Millionaire Interview 430

Here’s our latest interview with a millionaire as we seek to learn from those who have grown their wealth to high heights.

If you’d like to be considered for an interview, drop me a note and we can chat about specifics.

This interview took place in July.

It’s a long one (which I love!) so I’ll be breaking it into two separate posts.

My questions are in bold italics and their responses follow in black.

Let’s get started…

OVERVIEW

How old are you (and spouse if applicable, plus how long you’ve been married)?

My wife and I are both 42 years old and have been married for 14 years. We dated for 1 year prior to getting married and it has been an amazing 14 years.

Marriage isn’t work if you find the right person and realize you have to give up part of yourself to gain a new part to become whole. I do not miss being Single and hope to never be single again.

Do you have kids/family (if so, how old are they)?

Two kids that are under age 10. One is in public elementary school as we chose a neighborhood with wonderful schools and houses.

Yes, we pay for that privilege and feel that it is a good investment both in the asset of our home but also in the education/experience for our kids.

What area of the country do you live in (and urban or rural)?

TEXAS. We are natives and not transplants, my wife’s family since 1836.

The state has changed so much over the last 10 years with new population influx. The TX mindset is still more independent than most states, but it likely will become the biggest “purple” swing state in the Union soon.

Texas is a very friendly, pro-business state for a reason, but many people don’t understand that and want to make us CA as quickly as possible. We enjoy not having any state income tax, but it becomes a wash with our very high property taxes.

I live in a HCOL area of TX and have to pay annually for that privilege.

What is your current net worth?

$4.5 million in mid 2024.

We are incredibly blessed and hard to believe we are here.

What are the main assets that make up your net worth (stocks, real estate, business, home, retirement accounts, etc.) and any debt that offsets part of these?

• Personal Home: $800,000
• Rental Homes (3): $1,000,000 (all equity paid so far)
• Retirement Accounts: $1,150,000
• Syndications (multifamily): $250,000
• Brokerage (taxable): $1,200,000
• Cash savings: $100,000

I don’t count cars, jewelry, or 529s as that is all money that will be spent or worthless.

Our primary residence is fully paid off and that was very intentional. One rental property is paid off as well as it was purchased over 10 years ago.

The other two rental properties are recent purchases with high 7.5% interest rates, unfortunately. We use Vanguard and Fidelity, and I like Vanguard the most overall.

We have several RE syndications that are doing ok, but many are on distribution pauses while the interest rates are high. We max out every year our 401k, 403b, 457, SEP-IRA without hesitation.

This is so important to help grow your wealth but also have asset protection in a litigation-happy world.

I am very debt averse but I also realize that you can use debt to your advantage if done intentionally. Once I purchase something with debt to get it secured, my goal is to pay it off as quickly as I can.

Some will say I am missing out on other higher-earning investments or opportunity costs, but I sleep REALLY well at night in my paid-off home at age 41 🙂

I also have a term life insurance policy for $1,000,000 that expires when I turn 57. This was purchased 4 years ago to make sure my wife can raise our kids well and send them to college in the event of my surprise early death.

This costs me $415 / year fixed price and is honestly a no-brainer. Do you have yours yet???

EARN

What is your job?

I am a Physician in a middle-paying specialty (non-surgeon, non-Derm).

My wife is an Office Manager at a state agency.

As a result, neither of us earn bonuses or get equity stock grants. There will be no gold parachutes in our future. I love what I do and do not have a current exit plan or better opportunity waiting for me (yet).

What is your annual income?

Physician: $450,000 (base salary + side gigs in industry)

Office Manager: $60,000 (30 hrs/wk)

As mentioned, my Physician/consulting income is highly variable and can swing 6-figures each year. Thus, we try to make sure we are saving well and careful with spending because next year’s earnings are not guaranteed.

Tell us about your income performance over time. What was the starting salary of your first job, how did it grow from there (and what you did to make it grow), and where are you now?

My parents required me to work what I feel like my entire life to learn the value of money and to teach me independence. I have been a lifeguard, yard mower/landscaper, and waiter in a restaurant.

