Top 5 Ways to Derail Financial Independence and Early Retirement

One of my goals is to help give you the knowledge and motivation to help make FI a reality. I’ve talked about why you might want to retire early and how to go about it. I would be remiss if I didn’t talk about how not to do it.

Presenting, the Top 5 Ways to derail your FIRE plans

1. Live Beyond Your Means

This one is obvious. The only way to accumulate the money required to call yourself financially independent is to not spend it all. The higher your savings rate, and the lower your expenses, the sooner you will be FI. If your spending grows along with your income, you might save the same amount, but you’re actually delaying FI further by having higher expenses, therefore requiring a bigger nest egg. A smaller money requirement is just as important as the ability to acquire it, perhaps more so.

If you want to stay on track for FI or RE, strive for relative frugality when it comes to the big ticket items (house, cars, schools, etc…).


You can’t afford the Oprah suite, but you can take the tour!

2. Trust the Wrong Person to Handle Your Money

Who is going to have your best interests in mind better than you? Nobody. You may not know that much about personal finance, but the truth is, you don’t need to know a whole lot. You’re smart enough to have become a high earning professional, you’re smart enough to have found this obscure website. By golly, you’re smart enough to learn how to make simple investment decisions.

If you choose to outsource that task due to a lack of time or interest, do yourself a favor and make sure the costs are detailed, transparent, and low. If your money is with the friendly neighborhood storefront (#4 in the Top 5 Ways to Manage Your Money), your total fees could average 2% to 3% per year. What’s 3% of millions? Millions.


$100,000 a year invested and compounded monthly at 7% grows to $10.2 million over a 30-year career.

$100,000 a year invested and compounded monthly at 4% grows to $5.8 million over a 30-year period, a difference of $4.4 million. Factor in unnecessarily stunted growth over an additional 30-years in retirement and the 3% difference between the 2 approaches could approach or exceed 8 figures. Yes, Investment Fees Will Cost You Millions.

Now, are you sure you don’t have time to figure out this personal finance stuff?

3. Start Late

One of my classmates in medical school was a grandfather when he started. Sorry, Gramps, you missed the early retirement train entirely. I suppose it’s hard to be derailed from a train you never boarded.

My medical school offered all students the option to defer for a year prior to starting year one. A single year isn’t going to make or break it for you, but I declined, keeping my eyes on the prize. The sooner you start, the sooner you’ll be financially independent.

Some who defer one year defer indefinitely, and never realize their dream of becoming a doctor.

Robert Smith, lead singer of The Cure, running back for the Ohio State Buckeyes and Minnesota Vikings, was reportedly heading to medical school after his playing career was done. You can still see him behind the booth on ESPN. Nathaniel Motte of the one-hit wonder duo called 3Oh3! deferred med school at UC Denver for 4 years before deciding to focus on music exclusively. I’ve never heard another song of theirs since Don’t Trust Me made the top 10 in 2005.

Oh, yeah… this is the part where you’re supposed to see some graph that compares investing $1000 a year from age 20 to 30 compared to saving $1000 a year from ages 30 to 50. Hopefully, you’ve seen something like that before. Spoiler alert… the early saver comes out well ahead, despite putting in only half as much money. Compounding is mathematical magic.

4. Get Divorced

There’s nothing like divorce to instantly transform you from “financially independent” to “half-way there”. I’ve explored the financial details previously. Interestingly, one reader commented that her divorce put her in a better spot financially. Parting ways with someone who likes to spend every paycheck can be a good way to actually start on a path to FI for the first time.

Your mileage may vary, but most often, a divorce will derail you from your FI track. A prenuptial agreement might help some, but not nearly as much as maintaining your marital status. Once again, if you never boarded that train in the first place, there are no rails to be derailed from. Once life has stabilized, you can board the train at the next station!


All aboard! p.s. Thank you, Tony.

 5. Commit a Felony

I’ve filled out many credentialing applications and applied for many state licenses. Every single one of them wants to know if I’ve ever committed a felony. I haven’t, or at least, I’ve never been charged ;). Unfortunately, I know other doctors who have, and I’ve seen a couple careers end in abruptly and spectacularly tragic fashion. I don’t think every felony is an automatic career-ender, but I’ve seen it happen more than once.

