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.
Today’s interview is with the Debt Free Doctor.
My questions are in bold italics and his responses follow in black.
Let’s get started…
OVERVIEW
How old are you (and spouse if applicable, plus how long you’ve been married)?
I am 43 and my wife is 40. We’ve been happily married for 17 years.
Do you have kids/family (if so, how old are they)?
We have two wonderful, smart boys (parents always like to brag on their kids, right?)
Ages: 13, 11
What area of the country do you live in (and urban or rural)?
Louisiana (population 50,000)
What is your current net worth?
Roughly $2.4 million
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?
- House: $250k
- Office Building: $175K
- Retirement Accounts (Simple and Traditional IRAs): $520K
- Taxable Savings (Investments, mutual funds, etc.): $870K
- Cash: $200K
- Educational Savings (529 Plan): $135k
- Real Estate Crowdfunding + Syndicate Deals: $210K
- Bonds: 32K
- HSA Account: $60K
EARN
What is your job?
Dental Specialist, consultant to dentists and specialists, and have since started a financial blog geared towards helping other healthcare professionals.
Wife: Dental hygienist and recently began selling hair care products.
What is your annual income?
Solid 6 figures.
Tell us about your income performance over time. What was the starting salary of your first job and how did it grow from there?
During high school and college, I had a lawn care service where I was making anywhere from $800-$1000/week during the spring and summer. Not bad for a student with no debt and living at home. I feel this is where my drive started from that has since led me down the path of entrepreneurship (wow, that was a difficult word to spell!)
I was hoping to join a group practice out of my residency, but life punched me in the gut and the deal fell through shortly before I graduated. I had to take up mowing yards (again) while building my practice.
Started from scratch earning $0 to $100,000 – $175,000 after three years of hard work.
The income for the first 8-9 years continued to steadily climb to now in the solid six-figure area.
What tips do you have for others who want to grow their income?
NEVER stop learning.
Continue to invest in yourself as that is the BEST investment you can make. Think about it, with knowledge, you can have everything taken away from you and eventually build it back.
Become a voracious reader, attend seminars, network with like-minded people, and surround yourself with people that are SMARTER than you.
Proverbs 15:22 – “Plans fail for LACK of counsel, but with many advisers they succeed.”
What’s your work-life balance look like?
From Day 1, I always focused on having a balanced life. Too many docs I know start off working long hours and claim that “someday” they will cut back and spend more time with the family.
Most of the time they don’t and the kids are gone in the blink of an eye.
Outside of work, spending time with the family traveling, playing sports, coaching, etc. takes up a large amount of free time. (And oh yes, I don’t want to forget to tell you that I love Disney World, but don’t tell my wife I told you.)
I also love working out, bass fishing, snow skiing and playing tennis.
During the Fall and Winter, you can find me on the deer stand.
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?
My real estate crowd funding has earned anywhere from 8-11.25%.
I would eventually like to dabble in “financial coaching” but for now, I’m doing it at no charge.
SAVE
What is your annual spending?
It varies but is around $7K – $8K per month.
What are the main categories (expenses) this spending breaks into?
Expenses have dramatically decreased now that the house is paid off and the kids were moved from private to public schools (Yay!)
I’ve noticed as the boys have gotten older and hungrier, our food bill as steadily risen. We LOVE to eat out both as a family and as a couple. I don’t have an exact number but I would be willing to guess our food bill is about $1K/month.
We also love to travel. Our annual travel expenses are $30K – $40K.
Do you have a budget? If so, how do you implement it?
We don’t have a specific budget. I keep an eye on our personal checking account and the charges that come out of it and only transfer money from the business account to the personal account as needed.
What percentage of your gross income do you save and how has that changed over time?
I initially started out saving 10% as I was aggressively paying off my $250K student loan debt.
I know that Dave Ramsey advocates to NOT save anything for retirement until you are debt-free minus the house. I felt that I could do both (pay down debt and save) at the same time. I did NOT want to lose out on compound interest earnings from my early days of practicing.
If you feel that you can’t do both, then I recommend getting completely out of debt first.
I was saving about 50% a few years ago but decided to cut back to 30% and enjoy the kids a little more. Life’s too short to NOT enjoy it. It’s amazing how fast they grow up. One minute they are in their cribs and the next they are in high school!!
What is your favorite thing to spend money on/your secret splurge?