All of these jobs have taught me life skills that I use today. Also working a “hard labor” job teaches you quickly if that is the life you are content with, or maybe you should strive for something else in the white-collar world.

I went to medical school like all Physicians for 4 years, had no income, and was reliant on my medical school loans and occasional parent help for expenses. I did 5 years of Residency/Fellowship where I, like all Physicians, was horribly underpaid for the 80 hr weeks ranging from $48,000-$58,000 per year of the 5 year span.

During the last 3 years of medical training, I did a ton of Moonlighting (ie working overnight/weekends at a low-acuity ER) and was able to double my income. This additional income was vital to starting my nest egg to grow and allowed me to pay off my $170,000 medical school debt within 5 years of becoming an Attending.

Once I had a real Attending level job my salary has ranged from $175,000 to as high as $700,000. As mentioned above I do not earn a high quartile Physician salary as I work in a mid-paying specialty and in an urban core hospital (this means there is no incentive pay to bring me into a high-need zone).

But I work a lot with Pharmaceutical companies and Medical Education/Consultancy companies and that has paid me well over the years.

Networking, working hard, and being relatable are so vital to being able to grow my opportunity pool and open doors. Many Physicians are narrowly focused and don’t realize they aren’t working well with others, and this brings us all down as a peer group.

Physicians are not very good at communicating how important we are to the health and safety of the public and even our families. Thus, we are seeing the rise of NP/PA healthcare workers and the giant Healthcare industrial complex coming in and taking over YOUR healthcare options.

Many Physicians feel that salaries will go down as the demand for our expertise is not valued or wanted. Did you know Medicare is decreasing Physician payments 3% in 2025, while giving Hospital payments an increase?

Hmmm….. How many of you are planning for a pay decrease next year despite working the same amount?

What tips do you have for others who want to grow their career-related income?

Many of the wonderful ESI Millionaire interviews have given amazing strategies to grow and develop yourself up the corporate ladder. I admire these traits and possibilities very much.

Physicians must work hard and see many patients to grow their income. Finding the right peer group, hospital system, and location is vital to being happy and earning the income you feel comfortable with.

Some Physicians can get equity or ownership in facilities or the practice itself, but this is no longer the norm as 70% of Physicians in 2024 are basic employees.

My goal as a Physician is to be a “sought-after Physician”. To me this means being sought after by patients, my peers (as a referral), and by the Healthcare Industry.

In order to be sought after, you must be very good at your medical specialty. Next, you must be able to work well with people, be relatable, and communicate often.

Finally, you need to be able to say Yes to opportunities as they are presented to you, even if they may not be exactly what you were looking for to start. It is always ok to slowly back out and close out positions you are signed up for, but opportunity rarely calls twice.

So far this has worked well for me and has allowed me to earn income higher than my specialty national average. As well, I also have positions that come my way that are engaging and fulfilling to being a non-burned-out Physician.

Some view this as “selling out” or be a grift, but wise advice I was once taught is that ‘you cannot have a seat at the table if you have already locked yourself out of the room’. The Healthcare industry loves when Physicians are locked out of the decision-making/$$$ room.

What’s your work-life balance look like?

Right now it is probably too work side out of balance. I work 1 full weekend a month and overnight home call 1 night a week.

Travel is also required for work when doing healthcare consultancy or attending medical conferences. My hope in a few years is to cut back to “Full-time” 40-45 hrs per week, as the WhiteCoatInvestor likes to say.

My family means everything to me and I do not take them for granted. I am an older dad with young kids while in my 40s, and this is common for the Physician dads.

Many people like to say the years are short with younger kids and I want to be focused with them as much as possible. Obviously, I am not great at doing both things well, it is a work in progress for me.

My job will never be a work-from-home or remote work from the mountains. My wife extends me a lot of Grace.

Work-life balance is so important in practicing medicine too. Did you know that a Physician who is practicing commits suicide every day?

We lose over 400 practicing Physicians to suicide each year. That leaves a family and a patient group that is devastated and abandoned.

