I've written before about some of the reasons you should NOT retire early. The early retirement crowd savaged it a bit on Reddit, which I thought was kind of funny given how much I advocate for financial independence (FI) on this site. At any rate, I'm arguing today from the other side. Today we're going to talk about why you should become financially independent as soon as possible. What does financial independence mean? It means you can quit work today and never work again while sustaining a lifestyle that is reasonable to you. A rule of thumb is that you need 25 times what you are actually spending socked away in investments to be FI. Spending $120K a year or $10K a month? Then you need $3 Million to be FI. How do you get there? You make a bunch of money, save a huge chunk of it, and invest it wisely.
Without further ado-
10 Reasons to Become Financially Independent as Soon as Possible
Financially independent people can spend all day playing in the sand, or rappelling off it.
#1 You can retire early
It's called work for a reason- they have to pay someone to do it or nobody would. This is the main reason people go for early financial independence- they hate their job.
#2 You can live somewhere that doesn't allow you to earn a living
Oil workers can make great money…if they live in Texas. But what if you want to live in say Southern Utah? Then you're either looking at a massive paycut or no job at all. But if you're financially independent, then you can live anywhere you want, or even any country you want, or travel all over the place if you want. You're free of your job. A lucky few are able to do this throughout their career (think professional bloggers). Docs are able to get a job in most areas of the country (although the more specialized you are, the larger a city you have to live in), but there are lots of fields where you have significant geographic limits on your jobs.
#3 Your job is more enjoyable when you don't have to do it
Many of us actually like what we do for pay. We spent a decade or more learning how to do it, we find it challenging and interesting, and we feel like we're really making a difference in the lives of others. Want to know what you can do to enjoy it even more? Become financially independent. There's nothing worse than going in to work knowing the money you'll earn there has already been spent and there's no escape.
#4 EMR, HIPAA, meaningful use, preapprovals, managed care, EMTALA or whatever
Every job has a sucky aspect to it. For doctors, the regulatory and administrative aspects can be pretty painful. Guess what? Financial independence provides an escape. You can either walk away completely, or simply refuse to deal with whatever painful aspect of the job you don't like, no matter what the cost. Financial independence is “walking money” (i.e.you can walk away.) It doesn't matter if it takes you six months to get another job. It doesn't matter if you never get another job. You don't have to take that!
#5 Drop call, drop weekends, drop night shifts, or go part-time
Some of the worst parts about medicine come from its all-consuming 24/7/365 nature. People get sick at all hours of the day or night. However, that doesn't mean YOU have to take care of them at those times. In many instances, it is possible to buy your way out of having to stay up all night or be available all the time. Financial independence gives you the means to work when you want to work.
#6 Do Volunteer Work
There are many volunteer opportunities in medicine. Unfortunately, most of them require significant time and commitment. Doctors Without Borders, for instance, requires a 6 month commitment and provides a relatively tiny stipend ($1,913 a month currently.) You might not have to be financially independent to take on an opportunity like that, but you can't be making boat payments.
#7 Spend More Money
If you are financially independent, it doesn't necessarily mean you have money coming out of your ears. What it does mean, however, is that anything you earn in addition to your nest egg can be blown on the silliest of things. Still like that job? Fine, buy a Porsche. Or a cruise around the world. Or a fancy McMansion. Or pay off your mom's house. Or endow a scholarship. Whatever. There's something fun about being able to spend every dollar you earn guilt-free.
#8 Encore Career
Many of us dream of having an “encore career,” you know, the one that would have been stupid to do first because it pays like crap. Maybe you wanted to paint, or run a used bike coop, or in my case, drive big excavators. Now you have the opportunity to pursue any career you like without regard to the financial ramifications. You could even go back to college and get that art history degree your practical father talked you out of!
#9 No More Life and Disability Insurance Premiums
Sick of paying high premiums every month for insurance you'll probably never use? Financial independence allows you to quit paying those premiums since you no longer need the insurance.
