MtoM #148: Nurse Practitioner Hits $250,000 Net Worth and Finance 101: Pathways with the Military

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 148. Nurse practitioner hits a quarter million dollars. I estimate that 80% of doctors need, want, and should use a financial advisor and or an investment manager. Some investment gurus, such as Dr. William Bernstein, think my estimate is way too low. At any rate, if you want to use an advisor temporarily or for your entire life, there's no reason to feel guilty about it. Just make sure you are getting good advice at a fair price. If you need help updating your financial plan or just getting one in place, check out our list of recommended financial advisors@whitecoatinvestor.com financial advisors. You can do this and the White Coat Investor can help. All right, welcome back to the Milestones to Millionaire podcast. This is your podcast. We bring on you and your successes and use them to inspire others to do the same and to reach their goals. This financial stuff is a single player game. It's you against your goals. But it's still nice to hear about how other people are doing what they're doing and to use their, you know, experiences to inspire you to keep it up. Because it takes time to reach most important financial goals and a little bit of inspiration along the way goes far. So if you'd like to come on the podcast and share your story, you can apply@whitecoatinvestor.com Milestones. We've got a guest today that's reached a net worth milestone. We'll bring him online shortly, but stick around afterward. We're going to talk a little bit about some of the pathways available through the military that may help you financially while you're serving your country. Our guest today on the Milestones to Millionaire podcast is Aaron. Aaron, welcome to the podcast.

Thank you. Appreciate being here.

Tell us what you do for a living, how far you are out of school, and what part of the country you're in.

So I'm a family nurse practitioner. I specialize in infectious disease and I also on the side work at a psychiatric facility doing the medical side of things. I am about to be four years out of school in December and I live in Atlanta.

Atlanta. Okay. Very cool. All right, well, we got a unique milestone. We've done lots of net worth milestones in the past. I don't know that we've ever done this particular number. Tell people what you'd just reached.

So my current net worth, and this is without real estate, but it's 250,000.

Pretty awesome. Pretty awesome. And what do you mean without real estate? What do you have a house or you got some rental properties? What do you got?

So I have a condo and then a single family house that currently is used for a short term rental.

Okay. A lot of value in either of those besides the debt on them or.

No, about 100,000 for the condo and equity right now and the house is probably 60.

Okay. So you're pushing, you know, $400,000 in net worth just a few years out of school. That's pretty awesome.

Yes, I appreciate it. I try to keep the real estate out, I guess to give me that push. I guess if I see the lower number, I have that push to save more.

Yeah, for sure. It might not be as accurate though. You probably ought to count the real estate. Sometimes it's hard though. The difficulty with stuff like that is it's illiquid and it's hard to value. So I totally understand why you leave it out. You know, it's like trying to value the white coat investor as a business. Well, today nobody's interested in buying it, so it's not worth anything. Right, right. But tomorrow somebody gives me an offer for it, maybe it's worth something. So that makes it hard as well. Not as difficult to do that with a typical property as it is with a business. But I totally understand your difficulty. Okay, well, this is pretty awesome. So how'd you do this? I mean, what kind of money are you making?

So between my two main jobs, probably 180 right now. So when I first came out of school it was about 115, and that's gone up with my main job, so that's getting closer to 140. But then I pick up that side job doing admission physicals and medical visits at the psych facility to make up that difference.

So what was your net worth when you came out of school?

It was about 80, I want to say.

Okay, 80. So you had, you had something, correct?

Yeah, about 80.

Where'd that come from?

Over time? I was in the military for four years. So during that time I saved up a lot of money invested when I was overseas for some time. So.

Okay, what'd you do in the military?

I was a healthcare specialist, so better known as a combat medic.

Combat medic.

Okay, very cool.

Well, thank you for your service.

I appreciate it.

All right, so. But still, even with that, you know, little jump start, I'm assuming coming out of the military, you didn't have any debt either you have GI bill or something to pay for School.

