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Disabled but not quite disabled for doctors

Posted on November 17, 2018January 30, 2021 by SmartMoneyMD

Disability can be a devastating outcome to a doctor’s career and self-image. Think about it—you busted your butt to learn how to do a Whipple procedure, end up getting into a skiing accident that ends your career right there. No worries, because you purchased the appropriate coverage of own-occupation disability insurance, right?

Having disability insurance certainly provides a protective cushion, especially you are the sole breadwinner. This is a no brainer, and something that I think all new graduates ought to consider. One of the reasons why many of my coresidents (myself included) shied away from disability insurance during our training was that it did take up a moderate chunk of our income. At that point in our careers, every single dollar made a difference. Some of my colleagues were single without any dependents, so it was easier for them to convince themselves not to get insured. If they were not able to practice medicine, they could rot in the gutter somewhere without putting any family members in a dire financial situation.

The problem with disability insurance, too, is that it does grow with your income as you decide to increase coverage. If you don’t end up using it, the money is gone into the insurer’s pockets—but that is how insurance is supposed to work.

Enough about that.

What seems to fall into the grey zone is that if you become ailed with something that a medical or psychiatric diagnosis is unable to quantify. Let’s say you fall while rock climbing and fail to break any bones or tear any ligaments. None of the MRI’s or clinical exams reveal any damage, so you don’t get to invoke any of your insurance claims. However when you’re feeding that guide wire when placing that port or stent, something isn’t right. You can still do your job, but it seems that you’re having a much more difficult time accomplishing what you otherwise were able to do with ease.

Sometimes these hinderances are even more subtle. Maybe you tweaked your finger while playing basketball, started getting mild headaches whose only treatments include enough medications to put down a 300-lb wrestler, or simply just lose your stamina to power through an eight-hour cardiothoracic surgery. It could be all in your head, but the problems could also be real. Maybe it’s just a combination of age, genetics, and bad luck, sort of like those vague symptoms your patients with IBS have but you don’t really have any real suggestions to resolve them.

This is the realm that disability insurance isn’t going to cover. You’re not really disabled by any strict definition, and you’d better be sure that your insurer won’t be cutting you any checks when you’re still able to power through more surgeries than ever but just feel like crap doing it.

When you see fibers on your alternator belt but the car drives smoothly, you are working with a ticking time bomb

This is a problematic situation to be in, and I frankly am not sure what percentage of doctors remain in the workforce who are working in what they themselves consider to be suboptimal. I surmise that this number might be higher than we realize. Perhaps this percentage increases as doctors move past their prime and closer to normal retirement age.

How to cope with purgatory

What do you do if you aren’t 100% but function roughly at the cusp of where you think that you need to be to continue practicing medicine? At what point do you hang up your hat and cut your losses?

The easiest answer is to get yourself into a situation where you can walk away at any time without putting your family in a financial predicament in case you fall into purgatory. While there’s no need to live in fear every day agonizing over how to get to some magical net worth number, you can work towards achieving a sustainable lifestyle based on your I/O’s.

You’d want to find that sustainable situation while you are still able to function at 100% of your earning power. Focus on building your earning power while not completely squandering your hard-earned finances. This might simply mean moving a percentage of your paycheck to savings before you accidentally burn through it in one go. Run through the basic financial checklist on the Smart Money MD mailing list.

Heed the wake-up call

If you do find yourself working as your suboptimal self but are unable to leave your work situation financially, consider it to be a wake-up call. No matter what stage in your career you are in, remember that you can always crunch down your expenses just like what you is in residency.

Axe those car payments on your M5, sell the car, and get a used beater. Remember that driving that M5 doesn’t confer you any bragging rights. Nearly every single person in the hospital doctor’s parking lot can also afford that car. You aren’t as special as you think.

Your family will thank you for being diligent about your situation. Get them involved, and have them realize that it’s a group effort to make the financial ship run. No one can depend upon nice doctor incomes forever. I have seen doctors in their mid fifties turn their financial situation around.

Have you gotten yourself in a disabled buy not disabled situation?

Psychological impact of leaving medicine

Posted on November 12, 2018January 30, 2021 by SmartMoneyMD

We talk about money on this website, and how to make sure that you have enough of it. In fact, that’s pretty much the entire strategy for the growing crowd of people in the world who are gunning to retire at an age that most neurosurgeons start their careers.

Those of us in the medical field who also have similar ambitions to work our finances intelligently are likely to have similar end-game strategies in our profession, albeit less extreme. Sure, it’d be great to give your boss the finger, sell your house, and move the entire family down to St. Kitts. What’s not to like?

