My name is Dave Denniston. Welcome back to the latest episode of The Freedom Formula for Physicians Podcast.
In February, I was meeting with a “mastermind” of other small business owners. Everyone has an online business- some are podcasters, one guy has an online t-shirt business, and another gal focuses on health.
Anyhow, as the meeting was wrapping up, they made a suggestion to me on how to change my podcast. I have to be honest, it was a little hesitant. I’ll talk about that another time.
But that’s not all!
They made another suggestion to me that really hit home for me. They suggested to do a new feature, just once a month.
That I should have a monthly fireside chat with a physician to get to know their journey, their joys, and their struggles with finances and outside of finances.
I thought it was such a great idea and I reached out to my contacts.
Our next guest is generous enough to share with us his journey and his wisdom. He is our first guest in this new fireside chat.
He is an ENT physician. He has been working since he was 15 years old and has paid for college through Med school PLUS two graduate degrees. Now he is finally practicing after 18 years since high school graduation.
That is amazing, I can’t wait to hear about this journey!
Please help me welcome Dr. Eric Gantwerker.
In this podcast, you will learn from Eric:
– The toughest life-changing decision Eric had to make within TWO hours
– Why it took him 18 years after graduating high school to transition to practice
– Discover the best financial decision he’s ever made since transitioning to practice (HINT: It’s not the debt he’s paid back)
– Why you should be wary and aware of “black boxes” in practice
White Coat Investor
Bogleheads’ Guide to Investing 2nd Edition
(Note: I outsource transcription efforts, please forgive in advance any grammatical errors. I just simply don’t have time to review it all)
Welcome to the freedom formula for physicians podcast with all about slashing your debt and taxes and creating a liberated lifestyle. And now, your host, with the love of fantasy books and funk and the hatred of running more than three miles; Dave Denniston.
Hey everyone this is Dave Denniston and welcome back to the latest episode of the Freedom Formula for Physicians Podcast. In February I was meeting with the master minder of small business owners. And everyone in the mastermind they have online business, some were podcasters one guy has an online t-shirt business another guy focuses on health.
Well anyhow as the meeting was wrapping up they made a suggestion to me on how to change my podcast. Now to be honest with our guys ?? I will talk about that change at a different time but that`s not all. They made another suggestion to me that really just help. They made a suggestion to me to do a new feature just once a month.
They suggested that I should have a monthly fireside chat with the physicians to know their journey, their joys and their struggles with finances and outside of finances. I thought it was such a great idea. I reached out to my contacts and our next guest was generous enough to share this; his journey and his wisdom as a matter of fact he is the first guest in this new fireside chat.
Now to confess to you guys I was really listening to this after recording it and there is a few pops that takes place on the audio and I can’t figure out how to remove them but it`s a really good conversation you are going to love it. Our next guest he is an anti-physician, he has been working since he was 15 years old. He has paid for collegship medical school plus he`s got two addition ?? degrees. And now he is finally practicing after 18 years since his high school graduation. So it`s so amazing you are going to love it. I just such enjoyed learning about his journey. So please help me welcome Dr. Eric ??
Eric: thanks so much David I appreciate it.
David: well we are so glad to have you with us. So first tell us a bit about yourself. Just a little bit. Where did you grow up?
Eric: yes so I originally grew up in the suburbs of Chicago. My father was a grade 2 teacher at the Chicago Public Schools actually and my mum was a benefits person for an accounting firm. I grew up in a middle class home, went to a good high school, my parents moved out of Chicago proper to the suburbs so that my brother and I can go to a good school system and a good high school. You know I grew up in rather every other random kid in Chicago and were graduated from high school and went on to actually medicinal Wisconsin for college.
I stayed there for about a year and ended up having to come home to set up myself and went to ?? ?? for a year while I worked full time and also had a part time job doing that job as well. Did a lot better transferred back to a four year university down in university of Illinoi in Champaign Alabama. And then that’s sorts of where my medicine interest blossomed. We are going to talk more about that in a little bit but I am the second physician of my family actually my brother was a physician before me. And part of the reasons why I didn’t want to become a physician was I didn’t want to follow my brother`s footsteps.
David: older brother I take it that?
Eric: yes exactly.
David: so your older brother what kind of physician is he?
Eric: he is a neuro surgeon he specializes in spine.
David: oh wow so you did pick a different specialty. As a matter of fact this reminds me of a client where the dad was a an orthopedic surgeon and the son, the older of the two brothers definitely he wanted to be a in medicine just like your brother but he didn’t want to do what the dad did so he went into the art and the little brother initially didn’t want nothing to do with medicine because dad was in medicine, brother was in medicine and just like you.
Once he went into college he got to experience things and got a feel for his life he did decide to be in medicine. He ended up just like his dad and became an orthopedic surgeon. And what’s so interesting to me about your journey is you didn’t have a doctor in your family until your brother became one so am really curious what led to that. Why did you want to be in medicine?
