MtoM #50 - Orthopaedic Surgeon Pays Off All of His Debt in 6 years

This is the White Coat Investor podcast, Milestones to celebrating stories of success along the journey to financial freedom. Here is your host, Dr. Jim Dali. This is Milestones to Millionaire podcast number 50.

Orthopedic surgeon pays off all of his debt in six years.

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All right, we've got a really inspiring story today, which I'm excited about. We're on number 50 here. 50 milestones to millionaire that we've done this year or in the last year. And that's pretty exciting. But this story, I think, is really neat because it demonstrates just what can be done sometimes with income and what that allows you to do pretty quickly in your life. And so I want you to listen to what this doc's done about income, as well as how he chose to use that income. As we go through the story, let's get them on the line.

All right, our guest today on the Milestones to Millionaire podcast is Brock. Welcome to the podcast.

Oh, thank you for having me, Jim.

Tell us what your specialty is and how far you are out of training.

So I'm an orthopedic surgeon who ended up doing a total joint fellowship. I started practice in 2015, so I'm a little over six years into practice now.

And you have recently finished paying off your student loans, I understand. How much did you pay off?

Well, student loans, and I've actually ended up paying off all the loans I have altogether, and I've been able to become debt free. So all in all, student loans was about 330,000. Between myself and some student loans my wife had was able to pay off our vehicles and also pay off our mortgage.

Wow. So what was the total amount of debt?

So if I had to add all of that up together, that was probably close to 1.2, $1.3 million, I guess.

Wow.

In six years.

Six years.

That's got to feel pretty good.

Feels really good. Feels really good.

So what was your average household income over that time period?

So it has been a steady increase over the past six years. My original contract when I first started, before I became partner, I'm in private practice was for about $250,000. Second year was 275. And it has slowly just climbed as practice has evolved. And I've kind of used a little bit of geographic arbitrage here. I'm in a location where there aren't a lot of surgeons, not a destination location. And I've been able to grow a very busy practice. And last year I think I made a little over 1.4.

Awesome.

Well, congratulations on your success. Clearly your income has probably had a lot to do with this because you didn't pay off $200,000. You didn't pay off $200,000 in debt that first year, I'm assuming on an income of 250.

No, no, it really didn't get start rolling probably into my fourth year of practice or so. That's when the way we have things set up, I set a base salary and that's kind of. And I get to choose whatever my base salary is. And I've kept that relatively low even up till now. I think my salary is $330,000. And then we have a quarterly true up where I get whatever else is owed to me after overhead and expenses. And that's where I've been making the major dents in debt and everything like that.

So what's your lifestyle been like the last six years? I mean, how much do you guys think you actually spend on your lifestyle?

It's not that much, actually. When we first moved to town, we didn't buy a house to start with. We rented a house for a little over two years because we wanted to make sure the situation was right. I was still driving up until four years ago. Three or four years ago, a 1997 Infiniti J30. The windows didn't go up and down. So if I had to go through a drive through, I had to open the door to get the food. And it wasn't until kind of we knocked out a little bit of debt before I finally upgraded a little bit on the vehicle. And I still just drive a fairly normal pickup truck, nothing too special. And my wife drives minivan. And so we're pretty simple. We're not gonna go out and buy, you know, extra houses, things like that. We're happy in the house we're in because we Were able to wait a while before we purchase. We're able to kind of get into a house we could see ourselves in forever. And then we just kind of set things on cruise control, live within that $330,000, and just kind of set aside the rest of the.

You know, the millionaire next door talks about the most common vehicle among millionaires, and I think it's an F150.

That's what I got.

I think is the most common vehicle. So not surprised that you drive a truck. So congratulations.

That's.

That's pretty awesome.

I appreciate it.

So at some point, you made a decision here to pay off debt. You know, not to spend the money, not even to necessarily invest the money, but to put a significant chunk of your earnings toward paying off debt rather than stretching it out and trying to beat the difference, et cetera, by investing and earning more. What was it that made you decide to get rid of this debt so.

Early in your career?

It's a plan that my wife and I kind of came up with. We just really like the satisfaction of knocking out the debt. To us. It also gave us a sense of freedom in what we're doing, how hard, unnecessary, necessarily have to work. If something unexpected comes up. I don't ever really have to worry about whether or not we're going to be able to cover the mortgage. If we have to sell the house, are we going to get in upside down on something? And we just kind of felt like, okay, step one, this is really easy. Let's just knock out the debt. That gives us a little bit more freedom and leeway in what we do, and we'll start really getting into the nitty gritty of the investing. After that, we were still able to set aside money maxing out 401ks and whatnot along the way. But now we can really turn all of our attention to it.

Yeah, for sure.

So did it turn out being easier or harder than you thought it was going to be? Six years ago, if you would have.

Told me I'd be in the spot now, that when I started six years ago, I wouldn't have believed you. It was tough in the beginning because when you still have a lot of debt, you're paying rent on a house. I have three boys, two of them, to some degree, special needs, so have some expenses there. It was tough in the beginning, but then once I just kind of really kept a nose to the grindstone with practice and grew my practice, things just kind of started taking care of themselves because we just kind of stuck to our Plan.

