Today we continue our Chasing Fire interview series (<- click the link to see all interviews in this series). I have always enjoyed reading and listening to interviews to learn how people got to where they are, so as to learn from the successes and failures of others. Each individual’s story and path is unique, and we can certainly gain insights from those generous enough to share their stories.
My job as the host is to find interesting people that will inspire and motivate you, as well as myself. I plan to share one high-quality interview per month (maybe even less frequently) and the questions may change over time. I anticipate this to be an iterative process and I would love your feedback in the comments (or via email: email@example.com).
If you’d like to be considered for an interview, drop me a note (see email address above) and we can chat about specifics.
You may have noticed from the first two interviews that I’m trying to pull stories from those that are early in their journey (Zach our very own FIRE Starter) as well as from others that are much further along (Max, a higher earning multi-millionaire). The goal is to alternate every other interview in this fashion (the best that I can).
Today’s guest is MD from Millionaire Doc. MD started out as a reader and regular commenter of this blog before eventually being inspired to start his own blog. I’m glad he did because he has added another unique perspective to this whole Financial Freedom community. You probably deduced by the name of MD’s blog that he is a doctor. MD believes the following (borrowed from his own about page):
“To be truly rich in life, you need to invest in all aspects of your life: money, family, friends, health, and relationships. These are the essential ingredients that make for a truly rich life. You also need to have the right millionaire mindset – to always be learning and improving. There are many roads to wealth, and no right or wrong way.”
MD, the floor is yours – take it away!
OVERVIEW – Who are you?
Tell us about yourself: Who are you and what do you do? What is your story? How are you fighting for your Freedom? Where did you start, where in the journey are you, and where do you ultimately want to end up? (Demographics are great: age, marital status, family, career, education.)
Thanks for having me, Dom. It’s a pleasure to be here. I am a mid-career physician in my forties. My medical specialty is radiology and I work in a private group practice in Northern California.
I was born and raised in Northern California in the heart of Silicon Valley. I attended college in Southern California and medical school in Pennsylvania. I went on to complete my medical residency and fellowship in Southern California. I joined my current group after training and I’ve been with the group for around fifteen years. I am married and have two kids- one in middle school and the other in grade school. We also have a dog, a bird, two chickens, and a bearded dragon in residence.
My goal is to become financially independent in my early fifties but still continue to work by choice. So I am working toward the FI part of FIRE.
What is your favorite Quote or Mantra that you live by?
Happiness is not in the mere possession of money; it lies in the joy of achievement, in the thrill of creative effort. — Franklin D. Roosevelt.
Money is just a tool. For me, it’s not the end goal. Even if you have all the money in the world, you still need to live your best life.
What is your routine like? Are you a morning or a night person? What time do you wake up and go to sleep?
At this stage of my life, most of my schedule revolves around work and kids. Boring, I know, but I try to be the involved dad. I usually wake up around 6:15 to get the kids ready for school. I drop them off at 7:30 and I’m at work by 8 am.
I get out of the office by 5 to 5:30, fight traffic to pick up the kids at whatever activity they are at that day then be home for dinner by 6-6:30. After dinner, the kids sometimes have some other sports activity, tutoring, or music lesson so I usually take them and we are back home by 8-8:30. Then I help kids with homework and get them ready for bed. Lights out for the kids is around 9:30 p. I’ll tidy up around the house a bit, and then I’ll work again until midnight (administrative duties and side hustles) and be in bed by midnight to 1 am. I think I am naturally a night person.
FINANCIAL – It’s all about the Benjamins!
How do you earn your living (industry, position, annual income, where you started and how you’ve climbed the ladder, etc)?
I work in a private medical group practice. Our salary is based on how much volume we do each year. Annual income averages around $300-325K. We also have a group retirement plan that adds $55k a year. I started as an associate and made partner after two years. Salary has been flat since then but that’s to be expected in the medical field.
Do you have any side hustles? (how much do you make at those?)