The reality is that even if pipe dreams like that may not be palatable even if we have the means to do so; family, kids, friends, and our contacts will have to be on board if we expect to continue interactions with them. You know how that will likely end—not well. The interesting aspect, however, of being a physician is that the public expects you to have money. Even if you are only rocking a paltry $120,000 a year in a low-paying specialty, you are still a high-earning doctor to your non-medical friends (even if they earn more than you and not realize it).

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In this scenario, walking away completely from medicine may actually be more socially acceptable. Dr. X, who drives a fleet of Tesla X’s, probably doesn’t even need to cut back on his expenses to afford a third home in Puerto Vallarta. No one will bat an eye if you hung up your doctor hat. What you need to be aware of is how attached you are to your profession.

Your self-image will be impacted after your leave medicine

What might be more critical is how you will accept changing your professional identity if you decided to change what you do. I work with plenty of hospital administrators who have a medical degree, but no longer practice medicine. These are typically internists, family practictitioners, and emergency room physicians. These doctors have all rationalized to me that they saw a new calling outside of clinical practice. Many of them found administration to be more interesting than what they did previously and found that they could impact the medical paradigm more meaningfully through other means. Fair enough. They still are contributing to the healthcare system through other means.

Let’s say that you decided to leave your job as an ear, nose, and throat specialist at the age of 45 to work on your woodworking hobbies. You’ve made your $4 million safe withdrawal fund, sell your wood-turned teak corner tables at the local artisanal market, and maybe earn enough to pay the utilities every month. Can it be fathomable that you had just become a newly minted attending slightly over ten years ago, yet you are now contemplating letting your board certification lapse?

Give up your career in medicine too early and you will have to put your pup to work!

Most of your classmates will still be ramping up their careers, building their practices, and working long hours. They will be working on research projects to present at the next annual society meetings. Would you be ready to transition to a non-practicing status on your board certification? What do you intend to tell your classmates at your ten-year medical school reunion what you ended up doing with your life? Furthermore what would it feel like to exit a career that you toiled for decades to gain admission into? Can you still call yourself a doctor if you’re no longer practicing medicine or considered a viable practitioner by your specialty?

Prepare for the end goal while you’re working towards it

Several of my mentors are practicing medicine well into their 70’s, only because they cannot see themselves doing anything else outside of their profession. On the other end of the spectrum, millennials and younger doctors have other intentions in mind. Avocado toast, luxurious honeymoons in Hawaii, baby moons in Bali, and enjoyment of four-day workweeks are all part of the plan. Whether you are part of this younger doctor generation or cringe every time your potential hires tell you they need to have Tuesday and Thursday afternoons off to pick up their kids from grandma, the principle is to simply find a means to set your priorities and stick with it.

If you intend to crank through a decade of sleepless nights in your profession to maximize your income, reach fatFIRE, and call it quits, that’s okay. Be sure that you will be okay with what you intend to do hit your goal. Would working 0.5 FTE be adequate to maintain your skills and foot in the door? Is that even possible with your specialty? Would you be completely miserable leaving medicine completely?

Case in point: I had a colleague who retired at least 5 times before finally officially retiring. Even now, he’s anxiously itching to find ways to continue medical work without being officially employed. He’s in his mid seventies.

Whatever you decide to do, do it with a purpose. Remember, no regrets!

Should doctors worry about medical school debt?

Posted on October 27, 2018January 30, 2021 by SmartMoneyMD

There is a wide range of debt among medical school graduates. Family situation, school selection, and geographical location are some of the more common variables that impact the ultimate cost of “M.D.” (or D.O.) after your name. How quickly one eliminates the debt subsequently depends on I/O’s–your earning firepower subtracted by expenditures. There are quite a number of financially efficient doctors who opt for lower cost schools in low cost of living areas who end up choosing highly compensated specialties with very short training periods (read: emergency medicine) who emerge from their decade of school rocking enviable salaries. These groups will be able to repay their loans without much difficulty.

The rest of us without the financial foresight and fortune will fare differently. Most of us likely made our career decisions mostly by choosing what interested us. Frankly, that is how we should decide to choose our careers anyway, but unfortunately money doesn’t necessarily follow passion. If any of you graduated from a medical school with annual fees of $70,000 and are now $300,000 in the hole with a family medicine degree, you are at a financial disadvantage from your peers.

