MtoM #10 - Millionaire 5 years Post Residency

This is the White Coat Investor podcast, Milestones to Millionaire.

Celebrating stories of success along the journey to financial freedom.

Here is your host, Dr. Jim Dali.

This is Milestones to Millionaire podcast number 10, Millionaire, four years post residency. I'm having a lot of fun with these podcasts. Not quite as much fun as I'm having when I'm not on the podcast. As you're listening to this, I'm preparing to launch down the Grand Canyon. So I'm excited about that rafting trip coming. Coming up. I launch two days from when this podcast drops. But if you're excited about Milestones to Millionaire, you can actually be on this. Just sign up whitecoatinvestor.com milestones and if you have achieved a financial milestone, paid off a debt, student loans, mortgage, whatever.

Heck, you got rid of your credit.

Card debt, I don't care, we'll put you on the podcast. If you've reached a net worth milestone, we'll put you on the podcast. If you're financially independent or you got public service loan forgiveness, we'll put you on the podcast. Let's celebrate with you and use your experience to inspire other White Coat investors.

To do the same. Getting quality disability and life insurance should be the first financial chore for a doctor to complete. Most docs don't have the ideal policy for their gender, specialty, state or health status. And one in seven doctors get disabled at some point during their career. Because these policies can only be purchased through brokers, we've put together a list of vetted agents who are experienced with working with the specific needs of medical professionals and who have your best interest at heart. If you have questions about insurance and what kind of policies would be the best fit for you, check out our insurance recommended list@whitecoatinvestor.com insurance and feel the peace of mind that comes with knowing you have the optimal policy in place. You can do this and the White.

Coat Investor can help. All right, let's get our guest on here. All right, our guest today on the Milestones to Millionaire podcast is Jackie. Welcome to the podcast, Jackie.

Thank you, Jim. What an honor to be with you this morning.

It's wonderful to be here with you. Now we're going to celebrate an accomplishment with you today. What is your accomplishment?

Having a net worth of $1,000,000.

Awesome. Congratulations on that.

Thank you so much.

And what's your specialty? And how far are you out of training?

So I am outpatient internal medicine with an emphasis in bariatrics. And then that's 0.85 FTE and then I'm also a military doc in the National Guard.

Awesome. Well, thank you for your service on that. And what is your approximate net worth?

So now it's about $1.3 million.

$1.3 million. The market has been good to you since you applied to do this?

The market has been good, yes.

Awesome. Congratulations.

Thank you.

And what's that divided up into?

All right, so we have about 450,000 in real estate equity, which is our primary. One rental home and one small syndication. $100,000 in cash, 25 in cryptocurrency, a.

Little bit of mix of everything.

Yeah. Yep. Oh, and $1 million in our index funds and bonds. Missed that big one there. Yeah.

I was thinking that didn't all add up to $1,300,000. All right, and what's been your range of income throughout your career?

For my medical career in residency, I was about 65k between my rental, military, and primary job. And then more recently, $285,000 with those three. And then with my husband's combined income, we're about a little over $500,000.

Okay, and how far are you out of training?

Oh, yes, I am completing my fifth year out of training.

Five years out of training, already a millionaire. Congratulations. You beat me by several years.

Thank you.

And what was really your secrets to success? How did you become so wealthy?

I think I had an interest early on, spent some hours in medical school just preparing a plan. And then when I got married, my husband was also kind of just a similar mindset. We created some short term and long term goals and just made sure we had a plan for them. Definitely having a spouse that's on the same page is huge. He can make some amazing financial spreadsheets. So that is like a huge part of our success is just being kind of understanding about where we're going. And then as you mentioned earlier, Locke, I think I've been in a good timeframe, definitely with when I purchased some properties and when we've had our investments going.

Awesome. And so take me back five years ago, when you came out of training, what was your net worth then?

Yes. So at the end of 2016. And thank you for those amazing spreadsheets. This was easy data to pull. We were negative 256,000, which was negative $283,000 in my student loans that had even despite paying went up about 40k when I was in residency. And we had 90k on the rental mortgage and we had some cash. And my husband came into the relationship with some retirement Accounts. And then I had invested a little bit in my retirement account in residency as well.

Well, that's, that's pretty exciting. That's a $1.5 million swing in five years.

It, it's pretty remarkable.

Is that crazy to think about that? Could you have imagined that five years ago?

No, I mean, what we imagined was trying to hit the million dollar mark when I turned 40. So I'm like five years premature, I think just with a lot of amazing luck and just things going our way, I think.

Well, premature babies are not necessarily good, but premature wealth isn't necessarily a bad thing. Okay, so how much of this did.

You get from your parents?

Did they pay for any of your schooling? Did you get any sort of inheritance?

No, we did not. Neither of us had any inheritance nor help with undergrad or graduate school. My in laws have been kind enough to put a couple thousand in our kids. 529, but we don't include that in our net worth.

Cool. And tell me about debt, the role of debt in you acquiring this wealth. How much debt do you have currently?

Still too much. So we were calculating that out. 633,000, which is 380,000 on our home mortgage and then 250 still in student loans.

And what advice do you have for those who are a decade or two behind you? They want to get where you're at. They want to be millionaires. Five years out of residency?

