MtoM #106 - ER Doc Becomes a Millionaire Only 3 Years Out of Training

This is the White Coat Investor podcast, Milestones to Millionaire. Celebrating stories of success along the journey to financial freedom.

This is Milestones to millionaire podcast number 106, Emergency Medicine Doc Becomes a Millionaire.

If you're finding our podcasts informative and helpful, we would encourage you to sign.

Up for our monthly newsletter.

It is totally free and includes useful, actionable information not available on the regular blog posts or this podcast. It's almost like being in a secret club. The kind of club that can boost your knowledge and enhance your wealth at the same time, with no strings attached. Sign up today@whitecoatinvestor.com Newsletter. You can do this and the White Coat Investor can help.

All right, let's get today's guest on the line and get started with this.

All right, we have something pretty cool today. We have our first repeat guest on the Milestones to Millionaire podcast. Welcome back to the podcast, Cyan.

Yeah, thank you so much. I am very excited to be back.

I guess so for those who have listened to all the podcast, Syed was on here almost two years ago. He was podcast number 11. We titled that $145,000 paid off in six months. That referred to his student loan burden. Of course. He is back now with a new milestone. He has become a millionaire since that time. In the time we recorded not even a hundred episodes. He has gone from paying off his student loans to becoming a millionaire. Congratulations to you on this milestone.

Yeah, thank you so much. It's been an incredible ride. Having a decent income has definitely helped. And the fact that my spouse graduated from residency definitely helped a little bit as well.

Okay, when did your spouse graduate?

So she was two years behind me. So she started her real attending job in November of 2021. So we took like a three month hiatus after she graduated and just went back to Pakistan for a couple months and didn't do anything. And then they just came back and restarted work.

Okay, so that's pretty cool for her. She's been attending just over a year and she's a millionaire thanks to the hard work you guys did on your.

Salary for a few years.

That's pretty cool.

Yeah, it's been an incredible journey and we're very, very blessed. It's been pretty cool.

Now you're an emergency physician. What does she do?

Family medicine.

Family medicine. Okay, so Em and Fm not the highest paying specialties, but you put the two together and it's usually a pretty good income. What's your income average or not average? Maybe. What's it been over the last few years? Obviously it changed a lot in the.

Last year when she was a resident, she was obviously making around 50, 55. When I came out I was making 450. So together we were making about half a million. And that was about three and a half years ago when I started.

Okay.

And then November actually end of 2021 we switched. So she was finishing residency and we made the decision to basically move, settle down, put roots, buy a home, do the whole settling down thing. So I got a new job. I voluntarily took a pay cut to take on a rural setting. Er, slower volume, less stress. So I went from making 450 to roughly about 370 plus bonuses. So probably like hitting 400. So voluntarily happily took a $50,000 pay cut for longevity of career and then she went from 50,000 to 30,000. So in the grand scheme our family income still went up. So it didn't really make much of a difference to our financial well being. But definitely took a pay cut and I'm definitely happier for it.

Yeah.

So what part of the country we're talking about? You mentioned rural Midwest.

We don't live rural. I work rural.

Okay.

So I have a little bit of a commute. I drive roughly about 55 minutes. We live in a 2 million people metropolis, so it's a pretty good sized city. We were in Ohio previously and now we're in Indiana essentially. So it's a pretty good family friendly neighborhood and I guess this is where we're going to be for the next decade or two.

Now you've obviously got a good income, but this didn't take very long. Even making half a million dollars a year, in three years you've only made a million and a half and you've still got 2/3 of it, which is very impressive given how much of that money has gone to taxes in that time period. How did you get a net worth of a million dollars in just three years on that income?

So a little bit of luck, maybe a little bit of skill too. In 2021 I started transitioning a lot heavily into passive real estate syndications. So I kind of more or less avoided the 15, 20% dip that happened in 2022. And so I ended up with a portfolio of most of my net worth is in a taxable account which I self manage and is not something that you would. It's not the traditional VTSAX or VTI or voo. It's just, it's a very different kind of a portfolio that I self manage and my real estate assets, I mean everything went up in 2021. And I just get rental checks from my real estate assets. I'm in 15 syndications and getting about nine or 10 rental checks quarterly. So that has helped. And the fact that my portfolio went up 100 grand in my taxable account, it wasn't too bad over the last year.

So it wasn't all just brute force savings. Some of it was returns from your investments. Let's break down the numbers. What's your net worth right now?

A little over $1,300,000.

$1,300,000. And how's it divided up?

So $525,000 is my taxable account, which is a pretty good chunk of my net worth. A little more than 3, $90,000 is divided across 15 syndications. Most of that is multifamily. There's a little sprinkle of hotels, there's a little sprinkle of. There's a couple of office buildings, there's a couple of self storage funds that I'm in and then there's some medical office buildings in there as well. I think about 260, 270 of that is retirement assets. 401s, 403s HSAs, and then some equity in our actual home as well. We bought at a good time and market went up significantly since then. So there's about 100 grand in home equity and roughly about 40, $45,000 in cash.