You could argue that committing a felony doesn’t belong on this list. After all, these doctors were forced into very early retirements. On the other hand, they were likely nowhere near financial independence, and will be relying on other people or second careers to have a prayer of getting there.


Care to add the list? Give me your #6’s in the comment section below.


    1 WealthyDoc |

    I love this piece but just for fun will put down some thoughts/counterpoints.
    1. Live beyond your means.
    Shouldn’t that be not living below your means? There is a huge difference between living within your means and living well below your means and only the latter has any chance of getting you to FIRE.
    2. Trusting the wrong person.
    This can result not just in loss of optimal return. You can lose capital. I have personally knows several victims of theft as well as routine account churning. In the example given though I think I could make do on 5.8M
    3. Starting late.
    What has Grampa been doing? If he has been earning, saving, and investing for decades he should be just fine. It isn’t his age per se that is the problem it is his other habits.
    4. Divorce.
    Now that’s a big one for sure. I know a few surgeons who are on wife #3 and they can’t cut back at all. My wife refused to sign a prenup when we got married. It wouldn’t have helped me anyway since I was broke then. It is actually comical looking back that I wanted it and that she refused. All of my money has been made after marriage so I wouldn’t fair well I divorced. Let me wrap this up soon, I need to go buy some flowers.
    5. Felony.
    I have a physician-friend who served time in a federal prison. While there he worked on his business plans. He also received a letter from the government that he would never be able to treat Medicare and Medicaid patients again. I can’t say he was too disappointed about losing his two lowest payers. He got out, got his license back and has a medical-related business which is booming in several states. He works a lot less than ever but makes more than ever. I’m not recommending felony as a solid career path, just saying people and careers can be amazingly resilient.

    CM |

    3. Starting Late

    My med school allowed me to defer a year. It was the best year of my life. I would not trade it for $10 million.

    I would trade my career path for Robert Smith’s. I’m confident he would not accept that trade.

    One of the students one year ahead of me in med school was in his 50s. He had a PhD in chemistry and left a successful career in industry to go to school again. His wife was an internist. I remember that he would read the Wall Street Journal at breakfast in the cafeteria. I don’t think he had money worries; FIRE just wasn’t on his agenda.

    Bmac |

    Yeah, I’m pretty sure Robert Smith is happy with his career choices. Recall, he also suddenly up and retired from the NFL after 8 seasons when he was still in his prime and relatively healthy. Of course, partly for the expressed reason of going to medical school, which I don’t think ever happened. But between the NFL and working and ESPN and Fox I imagine he is doing just fine financially.

    PhysicianOnFIRE |

    Tough crowd today! 🙂

    Good point on making ends meet with $5.8 Million. Of course, without the fees, you would have had that sum 5 or 10 years sooner.

    A felony can be disastrous for your medical career, but no one can stop a felon from starting his own business. It’s tough to fail a background check when you’re the boss.


    WealthyDoc |

    Yup, I was amazed the medical licensing board gave him his license back.

    2 hatton1 |

    1. Living beyond your means. I wonder if the new tax changes about no tax deductibility will stop residents/young attending from buying houses they can’t afford??????
    2. Trusting wrong people. Bernie Madoff types (biggest losses), NW Mutual whole life people(usually a sunk cost), commissioned stock brokers (easiest to recover from).
    3. Starting late. Lack of role model key problem here. I hope your youth was at least fun.
    4. Divorce. I am doing this now but I think it will be contained.
    5.Felony. No personal experience.

    Neuro-doc |

    ” I am doing this now but I think it will be contained.”

    Ouch. Sorry to hear.

    hatton1 |


    G |

    Ugh. Money doesn’t mean squat in the light of health/happiness–I hope things turn out for the best for you.

    hatton1 |

    thanks. Ok so far.

    Kamban |

    really sorry to hear that piece of info.

    uptoolate |

    Yes sorry to hear hatton1. hope it all works out for the best.

    The White Coat Investor |


    The White Coat Investor |

    1. The proposal is that you can still deduct interest on up to $500K. That’s going to cover most/all of the mortgage for most docs not living on the coasts.