#10 Make Hay While the Sun Shines
You may look back on this period of your life and realize that this was the golden era of medicine. In some specialties, pay decreases dramatically from time to time, and it could happen to you. If your income is halved in a few years due to factors beyond your control, you will be very glad that you saved like a madman now, whether it gets you to FI or not.
What do you think? Are you trying to become financially independent as early as possible? Why or why not? What benefit do you think it will give you? Comment below!
Excellent post, well-articulated.
You can become a slave to your stuff or a lifestyle or you can choose to be captain of your own ship. Most of us (MDs) are slaves. Unfortunately, with the rising debt of newly minted docs and the steady downward pressure on incomes, FI is becoming increasingly challenging and elusive, especially for those in the lower paying specialties.
FI is bliss’ gives you so many opportunities to pursue your interests and is emotionally as rewarding as paying off all your debts
#3 really resonates – working because you want to, not because you have to.
A Top 10 list! That’s twice as good as the Top 5 lists I’ve been putting out.
I would say you hit all the high points. You need to be a little careful if employing #7: Spend more money. If you become financially independent, then ramp up your lifestyle to the point where you’re accustomed to a higher standard of living / spending, you might lose your treasured FI status.
I’ll quibble with the assertion that job hatred is the main reason people aim for FI. I don’t hate my job and I read dozens of FIRE blogs, and most don’t hate their job, or anything, really. FI minded people tend to be optimistic people. They don’t love or hate working; they simply prefer the alternative, and often have big plans that a typical 40-hour workweek interferes with. Do some people hate their job? Sure. But there are so many other great reasons to strive for FI, as you outlined in #2 through #10.
#11 For Your Health: Full-time physician work (50 – 60 hour workweeks are typical) equals interrupted sleep, time pressures, stress, and a lack of time to exercise and prepare healthy meals. FI allows for part-time or no-time work, and an ability to focus on your own health and happiness for once.
Oh, and to answer your questions at the bottom: Financially Independent as of last year. I didn’t know the term two years ago, but it happened by age 40 naturally by virtue of being a habitual saver and investor. What benefit? I’ll be able to retire anytime I choose, quite likely before age 45. We’re planning some incredible family adventures that dependence on a full-time income wouldn’t allow. Working locums in New Zealand or Australia, moving to a Spanish speaking country for a year. A year-long motorhome road schooling tour with our boys. We’ll have 8 to 10 years of retirement / semi-retirement with them before they leave the nest. Can’t wait!
Best,
-Physician on FIRE
I agree with POF regarding the health aspects of becoming FI. Shift work can be as harmful to your health as smoking a pack per day. It has been two years since I’ve worked an overnight shift, and being able to sleep every night has made me feel like a whole new person.
We’re not completely FI yet, but close enough that I can negotiate a little harder on the schedule and am comfortable working part time.
Now there’s more time to play with my nieces, do home improvement projects, hike, help where needed, etc. It’s a pretty sweet life.
I definitely agree with this #11. I’ll add a #12 (or maybe it’s just #10.5): there might be a day when you’re not physically able to do the work. My partner is 61, just had a fairly major surgery, and is back at work 2 weeks later because she feels like she doesn’t have another option financially. Ouch. Watching her work twice as hard to see half the patients she normally does is plenty of incentive for me to FIRE.
Great post, as always! I agree with all of this. Plus POF’s health one. I’m much more active on my days off.
It is hard to talk young doctors into working for FI sometimes. Some think they won’t retire and that is fine if it works out that way. But to be 60 yo and not have the option of retiring would suck. The field changes over time as do our priorities, values, and physical endurance.
I enjoy my work so much more now that I’m FI. I only do what I love to do and in the way I want to. I don’t accept patients, hours, or committee work that I don’t want to. Of course I could have done much of that sooner but financial insecurity can lead one to make choices out of fear. FI gives freedom!
While I agree with much in your list I often wonder if technically your financially independent long before 25x income. Sure that’s what you need to retire, but what you need to have it impact your life is only the amount that would allow you to pivot should things change. I’m not advocating to stop at 5-10 x your expense as retirement still has to come, but at 10x expenses or maybe even 5 your positioned to take more risk if desired provided retirement is far enough out. That in itself can be life altering.