Eric: that’s a great question. My brother actually was a traditional medicine person he knew from birth he was born with ?? around his neck and knew you like lined everything in his life very ?? you know I need to do this so I can do this, I can do this. So he went straight from high school to college to medical school, residency, the fellowship and then went straight in. so he had no time off whatsoever. I was a little bit more tight ?? in my brother`s shoes. I was more of a typical find your life kind of person. I was actually really sick when I was a kid, I was in the hospital probably about 50 times I was hospitalized, had really bad asthma starting from about age five so I certainly got much more laissez faire kind of let things happen some things are out of my control.
That kind of attitude and I think that’s kind of the world I was born out with. And so when I got to college actually I sort of thought I didn’t want to do medicine my brother was doing medicine and that wasn’t for me so actually I followed in the footsteps of my uncle who was a chemical engineer and he worked for companies like quicker rolls and Pepsi and things like that you know food science chemical engineering is really cool so that’s what I started doing.
And actually I didn’t do very well my first year because I was actually trying to you know be a kid and I didn’t do so well, came back and knew that I still wanted to do food science and I actually went through junior college for one year and then transferred to university of Illinois`s food scientist. And one day I was just walking on the ?? and run into a group that was teaching people how to become emergency medical technicians and they worked all the football games and basketball games and I was you know that would seem interesting and you can get your life just by joining the club and actually go to the training and that’s sort of my first exposure to anything medicine and I loved it.
I loved working with patients, I loved learning about medicine and I ended up getting a job sort of ?? at the local trauma center working in the emergency room and that sort of resented myself and I said well I think this is it I think this is what I want to do. Initially I was like you know let`s do paramedics so I did my paramedic work I was volunteering firefighting down in champagne and then I said you know what I want to be something more than this. And so I decided end of my third year end of my junior year of college and almost into my fourth year of college that I want to do medicine and I had been doing chemical engineering food science up until that point and I switched which actually had to extend me out another six months in college. I switched to biochemistry, took all the required pre-recs and then applied to medical school.
David: what age was this now?
Eric: it`s a good question. So I guess I was… would have been 22 at this point. When I graduated from college I graduated in December of 2001 so I was 22 years old at that time.
David: so you did have, in terms of normal graduation here it wasn’t like you were extended out in terms of ??
Eric: no. right exactly you know I was extended out for about six months but that first year I actually didn’t get into medical school. I did get into medical school but I decided that wasn’t a good fit for me and so I actually looked into graduate school programs when I didn’t hear back so I ended up applying to two programs one was at ?? one was at George town and ended up going to the one at George town basically taking classes with the medical students and getting a master`s degree through that program.
And so that was probably the shining moment of my life probably one of the best decisions I ever made. I was actually packing up to… actually I got a call ?? ?? in the afternoon that I got into the George Town program on Friday. And then I got a call 30 minutes later from the medical school saying I got pulled off the wait list and then needed to know at the end of the day so I had 2 hours to decide my life.
Was I going to go to medical school which was you know obviously so difficult to go through the process not only financially but emotionally, physically, you know having to rewrite all your essays, having to reply all these medical schools it’s a big process and in 2 hours I had to make that decision and essentially at the end of the day I always decided that the easy road was to go to the medical school that I got into even though I didn’t think it was the right fit, didn’t give me the best opportunity versus moving to DC and having to go to grad school and having to go through all this process again, not even taking into account the financial ramifications of that decision.
And I decided to go through the harder road, I decide to go through graduate school to improve my grades, to give myself a better opportunity get into a medical school that I though fit my personality better and that gave me more opportunity and so I made that decision in 2 hours and made the tough call to the medical school and say you know what I think am going to pass right now.
David: so take me back to that moment. You were sitting there, were you in turmoil, what was going on…
Eric: I wasn’t in turmoil, like I said I am a little bit more of a type B than the normal physicians are laissez faire so I think that what I decided my whole life I decided to take the easier road and my brother would attest to that as he always that I always took the easy road. There was actually a joke in our family that when I was a kid my brother tend to me because I got a D in my class and he said how do you live with yourself and I always say that that’s a tough thing to hear from your brother when you are in second grade.
So he always thought that you know I took the easy road and it was for me it was a life decision to say you know what I am going to take the hard road because I think it is going to be more beneficial for me and it was a definitely an inflection point of my life was those 2 hours and it was a tough decision I have to say. Am glad I only had 2 hours to make it because if I had longer I probably would have lamented that decision, I would have had a lot more time and I make better decisions on instinct to be honest so I think that it was beneficial because it was only 2 hours.
David: so you went through college, you were working full time and part time essentially. Tell us about one of the big issues that we talk about on the podcast all the time is debt. Up to this point how has debt been part of that journey?
Eric: that’s a good question you know from early age I always wanted to work you know that was my parents who thought that is a work ethic and you know you wanted to spend money on anything or hand out with your friends it had to come from your own so actually I opened a check in account when I was 15.
