etc. It's a truly amazing house. It's listed at 1.3 million, but could get it closer to 1 million (or 1.1). My house is worth 520, and I have about 150 of equity in it. It's killing me. If I buy this house, the 30 year mortgage would be around 5000/month, and the 15 year would be around 7000-7500 a month (I say 15 year because I'd love to have it paid off by retirement. I don't know how people afford large house payments during retirement.) My current mortgage I pay 1600 every two weeks, this is the accelerated plan to have it paid off in 13 years. So the 30 year mortgage on the 1.1 mil house is only a couple of grand more per month, which isn't bad at all. But the 15 year plan is really a lot more.

So if I bought this house, I would go from owing 520,000 - 150,000 = $370,000 on a house that I'm set to pay off in 13 years, to owing 1,100,000 - 150,000 - 50,000 (extra cash I could throw in) = 900,000. So I would put myself in 900,000 - 370,000 = 530,000 more debt than I am already in, which would be like paying off my existing house 2.5 times in a row. It's easy to see that it would be much nicer to have an extra half a million in retirement. But at the same time I do believe that "you only live once", and why the heck am I working so much if I'm just living in a small house and saving it all for one day when I'm past my prime.

My background: I'm an ER doctor, I work a ton, I work more than 300 hours per month, and I gross around 720,000/yr. I work at easier places, so while the hours seem very long, I have a lot of downtime, and it's not unusual for me to go 6-7 hours on a shift doing nothing. It's just the time away from family that really sucks, but even with that I get about 15 days off per month. I would like to cut back some.

I don't know... I guess I'm asking if buying a much more expensive house is really stupid. I know I should stay the course and not be stupid and fall into the "giant house" trap. But at the same time, I want a little more from life than a smaller cramped house and just saving every dollar I earn. It's hard.

Mr.BB
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Re: Staying the course is so hard (support thread)

Post by Mr.BB » Wed Jul 03, 2019 7:57 am

My diagnosis is that you are suffering from an acute case of "house envy" and the side effects of "I deserve this" syndrome.

Take a step back and try to imagine yourself 15 years from now retired or not retired because of the choice you made with the house.
You can try looking around your house and yard and say I will invest some money into my current property to make it more appealing to me. Upgrading the electronics, security, the way your yard looks, etc. Invest some money into your property and enjoy it more.
"We are what we repeatedly do. Excellence, then, is not an act, but a habit."

Longdog
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Re: Staying the course is so hard (support thread)

Post by Longdog » Wed Jul 03, 2019 8:01 am

ERguy101 wrote:
Wed Jul 03, 2019 7:50 am
I don't know... I guess I'm asking if buying a much more expensive house is really stupid. I know I should stay the course and not be stupid and fall into the "giant house" trap. But at the same time, I want a little more from life than a smaller cramped house and just saving every dollar I earn. It's hard.
If your goal really is to retire in 13 years, and you believe you are set to achieve that goal, then yes it is really stupid because it goes against your stated goal and you know it! If that's not really your goal, then go for it if you truly believe it will make you happy.

Another thing to consider - do you think you will be burnt out from working so much in 13 years?
Steve

HomeStretch
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Re: Staying the course is so hard (support thread)

Post by HomeStretch » Wed Jul 03, 2019 8:02 am

There are a lot of temptations to spend on the road to retirement. Are you willing to work another 2-3 years full time (or longer part time) to buy this house and the higher lifetime annual related expenses (repairs, taxes, insurance, utilities)? For a “dream house”, it might very well be worth it. But only you can answer the question.

rj342
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Re: Staying the course is so hard (support thread)

Post by rj342 » Wed Jul 03, 2019 8:09 am

You know there are other houses nice, not quite as expensive as the showplace, houses out there that are larger than yours, right?
You could get a bigger/nicer house in the middle, and the savings support a whole lot of lifestyle in other ways (as well as flexible cushion for the unexpected. If you're thinking to keep for long term how much space does one kid need, or only one set of grandkids to visit some day? (implication is no plans for more).
How much of this is, however unconsciously, driven by keeping up with the Joneses (other big $$ doctors). Wife extremely status conscious?
Just remember, sounds like your goal is to NOT be a [practicing] doctor anymore ASAP.

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Sandtrap
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Re: Staying the course is so hard (support thread)

Post by Sandtrap » Wed Jul 03, 2019 8:16 am

Considerations:

1. Work part time - take a break. (put yourself in "time out")
2. Spend more time with family.
3. Rediscover old hobbies and pastimes and passions, discover new ones.
4. Spend time with yourself, centered, at peace, still.
5. Forget about the house for now.
6. Forget about finances and when to retire for now.
7. Take the family on vacation.
8. Take yourself on vacation.. . as long as it takes.

The solution is not in "buying something".

j :happy
Last edited by Sandtrap on Wed Jul 03, 2019 8:17 am, edited 2 times in total.
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JoMoney
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Re: Staying the course is so hard (support thread)

Post by JoMoney » Wed Jul 03, 2019 8:16 am

ERguy101 wrote:
Wed Jul 03, 2019 7:50 am
... I work more than 300 hours per month ... I want a little more from life than a smaller cramped house and just saving every dollar I earn. It's hard.
I don't know how you have the spare time to be house shopping, let alone live in and take care of a big house, sounds like most of your time is spent somewhere else and you really just need a place to sleep and store your "stuff". Is there a family at home that will at least be enjoying the big house? If there isn't, but there's some chance that might happen, I would hold off on any big housing commitments.
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham

Bayareatechie
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Re: Staying the course is so hard (support thread)

Post by Bayareatechie » Wed Jul 03, 2019 8:22 am

Where is the rest of the $720k income going? It seems like with that type of income you should be able to pay off the current house faster than 13 years.