Experiences and travel hands down.
We travel 8-10X a year and love it. We’d much rather make memories with our family than buy another X-Box that sits around and collects dust after a few months.
INVEST
What is your investment philosophy/plan?
In one word: BORING
Index funds make up the majority of our portfolio. Vanguard automatic investing makes it idiot-proof to hire an adviser.
90% of our portfolio is stock index funds with a large portion in the Vanguard Total Stock Market Index Admiral Fund
What has been your best investment?
As I stated earlier, in myself, getting out of debt and paying off the house. There’s something about pulling into the driveway each day of a paid for home….
What has been your worst investment?
I bought a few penny stocks while in school. I didn’t lose much money but lost just about all of my total investment.
What’s been your overall return?
Roughly 8% in index funds and 10% in the real estate crowd funding
How often do you monitor/review your portfolio?
Typically on a daily basis using an online tracking tool and the Vanguard website.
NET WORTH
How did you accumulate your net worth?
I spent 12 years in school AFTER high school, as many docs do. This put me behind the eight ball versus my other friends who started working right out of college.
After paying off school loan debt, I turned up the notch and started investing heavily in Vanguard index funds. Other successes include: investing in 2 online real estate crowd funding platforms and with an individual that puts together apartment syndication investment deals.
What road bumps did you face along the way to becoming a millionaire and how did you handle them?
To be quite honest, I never imagined becoming a “millionaire” until I reached retirement age (maybe). I guess because none of my family members are millionaires, it was ingrained in me somewhere that I probably wouldn’t be one either.
So I had to change my mind set first and foremost. After reaching “millionaire” status at age 41, the light bulb finally went on that yes, I can do this and can continue doing anything I set my mind to.
What are you currently doing to maintain/grow your net worth?
We live so far BELOW our means compared to my income and our friends it’s silly. We don’t need much to be happy.
Continuing to live like “no one else, so you can one day live like no one else” is the key per Dave Ramsey.
I also continue saving a good chunk of my income on a weekly basis as I’ve done for the past several years.
Do you have a target net worth you are trying to attain?
I do and I don’t. It seems to move like most things in life.
If you ask a professional athlete, I’m sure they can tell you that they’d love to win a super bowl or a NBA championship. Then ask them after they’ve accomplished this and I can guarantee you that they want another one.
My old football coach taught us, “Be proud but NEVER satisfied.”
Initially the target net worth started at one million. It’s now 5 million.
I don’t really need it but it’s fun to shoot for something. Once I hit 5 million, I’m sure it will go up to 10 million then if the man upstairs allows me to live that long.
How old were you when you made your first million and have you had any significant behavior shifts since then?
Age 41.
Behavior shifts – it’s amazing how I never really much thought or worried about money until now that I have it, it seems I started to worry about how to keep it from going away. Maybe this is natural, I don’t know.
I put my faith in the Lord and whatever happens, happens. Much of this world is OUT of our control anyway.
What money mistakes have you made along the way that others can learn from?
I would have taken all of my student loan money when I was in school and bought Amazon, Apple and Yahoo stock when it first came out!
Also, taking out too much in student loans forced me to start off in a large hole. Looking back, I should have looked at having the military pay for my education in return for my service.
If you had to give advice to ESI Money readers about how to become wealthy, what would it be?
This is simple.
Get out of DEBT and stay out.
Don’t try to impress people. Trust me, they don’t care what kind of car you drive or how big your house is.
Surround yourself with smarter people than you at all times. If you’re the smartest person in the room, leave the room.
Get your mind right. You CAN do anything you set your mind to. Ask God, and he will provide.
Set goals and work hard to achieve them.
Automate your investments and focus on index funds. No amount of investing is too small.
FUTURE
What are your plans for the future regarding lifestyle?
We will continue living below our means but also enjoying ourselves along the way spending money on experiences instead of “stuff.”
We try to involve our kids too, teaching them about finances along the way. We teach them with every bit of money they acquire to: Give, Spend and Save. They know that money only comes from one place: WORK
What are your retirement plans?
It’s going to depend on our kids and where they live. I would like to spend more time out West in the mountains. I love to ski but love the summers in the mountains even better.
My wife is the opposite. She loves the water and beaches so I guess I know where I’ll be spending more of my retirement time (wink, wink).
Are there any issues in retirement that concern you? If so, how are you planning to address them?
