Its not news to most doctors that the rate of burnout among physicians has reached crisis levels. The 2018 Survey of America’s Physicians Practice Patterns and Perspectives found that 78 percent of respondents experienced feelings of professional burnout, a 4 percent increase from the results of a 2016 survey conducted by the Physicians Foundation. Longer hours, increased demands, lower benefits, and decreased reimbursement and recognition combined with ever-increasing red tape are often cited as the main causes of the problem.
While most doctors still enjoy their occupations, the majority of doctors (and most people in general), enjoy their free time much more. Where most burnout programs focus on mental and physical wellness, few address how personal finance plays a role in career burnout.
Life is expensive. It's also full of choices about how to spend your money. Doctors think they’re immune to the spending habits of their peers, especially those who are financially savvy, but the truth is they probably aren’t. If your friends live in the nicest neighborhoods or take expensive vacations, you'll likely do the same. If your neighbors have their kids in private school, you’re probably going to put your kids in private school. It takes an amazing amount of willpower to drive a Civic when everyone else drives an Audi, a Lexus, or a Tesla for just a few years, much less your entire life. It's easy to get lured into someone else's lifestyle because we want to look as successful as they do. It's important to realize that the Joneses are probably broke because they're trying to keep up with their neighbors.
It's amazing what retiring your debts and growing your net worth with passive income can do for your career options. If you find yourself getting burned out, having a firm financial footing allows you to offload the unenjoyable parts of your job or find a completely new job. Many high net worth physicians find that they can afford to take on fewer patients or work fewer hours or even days in the week, significantly improving their overall job satisfaction. Even if these choices aren't available to you, having a solid net worth and the ability to step out of the game can be a powerful bargaining tool.
This begs the question - how do you get there? The answer is simple: earn more and spend less. Taking drastic measures to cut spending leaves more leftover to address the income part of the equation. Suppose you make $200,000 after taxes annually and cut expenses down to half of your take-home pay. This leaves $100,000 a year to plow into passive investments. If your portfolio produces an average return of 7%, you'll have $2 Million in 13 years. Investing in private offerings with returns of 15% can cut this time down to 10 years. Investing in CD's with a yield of 2% will require 17 years.
Money doesn't solve all problems, but having it greatly expands your options to reduce burnout. Spend and invest wisely.