Okay.

All right. Well, as you list off those assets, it leaves me with a few questions. The first one is how you ended up in 15 syndications with just $400,000. I mean, a lot of these have got a minimum investment of 50 or $100,000. How did you find so many that you were interested in that obviously had a lower investment?

A lot of them. So if you go through privately, a lot of them have 5,000, $200,000 minimum investments. A majority of my investments, nine of them out of 15 are through Crowdstreet with a minimum of roughly about 25,000. So it's easy to put. So 25,000 to me is not a big chunk anymore. Then there's a few through equity multiple. There's literally a couple with a minimum of $15,000 too. To me, it's all about, I mean, tax time isn't fun, but asset diversification, syndicator, sponsor diversification, location diversification. So I really just go for the minimum and have gone for as many as possible. And really 2021 was the year that I took a lot of money out of my portfolio. My taxable portfolio. In 2021, I had already hit $400,000 in my taxable account. And that year I just literally just kept taking money out of that account and kept pushing a lot of my money in real estate.

So is it worth it to have 15 K1s for $400,000?

That's a question.

I hear a lot from people. Do you think it's worth dealing with that amount of complexity and hassle for $400,000 in investments?

I don't deal with my taxes. My accountant does. I just send tax forms, so who cares? Each syndication cost me an extra 30, $40 for an extra tax form that I pay my accountant in the grant scheme. In the grant scheme, once I've made that investment, I don't have to look at it for the next three to five to seven years. And I get quarterly rental checks. And so I think on paper, it's worth it. The only effort I put in is collecting all the documents and sending an email to my accountant. And that's really not that bad.

Yeah.

Now, you mentioned you were doing something interesting in your taxable account. I mean, how interesting is this? Are you buying options? Are you buying individual stocks? Is this cryptocurrency? What are you doing over there?

I mean, I don't do much crypto. I have like $2,000 of crypto. I never buy an option. I am always on the selling end. I exclusively sell puts, and I'm always extremely out of the money. And I'm essentially harvesting theta and I'm basically harvesting time. And when the market was down 20%, I ended the year up 17, 18%. So I bake in significant downside protection, and it seems to be working really well. And there's a lot of down risk protections that I put in. And this is selling. Put strategy is something that you should not do well on in a down market. You do better in an up market. But just because the significant risk mitigation that I do, that it's worked out really well.

So how much time do you think you spend on your investments in a given month?

A lot. I enjoy it. It's actually a true passion. On paper, I could just let it be. The trades I have right now expire in 51 days. I don't have to look at my account if I don't have to. It is a personal choice and it is just something I enjoy doing. I enjoy reading financial literature and ever since, I guess your book was probably one of the first books, but ever since I was a senior PGY3 resident. I truly delved into the financial world and pretty much wiped out the local library section on finance books. So it is, it is something that I truly, truly enjoy. And it's not for everyone, but it is a rather large portfolio now that I am very happy to self manage and I'm pretty confident that I can manage better than most people.

So let's go to somebody that's maybe just coming out of residency now, maybe they've got some student loans like you did, they want to be a millionaire three years out of residency. What advice do you have for them?

Well, don't do what I'm doing unless you really know, unless you really, really go down the path of education and spending hours and hours out, hours of your life on this. Just the usual, throw your money into vti, vtsax or vxus or Bohan. Just a traditional three fund portfolio. Minimize your savings, minimize your expenses, maximize your savings and let compound interest hopefully work for you in the future. I mean, that's what I started off doing the last time I was here. That is exactly what I was doing. But I've definitely skewed away from that. But I think over the last couple of years I've also educated myself a lot on these things too. But for somebody starting out, you know, just learn what a Roth IRA is actually look at your expenses and see where your money is going. And if you know where your money is going, you actually, you know, see what sort of expenses you can drop.

All right, so what are, what are we going to see you back on the podcast with? What's your next financial goal and when do you expect to hit it?

We'll probably hit 2 million in a couple of years. I expect to hit 2 million before the end of 2024. My wife's going to cut down to part time in about five, six months. And I'm toying with the idea of cutting down to part time by the end of the year or when I hit the 2 million mark. So I don't see a point in working a lot of shifts anymore. Like, I feel like we're getting to a point where the portfolio itself is going to become self sustaining. So we're going to start really prioritizing family rather than work.

Awesome.

Well, congratulations on your success. Thank you for coming on the podcast again to inspire others to follow in your footsteps and best of luck in your career as well as with your finances and investing.

Yeah, awesome. Thank you so much for having me. And your book was the first book I read, so thank you for Starting me on the journey of taking control over my life.

It was our pleasure.

All right.

I hope you enjoyed that interview as.

Much as I did.

I think it demonstrates a lot of things. Number one, the benefit of being financially literate. You can take this as far as you want. Some people love this stuff. They're true hobbyists. People like me, we just read this stuff because we think it's great. Syed same way, obviously, he likes playing with his money. He's got 15 syndications, he's buying more all the time. He's messing with put options in his taxable account.