With that income you should easily be able to afford the new house, but if I were in your position I'd first save up a hefty down payment instead of going further into debt.

bubbadog
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Re: Staying the course is so hard (support thread)

Post by bubbadog » Wed Jul 03, 2019 8:23 am

From one ED doc to another, don't buy the doctor house.

Your 720K/year income can front load the path to financial independence at an incredible rate.

Good luck

Accrual
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Re: Staying the course is so hard (support thread)

Post by Accrual » Wed Jul 03, 2019 8:24 am

Sandtrap wrote:
Wed Jul 03, 2019 8:16 am
Considerations:

1. Work part time - take a break. (put yourself in "time out")
2. Spend more time with family.
3. Rediscover old hobbies and pastimes and passions, discover new ones.
4. Spend time with yourself, centered, at peace, still.
5. Forget about the house for now.
6. Forget about finances and when to retire for now.
7. Take the family on vacation.
8. Take yourself on vacation.. . as long as it takes.

The solution is not in "buying something".

j :happy
I agree. I would also look into hobbies.

Strayshot
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Re: Staying the course is so hard (support thread)

Post by Strayshot » Wed Jul 03, 2019 8:28 am

So you want to stay locked in to working all the time so you can pay for a nice large house that you are never at?

Finance aside, this seems unappealing.

Edited to add that if you are feeling cramped in a 2400 sq ft house you may want to reevaluate your stuff that is taking up space..........
Last edited by Strayshot on Wed Jul 03, 2019 8:30 am, edited 1 time in total.

MiddleOfTheRoad
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Re: Staying the course is so hard (support thread)

Post by MiddleOfTheRoad » Wed Jul 03, 2019 8:30 am

Haven’t you heard? The things to keep up with the Joneses are no longer house or cars. It is health, fitness, travel and financial independence. Get on it!

onourway
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Re: Staying the course is so hard (support thread)

Post by onourway » Wed Jul 03, 2019 8:33 am

Where's your budget? Hard to understand where that huge income is going from the numbers you have given us so far. It sure sounds like you should be able to buy the more expensive house and have it paid off in 5 years or so.

HEDGEFUNDIE
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Re: Staying the course is so hard (support thread)

Post by HEDGEFUNDIE » Wed Jul 03, 2019 8:41 am

A $1M house is not expensive relative to your income.

Much less a Porsche.

blackholescion
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Re: Staying the course is so hard (support thread)

Post by blackholescion » Wed Jul 03, 2019 8:42 am

onourway wrote:
Wed Jul 03, 2019 8:33 am
Where's your budget? Hard to understand where that huge income is going from the numbers you have given us so far. It sure sounds like you should be able to buy the more expensive house and have it paid off in 5 years or so.
Bayareatechie wrote:
Wed Jul 03, 2019 8:22 am
Where is the rest of the $720k income going? It seems like with that type of income you should be able to pay off the current house faster than 13 years.

With that income you should easily be able to afford the new house, but if I were in your position I'd first save up a hefty down payment instead of going further into debt.
OP talked about child support. I wouldn’t at all be surprised if that was another 5k a month because of how much money they make. That plus current mortgage is most likely half their take home. Granted they probably still have 10k+ left after that so it sounds like a large lifestyle but they may also want 10 figures which does take a while to accumulate especially since they most likely started ER about 6-7 years ago after med school.

OP: the house isn’t worth it. You won’t be much happier and it’s probably too big of a house for your current situation. The novelty and shiny will wear off within a year and you’ll look to the next thing. Take it from me. I’m the same way. It’s takes a lot of soul searching to stop chasing the shiny new thing. There are places I still do it, but a massive purchase like this isn’t one to be made on a oooh shiny type whim.

Also as someone who has close friends who pay child support, it doesn’t always end at 18. You may be taken back to court for judgement on paying for college (529) but also college living expenses in college that aren’t covered by the 529 since in these situations the child support receiver usually doesn’t keep the money for long term best interest of the child.

onourway
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Re: Staying the course is so hard (support thread)

Post by onourway » Wed Jul 03, 2019 8:45 am

blackholescion wrote:
Wed Jul 03, 2019 8:42 am

OP talked about child support. I wouldn’t at all be surprised if that was another 5k a month because of how much money they make. That plus current mortgage is most likely half their take home. Granted they probably still have 10k+ left after that so it sounds like a large lifestyle but they may also want 10 figures which does take a while to accumulate especially since they most likely started ER about 6-7 years ago after med school.

OP: the house isn’t worth it. You won’t be much happier and it’s probably too big of a house for your current situation. The novelty and shiny will wear off within a year and you’ll look to the next thing. Take it from me. I’m the same way. It’s takes a lot of soul searching to stop chasing the shiny new thing. There are places I still do it, but a massive purchase like this isn’t one to be made on a oooh shiny type whim.
OP has a sub-$500k mortgage on a $700k income. The current mortgage should hardly be a blip on their expenses. Perhaps they are getting hammered with child support, but I suspect there are big swaths of spending unaccounted for here.