You might also like: How I paid off $148,260 in student loan debt my first year in practice

The average medical school graduate in 2018 will finish with roughly $200,000 in debt. This essentially amounts to a first mortgage, or a second mortgage if you got suckered into buying a home during medical school or residency. No matter how you spin it, that is a hefty chunk of change when the investment in your medical knowledge needs to be converted into practical financial firepower.

Basic strategies to repay student loan debt

There are plenty of resources from financially savvy graduates to optimize your student loan debt. Consolidating your high interest loans into a lower one is helpful. Making sure you are repaying the highest interest loans first is another fundamental principle. Those who are creative can also create a system for public student loan forgiveness (PSLF) while working for governmental type positions.

The premise with PSLF is that you have to be employed by qualified employers while making minimum repayments for a total of 120 months, or a decade. Some doctors have clearly made use of this program, but ten years is gamble to have your loans forgiven. The ideal scenario for PSLF borrowers include:

Extended training schedule such as neurosurgery (7-10 years) or advanced cardiology (7-8 years) where you are in residency or fellowship with “low” pay. Make sure you match into a qualifying program first.
Family with dependents but non-working spouse so that expense burden is high but income is low.
All loans have to qualify for PSLF.
High debt burden. Like $500,000 in debt.
This is a close second to the real thing, but is it really a justifiable purchase?

In these situations, doctors could find a means to stay on faculty for several years after training to complete the PSLF process. There is a calculator on the governmental student loans website to estimate the amount that you’d save.

Why PSLF isn’t for everyone

There are quite a few contingencies that make PSLF a viable option. If you fall under the ideal demographic, go for it. You deserve all that you have worked hard for. Unfortunately, most doctors don’t.

The biggest issues with this program is that you are tied to working for certain hospital systems that receive certain funding from the government. It’s great if you plan on working there anyway, but there is a good chance that there are more lucrative options elsewhere. Sometimes it’s not possible to predict what’s going to happen nine years down the road.

Even with debt burden, you might be saving less than you’d think with PSLF. Maybe 30-40% of your loans will get forgiven. This might amount to $100,000 out of a $300,000 loan over the course of ten years. It sure feels great beating the system, but $100,000 in ten years amounts to roughly $833 a month. Compare that to repayment the old-fashioned way with aggressive repayment, the difference would be even less when you are limiting interest growth.

Why student loans are only a bump in the road for doctors

Fortunately doctors have good financial firepower. All of us ought to be able to repay our loans relatively quickly with the appropriate discipline. You might have to extend your delayed gratification briefly but it will pay off.

Suppose that Doctor A finishes with $200,000 in student loan debt, but he is starting his new job that pays $200,000. Assuming a very generous buffer that the first $100,000 of that income will go towards taxes and tax-deferred retirement savings, he will still have $100,000 to live from. Not long ago, Doctor A only had maybe $40,000 of living income from his $60,000 residency salary. If he continued with living expenditures of $40,000 annually, he’d still have $60,000 of that post-tax attending income to put towards loans. At this rate, he’d be student loan free a little more than three years out of training!

Some of us will earn less but also have less debt. The converse could be true. Most doctors ought to be able to repay their student loans within the first five years into medical practice regardless of their income. It all depends on how motivated you are in eliminating this debt. Five years of controlled financial prudence is a small price to pay for what could amount to a thirty year medical career.

We should all pay attention to our medical school debt, but don’t let it consume your life.

Physician pawns in the healthcare system

Posted on September 22, 2018January 30, 2021 by SmartMoneyMD

Doctors and other caretakers are the pawns of the healthcare system. We provide the services that allow hospitals and medical groups to bring in big revenue. Unless we are contracting directly with insurers, doctors will never realize the true financial firepower that we have. As the healthcare environment evolves, we are seeing fewer individual physician-owned groups and more conglomerates. The larger the system that we belong in, the greater number of layers of complexity we face.

The WSJ recently published an article discussing contracts that large hospital systems have with insurance companies that theoretically reduces competition and obfuscates costs. Basically there are two conclusions of the article:

Hospitals can make agreements with insurance companies that prevent the insurance company from offering contracts to competitors without including them.
As a patient, it is common not to know the cost of a medical treatment until you get the bill. Many families with high deductible plans suffer since they cannot shop around for the best price.

These are interesting and valid points but it is impossible to understand the complexities of the healthcare system in one’s entire career, yet alone one article.