But the truth is, when you make.

A lot of money and you save a whole bunch of it, how you invest doesn't matter all that much. You know, if you want to take a little bit more risk in your portfolio and mess around with it, you can still be very successful when you're saving like they are saving, which is obviously a lot. You know, he talks about making 100,000 in the taxable account. He talks about the house appreciating 100,000 in value. But the other 1.1 million is just brute force saving, let's be honest. It's just money they could have spent and they didn't spend, right? So that's the way it works, especially in the beginning when you are trying.

To build net worth. And the part I really like about.

That interview is that he already knows what he's doing with the financial success.

Right.

His wife's only a year or 18 months out of residency now.

She's already got plans to cut back.

A lot of particularly women physicians like doing that early in their career to be able to, for lack of a better term, go on the mommy track for a few years, be part time.

For a while, maybe come back to.

Full time later, maybe not. And then he's got his own plans.

To cut back as well. And I think what he's going to learn is, what I've learned is that emergency medicine is a lot more fun and you don't have to practice it.

Especially full time, nights, evenings, holidays, weekends.

Et cetera, and can do it a little bit more on your own terms.

I wanted to address something else while we're doing this.

I know sometimes these milestone to Millionaire podcast can sound a lot the same. So I think this year, after reading feedback from you guys on the survey, thanks to all of you who filled it out, by the way, we may insert a little bit more material into these podcasts and talk a little bit more than just the interview. And I hope that makes It a little bit more enjoyable for each of you. One of the comments we had on.

The recent survey said this like to.

See more content more relatable to divorced.

Parents engulfed in debt related to divorce, domestic violence and child custody battles. The content seems currently rose colored and at times unrelatable to someone like me.

But maybe it's not meant for people like me. And that got me thinking a lot. I want the content to be meant for people like you because it doesn't go perfectly for everybody like it did for science, right? I mean, he's killing it. Him and his wife are killing it. They're doing awesome, right? Millionaires, three years out of residency. I mean, Katie and I took us seven years, right? But that's not the case for everybody. Everyone has different challenges. For the person who left this comment, it sounds like there's been some domestic violence, a terrible divorce with child custody battles, you know, losing half your income, losing half of your assets, you know, probably keeping all of your debt. You know, when you're going through that sort of a thing, you can't work as hard as you otherwise could. And then afterward you're now a single parent, right? And so that keeps you from working as many hours as you would like. You've got these additional expenses with childcare expenses. There's not a dual physician couple that you can split those with. And maybe you're in a high cost of living area, right?

It's a much harder road to hoe.

And I want you to know that we're thinking about you, that we are trying to create content that will also be helpful to you and that we will also celebrate your successes. Although they may not sound as impressive or look as impressive on paper as something like Syed has accomplished. It may be much harder for you to pay off student loans in that sort of a situation. It may be much harder to get a house down payment in that situation. A milestone of hitting a net worth of back to broke or 100,000 might mean a lot more than a net worth milestone of a million. And so I want you to know, keep plugging out there. The principles are the same. This is not a competition. Investing is a single player game. It is you against your goals. And you can measure success only in comparison to those, not in comparison to your peers. For Syed sounds like his goal is to build a bunch of wealth very quickly and cut back so that him and his wife are working part time. For the person who left this comment, the goal is probably some financial stability, right? Getting a house that is comfortable with a mortgage. You know, getting through the legal aspect of going through that divorce and getting started building some net worth again and paying off some debt. You know, Maybe you owe 50 or $100,000 to the attorneys for the divorce. You know, whatever your goal might be, we'll celebrate that with you. You know, you paid off a $50,000 debt to an attorney. I'll celebrate it. Call in, leave it on the Speak pipe or leave it on the Application for Milestones to Millionaire. And we will cherish that just as much as we do somebody becoming a deca Millionaire.

All right, we better wrap this one up. If you're finding our podcasts informative and helpful, we would encourage you to sign up for our monthly newsletter. It is totally free and includes useful, actionable information not available on the regular blog posts podcast. It's almost like being in a secret club. The kind of club that can boost your knowledge and enhance your wealth at the same time, with no strings attached. Sign up today@whitecoatinvestor.com newsletter. You can do this and the White Coat Investor can help.

All right, that's it. We'll see you next week on Milestones to Millionaire. Don't forget, the regular podcast drops on Thursday, so check that out as well. We appreciate you. We appreciate what you're doing. Those of you who are spouses and partners. We appreciate the support you are providing as well. Your job in a lot of ways is just as hard or harder with a whole lot less recognition. So we want to recognize you as well. Thank you for what you do. We're here to help. Stop by if there's anything we can do for you. Let us know and we'll see you next time on the podcast.

The hosts of the White Code Investor podcast are not licensed accountants, attorneys or financial advisors. This podcast is free entertainment and information only. It should not be considered professional or personalized financial advice. You should consult the appropriate professional for specific advice relating to your situation.