Health. I know too many people that have cancer that do not smoke or drink. Again, many things in life are out of our hands.
I will continue being active (lifting weights, playing tennis) 5-6 days a week.
Many people focus 100% of their time on financial success and one day achieve it….but are too unhealthy to enjoy it.
MISCELLANEOUS
How did you learn about finances and at what age did it ‘click’? Was it from family, books, forced to learn as wealth grew, etc.?
Watching my parents’ frugal ways growing up. It clicked when I realized that becoming a millionaire does take time and effort but patience and continued investing capitalizing on compound interest is the one of the keys to becoming wealthy.
Who inspired you to excel in life? Who are your heroes?
My dad and several coaches throughout life. I get my work ethic from my dad.
Do you give to charity? Why or why not? If you do, what percent of time/money do you give?
We tithe weekly but also give our time and my services to underserved patients in our area.
One of the main reasons of starting my new financial blog to other health care professionals was to “give back.”
So much has been given to me that the least I can do is give back to others.
Do you plan to leave an inheritance for your heirs (how do you plan to distribute your wealth at your death)? What are your reasons behind this plan?
My wife and I actually had this discussion over dinner recently. If we could time it, we wouldn’t leave our kids a dime!
If there is any money left after we both pass, it will equally be divided among our two boys.
Wow – $800 to $1000 a month from a lawn care service, that’s impressive! Must’ve been some serious hustle there and that obviously set the tone for your career. Great job!
Accidental FIRE: Somedays I STILL wish I was mowing yards!!
“We live so far BELOW our means compared to my income and our friends it’s silly.”
“Initially the target net worth started at one million. It’s now 5 million.”
See, I know what your issue is doc, you’re me! ?? I think my reward is the kick we get when we see our expenses (living on $27,000/year). It makes me laugh because “it’s silly” and life makes no sense. I swear, the kick is from being naturally rebellious and enjoyment in being odd for the sake of odd. 🙂
Lily: I like your definition, “the kick.”
You’re right, there’s definite comfort in having a large cushion between your expenses and income.
Great interview. I look forward to another one you have coming up 🙂
Also, not investing until your debt is gone is decent advice for people who didn’t delay making money into their 30s and are now high-income earners. Dave Ramsey’s advice is good for the average person and generally not so good for most doctors and high income earners.
Glad to see you know where your wealth comes from and where the credit is due!
TPP: I’m looking forward to the future interview as well. 🙂
I don’t disagree too much with Dave Ramsey, but for higher income earners that are disciplined, I feel that they can do BOTH, invest while paying down debt. I agree with you that his advice is more for the generalized population that may not be able to do both.
I did this early on to not miss out on the beauty of compound interest.
Great job on getting out from under student loans and onto a rock solid financial path with a balanced family life. I know plenty of Drs that have no idea what their kids are up to. They simply don’t have time and have lost touch with their kids. What real estate crowd funding companies or resources (website research) do you recommend?
Bhavani: Your point is spot on about kids. One of the reasons WHY kids are so lost these days stems from their parents… or lack of them. Many are being raised in one parent homes and/or lack supervision. We have to fight for our kids everyday because others are fighting for them too (except the others want them to fail.)
Real estate crowd funding: I started off with patch of land and Realty shares. I now am investing strictly with Joe Fairless.
If you have any further questions, feel free to email me: [email protected]
Another great interview. Thanks for sharing! Hoping to hit our first million around the same time and nice to see someone who has done it with a very similar philosophy. Aside from 401K, our stock and ROTHs are with Vanguard as well.
For education / 529, I’m assuming you have one account for each child. Are you doing any other saving for your children or have you focused the effort on 529?
KM:
My pleasure.
My kids are on the payroll and get a check at the end of each year. The amount of each check comes from my CPA’s recommendations based on their ages and the types of jobs they perform around the office.
The money goes into a Vanguard mutual fund. Depending on how they end up financially, I won’t allow them access to it until they can prove they are financially fit to.
I like that. Thanks for sharing!
I would also be interested in learning more about the real estate crowdfunding you mention!
Cool to see someone from Louisiana on here! I’m in New Orleans. I run an event called the New Orleans Investment Conference that you might be interested in attending – we’ll have speakers like Robert Kiyosaki, the Real Estate Guys, Peak Prosperity, etc and we have a discounted rate of $350 for LA residents. Info here: https://neworleansconference.com/ We have a lot of current and former doctors/dentists who attend.