Neither the hospitals nor the insurance companies are victims

The WSJ article paints a negative view of mega hospitals as aggressors who prevent competition by restricting insurance companies from negotiating with lower cost providers. There is indeed something awry with restrictive language in contracts, but we have to realize that this is simply a business. Of course McDonald’s wants everyone to eat their burgers. If the insurance company is willing to make an agreement, you’d also bet that they are benefitting too. The insurance company always wins. It doesn’t matter what they sell, whether it’s life policies, health policies, whole life policies…the math always works out in favor of the insurer. The patients and healthcare workers on the field are actually the ones that suffer.

Think about it…if Hospital A is willing to accept less pay than Hospital B for the same services, clearly Hospital A has figured out how to lower costs: (1) Hospital A is able to operate more efficiently and (2) Hospital A pays its workers less. Don’t forget that you, the doctor, is the worker getting less pay for the same work. Your work is paying for the management to make the rules. If you don’t like what they are doing, then you have the choice to leave. The hospital will always be able to find someone else to replace you.

Pawns, after all, are dispensable but needed to win the game.

There’s nothing wrong with being a pawn in a big company

Doctors get the short end of the stick

Those of us involved with direct patient care have all encountered situations where patients leave our practice due to changes in their health insurance. It’s an interesting phenomenon like a reluctant break-up: the patient claims that their doctor is great but due to a change in their health insurance, they have go elsewhere to an unknown entity. It doesn’t matter if the doctor has taken care of them for decades either. Money talks louder than one’s health, but that is the unfortunate truth of healthcare.

I’ve certainly had colleagues who have had patients tell them that their prices are “too high”. Ironically these price differentials may be a difference between a $50 copay and a $35 copay office visit, all dictated by an insurance contract beyond the control of the individual physician. Sometimes plans that require the lower copay actually generate bigger bills on the backend and pay the doctor less, which isn’t obvious to the patient. If I were only paid the copay to evaluate whether someone needed to get a carotid endarterectomy, I would have quit my job long ago and become an organic farmer. This situation reflects the confusion in an opaque healthcare system. If my patients are coming to me for their knee surgeries because they think that I am the most economical option, there is something wrong with the system. Healthcare shouldn’t be a race to the lowest bidder.

The case to untie yourself from the system

In American chess, there is a rule whereby pawns can become promoted to whatever piece the player chooses once the pawn reaches the end of the board. This is called, “pawn promotion”. It’s about time that doctors find a way to get that pawn promotion.

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We each have to define what our pawn promotion means to us. Does it mean financial independence? Does it mean putting yourself in a position to effect healthcare change? Is it a way to lift our fellow physicians from the shackles of our profession? I certainly don’t want to spend the rest of my career clicking through radio boxes and drop-down menus so that someone else can tell me how meaningful my quality of care is. It’s time for doctors to wake up and figure out the best way we can use our skills to benefit our patients without shortchanging ourselves.

Don’t worry if a $5500 decision translates into a $200,000 loss

Posted on September 15, 2018January 31, 2021 by SmartMoneyMD

How much we micromanage our lives is dependent upon our compulsivity and how many goals that we set in life. Medicine is a profession that attracts some of the most goal-driven people I have ever met. There are egos, obsessions, intelligence, and diligence all packaged into one unit. This is simply overwhelming. Fortunately, these habits tend to evolve with age. I’ve seen some of the most incendiary personalities in medicine mellow with time—maybe these doctors have rediscovered their life goals over time.

Our financial priorities evolve over time as well. During two of the years during residency, I opted not to contribute to my Roth IRA account. This amounted to $11,000 of post-tax monies that I spent for living expenses and student loans. These decisions were made during a time in my life where I had some understanding of long-term investing but was preoccupied by a seemingly large negative six figure student loan debt I had to repay. I used to receive monthly statements on my student loans. Every month these numbers increased as I deferred interest payments. These increasing numbers were psychologically abrasive. I made the decision to reduce my debt to zero, and get my net worth up to zero. If you threw $5,500 in the stock market in 1980, it’d roughly amount to $295,130 in August of 2018! If you left $5,500 of your student loans unpaid at 6.8% for 38 years, you’d only have less than $100,000 built up (there are certain factors like forbearance limits that actually prevent you from dragging out loans this long however). The right answer at the time probably would have been to contribute to my Roth IRA.

You might also like: How I paid off $148,260 in student loan debt my first year in practice

That’s roughly a $200,000 difference for a $5,500 initial investment. For me, it would have been double that for two years of lost investment.