I do have a side hustle which is a teleradiology moonlighting gig I do from home in the evenings. One of my radiology friends has a contract and I help read cases a couple times a week. It’s a convenient way to boost my income. Depending on how hard I work, I can make an extra $50-80K a year.
I also run a physician finance blog where I write about personal finance for high income professionals. I cover a wide range of topics ranging from real estate investing to physician burnout. The income I make is minimal and not even worth mentioning. It’s more of a passion project at this point.
What percentage of your after-tax income do you save?
I currently save around 10-15%. It used to be higher at around 20%. We live in an ultra high cost of living area with high expenses including two kids in private school. We used to save much more before kids. My work does have a retirement plan and I have a separate self-directed solo 401K. I put away a combined $80-100K pretax each year into those accounts.
What is your net worth comprised of (i.e., Real Estate, Stocks, Bonds, etc)? And what platforms do you use (i.e., TD Ameritrade for stocks, Rich Uncles for Real Estate, etc.)? Why?
My net worth is heavily skewed towards real estate. If I include my primary residence, my home is almost half of my net worth. (skyrocketing home prices in Silicon Valley will do that). If I leave my primary residence equity out of the net worth equation, my investable assets break down like this:
35% equities (index funds)
20% single family rental
21% real estate syndication/ private equity funds/ crowdfunding
3% college 529
I use Vanguard for my taxable account, rollover IRA, Roth IRA, and 529 accounts. I have another IRA at T. Rowe Price.
I have a self-directed 401K and I use that to invest in real estate syndication/funds/crowdfunding. I source some commercial real estate deals through RealCrowd and CrowdStreet. I’ve tested other crowdfunding sites in the past but don’t use them anymore and I can’t recommend them. As I get more experienced and continue to build up my network, I source more deals offline now. I favor real estate funds over individual syndicated deals because funds provide more diversification.
Cash is split between online savings account and Vanguard money market account.
When it comes to building wealth, do you spend more time figuring out how to cut expenses or increase income? Why?
I definitely spend more time on increasing income. It comes down to mindset – abundance versus scarcity. I used to have the scarcity mindset but as I’ve become more financially educated (reading books, blogs and podcasts), I’ve adopted the abundance mindset. In the beginning when you are just getting started, brute force savings is important. You need that delta between earning and spending to be as large as possible. Then it’s about investing wisely and getting the highest risk-adjusted returns.
What is your definition of Financial Freedom? Do you differentiate Financial Independence from Financial Freedom? If so, can you explain? And what is your FREEDOM number($)?
To me, the terms are synonymous. I guess if I were to split hairs, Financial Independence means not being dependent on a W-2 job to pay your bills. That is, having enough tucked away in savings and investments to cover your basic expenses without having to trade your time for money. So that would be housing, food, clothing, transportation, health care, insurance, and child care.
Financial Freedom implies taking control and being free; free to do whatever you want. To me it’s about having 100% control of your time and living your best life. So having enough to pay your basic living expenses, and also having enough do whatever makes you happy, (within reason of course). That may mean traveling, donating to charity, buying a Lambo, etc.
My financial independence number would be around $5 million with a mortgage and $3 million without.
My financial freedom number would be around $8 million. At that level, I’d take a world cruise.
What is the best financial decision you have ever made?
The best financial decision was choosing my career as a physician. I went into medicine with an altruistic mindset. I knew I would be comfortable financially but I wasn’t going to be outrageously wealthy by practicing medicine. I chose to be a specialist rather than becoming a general practitioner. Specialist physicians typically make more than generalists. Becoming a physician is a safe route – as long as you don’t mess up royally, most physicians will earn high incomes after residency and have good job security. The same can’t be said for other career paths. Having a high income enabled me to save and build a pile of money to invest. My income is high enough to qualify me as an accredited investor which allows me to access private syndication and private equity investments.
RECREATION – What do you do for fun?
How many hours a week do you watch TV? Favorite show(s)?
I don’t watch TV regularly anymore. However, I am eagerly anticipating the final season of Game of Thrones.
What is your beverage of choice?
I like a strong cup of joe or a cappuccino. My body runs on caffeine.