EnjoyIt
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Re: Staying the course is so hard (support thread)

Post by EnjoyIt » Wed Jul 03, 2019 8:48 am

If you make 720k/yr, I don't understand why it will take you 13 years to retire. It should take much less than that unless you are having other budget problems. What are your current expenses, where is all that money going?

BTW, I am very similar to you. Physician, 15 year mortgage, kid, with plans for early retirement. Personally I did not start considering big splurges until I had enough invested to be very close to financially independent. Now that I am there I am evaluating working a bit longer for X or Y. My biggest and most valuable splurge was to cut back to part time work. It has been a blessing for me and my family.

Also, I promise you that a bigger house will not make you happier. In the long run all it will be is more stuff to repair or maintain on your days off.

juliewongferra
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Re: Staying the course is so hard (support thread)

Post by juliewongferra » Wed Jul 03, 2019 8:49 am

ERguy101 wrote:
Wed Jul 03, 2019 7:50 am
Hi all -

I'm trying my best to stay the course. I'm 38, I'd love to retire in 13 years. I say 13 years because my mortgage (15 year bi-weekly payments) finishes then, and thats the same time my kid turns 18, so no more child support, and she'll have a healthy 529 by then. I'm trying to stay the course. I have a very nice house, it's 2400 sq ft, beautiful interior. I have a truck I lease, but will buy at end of lease, then pay cash to pay off.

I'm trying so hard to stay the course.

I've made multiple near mistakes. I almost purchased a Porsche sports car, just for a fun vehicle. I even bought it, then returned it the same day (CarMax.)

I started to try to buy rental property, but the cash flow was so bad I just couldn't justify it. I was able to scratch the itch by investing the same money I would use as a down payment for the property into FRESX. That seems to have helped.

Unfortunately, while looking at rental houses, I came across some beautiful houses for sale in my town. I found one in an old beautiful neighborhood, on a beautiful southern pond. A well known house. Its stunning inside, with hand scraped wood plank floors, high ceilings, gorgeous kitchen, pool, etc. It's a truly amazing house. It's listed at 1.3 million, but could get it closer to 1 million (or 1.1). My house is worth 520, and I have about 150 of equity in it. It's killing me. If I buy this house, the 30 year mortgage would be around 5000/month, and the 15 year would be around 7000-7500 a month (I say 15 year because I'd love to have it paid off by retirement. I don't know how people afford large house payments during retirement.) My current mortgage I pay 1600 every two weeks, this is the accelerated plan to have it paid off in 13 years. So the 30 year mortgage on the 1.1 mil house is only a couple of grand more per month, which isn't bad at all. But the 15 year plan is really a lot more.

So if I bought this house, I would go from owing 520,000 - 150,000 = $370,000 on a house that I'm set to pay off in 13 years, to owing 1,100,000 - 150,000 - 50,000 (extra cash I could throw in) = 900,000. So I would put myself in 900,000 - 370,000 = 530,000 more debt than I am already in, which would be like paying off my existing house 2.5 times in a row. It's easy to see that it would be much nicer to have an extra half a million in retirement. But at the same time I do believe that "you only live once", and why the heck am I working so much if I'm just living in a small house and saving it all for one day when I'm past my prime.

My background: I'm an ER doctor, I work a ton, I work more than 300 hours per month, and I gross around 720,000/yr. I work at easier places, so while the hours seem very long, I have a lot of downtime, and it's not unusual for me to go 6-7 hours on a shift doing nothing. It's just the time away from family that really sucks, but even with that I get about 15 days off per month. I would like to cut back some.

I don't know... I guess I'm asking if buying a much more expensive house is really stupid. I know I should stay the course and not be stupid and fall into the "giant house" trap. But at the same time, I want a little more from life than a smaller cramped house and just saving every dollar I earn. It's hard.
ERguy,

I think you are being too harsh on yourself. It's not "stupid" to want nice things. we all want nice things, We just need to understand that some nice things come at a cost, sometimes, financial, sometimes physical, sometimes time, sometimes opportunity.

I have 2 thoughts for ya:
1) I don't undertsand "I'm just living in a small house and saving it all for one day when I'm past my prime" First of all, if you are in your "prime" now, how would having a bigger house facilitate your prime? Wouldn't you want to live out your prime by taking vacations (Vegas, baby!), going to the gym to tone your body, having fine foods while your senses can appreciate them, etc.? To each her own, and I'm not criticizing the way you want to spend money. I'm just trying to help you better evaluate what a bigger house *means* to you. (Also you will not be an empty husk if you retire at age 51.Maybe not at your prime as you define it, but you will have many opportunities to enjoy life!)

2) Identify your temptations. (Cars and houses, at least, based on your post.) If you want to fight against it, then don't put yourself in a situation to fall to temptation, In other words, son't read car advertisements, don't look at real estate listings, etc. Just stay away.

BUT, if you find that things (houses, cars) are irresistable and it costs more to your emotional health to resist and deny yourself, give in, and go buy it. Understand the "tradeoffs" such as having to work longer hours or more years. But undertsand the benefits too, such as a higher satisfaction of present life. The present value of a happy life is greater than the future value of a happy life, because the present is guaranteed, and the future is not.

Don't beat yourself up. You're not "stupid."

You have my support!

cheers!
jwf
If you aren't familiar with Mr. Bogle and his investment philosophy, then you don't know Jack!