Hi Emily C: (My wife’s best friend is also Emily C 🙂 )
Thanks for the invite….I’ll check it out!
Hi Emily,
I’m also from Louisiana! I’m very new to investing. Would the conference be a good place to start? Or are there other good sources, such as books/webinars/classes/mentorship opportunities, that you or the other folks on this site would recommend?
How old were you when you made your first million and have you had any significant behavior shifts since then?
Age 41.
and now at 43, net worth is 2.4 M? 1.4 M in 2 years? pls explain how.
DT:
Thanks for bringing this typo to my attention.
I was actually 38 when I became a millionaire. Once the house was paid off, it then allowed me to have a higher net work + sock much more money away from then until the present.
I would like to know more about real estate crowd funding. Have very little knowledge of what this is or if it is safe to invest in.
My husband has a good income as an anesthesiologist; and like you we live in a low cost of living area of the country (albeit we pay a lot in real estate and income taxes in NY, we live in Western NY, so much cheaper over all). We did save about 30%-40% of our income, but then our 3 boys attended very expensive private colleges, and our savings rate plummeted, as we paid for everything. Now our youngest is in a private medical school, and again, our savings rate is plummeting, as we pay for it out of current income (yes lucky we are able to do so). Our net worth is thus lower than you would expect based on our income . I guess I am just mentioning this because many of the folks on this site have huge savings rates, but their kids are not yet in college. When that happens, the savings goes out the window! Your biggest expenses are still in the future.
Ellie, thanks for the feedback.
I informed my kids that they can go to any college that they want to go to as long as they get a full ride.
If not, they will be attending the local University utilizing what they have saved in their 529 plans which should more than cover the cost.
I don’t plan on putting myself in jeopardy due to the college decisions my kids make.
In my opinion, it doesn’t matter where they go to school, it matters what they make of the situation that they are in.
Everyone has their own opinion.
Mine is this: all of my financial decisions are based on whether or not I can make the purchase yet still keep my current savings rate.
If not, I don’t make the purchase. That could be anything from a vacation, vehicle, or paying for college.
My 2 cents.
I hear you. I do know that for the very competitive academic schools (think Ivy League, MIT, CIT, Stanford), every candidate is bright, they could probably fill the class 3 times with outstanding students. So no one gets academic scholarships, but financial aide is abundant, based on need.
My oldest attended Yale back in 2002-2006. Wall street types recruit heavily at these top schools, not so much elsewhere. He snagged a great job at JP Morgan, now works at a hedge fund. Makes ALOT and loves his job. Not sure if he would have been able to get a foot in the door at a big bank without attending a top school where they recruit. Obviously this is 1 example, 1 career choice. But food for thought.
And believe me, if our future were to be in jeopardy we would not have forked over the big dollars for their education. In the end, we have over 5 million and counting. The difference would have been negligible in the long run. So we chose to do it, because we could do it. But I just don’t think a lot of people realize that their big expenses are around the corner, and they have several children, without realizing the true cost. As my 90 year old mom says….children are luxuries!.
Ellie- just want to give you a shout out- well done that your investment is paying off. Debt-free-Dr – I had the same conversation w/ my kids but when it came t decision time and what we could afford it ended up very differently…good luck,
Ellie,
You should do a Millionaire Interview. I believe it would be very interesting for everyone. We also had a similar experience with our son and his college education. He graduated from Northwestern and also had interviews with companies that only go to the “top” colleges/universities.
“Surround yourself with smarter people than you at all times. If you’re the smartest person in the room, leave the room.”
Okay, what does this mean? I’ve seen something similar crop up in other interviews. It sounds like so much BS psychobabble that would be spewed out at an Amway or other multilevel marketing seminar. People are people and I don’t do IQ tests when I’m in a room with them. I find the majority of people have areas of expertise where I’m lacking. My one BIL dropped out of high school, but has been working on cars and trucks since he was 14 so I’ll plum his knowledge for automotive tips and issues. Another BIL never went beyond high school but has been in the trades for decades so he gets tapped when I’ve got questions about DIY projects. Smarts are relative, and sometimes drive, experience, and persistence will kick the crap out of smarts. Additionally, what if the person you want to talk to at a gathering realizes they’re the smartest person in the room and they decide to hoof it before you get a chance to talk to them? So much for increasing your knowledge.