Correct. So when I got out of school, I went and got my bachelor's in nursing first, then my master's. I received my associates while I was in. So all of my education was debt free. So that, of course, helps with the network.

Yeah, you didn't have to start in a negative hole like a lot of people. But still, even when I look at the numbers, you know, your. Your net worth encompasses about half of what you've made the last few years. Right. You're putting a lot of money toward building wealth.

Correct.

What. What percentage of your income do you think is going toward wealth building?

This is bad to say, but I don't know the exact percentage. What I can say is almost all of my second job income is going towards investments. I haven't figured out the percentage of it, but just trying to invest as much as possible.

Is there anybody else in the picture? Is there a partner or spouse or kids or anything?

No, I'm single and no kids.

Okay. All right, so we got some explaining to do. How have you done this? Tell us what your tips are, what your secrets and strategies and techniques are to be building wealth so quickly.

I think what helps for sure is during COVID I saw, you know, a lot of my. Everything I have in the stock market increase, which has helped. I would say one of the biggest things is probably that I have an older car. I drive an older Honda 96 Honda Accord. So not having that.

Yeah, that's older.

Yes, Correct.

You're making my car look brand new.

Yes. Yes. So I got that while I was in school, planned to get a new car after, and it just didn't happen. What I was seeing, going into my investment accounts, I couldn't justify getting a car payment. So I started out doing, I would say, like 400 BI weekly into my S&P 500 account, my brokerage fund, and then that's increased now to about 600 every two weeks and whatever extra I'm making in the side job going towards that. Also mentioned my second property that's on Airbnb, so some of the income from that as well, I invest.

Very cool. So, I mean, you're making real sacrifices to invest money, right? I mean, you're driving a 96 Honda. That is not a nice car.

Correct.

How do you feel when this money that you have not spent on a new car and invested instead trying to do the right thing when that goes down in value, say in 2022, how do you feel?

It's very emotional looking at those. Those. Those numbers. So right now I Was looking a few times a week during that time, seeing the numbers change, but I pushed myself to only look once a month now to make it not so emotional, you know, listening to a lot of podcasts and different things. I've just learned that this is part of, you know, the ebbs and flow of the market. So I know that eventually will go up. Like I saw earlier this year.

Yeah. What do you invest in?

So I have BTS X through a brokerage fund with Vanguard for my just one brokerage fund. Then I have a Roth IRA with Vanguard as well. That's in a Target date fund somewhere.

You got the motivation to, you know, work hard, earn well, save, invest, build wealth. Was that from your upbringing or did something happen to you or where did that motivation come from for you?

I would say as far as the hard work. My parents, both of my parents, my father worked two full time jobs for most of my childhood and my mother worked hard as well, but they really didn't save anything. They very much lived paycheck to paycheck. And I just remember being young thinking I didn't want to live that way. I had some friends that just seemed like they were better off taking nicer vacations, had nicer houses, and I kind of wanted that. So I really don't know how it started, but when I was 16 and got my first job, I saved almost everything. And at that time, I actually started watching Susie Orman as a junior in high school and that kind of kickstarted things.

Okay, can I afford this? Those are her famous segments, right?

Correct. That was my favorite part.

Yeah, yeah, everybody loves that. Maybe we ought to start doing that on the podcast. People call in and ask about their latest Tesla purchase.

Right, right.

Well, the problem is, you know, the big part of our audience is relatively high earners, lots of docs, etc. And a lot of times they can afford. They just can't afford everything they're doing. You know, they just pick one of those things they can correct. All right, well, what advice do you have for someone that's just like you, you know, maybe they're not the, you know, orthopedic surgeon making $800,000 a year. Maybe they're a nurse practitioner, maybe they're a dentist. Maybe they're, you know, physical therapists, married to an occupational therapist. What advice do you have for somebody like that moderate income earner that wants to be successful like you?

