MtoM #54 - WCI Ambassador Reaches Millionaire Status

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 54, WCI ambassador reaches millionaire status. Love what you hear on the podcast. Looking for more great white Coat Investor content? Head over to our YouTube channel where you can watch video recordings of our podcast, short snippets of financial tips explained succinctly by me and others, and deep dives into topics for more in depth learning. You can even learn all about real estate with webinars from our real estate partners. Check out all this and more@YouTube.com TheWhiteCoatinVestor. You can do this and the White Coat Investor can help. All right, we're doing a very special episode of the Milestones podcast today. I am here in the WCI studio with this just spac. Who is a WCI Ambassador? What is a WCI Ambassador? It is a podcast co host, a columnist, a host at WCICON 22, and somebody that's going to be representing the White Coat Investor across the country. So it's exciting to have you here. You're on the receiving end today, though. This is your milestone that we're celebrating. Although in future episodes you'll be able to hear thisha talking to people who have accomplished their own milestones. So let's let people get to know you a little bit. Tell us about your specialty and how far you are out of training.

Thanks so much for having me here. It's a real treat. I am an internal medicine physician. I practice as mostly an outpatient primary care doctor and an inpatient hospitalist once in a while. I work in upstate New York and I am about 10 years out of medical school and seven years out of residency. So really, seven years out of full training.

Awesome. Well, welcome to the team. First of all, thanks for having me. Second, welcome to the podcast and congratulations on your milestone. We're gonna use your milestone to inspire other people to do the same. So tell us what milestone we're celebrating today.

Oh, boy. Really great timing that you asked me to do this podcast. We reached millionaire status just a couple of months ago, actually.

Awesome. Well, congratulations, millionaire. How's it feel?

It's hard to believe.

Do you feel like that guy on the Monopoly box?

Yeah.

Not exactly the same. You know, it's interesting about Monopoly. When that came out, you know, a millionaire was about the equivalent of a Deca millionaire today.

Right? Exactly.

And it was at a time when there weren't that many wealthy people and so it was a big deal. Now, unfortunately, you know, most docs probably need to be millionaires to have a comfortable retirement.

Yeah, right. And it feels like, you know, really great achievement. But yeah, we're just in the beginning. We're just starting. But it's so cool because we would not have gotten here had it not been for the white coat investors. So it just all kind of comes together in a really perfect way.

Awesome. All right, so let's talk about what your net worth is divided up into. You're worth a million bucks. What is it?

Okay, so we have a lot in real estate. We got lucky with the real estate market. We bought early. So 597 of equity in real estate. We have 100,000 in cash or cash equivalent investments. We have 343,000. Roth IRAs are 68, 401ks, 207 HSA is about 25. Our brokerage is only 13 because we recently started that. So, yeah, that all adds up to 1 million, if you can believe that.

It's pretty awesome.

Yeah.

Congratulations. So you said home equity. Now is that all in your primary residence or is there some investment property?

Yeah, we have two investment properties. Most of it's our investment properties. So about 300 is in our primary.

Okay, so you know, you've been, you're seven years out. Is your husband working as well or are you sole earner in your family?

My husband is working now. I was sole earner for the first two years of my career and then he went back. He was in getting his master's at that time when he wasn't working.

Okay, so range of income throughout your career, what's the best year and the worst year?

So for me, I've been right around 200,000 for the last seven years. 200, 230. My husband earns about 85, 90 to 100.

All right, and so it took you seven years out of residency if you just became a millionaire. So I guess we know that answer to that question. What was your secret to success? Now, I kind of know your story, but I want them to hear your story because there was an abrupt turn at a certain point in your story. And I think they'd find that interesting.

Yeah. So I really consider our journey more like a five year journey right now because for the first two years I was floundering or we were just, you know, we did the usual thing where everyone tells you to just finance everything out, and that's what we did. We made a lot of just mistakes of lifestyle, inflation. We bought a nice House and the first job without knowing the group. You know, we bought it before we moved and then ended up selling that house just two years later. So what happened was my second pregnancy was unpaid and my maternity leave was unpaid. So that's really, that was my coming moment of clarity because I was sitting and sewing the COVID to a couch. Instead of spending time with my newborn baby, I was spending the entire maternity leave doing this cover from scratch that I really could have just bought and been so much happier, but I didn't want to because we were strapped for cash. And I, I felt like we just had gotten it all wrong. Like I was making a double six figure salary. Other people have done this where they have babies. Like, why was I getting this wrong? And that's when I, while I was sewing that cover, was listening to the WCI book on audible and learning just exactly everything that I'd done wrong and what I needed to do to make it better.

So you made this abrupt right turn and it was pretty drastic what you did. Tell them what you did. I mean, you realized you were doing stuff wrong and then you.

Yeah, and then we like, okay, so my husband and I, this is a team effort of complete insanity. We got at our debt, we both sat down and listed our debts out, realized we had, you know, two car payments, we had the mortgage, we had the rental property mortgage. Thankfully no credit card debt, but a whole bunch of student loan debt. And that really was the biggest life suck that was limiting my choices was this 2 to $3,000 bill every month on top of everything else. So what we decided to do was do the good old fashioned snowball method where we went for the smallest debt. First we modified it a bit. We didn't. We went for the two cars and then we went to. We skipped the rental property because it was cash flowing. And we decided to carry that debt and went at the student loans after that. So we paid off two cars and $238,000 of student loans in about three years. And the student loans were in 17 months once we had the cars paid off. But in order to get that done, we had to make the room for the cash. Right. Because we were cash strapped.