Mr.BB
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Re: Staying the course is so hard (support thread)

Post by Mr.BB » Wed Jul 03, 2019 8:49 am

Sandtrap wrote:
Wed Jul 03, 2019 8:16 am
Considerations:

1. Work part time - take a break. (put yourself in "time out")
2. Spend more time with family.
3. Rediscover old hobbies and pastimes and passions, discover new ones.
4. Spend time with yourself, centered, at peace, still.
5. Forget about the house for now.
6. Forget about finances and when to retire for now.
7. Take the family on vacation.
8. Take yourself on vacation.. . as long as it takes.

The solution is not in "buying something".

j :happy
The solution is not in "buying something". <---The Perfect Prescription
"We are what we repeatedly do. Excellence, then, is not an act, but a habit."

harvestbook
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Re: Staying the course is so hard (support thread)

Post by harvestbook » Wed Jul 03, 2019 8:53 am

I'd sell the 2,400-sf house and buy a 1,200-sf house and try to retire in eight years.
My daughter just finished her first year of college and has spent exactly three nights with us this summer.
I'm not smart enough to know, and I can't afford to guess.

Topic Author
ERguy101
Posts: 151
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Re: Staying the course is so hard (support thread)

Post by ERguy101 » Wed Jul 03, 2019 9:11 am

EnjoyIt wrote:
Wed Jul 03, 2019 8:48 am
If you make 720k/yr, I don't understand why it will take you 13 years to retire. It should take much less than that unless you are having other budget problems. What are your current expenses, where is all that money going?

BTW, I am very similar to you. Physician, 15 year mortgage, kid, with plans for early retirement. Personally I did not start considering big splurges until I had enough invested to be very close to financially independent. Now that I am there I am evaluating working a bit longer for X or Y. My biggest and most valuable splurge was to cut back to part time work. It has been a blessing for me and my family.

Also, I promise you that a bigger house will not make you happier. In the long run all it will be is more stuff to repair or maintain on your days off.

Image

It's those taxes, they're killing me. I'm working on setting up a DBP to save some in taxes, but I already maxed 401k, HSA, Backdoor Roth for this year so the DBP is not very effective this year. I'm trying to save about $20,000/month, which in 13 years should hopefully be multiple million. I feel like I can't retire until my house is paid off, because it's such an expense, and I feel like I can't retire until child support finishes. Question, whats the legal thing with child support if my income goes down, for example if I worked only 144 hours and made significantly less, or if I retired, would child support legally be able to go down?

rj342
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Re: Staying the course is so hard (support thread)

Post by rj342 » Wed Jul 03, 2019 9:14 am

bubbadog wrote:
Wed Jul 03, 2019 8:23 am
From one ED doc to another, don't buy the doctor house.

Your 720K/year income can front load the path to financial independence at an incredible rate.

Good luck
At first I didn't read ED as Emergency Department! :wink:

rj342
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Re: Staying the course is so hard (support thread)

Post by rj342 » Wed Jul 03, 2019 9:18 am

juliewongferra wrote:
Wed Jul 03, 2019 8:49 am
2) Identify your temptations. (Cars and houses, at least, based on your post.) If you want to fight against it, then don't put yourself in a situation to fall to temptation, In other words, son't read car advertisements, don't look at real estate listings, etc. Just stay away.
Stop watching HGTV, etc! They are meant to sell fantasy (to us ordinary folk) but can also stoke envy.

Topic Author
ERguy101
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Re: Staying the course is so hard (support thread)

Post by ERguy101 » Wed Jul 03, 2019 9:19 am

harvestbook wrote:
Wed Jul 03, 2019 8:53 am
I'd sell the 2,400-sf house and buy a 1,200-sf house and try to retire in eight years.
My daughter just finished her first year of college and has spent exactly three nights with us this summer.
Honestly, I thought about this. The rental house I almost bought was like 1600 sqft, all new, beautiful, $230,000. I could have sold my existing house, paid off the new one a few months, and be mortgage free. But I would lose my theater, pool, etc. Things that do make me happy!

stoptothink
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Re: Staying the course is so hard (support thread)

Post by stoptothink » Wed Jul 03, 2019 9:23 am

ERguy101 wrote:
Wed Jul 03, 2019 9:11 am
Question, whats the legal thing with child support if my income goes down, for example if I worked only 144 hours and made significantly less, or if I retired, would child support legally be able to go down?
Wait, so your child support is based upon you working 300hrs/month? I'm certain every state calculates it differently, but that is not how it works here in Utah. It is based on 40hrs; if you have a second job or work overtime, it doesn't count against you. My daughter's birth father works two, barely over minimum-wage, jobs. Our support is calculated is based only on the higher-paying job. We get $42/month (no, there is not a missing zero).

I find it very hard to believe that child support wouldn't go down if you worked less.

Topic Author
ERguy101
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Re: Staying the course is so hard (support thread)

Post by ERguy101 » Wed Jul 03, 2019 9:23 am

bubbadog wrote:
Wed Jul 03, 2019 8:23 am
From one ED doc to another, don't buy the doctor house.

Your 720K/year income can front load the path to financial independence at an incredible rate.