I would say it sounds really simple because I hear this a lot, but delayed gratification, that definitely is getting me where I need to be. Like I said, the biggest thing was the car holding off and not getting a new car. But even with my condo, I was able to save. Then it put quite down 20, but about 15% down on my condo. So I could have done that earlier, but I really wanted to save and have lower payments, but definitely delayed gratification.

What advice do you have to somebody else that wants to get into the short term rental business?

Oh, that's good. That was not easy and not something I thought I actually I would do. I would say what helped me, which was pretty simple, was watching a lot of YouTube videos for people who have already done it. So through that I learned about like a local Facebook group where you can buy, you know, people were getting rid of their Airbnb so they would give away a lot of furniture at a bulk price price. So little things like that I learned along the way. I would say with that too. It's a big investment in the beginning, but once you get stuff up and running and have a good set of cleaners, you know, mine's a household, lawn care and things, once you have that in place, you really make your return. The beginning is a little rough.

Very cool. You know, later this week, the week that we're recording this, not the week that it runs, I'll be speaking at pimdcon. My talk this year is on entrepreneurship. And there's really three categories I put people into. You know, you can just go and work and, you know, work your shifts, save a good chunk of your money, invest it in some reasonable way, a bunch of index funds, whatever, and just slowly build your way to wealth. And then at the other end of the spectrum is this, you know, go out, be an entrepreneur, do something nobody's ever done before with this new idea you have, and build a business, whatever. Who knows? It might be super successful, it might not. But in the middle is this sort of thing, like what you're doing. You know, it is a business, yes, but it's a proven business. It's a business that's reproduced all over the country every day that other people are doing that. You can learn how to do that. You know, if you just follow the formula, it's eventually, you know, gonna work in some reasonable way. And, you know, some franchises are like that. Real estate investing tends to be like that, but it tends to, you know, generate a little bit more income and a little higher returns than just boring, old, totally passive investments. What made you decide to take that kind of half step into entrepreneurship rather than trying to come up with something totally new and start a new business nobody's ever heard of.

Right. I'm actually someone. I never was interested in entrepreneurship. I always wanted to be an employee. I just thought it was easier show up and do my job. My favorite part of my job is patient care. Never wanted to administration or anything outside of that. But getting the second job at one point I did have three jobs, so the main and two side hustles. And it was just taking up so much time and I was there, you know, nights, weekends, and I knew I couldn't sustain that, but I still wanted that income coming in, so I just had to make that decision. You know, as you said, this is something already established. So not something I came up with, but what are other people doing? And I actually listened to an episode you had about side hustles and some other stuff on YouTube and I just thought, okay, this is something I can do. And full disclosure, I've used my VA home loan. So that allowed me actually to get that house with no money down. So I was able to purchase that, have it for some time, and then be allowed to use it for a short term rental. So it all fell into place.

Was there a regulation on how long you had to live in it before you could turn it into a rental?

Yes, it's a year.

A year.

Okay, very cool.

All right, well, what's next for you? What's going to be your next milestone? When are we going to see you on this podcast again?

That's a good question. I think eventually. My goal is more real estate. I see. I'm from Connecticut originally and there's a lot of multifamily there. So I see maybe getting that in the future. Probably like a 5 year goal. My big overall goal is by 40. I'm 32 now. By 40, I would like to be able to retire. Not that I want to, I would go probably part time, but just to have that option.

Pretty awesome. Well, congratulations to you. You've done fantastic. You should be very proud of yourself. And I want to thank you personally for coming on this podcast and inspiring others to do the same.

I appreciate it. Thank you very much. Nice working with you. All right.

Hope you enjoyed that podcast. You know, there's another person coming from a situation where they weren't given a lot of money when they left home. They weren't necessarily given great examples or a whole bunch of financial literacy. So somebody that had to learn it on his own.

Right.