I got a fool time lower probably 20-25 hour a week job at the local ice cream shop and that was about 15. By the age of 16 I was the assistant manager. You know I was in charge of closing, opening. You know I was doing training of all new employees. It was a huge responsibility I didn’t have a driver`s license, my dad literally had to drive me to work every day and pick me up. And finally when I got my driver`s license I was working a little bit more often, lots of weekends, you know basically trying to mass some spending money for myself never with the intention of saving for college.
You my brother was supported by my family throughout all of his college so you know he got small scholarships but for the most part my parents supported his education. And then my first year out my parents supported my education but after that it was all on my own so I paid for junior college I took out loans for college down to the university and you know it was in situations a little bit cheaper so I thought it would have been a little bit easier for me but that year that I was in junior college was transition to a retail location and I was working probably 30-5 hours a week and then on top of that I was tutoring 2 days a week for 5 hours each so about 10 hours of tutoring on top of my normal class work there and I actually did well that year because I was so focused and I allocated my time very well and it was all you know amassing some spending money so that I can make things a little bit easier because a lot of things I paid for I paid for myself.
I had my own checking account, I had my own… I started getting credit card really early on and so I sort of managed my dad from that stand point forward and actually my initial goal was to become financially independent from my parents as soon as possible and that happened about my second year of college that I just decided you know that’s it I am just going to you know pull away from my parents because my parents were modest middle class. My dad was a teacher in Chicago public school and my mum you know worked in benefit so she didn’t make a great deal of money and the two of them didn’t make a great deal of money together and you know we lived inexpensive neighborhood because of the school system so I tried to become independent financially as soon as possible as with my brother actually we made a concerted effort to get off the phone plan schedule, get our own phone plan and everything financially. Set ourselves up so that we could be completely independent of them.
David: and was it something that your parents instilled in you or was it something that you and your brother just chose, you know what do you think was behind that?
Eric: that`s really funny because it`s actually exact opposite. My parents till today, I come home to come visit them and you now I am an ?? so I have a decent salary and my parents try to give me 20 dollars to go out on a Saturday night and I try to tell them that’s one drink. And also like you guys need the money more than me you know, you are semi-retired, you know my mum is on disability and so I would like you to keep your 20 dollars, I don’t need your 20 dollars and they are like no you are going to take the 20 dollars whether or not you like it.
So it was actually exact opposite. My parents encouraged us to rely on them and you they are definitely with the attitude that it`s better that I give to you all my life than I gave it to you one dead and so they were very very generous and my brother and I are much more you know, no you guys keep it we understand more of your financial situation and we think you need to save more money. You know you are on a 15 coming so that’s always been my brother and I our attitude. We wanted to be financially independent of them as soon as possible so it`s funny because that’s just the exact opposite of what they wanted us to do.
David: wasn’t that interesting well, I know from me one of my main influence on money is we had in my family, though my dad`s side the best and so we had my dad`s parents, my paternal grandparents who were just kind of made it and then we had my great aunt who was extremely wealthy. As a matter of fact she and my uncle they kind of lived like misers but they were millionaires multi-times over and so I always wanted to be just like them. And so I would like to know what influenced you in regards to money. ??
Eric: yeah you know there wasn’t a kind of balance in my life with regards to how to budget, how to balance check book you know my mum you know working for an accounting firm and doing benefits, she was probably the most financially inclined. My didn’t really didn’t worry about it you know, he had my mother and still to this day he just get her all the bills to pay for and he doesn’t really worry about it so I think my mother was definitely an inspiration for me financially because she thought me how to balance my check book and I have my registers from when I was 15 years old.
I can see exactly what I spend every singly… is actually in a box in my parents` hose. And I can see exactly what I was writing checks for and balancing my budget and I tried as much not use cash so that I can keep track of my finances and my brother too my brother was very good at keeping track of his finances. But I was a little bit more of an easy spender when I was younger than my brother and my parents had a joke that I got a coconut which was a ?? in suburbs of Chicago. I got a 20 dollar gift certificate to coconut at my job just as a present and I came home and I told my parents; I got a 20 dollar gift certificate and they were like oh where is it and I spent it down the way home.
And parents were like you know you always felt like money was burning a hole in your pocket and so I wasn’t very good at budgeting but I felt the need for it. My mum always jokes when I came home from my first job, I said somebody stole my money and she said what do you mean somebody stole your money? I was I worked this many hours, I made this much money and I came home and the check was half what I was supposed to get. And she said let me see, she says that’s taxes and I said what are taxes? Why did people steal my money? I was 15 and my mum still tells that story. At the very early age the value of money and what it meant to pay taxes at 15 years old. And I certainly know now more than ever who is stealing your money and…
David: so you have now made the decision to go for your master’s program. So take us from there. What happened from there?
Eric: to save for my master`s program was financially a poor decision is an understatement. You know the tuition was very high. I tried to get some scholarships, tried to get some loans, grants and ended up getting loans to pay for not only in school but also ?? ??. ?? ?? in DC was not inexpensive so you know I was paying lot of money for this. I think it was a transition period in my life.