Absolutely agree. It is a continuum. Someone with $400K saved might not be FI, but he’s certainly in a better position than the new grad with a net worth of -$200K.
Love the list WCI. As you know I am a huge proponent of financial independence as early as is reasonable. I like to look at it as risk management. Your future health, both physical and mental are unknowable to some extent. If you have to or want to cut back due to burnout, or physically you just can’t do the work of a full time physician, you have tremendous leverage over your life with FI.
I can really relate to number 3 and 5. Work really is more enjoyable when you know you can walk away at any time.
in dentistry it is stated that 3% can retire comfortably at age 65
Kenny,
What do you think the reasons are that dentists can’t retire at 65?
Do you think it is the student and practice loans?
Do you think it is the expense of owning your own business and not having a practice worth anything when it is time to retire?
Do you think that it is because we simply, as a whole, spend more than we make?
Please cite your source or link that shows 3%. I know plenty in dentistry who have retired comfortably on schedule or before retirement age.
I am a 60 yo family doc, still working part-time, but consider myself financially independent.
I’m so thankful to my younger self for saving when it would have been easy not to- those paycheck deductions really worked for me.
Still working because I do like medicine and my patients, plus it would be somewhat painful to pay $800+/month for health insurance worse than what I have now.
Will probably pull the plug soon because quality metrics bring out my whiny side…really, it means I’m a bad doctor (and get a pay cut) if I have a certain percent of diabetic patients who smoke, and don’t come in for labs? Happy I have the financial independence to make that decision
Love recommending White Coat Investor to the younger docs I interact with!
I’m always fairly skeptical about the 25x rule, especially for the younger crowd. There’s too many embedded assumptions that might make sense on a large scale for financial analysis, but probably won’t hold true for any single person. Unexpected expenses are inevitable including simply wanting to buy things down the road that you haven’t thought about today.
It seems the younger FIRE crowd (under 40 YO) is especially susceptible. It’s unimaginable to me that I could predict my lifetime wants/needs/expenses at age 35 (before marriage, house, kids, businesses), much less think that the $2,000, $5,000, $10,000 (or any number you like) in monthly income will be satisfactory for the next 30-50 years.
It also makes FIRE difficult (if not impossible) when you get started later in life. You can’t save enough with the limited timeframe. That’s one of the reasons my take on FIRE has never been work/save to hit the magic 25x, but generating enough monthly income by acquiring or creating investments that generate passive cashflow (ala Rich Dad). You can always expand your monthly cashflow regardless of age, current income or a decade of bad spending habits.
You do realize there’s no distinction between “work/save to hit the magic 25x” and “acquiring or creating investments that generate passive cashflow”, right? Where you invest the money doesn’t matter, you still need to save the money.
I agree. A pile of money and a source of passive income are interchangeable. One can be sold for the other. For instance, I could spend 30 years acquiring mutual funds and then sell them all and buy a real estate income property. Totally fungible aside from the tax and transaction costs.
Sure, the two piles are equivalent in the end. The difference is what it takes to pull out a certain amount of money each month indefinitely. A million dollar portfolio is expected to provide $40K annually. That’s about $3,500 monthly.
Most of that portfolio came from direct savings plus capital appreciation (depending on when you started actually saving) with very little coming from cashflow (dividends). Very traditional. However, not many people will ever have a portfolio that large and it’s still only providing $3,500 monthly.
In contrast, you can buy a cashflow generating asset for about 30x monthly net revenue. It might cost around $100K ($3,500 * 30 months) to get the same $3,500 payout as the million dollar portfolio. Online business, laundry mat, newsletter subscription, any number of examples. Most people will find it much easier to borrow/save the $100K (or build something on their own) vs. savings/investing to build a $1M portfolio.
You can definitely convert either type of portfolio into the other. I just think the focus on cashflow instead of net worth (capital gains appreciation) makes it much easier for the average person to achieve FIRE without worrying about running out of money when their lifestyle changes.