It's amazing what you can learn with Google and YouTube. Right? He's learned how to run an entire, you know, short term rental business. He's learned to accumulate wealth. You know, all this stuff he's learned on it. So you too can learn how to become financially literate. You know, we got lots of resources here at the White Coat Investor, but we're not the only place in the world that has resources to help you become financially literate. It pays huge dividends. It will allow you to have a lot less stress in your life. You'll become a better practitioner, partner, parent, et cetera, by becoming financially literate and you'll be able to help a lot more people. It's just far easier to help people from a position of strength than a position of weakness. Speaking of strength, there's a lot of strong people in our military and there's a lot of great options for your career that involve the military. The military is actually having a lot harder time now and especially in the next few years. Recruiting docs, for instance, right? They have made public service loan forgiveness so attractive and so easy to get that people are looking at the health profession scholarship program or they're looking at the military medical school and going, well, that seems a lot harder than public service loan forgiveness. So it's starting to affect recruiting. That might cause there to be bigger bonuses for those of you who are serving in the military, but it might cause some shortages as well and make you all work a little bit harder. There's a lot of great pathways though. I have long thought that a great route for a career is for someone to join the military at 18, have the military put them through school, right? This happened all the time when I was in techs, would be going through nursing school, you know, while they're enlisted, the first few years in the military, then they commission as an officer and by the time they hit their 20 year mark, they're 38 years old. They're, you know, probably a major, you know, they've got a nursing degree. And then they leave the military and go on and have a nursing career for another 20 years while collecting a military pension. So not only do they not go into debt, right, they didn't waste any time because they're getting paid the whole time for 20 years and saving money the whole time. And they come out with this valuable degree, a valuable career and a pension. They get 38, they've got healthcare paid for the rest of their life at 38. They're collecting retirement checks every month whether they work or not. And considering a lot of docs don't even get out of residency until their mid-30s. I've always thought that was pretty awesome. But another great route is what this gentleman has done, right? He went in, he served for a few years, enough to qualify for the GI Bill. He let the GI Bill pay for his schooling. So instead of coming out owing $150,000, he came out with a net worth of $80,000 and hit the ground running, which I think is a great way to start a career. There's other options as well. The Reserve has programs, The Guard has programs, both of which to try to attract doctors. And even if you don't go through any of that, you can sign up for the military as a resident. I think it's the FAP program is what they call it. Once you've already eliminated the risk of having to go through the military match and not getting what you want, you can sign up as an attending and they'll give you signing bonuses. So if you're willing to serve, they would love to have you. The vast majority of the time, if you qualify, you're below a certain age, and they're pretty lenient for docs. But if you're below a certain age, you can still go in. And oftentimes they'll bring in as a major or even a lieutenant colonel if you've got a lot of experience. So you can do a lot of cool stuff with the military, not to mention stuff that really is only done well in the military. Things like dive medicine that you can do in the Navy, and some of the aerospace medicine you can do with the Air Force and the Navy and even the Army. That's just not as easy to do outside of the military. So consider those pathways for your career. Consider them for, you know, your mentees for children. And sometimes the military is the right route for somebody. I estimate that 80% of doctors need, want, and should use a financial advisor and or an investment manager. Some investment gurus, such as Dr. William Bernstein, think my estimate is way too low. At any rate, if you want to use an advisor temporarily or for your entire life, there's no reason to feel guilty about it. Just make sure you're getting good advice at a fair price. If you need help updating your financial plan or just getting one in place, check out our list of recommended financial advisors@whitecoatinvestor.com financial advisors. You can do this. And the white coat investor can help. All right, we've come to the end of our podcast. I'm sure glad you're here. I hope this is meeting your needs. Send us suggestions if you don't like what we're doing. If you want to come on the podcast whitecoatinvestor.com milestones and we appreciate you telling others about this podcast and helping spread the word. Thank you so much. Keep your head up, shoulders back. You've got this. The hosts of the White Coat Investor are not licensed accountants, attorneys or financial advisors. This podcast is for your 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.