So what, exactly, are you claiming to be looking for when you make such a statement? What does a room of “dumber” people look or feel like so you know when to leave the room? What is your actual discriminating factor? Is it brains, attitude, motivation, lifestyle choice, topics of discussion, what?
Not slamming the author so much as wanting to understand what this statement means to folks or is interpreted to mean.
It means you are in control of your destiny.
If you are feeling bored, un-motivated, or know that you could provide more value in a different situation then it is up to you to 1) recognize and 2) make a move.
Getagrip,
Hope this helps you:
https://www.forbes.com/pictures/fljl45lkm/michael-dell-never-be-the-smartest-person-in-the-room/#6051e7f07d6e
I think the statement actually means more than intellect. Essentially, if I want to be better at any endeavor, I’ll likely improve at a faster rate if I associate with people that are already “better” than me than I would associating with people on my level or below.
They could be “better” than me for a number of reasons… smarter, harder working, more patient, etc. By being in the room with them, I’ll see what it takes to operate at their level (which also validates that its even possible) and can even ask them how they do it.
You know you’re in the right room if your assumptions about what’s possible are challenged. You may have reached the limit of whatever paradigm you’ve been working in (like “I can only count on myself so I must have a hand in everything!!”) so you need to see other people being even more successful in a different paradigm to let go of yours(“I worry about hiring great people; they worry about everything else”).
You’ll know you’re in the wrong room if you feel like everyone’s talking about problems you’ve largely solved for yourself. Now, this is where I take issue with the “always” part of the statement. I do think there’s alot of value in paying your dues at certain plateaus. Sometimes you’ll need that broader experience at a lower level to handle challenges at the higher level and your network at your current level could be valuable later.
Also, how would anybody get mentored if their mentors spent all their time looking for mentors? We have to balance our time between personal development and helping others for everyone to progress.
If the “smartest” person leaves to room, you have to be honest about your own level with respect to the room and your goals. If you’re trying to develop yourself but can still learn alot from those still in the room, you should stay. If you’re trying to develop yourself and the room doesn’t have much to offer, you should leave too. If the room doesn’t have much to offer you but you can help others, you should stay.
Thanks to those who provided a response. As I suspected, the bulk of interpretations of this saying have nothing to do with intelligence, so I dislike that the saying is phrased as it is because IMHO you have to inject too much into it for it to make sense beyond the saying itself. Probably just a personal pet peeve. It reminds me of algebra class where my teacher kept telling me while discussing unknown variables that “you can’t mix apples and oranges” and just kept repeating the phrase as if such repetition was supposed to enlighten me when I said I didn’t get it. I ended up with detention when I blurted back, “That’s stupid, you throw the apples and oranges in a blender and hit the button. You’re done, their mixed!” She thought I was being flippant when I honestly just didn’t understand why you couldn’t mix them so why say that.
While I always like reading these, sometimes the person being interviewed losers perspective.
“Solid Six Figures” is so vague it loses meaning. That is because solid 6 figures can mean completely different things to different people.
Does he mean 150? 350? 650? 950?
It would be more helpful to say “between 350-450 depending on how business is doing. ”
Without quantifying income progression more the interview answers lose their effectiveness.
Jason, hope this helps.
Over 500K but less than a million.
Great interview with lots of good advise behind it. Not to mention lots of work…, lots of hard work behind the success you now display …
Ditto here —
Behavior shifts – it’s amazing how I never really much thought or worried about money until now that I have it, it seems I started to worry about how to keep it from going away. Maybe this is natural, I don’t know.
My goal is also 5M but I know I can probably live comfortably with what I have and still have money left over at the end of the game!
https://esimoney.com/millionaire-interview-75/
Congrats!
What real estate crowd funding platform do you use?
I use RealtyShare and Patch of Land.
I also have two apartment syndication deals going with Joe Fairless.
I plan on mainly investing with Joe moving forward.
One of my favorite articles! Its great that you started your entrepreneurship young with mowing lawns. I also started young, was a paperboy during all 4 years of high school, i also part-time at a couple of restaurants and selling paper door to door. For anyone that wants to be an entrepeuer, starting young is the key !
I also love reading, I read about a book at week on my kindle! Reading, Vacationing, and spending time with ones i love are the only things that gets me excited in the morning!
Once again, congrats on such an awesome financial success in a young age!