Lots of people on this forum will have a million+. Heck, many of them already do.
An online business, laundry mat, newsletter subscription, rental real estate etc are all a combination of active and passive income. Of course you should expect a higher return out of those as you’re putting more in.
But if you can buy a bunch of cap rate 8 properties then sure, it’s not terribly unreasonable to withdraw 8% instead of 4% from those. But that’s certainly got more investing risk and potential to have to add active work than a 50/50 mix of index funds.
Chris
Can you give a concrete example of investing $100K in order to purchase a business that will give you $3500 monthly with not much risk. Banks nowadays want you to put in 33 %, rarely 25 %. That means the total value of the business is $300-400K. The amount of work needed to run that business in order to generate $50K per year is huge toll and basic wages. Not something a physician is used to do. If you trust someone to run it without ripping you off and sit back and wait for that passive $50K check it is much less likely to happen.
I have invested $500K ( not $100K) into one and even after growing pains it is generating only $50K per year. Banks were not willing to lend money but I felt that funding it myself was better than letting that amount sit in a bank earning pitiable interest.
In your scenario investing #100K and expecting to get $40K annually is 40% returns ( I know your principal remains at $100K or about that amount when you sell, or you may go bust and lose that too to the loaning bank). That will be possible only if you own the laundromat, live upstairs ( like some Indians do when they come in to this country and have a starter business) and do all the work needed to keep it running. Not possible by passive income. I used the laundromat as an example.
Sure. All of them are going to be alt-investments almost by definition since it’s outside the mainstream. It’s the difference between buying a rental property vs REIT shares. Although it’s not like REITs are the most popular investing instrument in the world. 😉
Off the top of my head…
– hard money lending is worth 12-15% + 4 points
– online business selling at 30x MRR from reliable brokers (e.g. FE International). These will be things like e-commerce sites, established publishers with a large subscriber base, community sites (e.g. how to play certain board games). That’s the specific example I used for the 30-40% annual returns.
– online business selling at 6x-18x MRR from not-so-reliable brokers (e.g. Flippa). Not to say all of these are bad deals, but it’s definitely caveat emptor. For me, the biggest risk of these types of businesses isn’t getting scammed, it’s about the business staying viable enough to return my money
– royalty based lending to startups. It’s similar to angel investing, but your money is being returned every month/quarter instead of hoping the company actually does well and gets acquired before ever seeing it again
– pretty much any retail, service based biz will sell for 36x MRR. The downside is the small deals usually count the owners as F/T employees or owner-operators, but I’ve come across many deals that are already structured as 100% passive income to the owners.
Obviously, “without much risk” is entirely personal. My circle has many, many very successful folks and exactly zero risk-averse bankers. We have a different take on exactly what constitutes risk.
I am in my early 40s, FI and still working, though I’ve cut back on clinical hours and plan to cut back a bit more for 2017. Over the past 6 months, since cutting back, I’ve generally felt much happier. However, I have noticed that I’m still intolerant of the nonsense in my organization. I (perhaps naively) thought that I would care less about some of the pain points, given that I’m not in the office as much, and my life is overall better. But no. Because I feel like I could walk away from the job at any time (well, at least in 2+ years when my contract is up), my response to aggravation is a knee-jerk desire to tell them to kiss my rear end as I walk out the door.
So much for optimism. Call me Bizarro PoF.
How much in investment money do you have (not net worth) so you are FI at age 40?
5.3 million.
Wow! How did you got so much so early?
Check out my guest post from summer 2015, “Super Saving for an Early Retirement.” That was written in early spring 2015. Between then and now, our practice was bought, so both my wife and I received large payouts. I also received a 200k inheritance within the last year. I feel a bit like I cheated my way to FI.
As you know from the guest post, we max our tax-protected space and save an additional 20k/month in a taxable account. So it would have taken us at least 5 more years (maybe more) to reach where we are now. Hence, feeling like we cheated.
Rather than “cheating” I prefer to call that “offense AND defense.” Boosting income can work just as well, and in some situations, better than spending less.