Actually a lot of people once they found out that I actually got into medical school and I had turned it down a lot of people were very upset with me because basically everybody in this program were people who were trying to improve the resume to get into medical school and so people actually hated me because of it that actually when they found out that I turned down medical school. But it was an excellent time in my life because I made you know some friends because we were all in the same ?? lifelong friends.
One of my best friends is from that program and you know a couple of other best friends as well. And it was a great year because I got away from home. It was my first time very very far from home because even Illinois was only about 2 hours from my parent`s house and so you know I came from the back from where I already had some medical exposure, I had some life experience, I worked in an ?? you know I was working on an ambulance, I was a volunteer fire fighter, I was on a medical team at the fire department and so I had a lot of background knowledge in a lot of the most clinical applications which I think I was different from a lot of people in that program and I think because I had that background in medicine I had that grounding knowledge that actually helped me fit all of the knowledge that I was learning. All the basic science and stuff in to more clinical applications which made me learn it a lot better. And actually I did really really well that year and ended up getting into I think about ten medical schools actually.
David: wow. Were you ?? ?? ?
Eric: yes, I was.
David: yes actually at the quicker side it was earlier in my career and I think starting out on this business was door knock. I worked for Edward Johnson I went from door to try and help financial planning so I got super burned out. I was just emotionally… did that for almost a year. And I don’t recommend it to anyone do not ?? it is cheap and so ?? I was burned out and I actually became a volunteer fire fighter. My father in law was a volunteer, was a full time fire fighter in Washington State. Just because I didn’t know what I want to do with my life and I found out that was not it for me you know. It was good with my mind but not so good with speed to my body. You know we went on like three calls and I was always the guy holding the flag, wearing the vast so I never actually got any practical experience with it. It sounds like you did and you are a volunteer firefighter because…
Eric: oh absolutely and also I ended up getting… at that point there was the B level license which was like a kind of inter-basic and then there was sort of the advance life support which was the next level of EMT. And then there was the paramedic license and actually it was a year of transition where the paramedic license became an associate degree. But then all of the train that was incorporated into the paramedic license actually dropped down to the next level of EMT.
The advanced EMT. So I ended up trying to get my advanced EMT license but at that point I had already… you know I went through all the course work, I did all the write alongs, I worked on the ambulance, you know had fantastic opportunities to learn from the paramedics faire. I learned to ?? from the nurses. You know I learnt how to start ?? and all those stuffs that I went to work at the trauma center at the same time as being on the rig.
And you know in retrospect that really changed my life as a physician having that experience and I think I much more appreciate multi-disciplinary teams because of that because I learned from the paramedics, I learned from the nurses and I understand the dynamics of the team and you know when things go wrong in events when you are in the trauma bay, and the role earlier, you know you have to rely on that team and I think I got a sort of a gestalt of how the system works and how teams work. And I think it definitely helped me as a physician in general but you know I ended up not finishing the EMTP license because I was going to medical school. So I ended up not even testing out. And then I sort of had a lapse but at least I got the training for it and it was invaluable going forward.
David: I can imagine, you are in medical school now at this point in the journey that we are talking about and you’ve actually been on calls. You know you’ve seen trauma. Was that different you know versus some of your peers in medical school that had book knowledge or ?? based on that.
Eric: no there is actually people who you can definitely tell the difference and now that I do interviews for residency for fellowship for medical school I can the difference in life experience from people who learn from high school to medical school to residency. The people that sort of knew from the beginning that they were going to be doctors that they were going to stay on this pathway and they were going to go through it to the end. Because they didn’t have the life experience. You know it was a perspective.
David: just like your brother right?
Eric: exactly. People like my brother and I will say and I love my brother to death but sometimes he has problems with perspectives. Sometimes, I thought it was an asset to me and I think it was probably a secondary advantage of not going straight through of being a little bit type B. and so I think when I got to medical school I definitely had people who asked me questions, you know, like hey what was this really like? And I think that again it gives you context. I can’t press enough context. When you are learning basic science and you are working with learning things out of context is so much harder to learn than if you have life experiences bring to the table and you have context of why am I learning this?
You know why do I need to know what the kidney does, am going to be an orthopedic surgeon why must I care about the kidney? And when you have that experience you understand how everything works instead of having this B line in order to be orthopedic surgeon you sort of understand the intricacies and why you have to learn things. and I think life experience just gives you that foundational knowledge to build off of and to recall back when you learning things out of context like it does in medical school which fortunately is changing which we will talk about but my other ?? medical education and fortunately we are going away from the out of context learning but people who have life experience I thought had much easier time in medical school, managing their time, understanding the work life balance than the people who came straight through .
David: alright let`s just take a pause here for a second and go for our commercial break.
Ok. Well why not fast forward now. You are in medical school, you are in residency. Did you have a pile of debts? Or did you have just enough saved up from the working years. Tell me about that a little bit.
Eric: yes so I had a pile of debt you know I think that for me the undergraduate education was not very expensive you know. Junior college in this situation am a whole put me back about 25 000 maybe. And then George Town itself was extremely expensive between tuition and housing; I think it was about 50 000 at that time and that was in 2003. And so I went into medical school with a ton of debt. And in medical school I did not, you know I didn’t have enough loans because I had to take loans obviously for medical school and I got some grants and some scholarships.