    3 Rando |

    Great post, but #1 feels a little bit incomplete to me. The key is not just living within your means, it’s committing to making saving a priority. It’s the old “pay yourself first” philosophy. A person can live within their means and still not save nearly enough to achieve FI.

    Of course when financial advisors say “pay yourself first” they often are really saying “give me your money regularly” which ties into #2.

    4 Strider_91 |

    I am an m1 at 26 and am hardly older than most people in my class. I am certainly jealous of the students who went straight through, and there are even some who are doing a 7 year program. They can become neurosurgeons and finish residency at a younger age than I would doing a 3 year EM residency!

    I think being older gives me some different advantages though.

    I would have graduated as a psych major which is probably worse for retirement than starting Med school at 26 for sure. Either way, I’m happy doing what I’m doing. Many of the kids my age in my class couldn’t get into school and ended up paying for a masters on top of their medical education…now that would have been rough to have to do.

    Although most of them are crushing the average on every test since they basically did the first two years of med school…

    5 CM |

    “I am certainly jealous of the students who went straight through, and there are even some who are doing a 7 year program.”

    I suppose it depends on what you did with the years before med school.

    I know some UMKC grads who finished med school on a six-year program, so they were done at 24. I didn’t start until 23 (after a one-year deferment), but senior year of college and the next year of deferment were great years. It would have been terrible to sacrifice the years between 21 and 23 years of age to the grind of med school.

    In retrospect, it would have been better to take another two years or so to enjoy my youth. It’s gone now, and I don’t think it’s coming back.

    Strider_91 |

    @CM I ended up taking a gap year and going on a road trip that I will remember for the rest of my life so I don’t regret it, but I would be lying if I said I don’t envy the younger kids in the class at times.

    All in all my path is my path and It has made me who I am today. I have been enjoying my journey so far and can’t ask for much more than that.

    The White Coat Investor |

    You know, I find all this talk about delaying interesting. I mean, there is no doubt that a delay has a very real effect in decreasing the amount of wealth accumulated. But given that no doctor is ever really more than 10 years away from financial independence, the delay doesn’t seem all that important in the grand scheme of things.

    WealthyDoc |

    I took 5 years to get through college and then took a year off after college. It all worked out great. I enjoyed myself and learned a lot along the way about work, people, debt, etc. If you race through and your first job is as a medical sub-specialist you can miss out on some basic things.

    CM |

    “Some who defer one year defer indefinitely, and never realize their dream of becoming a doctor.

    Robert Smith, lead singer of The Cure, running back for the Ohio State Buckeyes and Minnesota Vikings, was reportedly heading to medical school after his playing career was done. You can still see him behind the booth on ESPN. Nathaniel Motte of the one-hit wonder duo called 3Oh3! deferred med school at UC Denver for 4 years before deciding to focus on music exclusively. I’ve never heard another song of theirs since Don’t Trust Me made the top 10 in 2005.”

    Robert Smith’s dream was to play in the NFL. I don’t know who Nathaniel Motte is, but it’s clear that his dream was to be a professional musician.

    I wouldn’t be a physician today if I could have been Mikhail Baryshnikov instead.

    Medicine has a lot to offer as a career, but it is hard, demanding work. You won’t find a lot of doctors doing it for nothing. You can find people everywhere playing music and sports for nothing but the joy of it.

    Just about every professional dancer you’re likely to meet does it for the love of dancing. There is virtually no money in it, even for the elite dancers in major companies, and (like football) it isn’t something you can do after retirement from medicine.

    Some things are only available to the young, and some things available to everyone are just better when young. Those years are precious things to spend on med school and residency.

    The White Coat Investor |

    Playing sports is very different from being a professional athlete, particularly in sports like Olympic sports and cycling where the pay isn’t very high but the hours and effort and time away are still long.

    CM |

    Baryshnikov had a lucrative career as a dancer, but I was never going to earn more than my daily bread. I only know of one member of my company that went on to a long career in the performing arts (and that was because he could also sing and act). However, the pay isn’t the point.

    Everyone in my company was there only because they loved what they were doing, and the ability to do it vanishes rapidly after 30.

    You can start med school at 22, or 32 (like one of my high school friends), or 50-something (like the chemist in the class ahead of me).