I guess it makes sense since you have double physician income.
I too believe that I would tolerate more, put up with more, out of necessity of course, if I were more profligate and HAD to work to pay the bills without a drastic lowering of our standard of living. So my theory on doctors (using myself) is that we’ll retire later and work more hours if we are paid worse. Of course many of us would not have entered medicine knowing we’d get crappy pay in advance, and another way (I think but maybe it isn’t true) that would have kept me working would have been to keep work from becoming such a miserable unbearable grind. (And there were definite negative changes in our working conditions over my 20+ year career, not just the same things bugging me more than they used to)
Do people who retire early worry about losing their skills “just in case” they need to go back to work? I mean if you retire totally at 45 and at 55 you have some unforeseen issue you can’t just pick back up and start working. However, you just cut back hours you’d still be able to ramp up if you need the cash?
I left medicine for 13 years while working in financial services. I returned to cardiology 2 1/2 years ago. It can be done.
Guest post?
Agreed, and a guest post on MOC, issues with leaving the field, reentry etc. I guess certain fields (EM, for example) are easier to keep a big toe in, so to speak.
Would love a post, though, on how maintaining clinical skills and certification while otherwise leaving the field. I would imagine the occasional locums gig (which will often pay for ACLS and PALS and licensing) might be the best solution for most.
Credentialing applications ask for an explanation of any gap greater than 30 or 90 days. If you’ve taken years off, particularly from a procedural specialty, I would imagine you would have a tough time finding a place willing to take you without some remedial training.
Working “just a little bit” doesn’t excuse you from CME, MOC, ACLS, PALS, meetings, etc… There are substantial carrying costs in terms of time and money. My plan is to overshoot the 25x by a wide margin and hang on to credentials for a year or two after retirement. If I were to want more money years later, I could work outside of clinical medicine.
I’ve often thought about this as well. If you really decided to give up medicine entirely it could potentially be tough to change your mind. We spend a lot of $ and time on MOC/CME-type stuff, and while it would be nice to quit doing that, it would make me nervous to loose the ability to make money if I needed to even after I thought I was FI. Its completely unlike a lot of these RE blogs that are usually written by software engineers who could absolutely get back into the labor force at any time if they wanted to.
Could always get back in by doing a fellowship.
Imagine a 55 year old doc who is out of touch with medicine for 10+ years trying to do a fellowship with 25-28 year old physicians. It will be pathetic.
Either keep up with the skills yearly by doing locums, free clinic, work part-time in a hospital or group or give it up for good when you are sure.
There was a 58 year old in my intern class. He did fine. Interesting guy — financially independent from a previous career and getting into medicine as an encore.
Absolutely I worry about losing my ability to return to a well paying job in medicine! I am spending several hundred $/year to maintain my license, my BC, and my CME and volunteering a few days a month to maintain that ability. My husband however has refused though for now maintains his CME and license.
Our situations, though, are different. He gets an Army pension which covers most of our bills. If he dies that amount drops in half or more and I will regret it if the best paying work I can get is 20% what an FP can earn. If I die then he gets a pay raise; no longer having to pay the survivor insurance covering his death.
My argument though is this: what if, instead of dying, one of us has high cost health needs beyond our current income? I d’ruther work 10 hour days and pay 1-2 shifts of health aides to wipe his bottom than have to care for him 24/7 because any pay I could get away from home wouldn’t cover the helpers needed while I was at work. So while I wish he also would, I plan to keep up my potential to work in medicine to age 60+. And might even want to work full time again, without repeating residency!
Many places and even states will not hire/ relicense if one has too long a gap. While an Army wife it was easy to say “I have several intervals when I wasn’t working because I followed my husband around the world and had kids. There are no issues with me HAVING to take time off” and that worked. Their real concern is you might have been in jail or in rehab. That’s why I was glad right after retiring to have a nice resume filler- running for office. But now I have a pretty swiss cheesey resume. Will be tough to get hired but not impossible.