What advice do you have for docs that would like to do something with their income like what you've done? You mentioned that you went to maybe a smaller town, maybe a less desirable, desirable town for a lot of docs. Any other tips you have for them on growing their income?

As far as the practice goes, you just got to be willing to. If you want to go to a place where there aren't many docks around, you're probably going to make more money. The more desirable places obviously have more people there. It's more competitive, it's probably more difficult and a longer process to grow a practice. But if you're willing to go somewhere where there's a little bit more of a demand and use that geographic arbitrage that you've talked about before, it's amazing. It's really kind of amazing what you can do now.

At the rate you guys have been building wealth, you're going to have far more money than you're ever going to know what to do with. Have you ever looked that far down the road and thought about what you're going to do with it?

I have to some degree. I've kind of done some of the wealth calculations that, you know, I use your online course, which is great, by the way, highly recommend that. And I guess you start running into an estate problem at, at some point, which I guess I'm going to have to address along the way. But in my mind, what kind of keeps me going in the long run is, you know, to some degree, I'm not sure in the long run how much my. At least two of my three boys may need some help down the road. And just to make sure that there's plenty set aside so there won't be a problem there.

That's awesome to be thinking of others first. It's interesting. Finance can be tough. You gotta learn how to earn well, save well, invest well, spend well, give well. And for most of us, one or two of those is harder than the other ones. You ever give any thought on which one of those might be harder for you?

To me, I think the, the work comes just, I guess, easy. In my training, I trained at a program where you just work hard and that's just what you do, try to work efficiently. I don't like working long hours. I want to work really hard when I'm working and be done by 3 or 4 in the afternoon. I don't want to work long hours, just really efficiently. I guess I get caught up in the weeds sometimes with the investing and that's where your course has helped a lot. And I just try to keep it very simple. Index funds, ETFs, and just, I don't think about it. I know it's there. I know there are going to be ups and downs and I'm just not going to worry about it. It's all going to work itself out in the end.

How's your spouse feel about what you guys have accomplished over the last six years?

She's just as excited about it as I am. And I have to give her credit because she's an optometrist and when we were in residency, she pulled all the weight. She worked five days a week, including Saturdays. The whole time we were in training, she. She was the big breadwinner there. Because of her, we were able to invest in Roth IRAs back at that time and we started kind of that down that road there. But I credit her and she has the harder job. You know, with everything that she does now, she works a little bit. She isn't able to work full time, but I give her a lot of the credit for being able to keep us on track and help me stay focused on what I'm doing.

So how, how do you think being debt free is going to affect how you practice?

You know, it's easier to take a Friday off or go on a trip or something like that when I'm. There's really no ramification besides maybe making a little less money. But when you're debt free, you really don't worry about that so much. And so I may be able to turn the needle back just a little bit, take a little bit more time off and just relax. As far as that goes.

That's awesome. Well, Brock, congratulations on your success. You've done really well. You got a fantastic education. You're taking full advantage of it. You're clearly running a business very well and you're doing a great job managing your money. So congratulations to you. I know your story will inspire some other listeners and thank you for coming on the podcast and sharing it.

Well, thank you for everything you do. It's ultra important.

You're very welcome. It's my pleasure.

All right.

I hope you enjoyed that episode. This has been a pretty inspiring one for me. You know, I talk to lots of docs and sometimes they're in relatively high paying specialties, orthopedics or spine surgeons or neurosurgeons or plastic surgeons or whatever that potential to make great money. But there's many of them who work as employees and make three or four or five hundred thousand dollars. And then some of them grab the bull by the horns, open their own practice, become very successful at doing so, and make high six figures or even seven figure incomes. And it's amazing what you can do financially with that sort of an income. I mean, here's just one example, right? Here's a doc that not only paid off student loans in six years, but paid off all the debt in six years and now is probably at some point down the line going to have an estate tax problem. And so what I would say to you is, if you have thought about opening your own practice, if you have thought about geographic arbitrage, this is what it looks like. It's a pretty awesome life. So if you are not tied down to living in a really expensive place with high taxes, consider going somewhere else. The people do need you there. They need surgeons in medium and small towns across the US and you'll be doing great service there and really helping yourself, you know, have a tailwind when it comes to paying off debt and building wealth.

As a white coat, you have valuable knowledge. Various companies want that knowledge and they're willing to pay you for it. That's why we put together a list of recommendations for companies that pay you to take surveys. If you're looking for a profitable side gig for not too much effort, getting paid for surveys could be the perfect solution for you. You can make extra Money, start a solo 401 and use your medical knowledge to impact new products. One of the WCI columnists makes an extra $30,000 a year just doing these surveys. Sign up today and use a fraction of your downtime to make extra cash. Go to whitecoatinvestor.com mdsurveys you can do this and the white coat investor can help.

Thanks so much for being with us on this Milestones podcast today. If you'd like to come on the podcast, go to whitecoatinvestor.com mil and apply today. We'd love to use your story to inspire others to reach the same milestone you've reached and to celebrate your accomplishment with you.

Till then, keep your head up, shoulders back.

You've got this and we can help. We'll see you next time.

My dad, your host, Dr. Dalla, 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.