Good luck
Isn't it hard to not "keep up with the Jonses"? All I hear about is Dr Xxx is building a 4000 sq ft home in this neighborhood, or this one is building an even bigger 6000 sqft home. I guess they're just all in debt up to their eyeballs? It is frustrating to hear, but I guess if I can stick to my plan in a little more than a decade I'll be done and they'll still be slogging on. It's interesting though. In the last couple of months a lot of doctors have screwed themselves. One got let go during a hospital merger, he has a 1.4 mil house trying to sell, another one had substance abuse issues, is now let go (he has $2 million in property trying to sell), another ortho got let go, and one who was building a huge house got let go too. So that's something to consider, instability. Ouch.

onourway
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Re: Staying the course is so hard (support thread)

Post by onourway » Wed Jul 03, 2019 9:24 am

ERguy101 wrote:
Wed Jul 03, 2019 9:11 am

Image

It's those taxes, they're killing me. I'm working on setting up a DBP to save some in taxes, but I already maxed 401k, HSA, Backdoor Roth for this year so the DBP is not very effective this year. I'm trying to save about $20,000/month, which in 13 years should hopefully be multiple million. I feel like I can't retire until my house is paid off, because it's such an expense, and I feel like I can't retire until child support finishes. Question, whats the legal thing with child support if my income goes down, for example if I worked only 144 hours and made significantly less, or if I retired, would child support legally be able to go down?
This is a good start, but it's nowhere near complete. Where are groceries, dining out, home maintenance and repair, fuel, medical, clothing, gifts, giving, personal spending, entertainment, kids activities and other costs? And so on?

Your house isn't a major expense right now. It's less than 10% of your net income. If paying off your home is a priority, you could have it done in 2 years while still saving $75k/year into tax-advantaged accounts.

Even child-support should be a non-issue. It's far, far less than I would expect given your income. I've seen close to those numbers for people on a tiny fraction of what you earn.

If you want this house, you can easily afford it. Now I don't think you necessarily need it - and I wonder what you would do with all that space (sounds like you are currently single?) with a kid who is nearly grown. But you can afford it. The question is whether it's worth it to you to work a couple-few years longer to have it.

bubbadog
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Re: Staying the course is so hard (support thread)

Post by bubbadog » Wed Jul 03, 2019 9:26 am

rj342 wrote:
Wed Jul 03, 2019 9:14 am
bubbadog wrote:
Wed Jul 03, 2019 8:23 am
From one ED doc to another, don't buy the doctor house.

Your 720K/year income can front load the path to financial independence at an incredible rate.

Good luck
At first I didn't read ED as Emergency Department! :wink:
Department not dysfunction!

The emergency department has many rooms. :happy

Topic Author
ERguy101
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Re: Staying the course is so hard (support thread)

Post by ERguy101 » Wed Jul 03, 2019 9:29 am

stoptothink wrote:
Wed Jul 03, 2019 9:23 am
ERguy101 wrote:
Wed Jul 03, 2019 9:11 am
Question, whats the legal thing with child support if my income goes down, for example if I worked only 144 hours and made significantly less, or if I retired, would child support legally be able to go down?
Wait, so your child support is based upon you working 300hrs/month? I'm certain every state calculates it differently, but that is not how it works here in Utah. It is based on 40hrs; if you have a second job or work overtime, it doesn't count against you. My daughter's birth father works two, barely over minimum-wage, jobs. Our support is calculated is based only on the higher-paying job. We get $42/month (no, there is not a missing zero).

I find it very hard to believe that child support wouldn't go down if you worked less.
I'm honestly not sure. The child support was done when I was working 144 hours (full time) at another ER, but the ER paid more per hour. We went to an arbitrator person to just hash out the details without any court involvement. I would have been paying more according to the tables that are available (if you google your state name child support tables.) I went from 144 hours to 300 hours just in the last year, and I make less per hour, but much more overall now. The 2800 was probably underpaying what I technically would owe if I went to court for back then. I would owe even more now, but no one is keeping track of that, because it was never court ordered. We just agreed to it (this was in my advantage.) I just hope she marries someone rich and they don't want my payments.

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Re: Staying the course is so hard (support thread)

Post by surfstar » Wed Jul 03, 2019 9:29 am

ERguy101 wrote:
Wed Jul 03, 2019 9:19 am
harvestbook wrote:
Wed Jul 03, 2019 8:53 am
I'd sell the 2,400-sf house and buy a 1,200-sf house and try to retire in eight years.
My daughter just finished her first year of college and has spent exactly three nights with us this summer.
Honestly, I thought about this. The rental house I almost bought was like 1600 sqft, all new, beautiful, $230,000. I could have sold my existing house, paid off the new one a few months, and be mortgage free. But I would lose my theater, pool, etc. Things that do make me happy!
We live in a less than 1200 sq ft house - I can't imagine a single person needing 2400 sq ft. But if those things make you happier than retiring in half the time, enjoy! Seems like if you downsized your expenses you could retire in 5 years, if you desired.

You have the financial freedom to decide - what makes you happy? A big house, fancy car, etc? Free time? You can choose what to prioritize. Good luck on the journey.

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Re: Staying the course is so hard (support thread)

Post by bloom2708 » Wed Jul 03, 2019 9:34 am

Buying stuff won't make you happy/content. You get a momentary blip and then soon return to "what should I buy next?".

It is exhausting. To do and to watch. If you were an outsider and read your own post you would probably start with "STOP". Shopping and buying stuff isn't the answer.

https://www.theminimalists.com/

https://dailystoic.com/

You don't have to become a true minimalist, but the tenants are sound. Sign up for the Daily Stoic email and get a daily reminder of how to be less everything.