Don’t sweat the small stuff

Sometimes I still kick myself for not investing in a Roth IRA back then. Over time, this “mistake” will actually amount to big stuff. It’s human nature to focus on the negative. When you do that, it’s easy to get bogged down on the details. It is not possible for us to make the “correct” decision every single time. We all have patients [read: engineers] who micromanage ever aspect of their care, and sometimes they actually end up making their care worse. If you micromanage your finances, you will likely land on your face too.

If this happens to you, realize that you’ve made hundreds of “correct” financial decisions before you make a financial flop. Sometimes these mistakes right themselves. Other times they will serve to help us make better choices when they will really count.

Perspective evolves with the size of their wallets

I had coresidents who easily spent $5,500 on a single vacation. I doubt that they were wondering what their Roth IRAs would have in them in 38 years. It’s all about perspective, and how much buffer one has to fall back on. We all have coworkers who don’t bat an eye when they drop $100,000 on a Tesla. Many of them have mortgages several times the cost of the Tesla and student loans. I suppose that if you have five times the income of a resident, you are able to stomach an equivalent amount of leverage. Only their financial advisors will truly know how much wealth is hidden under the veil of nice material wealth.

The moral of the story, if there is one, is that you alone will determine what is more critical to your happiness. If that means having a stable nest egg in retirement you will make appropriate choices to get there. If that means owning a fast car while you still have the dexterity to drive it, you can still make it happen.

Fortunately these rides aren’t as expensive as those at Disney!

I used to balk at the cost of an $4 cup of Coke at Disneyland. Now that Coke is $6 at Disney (and I finally feel that I can afford it), I still opt for water simply because I can afford the calories and sugar! Maybe psychologically I never wanted the Coke in the first place!

How has your perspective on money evolved as you’ve made better financial decisions?

The key to physician success: it’s okay to be missing out

Posted on September 1, 2018January 30, 2021 by SmartMoneyMD

It’s human nature to be social. The collective sensation of being in a group or organization helps us belong. We see this in school, where kids band together for activities. We see this in the doctor’s lounge, where the anesthesia guys chat about the latest hospital gossip. Occasionally we see the loners who shed the collective mentality and shine through their own path. If these novel beliefs are compelling enough for the masses to adopt, then the long wolfs become mainstream.

There has been a push over the last year in the online physician community to venture into seemingly radical pursuits, like trying to retire early. Other more tempered pursuits seem to revolve around doctors finding self-sustaining means to escape medicine itself. Multilevel marketing, real estate, side hustles, and other income-producing hobbies are the rage. I am always amazed at how motivated my peers are. The irony is that sometimes it seems like more effort is put towards pursuing something outside of medicine. Nearly all of the side hustles that I’ve encountered don’t require having gone through the pain, time, and intelligence of medical training.

I had a classmate in medical school who finished his medical degree and a year of internship before joining a huge medical consulting firm. I never really knew why he did that, since medical school isn’t exactly a walk in the park for most people. Unless he ends up in the C-suite of a major hospital or healthcare behemoth, it is difficult to justify the financial advantages of the career route that he chose. Fast forward to today. He’s not exactly in the C-suite, but he has a similar income trajectory as most doctors his age and a much greater potential to impact healthcare that most of us will never even dream of doing. Go big or go home, as one might say.

Dare to be normal

Most people would prefer to live according to their own terms, and blend into the crowd. This applies to doctors as well. Some of us are workaholics; some of us want to do the minimum amount possible. But average is still somewhere in the middle. I only know a handful of doctors who actually love booking elective surgical cases the Friday after Thanksgiving or rounding on patients every weekend. Everyone else just wants to be able to play a round of golf on their off-days, and take their families out on a road trip in a nice U.S.-made German-branded SUV.

Not missing out on this would mean more inches to your belt.

Not every doctor wishes to own a dozen homes, a private jet, or a Maybach. On the other end of the spectrum, most doctors aren’t going to want to pack up their medical practice, travel the world for weeks at a time, and homeschool their children. It’s okay to teach your kids about World War I by renting an AirBNB in Sarajevo, but a textbook will probably do just fine.

It’s important for practicing doctors to focus on what is important to their family and careers. There is a lot of noise in the online community with anecdotes of doctors who are able to build an escape route out of envious medical careers that most people would only dream of being in. There is nothing wrong with being a doctor working 55 hours a week, taking call every fourth weekend, and earning a comfortable living.