Yes, I've been practicing that. I take medical students and try to spend an hour to give a little lecture. So I think the big overarching theme is knowing what your debt is and having a plan for it. Knowing what your wealth is going to be and having a plan for that. Making sure you have your insurance in place. And then if you're going to be married or have a spouse, making sure those topics are in line or at least planned out with them.

And you decided to use debt a little bit here. I mean, you're five years out. You said you still have a quarter million dollars in student loans. You clearly didn't make that priority. To knock that out, you decided to invest instead. Tell me about that decision, which clearly I'm not saying it's a bad decision because in retrospect, it was the right decision. Right. Markets and investments have done great the last five years.

Yeah, I would say we are more debt averse. We decided to pay off the rental home and that's kind of. I'm in public service loan forgiveness, so.

Ah, here we go. Okay.

Basically we use the Jim Dolly recommendation which is put aside aside funds so that if any day I come into work and I don't want to work anymore, I can pay that off. So we paid off my rental home, which happens to have a value very similar to my student debt, and I have another three years in public service loan forgiveness. So it's amazing that I've paid well, not this year because of the programs, but that I've been paying since six months into residency every month and I'm still above what I graduated with. But, yes, I think we would have made a different choice had I not been a primary care doctor and had that option of public service loan forgiveness.

So are you guys filing your taxes separately?

We are.

Okay, so we're going to get you back on the podcast in about three years then to talk about public service loan forgiveness, right?

Yeah, I really can't wait. It's been. It's that thing on your back. And we even met with one of the student loan like people just to make sure we are on track. And that was a big part of when I was graduating. I think I spent six hours reading about that program because it wasn't very well written about when I was graduating medical school just so I could be prepared and know exactly what I needed to do to be in that program.

Awesome. Do you guys have any kids?

We have two, and then I'm 20 weeks today, so yeah, so we'll have three.

Congratulations. That means now if you show up in my er, we send you upstairs first.

That's right.

Get checked out on L and D. All right. So how do you balance being a parent with building wealth?

I would say my husband truly believes being a parent is 50% of his responsibility, despite having a big career of his own. So that really, really helps. I grew up with the working mom, and I just. I don't have the mom guilt of having a job that. That is luckily something I just don't suffer from. So my kids see me work, and I think that is fine. I expect my kids to eventually work, and I don't think that needs to be something we need to completely shield them from. My kids don't get to do all the greatest parts. You know, they don't get to have all the other sports. They're still pretty young. It's hard, you know, you have to put the financial decisions into what they get to do. And they're probably not going to do everything that every other doctor kid gets to do just because I'm also trying to gift them me not being their responsibility when I'M older.

Anything in your upbringing that affects how you manage money?

Definitely. So my husband and I both came from very humble means, which I think. Not that I ever suffered from that. And my parents were very involved and very pro education. But seeing parents lose jobs, seeing parents not have health insurance, that definitely makes me want to have a very firm foundation. And I think having financial independence or just being set up for the future can help me feel more secure.

I'm guessing your kids are a little young to pass on too many of those lessons so far, right?

So far we're trying. Yeah. We were reading Berenstein Bears book about having enough and my son was like, well, I want a lot of toys too. And I'm like, opposite point of the book. So they're still young. I bought that book that was recommended recently on your podcast about the silver spoon. Haven't read that yet, but hoping to get some tips from that.

Potty training then finance, right?

Yeah. Return on investment. Really early lesson in our house for sure.

Awesome. Well, Jackie, congratulations on your success. Millionaires less than really five years out of residency. It's really impressive what you've done. Thank you for coming on the podcast and using your experience to inspire others.

My pleasure. Thank you so much. I really appreciate all you've done in this world.

All right, so some good takeaways from that one, right? Obviously a good income helps. This is a dual earner household, but they still came out with a lot of debt, so it's not like they had everything just paved in front of them. To build 1.5 million in net worth swing over five years. That's $300,000 a year. Even you're making three or four or $500,000. That's a pretty impressive amount of your money that's gone toward building wealth. I also think it was interesting to see that she still has basically all of her student loan debt. And obviously that's because she has a plan to get public service loan forgiveness. But she's done a great job doing the PSLF side fund. I don't think she's going to need to use it. So I think that's all just going to get added to her net worth here in the next three years as she gets pslf. So really a pretty awesome story. I hope you found that as inspiring.

As I did, getting quality disability and life insurance should be the first financial chore for a doctor to complete. Most docs don't have the ideal policy for their gender, specialty, state or health status. And one in seven doctors get disabled at some point during their career. Because these policies can only be purchased through brokers, we put together a list of vetted agents who are experienced with working with the specific needs of medical professionals and who have your best interest at heart. If you have questions about insurance and what kind of policies would be the best fit for you, check out our insurance recommended list@whitecoatinvestor.com insurance and feel the peace of mind that comes with knowing you have the optimal policy in place. You can do this and the white.

Coat investor can help. Keep your head up, your shoulders back. You've got this and we can help. We'll see you next week on the Milestones to Millionaire podcast.

My dad your host, Dr. Daly is a practicing emergency physician, blogger, author and podcaster. He is not a licensed accountant, attorney or financial advisor. So this podcast is for your entertainment and information only and should not be considered official personalized financial advice.