We must do better to make sure our Physicians are well, as too many of us are sick ourselves. (Source: Physician suicide: Contributing factors and how to prevent it )

An exploration of the contributing factors and root causes of physician suicide along with prevention strategies…

Do you have any sources of income besides your career? If so, can you list them, give us a feel for how much you earn with each, and offer some insight into how you developed them?

Currently, our three rental properties earn about $10,000/year. This is not very much as we are using most of the income to pay off the mortgage and the expensive repairs that pop up every few years.

Our high interest rates are not helping but paying these down at 7.5% APR really does improve the net worth slowly over time and one day we will have three paid-off big assets.

My wife inherited Texas oil mineral royalties that pay $20,000ish per year and are highly variable. We are using this gift from previous generations to fund our 529s for the boys.

This has been an amazing blessing.

Dividends, capital gains, and any appreciation shares are all reinvested immediately on autopilot.

So right now from day-to-day cash flow, we are highly relying on my income. Later you will read that we save 100% of my wife’s income into her two available retirement accounts.

I am really excited to be in the investing journey where our Investments are really starting to earn money themselves. I have millions of green workers (dollars invested) earning compound interest for me every month.

I track my net worth monthly on a spreadsheet and the swings high and low based on the market and investments can be six figures at times. When we have a big recession it will be a big shock, but I am a firm believer in Boglehead.org’s principles of staying the course.

Our investments are for the decades ahead, and not for spending now.

I feel it is my responsibility to my family and to my future self to try and earn the highest income available to me now, as the years ahead are not guaranteed. Given Healthcare changes that are never ceasing, I want to be in a position to pivot my career to less work or a different role in the future if needed.

This will likely result in a pay cut, not an advancement at a new company that so many people in the corporate world enjoy.

SAVE

What is your annual spending?

We spend about $12,000/month of usual expenses.

Big ticket items add up to about $20,000 annually (travel, home repair, gifts, etc).

What are the main categories (expenses) this spending breaks into?

I do not track our expenses on a line-by-line basis. I try to put all expenses I can on our AMEX to earn hotel points and follow those weekly payoffs very closely.

I’ve found that post-pandemic in our inflation world we are spending about $ 1200/week on the AMEX which includes (food, gas, groceries, utilities, kid expenses, misc).

Thus I get super annoyed that some things have to be drafted from the checking account or use our Debit card. Let me earn my points! I’ve got trips to book 🙂

I will say that we are loyal Patriots and pay well into the 6 figures of taxes each year. Living in Texas, we have enormous property taxes (given there is not state income tax), so our properties add up to around $55,000 in property tax payments yearly.

Do you have a budget? If so, how do you implement it?

The easy answer is we always spend way less than we make. My best way to track this is to follow our weekly AMEX spending and make sure it stays around the average and determine if there are justifications for overages.

I feel this helps keep the hedonic spending increase from happening. I whine to my wife when I see the weekly overage and I don’t have a good reason or intentional purchase.

I am the more frugal spender than my spouse. It drives me nuts when I see she went to Target and she has no idea how much she spent.

I am the opposite and can recite any receipt within the last 48 hours of something I spent money on. This is very purposeful spending and is reflective of my default “scarcity mindset”.

Really wish I was born with the abundance mindset, but being a Physician with an income that will unlikely rise, I feel that I must have control over our expenses wisely. I have no direct way to move up to higher management, C-suite, or owner status with a big pay raise.

Additionally, Physicians cannot just change companies on a whim to hop from higher salary to higher salary. That is something I envy regarding most people with corporate jobs, or travel nurses.

What percentage of your gross income do you save and how has that changed over time?

We save between 30-50% of our income. High earning years raise us to a higher percentage.

As above, living below our salary and means is incredibly important. Burnout is coming for me and I don’t want to be rounding in the hospital on Christmas Day when I’m 72 years old.

If you have an old Physician, it is more likely that they cannot afford to retire vs they just “love what they do”. I’m not going to be in the ‘have to work the holidays/nights Physician’ that I see roaming the halls with me as a Mid-career doctor.

What’s your best tip for saving (accumulating) money?