There is nothing wrong with being out of the loop

Fear of missing out, or FOMO, can be self defeating. It doesn’t matter what your colleague down the hall is doing with the latest real estate craze. You might be missing out on the biggest financial opportunity of the day, but you could also be missing out on the biggest flop. Just because your roommate quit her stable job as a gastroenterologist to join a startup doesn’t mean that you need to find some radical way to prove yourself. The key to success is to keep your head in the game. You are already a physician. You have a better income and lifestyle than many other professionals. Don’t sabotage it. Hone your plan for a successful career and follow it.

Frugality does not guarantee financial independence

Posted on August 18, 2018January 30, 2021 by SmartMoneyMD

Medicine is a humbling profession in that no matter how advanced healthcare becomes, we are far from guaranteeing a particular result. Fate, as one might say, is fate. Financial temperament, on the other hand, fortunately has a more manageable learning curve. Investments really don’t have guaranteed returns, but if we invest enough relative to our income and expenses, the math inevitably works in our favor. We are all not doomed!

Ego is the enemy

What we don’t know can actually hurt us. We all are guilty of overestimating our own abilities at some point in our lives. Sometimes we pay the price. For many doctors, believing that we have more earning power than we actually do serves as our downfall. There are plenty of smart people in medicine who simply don’t acknowledge that small expenses in great numbers can overtake even the biggest of salaries. Two fancy car leases? $1600/month. Restaurant nights several times a week? $1000/month. Take-out meals for the family? Another $1000. Each one of these purchases is achievable alone, but together can whittle away a solid physician salary.

Put aside the ego, and you can get far in life.

Life can deal you the worst of hands

Sometimes even with judicious financial planning, you can even come up short. My heart aches when I hear about these unfortunate stories, but we can all learn from others. This is the case of Doctor D, who conglomeration of several of my colleagues’ financial situations. Doctor D, despite having sound fundamental financial sense, will likely protracted medical career beyond her control. Let’s delve into the details:

Doctor D, an anesthesiologist, enjoys a relatively high physician income with shorter work hours than the average physician. Her husband, armed with a business degree from a top 5 institution, commands an income after bonuses in the mid-$300k range. Along with prudent real estate ventures, their combined pretax income will hover around $700,000. They live in an expensive part of California, and will roughly have a net state and federal effective tax rate of 45%. For most people, $385,000 is a generous annual fund to work with.

Keep on hustling, and maybe you’ll get your lucky break.

Doctor D has two children, one of whom requires lifelong extensive healthcare expenses. She also has aging parents with recurring medical and lifestyle expenses that require financial support. These two factors alone will erode most of their savings:

Therapy and cognitive classes – $120,000/yr, 50% of which is covered by health insurance.

Senior living and healthcare expenses – $100,000/yr

Rough Total: $160,000

Fortunately, her parents do have some savings that offset some of the senior care needs, but if you add the rest of their expenses, there is really nothing much left to invest:

Property tax – $30,000/yr

Mortgage – $60,000/yr

Nanny – $3000/month – $36,000/yr

Food – $3000/month – $36,000/yr

Household/misc – $2000/month – $24,000/yr

Total: $186,000

Finding the escape plan

I have been wondering how one can escape from this vicious cycle. When you have fixed health expenses consuming roughly 50% of your post-tax income, you are already starting the race with one foot. Let’s look at several options that might be palatable:

Geographical Arbitrage

Those who practice geographical arbitrage swear by it. The fact is that not everyone will be able to adjust their interests to a particular region, no matter how financially advantageous living in Wisconsin is (sorry Badgers!). Doctor D would do well packing up from the OC and reducing taxes, mortgages, and essentially all other food costs. A recent article by @HiringLab shows just what you can account for with geographical arbitrage. Even if there is a comparable region-adjusted salary for Doctor D and her family, it may be tough to pick up the family and move.

Running lean on what you already have

This is the strategy that we should all employ if we need to work with what we have. Perhaps one could find a more economical nanny, groceries, or recurring daily expenses. Doctor D is in a predicament because her recurring expenses really aren’t necessarily the problem. Running leaner on these expenses may only make the family less happy without significant savings.

Find an employer who can front the medical bills

This is an interesting option. Big players in the tech industry are often known to offer generous benefits to its employees. There may be options in the healthcare industry that have similar arrangements. Large public hospitals and the Veterans Affairs are two options that come to mind. Perhaps there are options for their employees to purchase healthcare benefits that will cover the high cost of healthcare for Doctor D. In exchange, Doctor D will accept the lower salaries or perhaps more inefficient medical practice.

The bottom line

I feel badly for Doctor D. But her situation is more common than we realize. She may not be able to retire by 45, but there is still light at the end of the tunnel.

What alternatives would you suggest she take?