How much income do you need to stick through your doctor job? | Smart Money MD
Side income is the wave of the new generation. Having multiple income streams is sexy. If you are not bound by a single means to survive, then psychologically the stressors of a particular job may not affect you as much. In medicine it is becoming more popular to have additional income, passive or active, so that the goal of reaching financial freedom comes sooner.
The stress of your day job matters
Most doctors like what they do, but there are probably some aspects of our jobs that we would rather do without. Callbacks, charting, meetings, insurance denials, disgruntled patients, midnight calls…they’re all synonymous with our jobs but it’s truly not common that any of us actually likes the nitty gritty annoyances of the profession.
You might also like: Why a Roth IRA should be considered in every physician household
Medicine inherently is a stressful profession–many of our decisions and actions can determine life or death. In our society, there is a big emphasis on malpractice. The premiums on some medical professions range in the six figures–this certainly can add indirectly to the stress of the job.
Certainly how stressful your profession is and how much your tolerance level is will contribute to your desire to find a change.
How much control do you have in your job?
Even though the premise of medicine is to take care of patients, how a clinic or hospital is structured makes all the difference in the world with physician autonomy. Employment through a large hospital system or managed healthcare group often translates to standardized benefits and expectations (i.e. it would be difficult to reschedule a patient clinic in two days–some manager will hear about it and probably intervene). But you probably won’t have to directly deal with any logistics of letting go a low-performing staff member or most issues that a human resources department would be responsible for.
If you are a self-employed physician or a physician-owner of a medical practice, the onus falls on you to handle everything. Sure, you might have an office manager handling the dirty work but in the end you fit the bill, and you lose the sleep if things don’t function smoothly. Many physicians are okay with these responsibilities, and they want to have the control.
There is more to life than money, but we all have a certain expectation of our worth that interplays with career satisfaction.
I once knew of an anesthesiologist who quit her academic position to develop a medical spa and infusion clinic empire. While I do not have exact numbers, but I suspect that the business likely produces a multiple seven-figure net income. I have no doubt that the business empire checks off many needs and desires: high income, satisfaction that you’ve created a wildly successful business, freedom to spend more time with family and friends, and simply a validated means of success.
Would she have chosen a different path if her academic clinical position was different? Let’s look through some hard numbers. An academic anesthesiologist might have a salary of $250,000-$300,000 working 55 hours a week. This would include uncompensated time to prepare lectures or administrative roles. Would she have started her business if she worked in private practice 40 hours a week earning $450,000? What about $450,000 working 32 hours a week? Or $800,000 working 35 hours a week?
It is a fascinating thought exercise to see how each person would react to a given scenario. Maybe she would have started her business anyway even if she made $1 million a year at her day job, but many of us would probably opt not to rock the boat if our clinical job gave us career satisfaction, a comfortable income, and time for family.
Our final choice also depends on our view on risk
Doctors, in general, are risk adverse. Some of you might be comfortable handling seven to eight figure+ commercial real estate, but the reality is that most people in the medical field want to make a good living and not get ripped off by the system. If you had your dream medical job, how likely would you opt to have additional income?
If your clinical job had tolerable hours, above what salary would you not consider another career path?
2 thoughts on “How much income do you need to stick through your doctor job?”
Pauline Heslop says:
Maybe some are but I’ve never been. When I went into medicine I did it not for monetary reasons. Truth is at that time I as a physician was never taught money management. Our classes never included. I cannot recall ever having received a financial management course as a physician. I wish I did then. Above all medicine was and still is my spiritual calling. I gave more to my patients than I will ever be compensated for in this life. As a result of my calling I also embarked on another aspect, the spiritual path. Although this didn’t and still doesn’t provide any substantial monetary benefits it has brought me tremendous joy and satisfaction to see the lives that have been changed. Yes we do need to pay our bills and we do need to have an income that will allow us to live a good and pressure free life but excellent living does not only come from money. Having another Avenue of an additional income stream is good if it’s wisely managed. But what’s more important is peace, joy and satisfaction and the knowledge that we have been able to help another to achieve fruitfulness in their lives.
Sounds like you’ve found a great healthy approach to medicine. Unfortunately financial management still isn’t taught in medical school, but I’ve noticed that the younger generation has found ways to adapt.
Do you still practice clinical medicine or do you offer alternative services?