What movie – if any – have you seen more than once?
I love all movies so it’s hard to pick one. I end up watching a lot of animation and superhero movies with my kids. For myself, I just watch DVDs because it is too much work to go to the movies with my wife (getting childcare, carving time out of our busy schedule, etc). We end up watching a DVD over two or more nights because invariably my wife will fall asleep in the middle. My all time favorite is probably The Shawshank Redemption. I’ve watched all the original Star Wars films like 20 times each. Now, I just put all the Oscars and Golden Globe nominees in my Netflix queue. I just finished Roma and I loved it.
Do you like to travel? Describe your last vacation. Describe your dream vacation.
I love traveling and I used to do more of it before we had kids. Now, we are limited to weeks when the kids are out of school, which is also when everyone else wants to travel as well. That makes everything more expensive and crowded. The last big trip we took was to Costa Rica last year. We created our own custom itinerary through a tour operator and visited Arenal, Monteverde, and the Guanacaste. It was cool to see South America’s natural beauty and the kids loved the wildlife. At some point, I’d like to do a culinary tour of France and visit Australia. Those will have to wait until we have an empty nest.
What other activities do you enjoy?
I enjoy skiing with my family. I didn’t pick up the sport until later in life when my kids started taking lessons. I’d say I’m now an intermediate level skier and I can get down the blue runs without breaking my neck. I also enjoy working out at the gym.
My wife and I try to go out for date nights once in a while and try new restaurants in the area. Once or twice a year, we’ll escape from the kids and head to Napa Valley for some wine tasting and R&R.
MORE – Tell us your secrets!
What are you really good at? What is your “Super Power?”
I’d say that I am very average and not really good at anything. But I’m naturally curious. I like to learn about things that interest me. If I don’t know an answer, I’ll look it up. And that usually leads to more questions than answers. For example, I was curious about investing in litigation finance so I did a bunch of research and made a test investment. I recently wrote a blog post about it. Also, I don’t give up easily. Once I commit to an endeavor, I try to see it through.
What about you do most people not know?
Other than my wife, no one knows I have a blog.
What is the best piece of advice you have ever received?
My father used to tell me that talent and intelligence will only take you so far. You also need to work hard and be persistent to be successful. Also, there is a reason God gave us two ears and one mouth… listen more, speak less. And lastly, be generous with your time and your resources.
What is the worst financial decision you have ever made?
I dabbled in individual stocks during the Dot-com bubble. Remember Enron? Tyco? Yeah, I bought those. I didn’t lose that much in absolute dollar amounts but it taught me the lesson that I had no idea what I was doing.
What was your biggest surprise, financially or otherwise?
Kids are expensive. I thought that after preschool, the big childcare expenses were done with and expenses would drop. But I’m not seeing that as the case. In my area, people take academics and college prep very seriously and devote a lot of resources to it. It can turn into a bit of an arms race to get your kids ahead. We’re talking private schools, travel sports teams, private coaches, tutors, lessons, after-school and summer camps, etc. A thousand bucks here, a thousand bucks there times two kids really adds up quick. College admissions is much more competitive than what it was in my day. And all of this is starting earlier in elementary and middle school. All of this is by choice of course, but in my locale, things are skewed upwards. I live in an area populated by really smart and high achieving professionals who work at Apple, Google, and Facebook. They expect their kids to be the same and will go to great lengths to make sure that happens. It seems like kids need to be professionally packaged and marketed to be competitive for a top notch school. I want to just take my kids off the college prep treadmill but then you look around and see everyone else passing you by. You want the best for your kids, but at some point it gets to be too much.[GYFG Here: A great book I recently read on this very topic as I continue educating myself as a father is “How to Raise an Adult: Break Free of the Overparenting Trap and Prepare Your Kid for Success.” I think you might enjoy it.]
Who and/or what has influenced you most in life, positively or negatively?
I saw my father work really hard when I was growing up. I think I adopted his work ethic which helped me get to where I am today. On the flip side, since he was always working, I didn’t get to see much of him as a kid. Once I had children of my own, I made it a point to make sure I would not be an absentee father. I made conscious decisions to achieve a good work-life balance.