Good luck!
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EnjoyIt
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Re: Staying the course is so hard (support thread)

Post by EnjoyIt » Wed Jul 03, 2019 9:53 am

ERguy101 wrote:
Wed Jul 03, 2019 9:11 am
EnjoyIt wrote:
Wed Jul 03, 2019 8:48 am
If you make 720k/yr, I don't understand why it will take you 13 years to retire. It should take much less than that unless you are having other budget problems. What are your current expenses, where is all that money going?

BTW, I am very similar to you. Physician, 15 year mortgage, kid, with plans for early retirement. Personally I did not start considering big splurges until I had enough invested to be very close to financially independent. Now that I am there I am evaluating working a bit longer for X or Y. My biggest and most valuable splurge was to cut back to part time work. It has been a blessing for me and my family.

Also, I promise you that a bigger house will not make you happier. In the long run all it will be is more stuff to repair or maintain on your days off.

Image

It's those taxes, they're killing me. I'm working on setting up a DBP to save some in taxes, but I already maxed 401k, HSA, Backdoor Roth for this year so the DBP is not very effective this year. I'm trying to save about $20,000/month, which in 13 years should hopefully be multiple million. I feel like I can't retire until my house is paid off, because it's such an expense, and I feel like I can't retire until child support finishes. Question, whats the legal thing with child support if my income goes down, for example if I worked only 144 hours and made significantly less, or if I retired, would child support legally be able to go down?
Just a few pieces/quibbles.

401k max is $56k in 2019.
HSA max is $7k in 2019 for a family plan.

Yes, if you are an independent contractor which I assume you are considering your 401k, a DBP is a great idea to cut down on taxes.

Your budget is missing a few key items such as food, health insurance, travel, discretionary expenses. Let us just lump those up as another $5k/month which should allow you to save $22,500 per month or $270k/yr. In retirement you won't need disability insurance or life insurance saving you $900/month. Your child support will plummet as well. You don't necessarily have to get rid of the mortgage before you retire and believe me, at your current savings rate, in 10 years the mortgage will not be that large or much of a concern especially when you are sitting on well over $2.5 million invested.

Back to your question at hand. How do you avoid lifestyle creep when everyone around you is living the good life? Believe it or not, it is not that hard when you start understanding the value of the things you buy. Look around your own home and see some of the trinkets and gadgets you bought over the years that just sit there and take up space. This is what conspicuous consumption looks like. Buying things and not realizing how little value they have. remind yourself of the docs around you who are struggling because of poor consumer choices. Do you think they are happy, or are they struggling to make ends meet?

You just started on your path to wealth building. Give it a couple of years, try and study happiness and what makes you happy. What items or experiences bring you real joy as opposed to buying garbage that sits around and does nothing useful. Basically I recommend you learn yourself. It takes years to get a grasp on these things if you consciously make an effort to do so. Most people never attain that knowledge and continuously waste money. Money which they work so hard to earn. In the mean time, set aside some cash every month to waste. When using it, try and learn from those expenditures to see if they are worth it once in your possession for a few weeks/months.

Then, after 3-4 years and $1million+ wealthier, and much wiser, decide if a bigger house is worth it for you.

Good luck

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Re: Staying the course is so hard (support thread)

Post by HomeStretch » Wed Jul 03, 2019 10:45 am

Your budget, which include 401k/HSA savings of ~ $5k/mo., shows an excess of ~ $27k/mo. You are targeting to save $20k/mo. It’s not clear if the $20k includes the $5k or is in addition to it. Either way, there are ~ $7k - $12k/mo of expenses/spending missing from your budget.

Perhaps there is room to cut the spend so you can pay off current home sooner/retire earlier OR buy new house/retire on same timeline.

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Re: Staying the course is so hard (support thread)

Post by delamer » Wed Jul 03, 2019 11:03 am

In my neck of the woods, a $1.3 million house would be considered expensive but not uncommon. I’d be very hesitant to buy a house at that price in an area where there was a very small market for homes of that price (don’t know if that is your situation).

With that said, if you want the house then buy it. But plan to downsize to a home that you can purchase with your equity when you are ready to retire. I know someone who is in the process of doing that now, just at a lower price point — buying a new $325,000 house free-and-clear with the equity in their current $550,000 home.
Last edited by delamer on Wed Jul 03, 2019 11:08 am, edited 1 time in total.

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Re: Staying the course is so hard (support thread)

Post by visualguy » Wed Jul 03, 2019 11:07 am

bloom2708 wrote:
Wed Jul 03, 2019 9:34 am
Buying stuff won't make you happy/content. You get a momentary blip and then soon return to "what should I buy next?".
This is kind of true, but not entirely... A nicer home does make a pretty big and persistent difference in quality of life for many. Also, things that you use regularly like computer/monitor, phone, car to some extent (but without going crazy), sound system and home theater (if you listen to music and watch moves), etc.

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Re: Staying the course is so hard (support thread)

Post by KBREAMK » Wed Jul 03, 2019 11:10 am

I just finished the book "Decisive" by the Heath brothers. One of the things they preach is to "widen your options." So, instead of thinking of your situation in binary terms (i.e. to buy the house or not buy the house) how about throwing in some other options such as "buy a bigger house that still allows me to maintain my long term retirement plans."

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Re: Staying the course is so hard (support thread)

Post by LFKB » Wed Jul 03, 2019 11:23 am

ERguy101 wrote:
Wed Jul 03, 2019 9:11 am
EnjoyIt wrote:
Wed Jul 03, 2019 8:48 am
If you make 720k/yr, I don't understand why it will take you 13 years to retire. It should take much less than that unless you are having other budget problems. What are your current expenses, where is all that money going?

