MtoM #61 - Anesthesiologist Gets PSLF and Becomes a Millionaire

This is the White Coat Investor Podcast. Milestones to Millionaire. Celebrating stories of success along the journey to financial freedom. This is the White Coat Investor Podcast. Milestones to Celebrating stories of success along the journey to financial freedom. This is Dr. Disha Spath, your host for today's episode. Today's episode is number 61, anesthesiologist gets PSLF and becomes a Millionaire.

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Today we have an anesthesiologist who got PSLF and became a millionaire all in one go. This is going to be a really exciting story. I'm so excited to get started with it again. I'm your host, Dr. Dasha Spath, primary care physician and new White Coat ambassador, here to host this podcast for. So today we have John here to share his story. Hey, John, how are you doing?

Good. I'm so happy to be here with you guys.

Thanks for being here. So tell us, what's your specialty and how far are you out of training?

I'm an anesthesiologist and I have been out of training for six and a half years now. Time flies by.

Awesome. And why did you decide to come on the podcast today?

Well, I've been an avid follower of the White Coin Investor and the network for many years, since I was a student. And listening to other people share their stories on this milestone as a millionaire gave me the inspiration to really live like a resident and pay off my loans quick and have a good financial education for me and my partner. And I really, you know, once I reached this milestone, I felt like, you know, it was only right for me to apply, to be able to share my journey with other people. So hopefully, you know, students and residents that were in my shoes years ago can kind of see what I did and try to do the right thing and not make the mistakes I have made before.

Awesome. Well, so let's get into it. You applied to be on the White Coat Investor Milestones to Millionaire podcast because you reached a net worth of a million dollars and you also got a PSL of forgiveness. So let's hear about that. What is your Net worth currently, most.

Recently, it's about 1.2 million. That's excluding my primary residence. Including that, we have about 400,000 equity in the primary residence, but I don't include that.

Okay. All right. And what is your range of income been throughout your career?

Started around 290 and it's about 420 the last year.

Awesome. And did you take out student loans then to go to medical school?

Yeah, I took about half the tuition on student loans. I had about 180,000 loans when I started intern year. That's at 6.8, the very high interest rate. And then I paid off about 40,000 of it before it was forgiven.

Okay, wow. So were they all federal then and no private?

Correct. It was all federal, subsidized Stafford and unsubsidized Stafford loans.

Okay, and which IDR program did you use to pay down your loans while you were paying them?

When I was a resident, I just did the income based repayments or my payments were around $250, $300. So really not too much. Once I became an attending, the max rate is the 10 year payment. So I paid about $1,500 or so a month for that.

Okay. All right. So what was the experience like getting through pslf?

It was a very long journey and I would equate it to kind of if you ever get an insurance denial and you're the resident, you have to go through the process to fight the claim. That's what I felt like I was doing for this whole process. And I wrote my application. You know, it took me many hours of phone calls and had to submit the application, you know, four times after I got 120 payments.

Oh, my goodness. So you got rejected quite a few times then?

Yeah, so this was after I had 120 payments. And it was for reasons that are just obviously incorrect. Like the first time they said the HR rep that signed the application, their signature was too neat and it looked like it was computer generated and they needed a scanned. So they needed them to print the PDF, scan it on a pen that's a different color so it doesn't look too neat, and then send it back to them. So I jumped through that loophole. Then the second time they said that I was not currently employed at a nonprofit and I work at a University of California institution. And the error for that was that the check mark for saying that your employment end date was not checked. That's because I'm currently employed. So there's a checkbox that says currently employed. So they Denied it for saying that, oh, you didn't put an employment end date. So that was the second rejection. Yeah. And then the third time, they came back and said, the EIN number, which is the federal, that's on your W2. That number was inconsistent with my previous application form since I've recertified pretty much every year. And that was because the University of California system changed their payroll to, you know, instead of every campus having their own payroll, they moved to a centralized payroll. So the EIN change on the W2s. So that made them reject it, saying that, oh, it doesn't make sense that the state institution would change their EIN. So they needed to see my updated W2 again, which I sent.

Okay.

Yeah. So after all those things, I ended up doing, submitting a claim through the Consumer Protection Federal cpfc. It's a Consumer Protection Bureau.

Cfpb, The Consumer Finance Protection Bureau. So that worked well.