As discussed by so many others you must automate your savings into the accounts at payroll. Compound interest is your best friend and the overnight worker you employ while you sleep.

Knowing your expenses or weekly/monthly spending is also extremely important so you can see how much saving is possible from your paychecks. All bonuses or big pay raises should be saved at least 80%.

Also buying items or purchases when there is a sale or discount offered is imperative to get your value. I don’t always hunt for the lowest-cost item, but I want to make sure I am getting the value and not being ripped off.

What’s your best tip for spending less money?

Shopping online among multiple websites is another way to save items or travel. Do not impulse buy, but look around for at least a few hours/days to make sure that it will be the best deal.

Realize that you don’t need the best or highest quality at all times. Some things are good to splurge on, others choose the generic brand.

If you open your cabinets, fridge, or closet and you don’t see a few generic Walmart, good and gather brands, mayyyybe you have an issue.

What is your favorite thing to spend money on/your secret splurge?

I love upgrading electronics. I want to have the best gadgets available so I will always have a well-working laptop, newest iPhone (1-2 yrs old), household appliance etc.

This is an expensive hobby (habit?) but it brings me a lot of satisfaction. We will not upgrade to the next model unless it offers significant improvements over what we have currently.

If the company just changes the label and raises the price, we will wait until the next release cycle. It’s always coming after all…

I am an eternal optimization guy as well. If this requires spending a little bit more to get more value, or trade away the old and failing, then I am going to spend on it.

As my finances have become more secure and higher than I expected, I give myself more permission to spend less wisely. Breaking out of my scarcity mindset at times is ok when done with good goals and objectives.

INVEST

What is your investment philosophy/plan?

I am a Boglehead investor, WhiteCoatInvestor, and real estate investor. You must first save a good portion of your income, to then create the unearned income (passive money).

As I have more and more in the market and asset equity, I see the compounding transform from a linear change into an exponential money-growing curve.

I have less than 20% in bonds or cash equivalents and I guess you could say the rest is “high risk”. I want to enjoy my upside in the market potential while I still have an earned income that pays me well.

In the future I may turn to more conservative “age in bonds”, but there is a lot of new data that may not be necessary.

I am hoping to win the race and get to the place of FATFi, then I will determine the next steps. This will take many years and I do not plan to retire early, but definitely transition my roles.

What has been your best investment?

Our best investment has been mutual fund and index fund investing. We have taken advantage of the bull market like everyone else.

Real estate has gone up well from a paper trail standpoint, but anything we would want to buy is higher also. I am definitely a benefactor of buying real estate before 2020 which was just dumb luck.

I also do not believe in miserly saving after having read the book Die with Zero. We must save for the rainy day tomorrow, but shouldn’t miss the sunshine of today.

Spending my kid’s inheritance on us as a family now can create a lifetime of memories. I agree with the book that I want to be a generous giver now rather than stay frugal my entire life, give them a giant inheritance when I die at 82 years old, but have no major memories or legacy was created along the way.

What has been your worst investment?

Buying single stocks has been terrible. I have invested in companies like Citi and NRG when I was a teenager and they had all done poorly within 5 years when the early 2000s financial crash.

Luckily I have not had any catastrophes and am very lucky. Watching my finances and learning from readers like ESI Money loyalists has helped me avoid some pitfalls.

What’s been your overall return? 

Overall I would say about 8% return which is great, and this lines up with my Vanguard performance stats. I know a several-year recession will bring that down in the decades ahead.

But I want to grow my number of shares as much as possible, the price is up to fate and God’s plan.

How often do you monitor/review your portfolio?

I do my nerd Net Worth spreadsheet on the last day of every month to track the good and bad progress. It is so inspiring to see the numbers rise and look back 2, 5, or more years to see what those accounts or assets were tracking at $$$.

When every I reinvest or make contributions this also helps get us to our goal.

I do not stress when the accounts go down 5 figures, I know this is temporary and we must stay the course. Maybe I’ll feel differently at 7 figure drops, but I look forward to that First World 1%er stress one day.

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To read the rest of this story, see Millionaire Interview 430, Part 2.