I was applying to all kinds of scholarships. And I got some and I got some decent ones that helps you know kind of defray the cost but on a whole I ?? all these financial debt from medical school. So now am entering residency and I have you know probably, maybe a 100 000 dollars or a little more than that. I entered residency when I was about 200 000 in debt and so it was very daunting. And so my residency you know I went to scincinaty so it wasn’t a huge cost of living but we may talk about it in a second my worst decision was not to start paying down that debt.
I went more into deferment for the first couple of years because ?? deferment and so I took advantage of that but at that time you could only do it for two years so after the first two years residency I was into deferment I hadn’t paid very much at all except for anything that I had to. And then I went into ?? for a few years and we may talk about it in a second but that was a horrible decision. You know I was living in different places… I actually moved 18 times in 18 years. I have not had the same address for more than 2 years. And so there is a lot of debt incurred by me moving constantly as well which I tried to defray by actually robbing in my friends to help me move which quickly exhausted itself. “Am doing my hair” so that is sort of what happened with my friends and so I did not do a very good job of managing my debt at that time.
David: let`s think about that. If you think over, you had that time, you are talking to yourself as a first year resident and maybe just talk into the first year resident. What would you encourage them to do or learn from your situation?
Eric: the first thing I would say is learn how to budget. Budgeting was the one thing that was the ?? that I missed. You know I sort of just generally thought you know this is how much money is coming in, this is how much is coming out but I really didn’t think about, you know when I was going to dinner, when I was going to the movies, you know what is this going to impact my debt and can I afford to pay income repayment plan from my loans? I didn’t even think about that. I could think about was I want have as much spending money as possible right now so am just going to defer my loans and am going to go into ?? for my loans. And I think my biggest ?? for first year is number one; budget. Look to every possible, nook and cranny, every penny, know where every penny is going so that you know can I afford to go to the movies this weekend?
Or if I want to go to the movies this weekend maybe I should eat at home this week, you know kind of things and I didn’t really think about that. The other thing that I would say is try to pay your loans. One thing that I found about later in life was about loan forgiveness plans. And right now there is a loan forgiveness loan through the federal government that if you repay your loans for ten years and you are in a needed area which most academic hospitals nonprofits are then you can actually have loan forgiveness.
And for me now that am attending to start that repayment you know the minimum is ten years repayment at the current my salary so it doesn’t behoove me to do that but if I had been paying for five years of residency then I would have been able to pay five years as an attending then I would have loan forgiveness. But it was one of those things that you know I didn’t really think about it, I was more worried about my training and I have to say people in medicine in general are not very good business savvy. We are not very good at budgeting we are not very you know…
we got the financial talk when I was a resident, that was Auckland and they talk about the biggest mistakes that physicians make and once they get money they spend it. So that would be advice; budget and don’t fall into that cliché of spending the second you have money. Really budget, really know your options, especially primary care right now is giving a lot of loan forgiveness through the federal government so if you want to work unassured areas and you want to do primary care you can do loan forgiveness for your entire medical school. And even medical school…
David: because they ??
Eric: yeah, exactly. And I recommend medical students looking to as many loans, scholarships, grants, that they can because it really makes a difference at the end of the day when you look back on your debt and you are like; oh my God if I had paid X down or if I had put 10 dollars a week into a savings what would that be? And compounding is something that people don’t really understand until it`s too late. And definitely I fall into that now that I am 37 years old and I am finally you know making an attending salary, you know and I have friends who are in the financial industry who have been working since graduating from college.
And they have like sixteen years working on me at a probably salary that is equal to mine right now. And that’s daunting for most physicians to understand and like hey these guys have been living a life for like 16 years while I have been in school and it’s a tough thing to deal with. Especially when you and your friends you go out and they are making this salary and you are not. You are making a resident salary for a long time. I think that’s part of the desire to spend when people finish because… hey I can finally do what my friends in business do. Let’s go on a trip for two weeks to Europe you know.
David: well you know what I would do. I have… in a short not I will link… for everyone listening if you are serious about PSLF or the different repayment program our link is going to show us to some of that stuff you guys can check that out. So your getting to residency did you do any fellowship?
Eric: of course, why will I start working. My friends always joke, I have a good friend who is a ?? specialist outside LA and he always told me “I think you hate money”. I decided to do a fellowship and I decided to go into pediatric ENT because I really liked talking with kids and I just like that population so I ended up moving to Bostin a doing a fellowship there; Bostin children`s which was a fantastic experience.
Once again not very financially sound. Boston was exquisitely expensive to live in. and you know walking in with all my debt. And so again you are there you are paying your rent and cost of living so high, I couldn’t even ?? contributing anything to my loans and so during that year I just focused on my studies and again went into… I think at that point you can do deferment again and so I went back into deferment on my loans and paid a minimum of whatever I could with interest and held my head low tried to get through that year and say you know once am on attending I will start paying down that debt.