    Zaphod |

    Those are great examples. Brutal training hours and brutal competition, and very very little pay. Its kind of insane really.

    WealthyDoc |

    I was never in much of a hurry. I took 5 years to get through college and took another year off after college. I enjoyed my college experience. In my year off after college I was able to work, learn, save and travel. I felt better prepared for my medical practice eventually since it wasn’t my first job. I appreciate how wonderful work in medicine is because I have worked in other capacities. I’m glad I didn’t race through all my education. Life is a journey as well as a destination.

    PhysicianOnFIRE |

    I’ve written a post that looks at taking a sabbatical at various career points. By far, the best time is when you’re young. It delays reaching FI by exactly one year, assuming you’re self-sufficient in that year off, which is much easier to do when young, single, and with few expenses.

    Taking time off mid-career can obviously be done, but by then, your life costs a lot more, and there can be numerous factors that make it difficult to make a clean break and be commitment-free during that sabbatical. I know it can be done, and that CM made a career change for awhile, but I imagine it’s more difficult (and potentially costly) later in life.

    I totally get the point that a year off at 22 can be far more meaningful in life than the difference between becoming FI at 48 versus 49. I didn’t when I was 22, though. I looked at it as a $200,000 mistake. The follies of youth.


    CM |

    Looks like I was writing the post above while you were posting this, PoF. 🙂

    I’m 58 now, so when I read about younger FIRE folks like you, I could have some of Strider_91’s envy of the younger kids in class. If I had stayed in medicine I would have had Vagabond/Hatton wealth a long time ago.

    However, I had a great one year sabbatical at 34 yo, and 13 years of freedom between 41 and 54. Although I “worked” for a few years as an analyst and went to school for a few more during that time, I always felt like I was on vacation.

    I highly recommend flipping life upside down in this way. Old(er) age is better suited to (white collar) working, and I’ll still be able to enjoy a Vagabond/Hattonish retirement if I work until 64 or 65 (but wonder if I’ll make it that far :-)).

    The White Coat Investor |

    The only issue with that approach is if health problems intervene, preventing you from working into your 60s. Lots of people can’t work after 50 due to health issues and age discrimination.

    CM |

    That’s fair. You’re taking a chance, but life is one big gamble.

    Vagabond recently told about his friend who was set to enter a wonderful retirement at about 60 yo, but then discovered he had metastatic cancer a few months before the big day.

    My med school roommate had a partner who died at 36 yo with an astrocytoma.

    Apparently, two of my 120 or so med school classmates died in their 30s.

    Because I don’t have kids, I was only gambling with my future.

    LizOB |

    I finished college in 3.5 years so had 8 months off before starting med school. It was WONDERFUL to get a longer break from school before starting up again, but because I finished college in Dec I didn’t have to explain a gap year or anything (and didn’t lose a year of eventual attending income). Best of both worlds

    hatton1 |

    I did the same thing LIZOB

    6 Zaphod |

    3Oh!3 isnt a one hit wonder! They had 3 top ten songs on that first album. Maybe they never cracked it big but seriously doubt theres any regret.

    Zaphod |

    And looks like theyve made plenty more than even the most successful tier of average doctors have. Plus, look at all the crazy fun theyve had. I quit a band that was likely never going anywhere in college when I went to medschool, and it was still some of the most fun I’ve ever had, not much like it and we were just locally doing well.

    CM |

    “Plus, look at all the crazy fun theyve had. I quit a band that was likely never going anywhere in college when I went to medschool, and it was still some of the most fun I’ve ever had, not much like it and we were just locally doing well.”


    And Zaphod might still enjoy playing in a band (if he had the time), but I doubt it could ever be as much fun as it was during his 20s.

    Zaphod |

    Yeah, something to be said for doing things at the best age for it. I could never backpack Europe and do hostels now, and didnt then either. I can barely sleep decently not in my fancy tempur-pedic bed with 30 minutes massage on while I pass out. Some things are best done at certain ages.