I listen to Keith Weinhold who is a real estate investor and podcaster (Get Rich Education). One thing he said really stuck with me.
“Don’t let your dreams die. Most people end up working at a job they dislike for decades, hoping to have enough to retire and finally live their dream life. How much is your employer paying you to let your dreams die? Most people let their dreams die by the time they are 25. And when your dreams die, you die. You’re just not buried until you turn 85.”
What does “living life by design” look like to you, in terms of a typical day, week, month, year…? What, if anything, is holding you back from living life by design?
Being a physician is part of my identity and work will always be a part of my life. My ideal life would be working part-time, perhaps 3 days a week at the office. Then the rest of the time I’d do other things that interest me. This would include volunteer work, reading, blogging, investing, and traveling. I’m not financially independent yet but I can see myself transitioning to part-time in about 10 years.
PARTING ADVICE & WHERE WE CAN FIND YOU
What advice would you give to a reader who is 25-35? How about 45-55?
It depends on your personality. For the younger readers, if you are conservative and don’t like taking risks, start saving early, regularly, and invest in index funds. Over time, through the power of compounding, and dividend/capital gain reinvestment, you should have a nice nest egg. For those who are more aggressive and willing to take more risk, start a business or invest in real estate. That’s the only way to get to next-level wealth. Create a business that adds value or solves a problem.
For those 45-55, maximize your income. Keep saving and investing as much as you can. At some inflection point, your investments will earn more than your savings rate. That’s what I call escape velocity and your wealth starts to take off. Getting to that point is hard. It takes discipline and sacrifice, but don’t give up.
Create multiple streams of income so if you lose your job, you have other options to fall back on. Don’t be 100% dependent on your job. If you are an accredited investor, learn about alternative investments like commercial real estate syndications and private equity funds. Learn how to minimize your tax bill. As you get closer to retirement, shift from wealth creation to wealth preservation.
What book do you most frequently recommend?
Grit: The Power of Passion and Perseverance by Angela Duckworth
How to Be a Power Connector: The 5+50+100 Rule for Turning Your Business Network into Profits by Judy Robinett
Secrets of the Millionaire Mind by T. Harv Eker
Rich Dad Poor Dad and Cashflow Quadrant by Robert Kiyosaki
What are the top five personal finance blogs (or podcasts) you read regularly? Why those in particular?
Financial Samurai – Sam covers financial topics for high income professionals.
The White Coat Investor – Jim Dahle’s blog covers personal finance as it specifically relates to physicians.
Retire By 40 – Joe has a very personal and relatable blog about life as a stay at home dad.
Side Hustle Scrubs – Funny as hell ER doc writing about medicine and life.
Get Rich Education
Wealth Formula Podcast
The Real Estate Guys
The RealCrowd Podcast
Where can we find you online? If you’re a blogger, this is the perfect place to plug to your blog and tell us why it’s great
I can be found at Millionairedoc.com. You can also follow me on Twitter here. I blog about personal finance, alternative investments, doctoring, and life in general. There are plenty of sites that talk about saving, earning, and investing. I try to differentiate my site by covering issues related to high income and high net worth individuals. Part of the mission is to uncover the secrets of the wealthy and discover how they get ahead. One of the goals is to share ideas and strategies which are not necessarily mainstream; I figure that if I am interested in a topic, there must be others that are too. So far, the blog has been a fun and educational experience for me.
Thanks for having me on the blog!
I’m a fan of Millionaire Doc and thank you for featuring him on this great series.
MD is right, kids are very expensive, but they are indeed worth it. It does seem like we are trying to package and market them for college which adds a lot of expense to the equation.
I too have tilted my portfolio towards real estate and found MD’s site to be a great resource.
Thanks Xrayvsn. It think for most people, having kids (especially in a HCOLA), makes FIRE very difficult. I’m not hanging up my x-ray vision anytime soon;)
It was a privilege to be interviewed on your inaugural post of X-ray Beam series as well.