It was a great experience and of course while I was there I decided that I want to pursue more of my medical education niche and so I ended up going to a masters medical education program at the Harvard medical school and again trying to amass more debt at the at Harvard education institutions so that’s where I started my second masters` program that I am currently in. it was a two years masters` program and doing lots of work with medical education, medical education research.
And again having to pay tuition. I worked part time my year after fellowship year ?? in Boston and I worked you know doing one day a week of seeing patients. And my program there. Hospital my home, hospital my home, the program was very generous to help support me financially at that time you know with a base salary of about equal to what my fellowship was and I was able to go to school four days a week and work one day a week and that was what was able to paid my salary for that year and helped support my cost of living. But again you know I have this you know huge number when I first signed into my loans. At this point it`s home, apple and money in my mind you know I basically mortgaged ?? and ?? and m not really worried about it.
David: fast forward now to… now you are in practice at this point. I would love to hear about with all these debts that you have on top of maybe you want to save for retirement or buy your ?? you know how are you going about or have been going about your financial decisions? What does that look like for you?
Eric: that’s a great question and honestly this wasn’t planned at all but I can say the number one best decision I made was get a financial advisor and specially someone who specializes in physicians because physicians have a very unique position where you have a lot of debt it`s education debt and only certain financial advisors who work with physicians a lot sort of understand the opportunities you know like these grants or the loan forgiveness programs so the federal government.
Things like that, the lifetime learning tax rebate, you know things like that and something very very unique to physicians and they sort of understand the mentality. And you know my financial adviser sat me down and the first thing he told me is; the number one mistake physicians make is the second they become an ?? they buy a car, buy a house, they start travelling and they have all this debt that they haven’t even touched yet.
And so he definitely prepared me for that and said you know what we are not going to do that, we are going to live within your means, we are going to budget. And he worked with me in making a budget and says this is how much we are going to pay for this, this is how much we are going to pay for this and sort of my mind said I am going to live the same type of lifestyle that I lived last year when I was a fellow and am not going to change my cost of living. The only thing I have changed is I have to buy a car because I didn’t have one in Boston.
It’s such a workable city and the public transportation is so fantastic, I didn’t need a car. So I ended up buying a car before I moved and basically everything else is the same for me financially. We worked on getting a disability insurance plan which was probably a number one decision and another advice that was strongly encouraged residence to look into is to start getting a disability`s policy earlier on and start paying it. It`s worth it and then as the income goes up you can increase that without any health considerations in most instances and I think that was a great decision for me and having that is the backbone of my financial security. The next thing that my financial adviser told me was to pay off that debt…
David: just something real quick. That financial adviser isn’t me in case anyone putting it out there. This is not Dave Denniston he is talking about there is another ??
Eric: exactly, that’s why I said this wasn’t planted at all, it`s not Dave. Nothing against Dave, but yes. So the next thing that my financial adviser told me was pay off bad debt. So I did amount some credit card debt both from residency and from fellowship and so the first call was pay off all my bad debt which I did what I could with keeping that very low. I did zero bounce transfers to try and avoid APRSs which I did you know successfully, thank God. And now am focusing on just paying down my bad debt. The next thing was once he talked to me about my educational debt and you know I was fortunate enough to get educational loans at the time when interest rates were really low so most of my time interests was around 3.5% and so what his advice was to wait on those and then try to pay off your bad debt. Try to work on your investment, work on your retirement and then slowly pay down that debt which is what we are working on now. The next thing he told me was to save up six months’ worth of salary and we are working on that. And I will be there actually relatively soon.
David: post tax or pretax?
Eric: post tax all of it. And the other thing was you know when I went with him I worked with the university of Texas now and they have a fantastic benefit package and am very very fortunate to work here and they didn’t pay me to say that. But the greatest thing is to still have preample tax of equal and so I think that I will totally not understand as a physician working on you know patients and if am not financially inclined then the best advise she gave me was listen at the end of the when you have post tax pot and you have a pretax pot at retirement and so we worked on getting a four or three post tax dollars and my ?? one ?? is pretax dollars. And so I am contributing to those, maximizing those and they have a very good match here at university of Texas that they are contributing to and so that is getting you know ?? very fast on best of debt after one year. Another concept that I wouldn’t understand otherwise is lasting. And so we are working on building on you know that golden nugget at the end and am starting late. I haven’t started really contributing to retirement plans until now. I just turned 37 I was 36 when I started and most of my friends started when they were 21 so am definitely behind the ball when that comes to be at the end of retirement but you know am trying to catch up as possible.
David: here is the question; are you going to be moving out anytime in the next year?
Eric: I live in an apartment now am looking to move into a house. I have a dog so I think the dog deserves a yard. He’s lived in an apartment his entire life, he is now five. So I probably will move but I think it`s going to be maybe the last time I move for a little while.
David: maybe in the same city?
Eric: yes. Same city. Am here for a while.
David: that’s the accomplishment?