    Strider_91 |

    @Zaphod —When I was up in your neck of the woods on my PNW road trip I met this guy named Jerry who taught my friend and I some mountaineering skills. The guy was 62 years of age and one tough Mudda….He set the pace for my friend and I and it was NO JOKE…

    I could not believe he was my fathers age!! I mean I dont even let him shovel snow because I am afraid he’s going to have an MI—then theres this guy with calves the size of watermelons trucking up a mountain ahead of me and then proceeding to slide down on his butt…

    Also, why was he wearing shorts on a snow covered mountain?! Idk because he’s Jerry from Washington and he probably showers in glacier water for fun.

    I also once saw a man who celebrated his 85th birthday by day hiking to the top of Mt. Leconte in the Smoky Mountains. This is not the hardest hike but I would NEVER expect my Grandmother to do it…I mean heck I was tired at the top.

    What I’m saying is being old isn’t an excuse to stop doing cool things, and if you never stop doing them it makes it easier to do it as you age….but yeah you’d look creepy in a hostile depending on your age.

    CM |

    I think Zaphod is not much older than you Strider, but Father Time is undefeated. People age at different rates; partly due to lifestyle, but also partly due to luck.

    At 27 I could bench press about twice my body weight and run all day. If Jack LaLanne ( could swim towing 70 rowboats at 70 years old, I presumed I’d be able to do the same.

    Well, I still work out at least 4 days per week, but I’m no Jack LaLanne. That’s mainly due to bad luck regarding my health.

    Youth is a precious thing. Carpe diem.

    Strider_91 |

    I agree luck plays a huge role. Reading about Jack LaLanne is insane. Wonder why he always swam “handcuffed and shackled” seems excessive.

    If you are working out 4 days a week, and still not able to swim towing 70 boats, It is obvious to me you are not utilizing the Jack LaLanne Juicer enough…. 😀

    CM |

    Too funny. 🙂

    Zaphod |

    Age may not keep you from doing things, but that doesnt mean your body enjoys it or you recover the same. I’ve always been an athlete and into fitness. Im still pretty fit even though I fall off the wagon like everyone else now and then.

    However, I dont take to less than a full nights sleep like I used to and I do not sleep well outside of home (as well). Heck, I cant even sleep well if the wife and kiddo are out of town and not in bed.

    One of the reasons I stay fit is so I can keep doing things as long as possible, but its different. Dont be fooled.

    7 Vulcan Alex |

    Some that sports stars sometimes have:

    Having a lot of family or other “friends” that think you should support them or at least have parties with them. You might be able to afford this, but it does reduce your investments.

    Investing in things you don’t really understand, this might be trusting the wrong people but some stars do their own investing in say real estate.

    Getting “involved” with several (or more) females, especially when not taking proper actions to avoid making children.

    Good post and comments. As some have noted after you have a certain amount of money experiences can be much more valuable than more money.

    PhysicianOnFIRE |

    “Getting “involved” with several (or more) females, especially when not taking proper actions to avoid making children.”

    I may or may not have known a gal who dated Robert Smith on Thursday nights. But only on Thursday nights.

    8 The White Coat Investor |

    Via email:
    #6. Make stupid (or unlucky) investment decisions. Early in my career I fired my broker, when I figured out he was only a salesman and was hurting our returns vs. the actual stock market. I quickly learned to invest myself, and have no regrets. However, along the way I made some stupid decisions, or at least stupid in hindsight. For example, I was very heavily invested in stocks during the dot-com bubble, and didn’t sell when the handwriting was apparent (OK, in retrospect); had I at least adhered to the 60-40 rule (60% stocks, 40% bonds), we would have come out a lot better. Another example: I bought World Com for the dividend, at around 50, and then bought more at 15, never dreaming the company was an accounting fraud. I lost it all. Then, a few years later I bought a lot of GE, also for the dividend. GE is now the worst performing stock of the DOW falling precipitously while the DOW has been rising, an is about to cut its dividend. I watched it collapse and didn’t sell, not believing or realizing just how incompetently managed it has been over the last decade.
    Moral? Follow Rule 2 (even with these mistakes, I will never let another person manage our money, because of the fees) and, if you do invest on your own, stick with low-cost index funds and only buy individual stocks if you can track and study them closely. And be prepared to sell when you realize you’ve bought a dog.

    9 ken |

    I put two kids through Harvard; my brokers Learn to be a DIY investor as its manadatory even if u decide to get some advice along the way. Investing is middle school education
    As Tobias says “TRUST NO ONE”

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