Yeah. And I submitted a complaint after, you know, three months of trying to get them to accept my posf, just for. Just. Just to say that, oh, you check the boxes and we can process it. And then magically, in about, you know, a month and a half later, they said, oh, your loans are not forgiven now.

Forgiven. Oh, my God, what a great day. That's wonderful. So. Oh, my gosh. So what year was it that you finally got forgiveness?

This was August of 2021. So it was just this past year.

Just this past year. And you had to get the CFPB involved in order for them to approve you, Correct?

Yeah, and I found that out. There's a. There's a PSLF physician's Facebook group that I follow, and there's people that. That's where I got the idea to do it. And I only did it because by then we had spent hours on the phone. It seems like they were just trying to mess around with me and just reject it for different reasons that are not correct. And I really didn't know what to do. And the people on the phone are very nice when you call them, but, you know, they come with rejections left and right for no valid reasons.

Right, right. Yeah, there were. There were a lot of stories like that initially about PSLF and all these rejections, but I'm so glad that it for you finally. And, you know, the CFPB is a governmental organization made to keep other financial institutions accountable and make sure that they're not messing with consumers. So this. That's great. That worked out for you. And the different checks and balances in the system worked out for you too. So how did you hear about pslf? What got you down that road in the first place?

I think I was as a student when I first heard about it. I didn't think really anything of it. I figured, oh, you know what, if I end up doing academics, then I'll use this tool and hopefully it works out. But I didn't plan my career around being in a nonprofit so I can get psf.

Oh, interesting. So you just happened to be stay in a nonprofit and it worked out for you. That's awesome. And so you were, since you've already reached this awesome milestone on your net worth, you were investing alongside the whole time.

Yeah, that's correct. So for me, I started as a resident doing the maxing out the Roth IRA, the I think 5,000 a year or so. And ever since, you know, I became an attending, I try to do the at the state institution. We can do 403B and a 457B, about 20,000 pre tax each. And the place that I'm at, we can actually do a mega backdoor Roth for I think like $57,000 post tax in addition. So I try to really maximize everything.

Wow. Yeah. That is winning right there. You've got 457, 403B and the mega backdoor. And you got PSLF because you're working at the place that you're working at. That's lovely. I love that. Yeah.

So I feel very lucky.

That's great. And you took advantage of it. You know, a lot of people have access, but they don't actually take advantage of it. So kudos to you for working all the angles possible to get you to where you are now. But in any case, congratulations. You did a great job. And if there's one thing you want to tell people coming behind you, what advice would you give to people coming up behind you?

For people applying for psa, really? Save your records, save your bank accounts, because they were missing four months of payments magically in the initial count. And then I found out that online banks only keep, you know, I think seven years of online statements before they disappear. So I didn't actually have proof of even though I made those payments. And luckily it did work out with a manual recount, but it took a year and a half for them to do the manual recount.

Oh my gosh, how stressful. So would you still recommend PSLF to other people coming up behind you?

Yes, I do, because I think people in my medical school class, one by one, others are getting similar results like me, but actually getting their loans forgiven. So I think it is a valid program. You just have to really fight for yourself. It's not going to be easy like applying for a credit card. You just send in the application and they're going to say, okay, you're good to go. At least it wasn't for me.

Yeah, it requires some work now with the PSLF waiver in progress. They're making things easier recently. But absolutely you don't get anything for free. And this forgiveness you really had to work for. And congratulations for getting where you are and getting the forgiveness and doing all the hard work.

Thank you.

Yeah, absolutely. Thanks so much, John. Thanks for being on and thank you for sharing your story with us. So what an amazing story. I mean, this doctor got rejected four times from PSLs, but he persisted and finally filed a complaint with the Consumer Finance Protection Bureau. And thank goodness that worked out because he had done his part. He had worked for a non for profit for 10 years. He had made 120 payments, he had gotten all the paperwork in line despite all the little things that they picked up and wanted him to change. And so he rightly got the PSLF that he deserved. And not only that, he also maximized all the other retirement accounts that were available to him and did the Mega Backdoor roth, did the 457, did the 403B and was able to achieve millionaire status rather quickly in his career. So recently he hit the 10 year mark after finishing medical school and hit the millionaire mark as well. Really great job and I'm so glad that we were able to share this story with you on this podcast.

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.

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