Eric: yeah exactly. Actually is a very interesting concept I actually talk to this about some of my medical friends before it was the concept that we constantly changed the cities and is not a big deal for us. When we were in training I when I was in DC I said ok am moving in a year. I am moving somewhere in a year and when I was in residency when I was medical school I said Ok I was in Chicago for four years. At the end of four years I am probably going to move somewhere and I moved to Sinsinaty and I was there for five years and I knew at the end of five years I was going somewhere. And then I moved to Boston and I didn’t know anybody. I knew one person but for ?? I didn’t know anybody. And then when I was done in Boston I said am probably going to move somewhere and it was just a granted thing.
And I talk to friends whose wives have grown up in the same cities that they were born in and they never left. They went to college there they never left and that was just a foreign concept. For them we just often move our lives, change our friends on the drop of a dime and you know I always raise financial cost go into that. But also you know the emotional thought that takes when you have to leave all of your friends. When you spend five years cultivating a friendship with people in the same situation. It’s almost like the military you know you are in the same room, you are in the same group of friends for five years you guys are going through the tough stuff together and then all of a sudden people graduate and they are gone. It’s a high emotional toll that people don’t talk about too much.
David: well on top of the emotion the other thing that I want to get across the people I am running into more lately, I talk to a number of younger physicians that I think people get trapped into one wanting to be financially ?? making good financial decision and they go only buy a house. I was talking to the sweetest people. Ernest is a physiologist and her husband have a bunch of kids and they now have four houses and I would encourage… they have a watering, two of them and they can sell a third one right now. So I want to tell everyone listening; be careful about your financial decisions in residency and fellowship and that’s the thing am hearing from you as well that be careful about those kinds of decisions that really takes some time to think about it.
Eric: right. And I think that’s a great point and like I said you know when you are in residency it’s such a hard life you know. You are working a 100 hours a week you know, we say 80. You are working 80 hours a week, you are trying to find time to sleep when you can. A lot of people have families, a lot of people have kids and you know trying to split their time and you know finances usually fall by the wayside unless you have a spouse that’s really good in budgeting. But you know if you are really single and you are in residency you just try to live day-to-day.
You know you use a whole you don’t think about. It’s cheaper to make dinner when you’ve been working for 14 hours. You want to you know grab something on the way home, that’s inexpensive and so people gain weight during residency too because they are making poor financial decisions and poor health decisions because you don’t focus on your health. And I think that some people do buy a house during residency and obviously a lot of people… a lot of my friends unfortunately bought a house just right before the bubble burst and so they are in poor financial situations.
A lot of my friends still have houses or properties where they did medical school and now they are like ten years out and they are like I can’t get rid of this place. And so you know at first it seemed like a really good decision and so for me I have always rented which I thought it was a poor decision because I was like you know I am not building any equity, am not doing this, am not doing that and when it came to today I don’t have places that are sucking money from me right now but some people really turn those into rental properties and they are doing.
But I think the financial situation am in now is; I have to decide whether to do investor pay off debt and that is a really tough decision to make on your own to understand how that works so I say again get yourself a financial advisor who understand the physicians a lot and can guide you through that decision making process because you know for me I tend to be very ?? even though I have a mortgage ?? in ??. I tend to be very ?? and I want to pay that economic debt, educational debt as ?? as possible. Btu the recommendations were; don’t do that pay that debt slowly because you have other vehicles that are going to be more profitable for you and to help you build a ?? at the end of the day. And don’t focus on it and that’s something very counter intuitive to me. You have a problem you fix it but there is multiple ways to fix that problem and you have to be fore thinking, you have to understand all the ramifications and all the implications of what you do with your money and that was something I didn’t understand until I got my financial advisor.
I am fortune I also have a friend that I grew up with that I am very very close who did finance major. He is probably one of the most intelligent people I have ever met in my entire life and he`s been a huge asset to me and I talk to him every day about my finances and you know verify hey so my financial advisor said this what do you think about that? And he I like; yes get on I will do exactly the same. And so it made me feel a lot better. But a lot of people don’t handle people you know. And I think it’s really funny, it`s very much like medicine. When you are trying to navigate the medical environment and you are not in medicine.
So you are trying to pick a primary care doctor and making a less 500 primary care doctors in your network and you are like I have no idea who to pick. You know so you are like I don’t know what to do so you like try to find friends who are in medicine to like; hey who would you pick? You know and so its same thing with finances like you know going in and understanding the financial environment, you have no idea, you know should I invest in this company? Should I pay off this debt? Should I get this? Should I get that?
You don’t know because you are not in it, you don’t understand it on a regular basis so that’s why my biggest recommendation is to get a financial adviser, somebody who is familiar with the environment now who knows what`s good and you and that you get along with because they are going to be very close to you and you are going to be close with them and that should be somebody that you trust with your finances and you know build that relationship and I was very fortunate to find a financial advisor earlier on that I build a relationship that I trust and you know going forward he is a man I ask him everything. And he is very unique because he knows the physicians positions and he’s a lot of physicians’ client that he can draw upon as experience to say hey I have a client who did this and it really worked out for him and it was invaluable. I cannot stress it more.