BTW, I am very similar to you. Physician, 15 year mortgage, kid, with plans for early retirement. Personally I did not start considering big splurges until I had enough invested to be very close to financially independent. Now that I am there I am evaluating working a bit longer for X or Y. My biggest and most valuable splurge was to cut back to part time work. It has been a blessing for me and my family.

Also, I promise you that a bigger house will not make you happier. In the long run all it will be is more stuff to repair or maintain on your days off.

Image

It's those taxes, they're killing me. I'm working on setting up a DBP to save some in taxes, but I already maxed 401k, HSA, Backdoor Roth for this year so the DBP is not very effective this year. I'm trying to save about $20,000/month, which in 13 years should hopefully be multiple million. I feel like I can't retire until my house is paid off, because it's such an expense, and I feel like I can't retire until child support finishes. Question, whats the legal thing with child support if my income goes down, for example if I worked only 144 hours and made significantly less, or if I retired, would child support legally be able to go down?
1. You need to include all your expenses to get a clear picture
2. You need to have a number in mind for retirement. What is that number and what do you plan to spend in retirement?
3. Then you can do some simple modeling, and determine what your expected retirement age is based on the current house or the new house based on various return assumptions
4. If you do this, my guess is you’ll be able to afford the new house and still retire in a reasonable timeframe if your i come and other expenses hold

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Re: Staying the course is so hard (support thread)

Post by bloom2708 » Wed Jul 03, 2019 11:29 am

visualguy wrote:
Wed Jul 03, 2019 11:07 am
bloom2708 wrote:
Wed Jul 03, 2019 9:34 am
Buying stuff won't make you happy/content. You get a momentary blip and then soon return to "what should I buy next?".
This is kind of true, but not entirely... A nicer home does make a pretty big and persistent difference in quality of life for many. Also, things that you use regularly like computer/monitor, phone, car to some extent (but without going crazy), sound system and home theater (if you listen to music and watch moves), etc.
I'll stick with kinda true. :wink: An ER doc who has a beautiful 2,400 sq ft house (who works all the time and is never home) will likely get the exact same enjoyment out of a beautiful 5,000 sq ft house. If you are not in 2,400, why not not be in 5,000?

These things are diametrically opposed to his desire to retire early. Toss out the "retire early" part and spend whatever on whatever. Have 2 or 3 $1,000 truck leases. At $720k income, the world shopping market is your oyster. Unless you want to save a bunch and retire early. :wink:
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Re: Staying the course is so hard (support thread)

Post by mrspock » Wed Jul 03, 2019 11:55 am

2400sqft is *not* a small house IMO :) . On some level, I empathize with your situation as I'm in a similar situation, with big spending peers around me. But it's exactly *this* you need to overcome. That "thing" you are feeling? Yearning perhaps? It's called gratification...and it's what you need to "delay", aka "delayed gratification", and yes it can be super hard at times. Here's some things which help me:

1. You are looking at the wrong houses: I look at "house porn" in my target retirement destinations (Hawaii, Florida, Colorado mountains, coastal California et). It's not some house in my area I want to retire to, it's THERE. If I blow money on useless things, it puts me further from that goal. In other words, keep your eye on the ball.

2. When you feel the urge to purchase cars, houses, etc, calculate how many days/years you are tacking onto your retirement date. Is it worth an extra year? Two? Five? Then go for it, but be crystal clear on the consequences of your decisions (i.e. opportunity costs). Also, it's not a 100k car at 38, it's more like a 250k car (12 year opportunity cost), or 550k car (22 year opportunity cost) by time you hit 60. Buying expensive cars is far smarter when you are older as the opportunity costs are far less.

3. I look at how far I've come by "staying the course". Schwab has this amazing graph that shows my financial journey which started some 4.5 years ago. By staying the course and following Boglehead principals, it's changed my life and given me something worth far more than houses or cars: freedom.

4. Be mindful of "hedonic equilibrium", the house or car is a really really expensive way to boost your happiness for about a month or two. After that you'll revert back to baseline, meaning whatever you are feeling now, is likely to come back. Instead, reward yourself for your discipline and take a vacation to that place you've always wanted to go or buy something which enables a new hobby (perhaps a new camera, or workout gear, climbing gym membership etc). Also, when on vacation, let loose with the wallet a bit, spend a bit more freely, wine & dine, enjoy life.

Good luck, you aren't alone!

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Re: Staying the course is so hard (support thread)

Post by fposte » Wed Jul 03, 2019 12:16 pm

ERguy101 wrote:
Wed Jul 03, 2019 9:23 am

Isn't it hard to not "keep up with the Jonses"? All I hear about is Dr Xxx is building a 4000 sq ft home in this neighborhood, or this one is building an even bigger 6000 sqft home.
An important trick is to change up your Joneses :D. Seriously, an advantage of reading Bogleheads is to get regularly exposed to people who make long-term rather than short-term choices with their money.

I bet also you could change up your listening. I suspect there are a few people not talking about their new 4000 square foot houses, because that's not what they're doing with their money. Just because the flashy house people are the loudest noise doesn't mean you have to listen only to them. Are there co-workers you admire who aren't building McMansions? Give them salience in your mind as well.

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Re: Staying the course is so hard (support thread)

Post by visualguy » Wed Jul 03, 2019 12:33 pm

Houses can be sold, and they typically appreciate in the long run - they aren't exactly consumption...