Great post, retiring early isn’t for everyone, but for me it’s has been outstanding. The death of a colleague two years prior to his retirement date accelerated my decision. A year before he died, I had lunch with him and he pined for the day he could create his own schedule. If you really think about it, we are on somebody else’s schedule from the time we are in kindergarten until we retire at 65. If we are fortunate to be in good health, that would leave us actuarially with only 18 years to enjoy being on our own schedule. I retired at 52 and work one day a week (6 hours) as a clinical instructor to keep me appreciating the days off. I loved clinical care, but love be on my own schedule even more. Most people who retire say, “Why didn’t I do this earlier.” You can fill your schedule to pursue the things you put on hold and sacrificed to build your career, like family, sports, music, reading, travel, museums, hobbies, philanthropy, etc., it’s all up to you.
Nice article. We should be FI in about 15 years. But I’m not willing to kill myself now to make it happen before then. My kids are only little once, and I want to be around more for them at this stage of life, which means working part time now . . . and later :-). I really don’t see myself ever wanting to work full time. I think I have a nice balance between what I want now and saving for what I want later. So I wouldn’t necessarily advocate for one working a crazy ton of hours for 10 years to reach FI, if that doesn’t fit in with your core values or priorities.
I agree with it. Chasing FI for FI sake is a bad thing and can lead to unwanted consequences. Missing out on Children’s activities is one such thing. I worked at less than full schedule by seeing less patients and getting paid less but took those hours off in between to attend a Halloween or some other party at school at 11.30 AM or my daughter’s birthday party cake cutting at school at 9 AM, when she was in pre school and elementary school. I juggled schedules a lot, but those photos taken then and now running as a screensaver makes me smile each time and is priceless. Totally worth any extra years to reach FI
I am responding to the question about returning to the workforce after becoming financially independent and retiring from primary care. After retiring at age 52 from a primary care practice, I returned after a four year hiatus to do charity work. My interview skills were certainly adequate; physical exam skills were good; and the drugs and procedures hadn’t changed that much. It is very fulfilling to be able to practice in a volunteer capacity, without worrying about money or insurance concerns. I would certainly recommend this without hesitation to any doctors who are burned out but financially independent. I think it enables me to use my skills that I’ve developed over my lifetime to have value back to the community.
Reason 10 is the biggest for me. I’m not going to claim the sky is falling, but even if there is only a 5-10% chance of the sky falling, I would like to insure against it. Self-insurance in the form of financial independence is really the only way to insure against loss of income due to changes in reimbursement structures and employment markets. Is this unreasonable? Well, my odds of death or disability within the next 25 years are probably less than 10% and I insure against those. True, the cost of life and disability insurance is considerably less than the cost of financial independence, but FI has considerable secondary advantages as well (see reasons 1-9).
It is also the only way to insure against things such as job loss for sexual harassment or other misconduct issues. Not saying that affects a lot of people and maybe it shouldn’t affect any, but it is true.
Yikes. This is a dark way to look at things. I’d hope that anyone who had enough insight into themselves to know that they are sexually harassing other humans or otherwise abusing their power, would try and change these behaviors, rather than continue to engage in them while saving up enough money to quit when they finally get caught. But then again, it’s worked for Donald Trump, so maybe using money to buy your way out of any difficulties is a legitimate way to be in the world. A depressing thought.
Bear in mind an accusation of that behavior may not be true, but could potentially still have career ramifications. Say a patient accuses you of molesting them during an exam and you have no witness. What will the hospital do? At a minimum your privileges will be suspended during an investigation that may take months.
I heard about this today from a colleague at work:
http://www.times-standard.com/general-news/20160503/firing-of-highly-regarded-vmc-doctors-stuns-child-abuse-advocates/2
This happened several months ago, but based on what my colleague learned, these doctors were thrown under the bus because the hospital was getting sued, not because they actually were to blame.
Whatever the truth (and to be clear, what I heard is essentially 4th hand information), it’s going to be hard for those doctors to gain employment again.
Ok, that is scary, but makes sense and is less depressing than what I was assuming.