David: well I would like to find out a couple of things to the audience seeks to be aware of it around this topic and number one thing that I would encourage every physician to think about is the select a financial official professional if they have one already I think one of the questions you have to ask yourself is; is this person out for my best interest? And there is two ?? tests that I would use. Number one; do they work for a company that produces proprietary products, meaning that they have an insurance company that produces insurance stuff that there might be a conflict of interest. Number two that I will suggest to most folks is do they tend to push insurance products? Something like this insurance is great, are they only trying to sell your cash value life insurance policy and disability because they send you ?? or were they actually giving you holistic advise? So those are two things I would encourage every doctor to think about. What about for you Eric, how did you make your decision in working with this gentleman.
Eric: yeah that’s a great question. So you know there`s been a lot of financial advisors that have been giving talks to you know medical students in residence, they go in they give a free talk and you know you are always… hairs go under the ?? when ?? trying to tell you anything right? And so you are always a little bit on urge and so you listen to a lot of cynism and so you know when I first met with the people one of the gentlemen who did one of those talks I came in as a cynic I was like you know listen I don’t trust you.
you are trying to sell me something and one of the things he told me earlier on was you know what like we are not going to charge you anything, you know now you are in residence we know that you are tough and we will build this relationship and at the end of your residency if you choose that you don’t want to work with me anymore that’s really fine you don’t owe me a penny, you don’t owe me anything. And if you choose to work with me then we will talk about what that compensation is going to be but you know and he describes to me the sort of compensation and what it would be and it was not very much at all. And so you know he was very upfront and honest with me and I think as somebody who is a cynic you will try to do that limit stuff to see; are they being honest with me?
And are they showing all their cards? Ad for him you know he was a younger guy, you know we got along really well and I honestly felt like he was showing all of his cards on the table. And he said you know we do this because when we give you a free service and you build relationship with us the vast majority of physicians don’t like change and so they stay with that financial advisor after. And so he put it all on the time exactly what the ?? was. Exactly what his plan was forward and how they build relationships.
And I actually appreciate it that he totally put all of his cards on the table and he was just seem like a guy who was definitely out there for me. And I come to him with questions be like hey you know I need to do this with this that has nothing to do with him, it has to do with my own financial budgeting and he gives it back to me within 24 hours. Sometimes within a couple of hours and he is give me a cell phone I can call him anytime and you know I still have not paid him a penny. I have been with him for six, seven years now and he is just a fantastic guy and I think we really build a trust with each other and I think that you definitely need somebody who is going to show all their cards. You know how they are going to make their money, absolutely find out what’s in it for them and find out how they make their money. And if somebody is unwilling to tell you how they make their money and say it’s a black box that is a red flag.
David: that’s great. Fantastic advice. I would like to wrap up now. I would like you to leave people with couple of closing thoughts. Number one I always love turning people on their resources. So what are the resources whether a book or a blog or a podcast. Whatever you think they are awesome that you think they are awesome that you ?? ?? too and also any other closing thoughts. Yeah.
Eric: that’s a good question. Actually my friend recommended a book and I knew this was going to happen I totally forgot the name of the book. And it basically goes over financial physicians.
David: ?? investor?
Eric: that sounds familiar. That was a book I haven’t read yet. He came very ?? recommended so we are working on that. I think other resources you know, definitely financial adviser and they can point you to the kind of resources. But also understanding like you know the ?? ?? so look on the federal website there is tons of information in there that people don’t even know exist like this loan forgiveness plan. I didn’t really understand it and had I looked at I it earlier I would have known. Hey I just started paying my loans on income base repayment plan as a resident and I would be in such a better financial position now had I known that. And so the best advice is do your homework, look at what is out there, look at the opportunities for loan forgiveness, look at the opportunities for undeserved minorities or underserved areas in medicine because there is a lot of opportunity there for you financially and clinically I would say. Those are great experiences everybody who`s done that have had great experiences in that. But definitely the book that Dave mentioned. But if I remember there is another book he recommended if I remember what it is I will come back on and maybe we will put the resource up for you guys and my hope is for everybody who is listening is don’t give up the dream of becoming a doctor just because of your finances because your world of seeing a kid in a clinic is far beyond any financial reimbursement I will ever get.
David: awesome. Eric if people have more questions they just want to reach out to you how can they get back in contact with you?
Eric: the best thing is you guys can follow me on twitter @drericgant and you can also find me on LinkedIn.
David: alright. Well if you enjoyed the show and you want to check out the show note in the resources that Eric and I have been mentioning throughout make sure to visit the podcast website at www.doctorfreedompodcast.com and in addition I would like to tell your story in this next fireside chat. It would be my honor to host you on the next chat. I know we can learn from your journey and it will help other doctors. After all who better to speak to physicians than another physician? I think there is going to be some awesome stuff for us here today and in the future. So make sure to contact me at firstname.lastname@example.org or on my website www.doctorfreedompodcast.com. For the freedom formula for physician’s podcast this is Dave Denniston, thank you so much for joining us. Make sure to subscribe and check in again soon. Have a good one.