By Genhee So, WCI Columnist

I proudly held the bright yellow cardboard pieces in my chubby 5-year-old fingers. It was hard work to earn these “coins” that I was grasping so tightly—painstakingly acquired by tidying up toys and playing nicely with classmates. In a kindergarten classroom, these perfectly round canary-colored cardboard discs were currency dished out by our teacher for good behavior with the promise of a “toy of our choice!” once we had enough in the bank. Flush in funds, I stared intently at the lineup of colorful gadgets, squirming in anticipation before finally claiming my newest shiny acquisition.

It seems humorous, now, as a seasoned radiologist with 17 years in the field, reflecting on that moment only to realize that I received more formal finance education in kindergarten than I did throughout my three years at McMaster Medical School in Hamilton, Ontario, Canada. Classroom discussions on money management as a medical professional were nowhere to be found, but unsolicited pitches from the financial industry were abundant. Insurance brokers and the like were trying to capture fresh meat from the new doe-eyed medical student pack, all sounding like used car salespeople peddling their ‘must have’ products.

That would set the tone for my relationship with finances and wealth during my medical career: skepticism.

 

Spending on Luxury, But Knowing So Little About Finance

My instincts at the time told me to put insurance decisions on pause; there was so much to learn in medicine to worry about monetary safety nets. Instead, I fostered a relationship with a local advisor at an established bank. This carried me to my early days as a Canadian academic cross-sectional radiologist, where my primary focus remained becoming proficient at the workstation.

Breaks from work were spent enjoying the fruits of my labor as a single professional, traveling the world, savoring fine dining, and amassing a fun but tasteful shoe collection. I still didn't feel the need to concentrate too much on wealth planning, but I also didn’t frivolously spend my earnings on shiny toys like my 5-year-old baller self either. Advice from a mentor taught me to always put aside money for anticipated tax bills and to save consistently, but I didn’t know what or where to invest my savings. At that point, I knew so little financially that I embarrassingly can’t recall what securities my financial advisor used for my portfolio.

I was three years into practice when the milestone of marriage caused the first major shift in my relationship with money as a radiologist. The allure of carefree spending on self-indulgent luxury took a backseat to more earnest considerations for wealth planning. Without pensions as a backup for myself or my graphics designer husband, the need to save responsibly for our older selves felt palpable—it was time to start thinking more about investments and less about spending sprees at Prada in exotic locales.

The five(ish)-year-long journey from zero to $1 million in assets came with its stressors. I still didn’t know how to effectively build wealth. Asset location and allocation? Those were foreign terms. I thought it was sufficient enough to understand MER and how it worked in my favor: the smaller the Management Expense Ratio, the better. This guided my decision to join a wealth management firm that charged a nominal annual fee. These advisors were salaried which I thought translated into decreased motivation to provoke a flurry of buy/sell transactions for their own benefit. And yet still, I left every meeting with a mixed bag of emotions. I felt relief that our wealth was growing by proof of increasing dollar values, but there was always a nagging feeling that our wealth generation was not optimized.

My financial ignorance started to brew an undertone of unease whenever I thought about our fiscal well-being.

We may have still continued with what was then known as MD Management, but our advisor took a leave of absence, leaving us unwillingly paired with a stranger for an advisor with whom we struggled to establish a good rapport. Gone was the trust we held in our key liaison to the financial world. Simultaneously in 2018, notable changes in government policy were coming down the pipeline affecting tax treatment on physician income. I was becoming increasingly annoyed that I was first hearing about these changes from my colleagues and not from the financial advisors who I paid to stay current in their field. I learned the hard way that a salaried employee, while perhaps less motivated to sell me everything under the sun, also had less incentive to work more diligently with our growing wealth despite knowing intuitively that more wealth creates more opportunities and complexities. What I presumed was the best way to obtain value for paid financial services fell short of expectations.

Ten-plus years into my medical career, as our family continued to save responsibly and as we dipped our toes into the multi-million dollar realm, our nest egg-related worries now morphed into how to effectively retain wealth and combat the evil forces of inflation and taxes, particularly with a young daughter added to our growing family. These unsettling feelings of insecurity only exacerbated the overwhelming feeling of burnout at the hospital.

By the end of 2019, I was at my limit on all fronts.

More information here:

How I Went from a Negative Net Worth in My 30s to Early Retirement

Phase of Life Spending

 

Financial Advisor or DIY? Or Something in Between?

Depleted healthcare resources piled on to my list of frustrations. Work felt like a revolving door breeding unhappiness, where self-inflicted pressure as the primary income earner financially handcuffed me to my job. And spending all my time working provoked the guilt of being a neglectful mom and wife.

Physically and mentally, I knew I could not continue on this hamster wheel of endless radiology work hours. Although I always acknowledged that investments could generate meaningful income to offload my burden of working to live, I was never convinced that our approach was yielding optimal performance in asset appreciation and wealth retention. Fee structures were shrouded in mystery which created doubt that fiduciary practice was authentic. For me, the cost itself wouldn’t have been an issue if the scope of services I would receive in return was made clear; I’m happy to compensate quality accordingly, but it’s difficult to feel confident that you are paying a fair price when you don’t quite know the cost of what you’re buying. I lost faith in the professionals managing our money but I also knew that I didn’t have the capacity to be a complete DIY wealth manager.

How, then, could I obtain value, trust, and transparency to prosper in the financial jungle? The answer: self-education.

It took an imminent nervous breakdown for me to realize that a medical education could only get me so far in life; tandem lessons in finance were absolutely crucial to ensure that the generation of passive income contributed as the clinch team player to feel and achieve my definition of success.

More information here:

How Moving to Canada Affected My Life as a Physician

 

How I've Made Myself Healthier and Wealthier

From the dark cloud of 2020 arose the precious commodity of time. The national lockdown created the space I needed to read, listen, and watch as much as I could about money-related matters. The pandemic was also a sobering wake-up call that highlighted the urgency of establishing wealth generation independent of my own health and practice in the unfortunate event of my demise.

The beginning of this new educational adventure wasn't easy. Despite the vastness of the internet, it was challenging to find relevant data that applied to my circumstance as a mid-career, incorporated high net-worth physician. I no longer had my loving kindergarten teacher to spoon-feed me the relevant information, but steadfast tenacity brought clarity to monetary concepts and helped distill pertinent information.

I was skeptical about finance for much of my career, but now my attitude toward wealth management has been reshaped into respect and passion for understanding fiscal matters. I now have clarity about the components of our wealth management that I can handle myself and the other facets where I need assistance. Self-education has expanded the pick list of financial tools for proficient net revenue generation, including what investment vehicles, compounding maneuvers, and services to employ for sustainable wealth.

I now know the right questions to ask to distinguish quality professionals from the product pushers. Acquiring nonmedical knowledge has provided the building blocks for a dynamic wealth framework that allows for growth and evolution alongside my road trip of family, life, and career. It has allowed me to return to a doe-eyed perspective of my radiology practice as a rewarding contribution to our community and definitively melted financial stress related to the job. And more recently, it has opened a doorway to explore the role of a physician advocate to help colleagues navigate the murky waters of finance and avoid burnout territory.

Turning those perfectly round yellow cardboard discs into savvy, hard-earned dollars by establishing a sound and growing foundation of financial wisdom, I am healthier and wealthier in ease and confidence that the path ahead is bright (with more than just a vast array of colorful gadgets), and I embrace the opportunity to provide the same illuminated journey to elevate personal contentedness for our physician core.

Can you relate to this arc of financial knowledge and behavior? What was the turning point for you to join the journey to financial literacy? Is your story similar to this one?