Sure we all assume we’ll never behave inappropriately, yet we know so many people do or are judged to have done so and standards are changing- many especially older docs view some rules as way too PC etc. And what if we make mistakes due to mental illness or other uncontrollable reason? We may still lose our jobs and it might be tough to get disability or take a very long time.
We as high income earners create our own work prison. We choose what we want our lives to be. We can live like a family who makes $50k/yr and retire very quickly or we can live on $250k/yr and never retire (depending on income). I watch colleagues building or buying these million dollar homes knowing perfectly well that just the taxes and maintenance will cost $40k-$80k/yr (high property tax state.) These docs have imprisoned themselves to their job for ever. $80k/yr just to live in a house in retirement requires $2 million and they haven’t even bought food, clothes or health insurance.
I think the first step to all this is to know thyself and learn what truly makes you happy. Concentrate on spending money on those things and spending very little on the other fluff in life. Fancy cars, boats, expensive dinners, clothes, jewelry/watches, large McMansions don’t necessarily purchase much happiness as compared to experiences with the people you care about. I wish I knew that a few years sooner. My life would be slightly different today.
Let me also add #13 by being financially independent you have the opportunity of eating healthier and exercising more. That in conjunction with decreased stress from being financially independent should ideally prolong your functioning life and allow you to enjoy all those great things that life has to offer even more.
What about experiences with people you care about in fancy boats? 🙂
Seriously though, totally agree.
Honestly i have none of the fancy stuff other than a surf boat, it’s really fun esp with family!
When I wrote my comment above I was expecting people to say having fun on boats with family. Boats are an extravagant luxury. There is no reason why a high income earner like a physician can’t afford a boat to have fun with friends and family. I’m sure those moments are priceless.
The problem I see most physicians have isn’t the single boat. It is the boat in conjunction with all those other things I specified. I am paraphrasing WCI here, but as physicians we can afford some luxury, we can’t afford all the luxuries.
Also being financially independent allows one to work a little more and purchase a boat and its maintenance without affecting financial security. It is much easier to buy a $60k boat when you have $1.5 million in investments generating $60-75k/yr as compared to having a net worth off negative $400k paying $25k a year to service that debt
Thats right, I did buy my fancy boat after I reached a net worth of 2 Million. Tell you its really fun and great ice breaker and people always appreciate you taking them out for a ride.
Physician from Canada here. I have been reading your blog for a while but haven’t commented before. First off, great job with the blog, I have learned a lot from you. I agree with this list completely. I am in a relatively high paying specialty here in Canada but have had recent cuts and expect more cuts soon due to government budgetary problems that is causing them to trim the higher payed specialties. The first round of cuts really opened my eyes and I became a hyper saver. Now, after a net worth in the 2M range (CAD) I don’t consider myself financially independent but I feel much much less stress about any upcoming further cuts or whatever else life may throw. Totally agree about the path to FI being a continuum with accumulated benefits along the way.
I am mostly in the #8 boat. I would like to try something new now that I’m close to having the financial stability to make that happen.
I have found #3 to be the opposite. The closer I get to not needing to work at all, the harder it is to sit though another boring meeting, or contain my annoyance when I receive a request to do the opposite of what they just asked me to do last week.
I’ve noticed that a bit too. Since you can say, “Screw it” sometimes you think you just might! But I still think it’s better to be able to do so than to purposely mismanage your finances so you can’t!
For me its all about being able to quit if I want and work when I want, how often I want, etc. I totally agree that its a much different feeling to work because you want to, not because you have to.
I’m in the camp of people who’s decided that medicine is not the greatest fit for me and my personality. I can do it, but I don’t like doing it full time. Especially when my finances were such that I had to work full time. Over the last year I’ve started to aggressively get rid of debt and saving a lot more. I feel much, much better now and will be able to cut back to a part time status soon and switch jobs more freely in the future.
I don’t see myself being able to retire early or be completely financially independent, but being able to work at a pace that is comfortable for me while still being able to save and do the things I enjoy (travel, hobbies, etc) is what I think will ultimately make me feel very satisfied.