This is the part of the story I really like. Listen to this part.

So we said, okay, you know what we wanted. I, you know, I was in love with my job. So we wanted to change anyway. Josh wanted to move back home. We were in Savannah and he's from New York where he wanted to get back to skiing and snowboarding. So we said, okay, let's move back up to upstate New York, or let's move up to upstate New York, and instead of buying like a doctor home, we're gonna go back to a resident home. And we decided to just deflate our lifestyle hardcore and cut all many of our expenses. And we just. Every single line item, we just started cutting. We dropped the cable, we dropped our grocery bill. You know, really optimized how much we were spending on alcohol and that kind of thing. And just every single line item started cut, cut, cut. And all of a sudden, we just started making progress, like, humongous amounts of progress. And it was an amazing experience that taught us a lot about how to manage money and how easy it is to get on the wrong side of cash flow.

She frugal down, sold her house, moved to another state, and cut every line item in her budget. So, yeah, congratulations. That's pretty awesome story, I think.

Yeah.

Okay, so let's talk about the very beginning when you came out of training. What was your net worth?

Negative 250 to $275,000. Yeah. Really?

So this swing in seven years is not just a million dollars. It's almost $1.3 million.

Right.

So very impressive. And so I'm assuming you didn't get much help from parents as far as paying for school.

No, my mom was a single mom for most of my life. And. Yeah. And I basically put myself through college. They helped a little bit, but I had three scholarships and three jobs. We did lots of tables.

So no big inheritance here.

No.

You guys got $10 million on your own. That's awesome.

Thank you. Thank you.

Okay, so let's talk about debt. How much debt do you have right now?

Right now we have $872,000 in real estate debt.

Okay. Between rental properties and your home mortgage.

Yep. We have 1.5 million in assets in real estate, so it makes up for it.

Okay, so what advice do you have for those who are a decade or two behind you? Or maybe let's just go back five years. Let's say five years behind you. Someone's sitting there, they're in the situation you were in, you know, maybe they're on maternity leave, you know, and for whatever reason, they're realizing this path I'm on is not going where I want to go. What advice do you have for them?

Well, the good news is that we have a really big salary as compared to most people, and so it's very easy to turn things around if you decide to. The hard part is deciding to and changing stuff but once you get at it and you get rolling, it's really seamless and it goes way faster than you planned. So what I would do is start first of all by talking to the entire family about the situation and making sure everyone is on board. And then one step at a time, just list your debts and then get at them. But figure out a plan. Choose one to pay off first and then the second and the third and then get at it.

So you mentioned your mom was single. What from your upbringing affects or affected how you managed money? Did you bring any mindsets from your upbringing or any habits or any teachings that maybe you got that have affected your financial life?

Yeah, so I had two very influential women in my life, my grandmother and my mother. My grandmother was the head of, basically the financial head of household in India of my extended family. And she would sit me down as like a 10 year old and tell me all the stories of all the money and where everything is and all the interest and who we owe what to and how we're paying that back. And she was just completely transparent and really want and kept it all in her head and kept a track of every single penny. And then also my mom, on the other hand, was really frugal when we were growing up. When I was growing up, she only earned like 29, $30,000 a year. And so we were very good at getting the most out of every penny. So I got that from her. But she wasn't good about keeping track of everything or investing and that kind of stuff.

She probably didn't spend a lot of time teaching you about asset allocation, I'm guessing.

No, But I did learn how to pay bills very early. Very nice.

Very nice. Okay, so you're a parent now this whole time you've been becoming a millionaire the last five years you've had two small kids.

Yes.

So how did you balance that?

So part of our geographic arbitrage, which it may not seem like it because we went from Georgia low tax state to high tax state, was going to grandparents. And so we kind of minimized childcare costs by moving closer to grandparents that could help us. So that was one. The other was honestly getting them involved in the debt payoff journey was so good for all of us, especially like having them. We made a macaroni jar of my student loans. So at one, macaroni was $1,000 in student loans. And every time we paid a payment every month we would take it out as a family and the kids learn it was dry. But we did make some good Mac and cheese at the end of it. But yeah, they would. You know, that's how they learned account sticking out those macaronis. And it was just such a great process. And once we paid it all off and then bought a bigger house, they saw they reaped the benefits of that.

Awesome. Well, congratulations. Thank you so much for coming on the podcast with your own story number one. It's very inspiring and I'm sure others will find it inspiring, especially those who maybe are a couple years out of training realizing that maybe they're not quite doing it right. But mostly, thanks for coming on and helping us run the WCI podcast.

Thank you. It's my pleasure to be on and what an immense honor.

Love what you hear on the podcast. Looking for more great White Coat Investor content? Head over to our YouTube channel where you can watch video recordings of our podcast, short snippets of financial tips explained succinctly by me and others, and deep dives into topics for more in depth learning. You can even learn all about real estate with webinars from our real estate partners. Check out all this and more@YouTube.com thewhitecodeinvestor you can do this and the White Coat Investor can help my dad.

Your host, Dr. Dahl, 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.