It's all about balance in my view. Don't go to extremes with frugality or with high spending. The same with early retirement. Don't go too extreme with that, and maybe stay employed at fewer hours instead of bailing out altogether.

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Re: Staying the course is so hard (support thread)

Post by mrspock » Wed Jul 03, 2019 12:39 pm

visualguy wrote:
Wed Jul 03, 2019 12:33 pm
Houses can be sold, and they typically appreciate in the long run - they aren't exactly consumption...

It's all about balance in my view. Don't go to extremes with frugality or with high spending. The same with early retirement. Don't go too extreme with that, and maybe stay employed at fewer hours instead of bailing out altogether.
Good points, especially about not bailing altogether. I envy doctors, they can move to part time, and their talents are usually in MORE demand in that various retirement destinations. This makes for a pretty sweet glide path to full retirement. We tech folks have it OK too, but we work from home gigs are a bit harder to find and part-time work very rare.

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Re: Staying the course is so hard (support thread)

Post by Hamberders » Wed Jul 03, 2019 1:11 pm

What kind of truck are you leasing for $985 a month? A Mercedes G-wagon? You can lease a Toyota Tacoma for much less. It’s a reliable truck that transcends the pettiness of superficial socioeconomic judgements, and doesn’t ostentatiously project wealth.

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Re: Staying the course is so hard (support thread)

Post by rj342 » Wed Jul 03, 2019 1:32 pm

ERguy101 wrote:
Wed Jul 03, 2019 9:23 am
bubbadog wrote:
Wed Jul 03, 2019 8:23 am
From one ED doc to another, don't buy the doctor house.

Your 720K/year income can front load the path to financial independence at an incredible rate.

Good luck
Isn't it hard to not "keep up with the Jonses"? All I hear about is Dr Xxx is building a 4000 sq ft home in this neighborhood, or this one is building an even bigger 6000 sqft home. I guess they're just all in debt up to their eyeballs? It is frustrating to hear, but I guess if I can stick to my plan in a little more than a decade I'll be done and they'll still be slogging on. It's interesting though. In the last couple of months a lot of doctors have screwed themselves. One got let go during a hospital merger, he has a 1.4 mil house trying to sell, another one had substance abuse issues, is now let go (he has $2 million in property trying to sell), another ortho got let go, and one who was building a huge house got let go too. So that's something to consider, instability. Ouch.
Sounds to me like you just answered your question -- its not always rosy even for a doctor.

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Re: Staying the course is so hard (support thread)

Post by DonIce » Wed Jul 03, 2019 2:18 pm

ERguy101 wrote:
Wed Jul 03, 2019 7:50 am
Unfortunately, while looking at rental houses, I came across some beautiful houses for sale in my town. I found one in an old beautiful neighborhood, on a beautiful southern pond. A well known house. Its stunning inside, with hand scraped wood plank floors, high ceilings, gorgeous kitchen, pool, etc. It's a truly amazing house. It's listed at 1.3 million, but could get it closer to 1 million (or 1.1). My house is worth 520, and I have about 150 of equity in it. It's killing me.
I don't get it. Why do you want this house? You work 300+ hours per month you said, so you will literally never get to cook in the gorgeous kitchen, never get to swim in the pool, never get to admire your scraped wood plank floors. If I worked 300+ hours/month, I would live in a 500 sqft 1-bedroom apartment located a 2 minute walk from work.

Spend the extra money on things that save you time (i.e. "buy back your time"). Bigger house just means more time cleaning it and keeping it presentable. Smaller house is easier to deal with. If you want to splurge, hire a cook, janitor, groundskeeper, etc. These services will free up your time to pursue activities you enjoy.

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Re: Staying the course is so hard (support thread)

Post by michaeljc70 » Wed Jul 03, 2019 6:19 pm

You came across a well known house that costs $1.3 million while looking for rentals? :shock:

Of course, you can afford it. Your current house is less than your annual salary which is pretty unusual (at least in the general population).

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Re: Staying the course is so hard (support thread)

Post by willthrill81 » Wed Jul 03, 2019 7:25 pm

You really, really, really need to go check out the White Coat Investor website. Jim is a poster here, and he offers fantastic advice for docs.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: Staying the course is so hard (support thread)

Post by MTF » Wed Jul 03, 2019 8:24 pm

I'd buy the house. Granted, we don't have the full financial picture, and you have an early retirement goal, but I can't understand why someone earning more than $700k a year should not buy a house for $1m or $1.1m. With the equity in your current house, and spare cash, it is only a little more than a year's gross income. That is affordable on any sensible metric. You only live once. And you could always sell and downsize when you retire.

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Re: Staying the course is so hard (support thread)

Post by tesuzuki2002 » Wed Jul 03, 2019 8:39 pm

What do you really value?


I give up things all the time because I'd rather have the flexibility in a few more years (early 40s) to not work if I don't want to. My portfolio as of now will sustain me as of now... but I'm sure we'll experience some economic instability in the coming year... I'd like to ride thru that storm and then know I'll be fine coming out of that one.

I value my time... on my schedule.. not someone else's

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Re: Staying the course is so hard (support thread)

Post by Elsebet » Wed Jul 03, 2019 9:38 pm

"The things you own end up owning you."
"...the man who adapts himself to his slender means and makes himself wealthy on a little sum, is the truly rich man..." ~Seneca

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