millionaire doctors?

[thetruth9]

haha keybank? Thats a regional retail bank - they don't have ibankers/traders. accenture? This is consulting. No bankers or traders here.
qatari funancial? I don't think this is a company.
Your friends at GS or Citi are probably in non front office positions or they are lying to you. When you worked at BOA, what did you do?

I can think about 15 friends that are juniors off the top of my head including myself that are making $13-16k this summer. Think BAML, GS, MS, BX, Citi, etc. I even have friends that are consultants making $15k. You have no idea what you are talking about buddy.

Bankers/traders and the like make more on average than people in medicine. Believe it if you want or live in your bubble. I'm done arguing about this.

MagicDrumSticks: It's possible to come from a lesser known school, but those kids either have connections or networked their asses off for three years. The vast majority on the street are from elite schools.

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[radiodoc99]

Build a product and market it. Or just be a good professor. Help patients and the money wont matter.

 

[notinkansas]

I find it sad when people post on SDN asking how they can make a million dollars a year as a doctor.

Why?

I find this kind of thinking extremely disturbing.

Why shouldn't anyone be able to seek to maximize their income in their chosen profession?

The vast majority of wealthy people have earned their money honestly, by providing value in the form of goods and services to people who are willing to exchange money for that value. As long as you behave ethically and honestly- which most people do- nobody has any right to put a cap on what you make or try to make you feel guilty about it!

The only doctor that I know for sure makes 7 figures is a general surgeon in solo private practice. He is amazing in the OR- much faster on routine cases than most others. (Record time for a lap chole, skin to skin, is 12 minutes!). Consequently, he can do more cases per day. He also does elective cases til 8pm-ish most days. He also has good outcomes. So he deserves every penny he makes. I admire him and what he's achieved. I would not want that lifestyle, but I could do what he does if I wanted to.

I think that if you want to make something approaching seven figures in medicine, you probably won't be able to do it as an EMPLOYEE drawing a salary. You'll have to be in private practice- with some type of eat-what-you-kill compensation. This also means risking that there may be times when you don't make what your target it. Add to that investments, debt control, etc. Plus some people will be able to invent devices, write books, etc.

 

[jaguarms]

Bankers/traders and the like make more on average than people in medicine. Believe it if you want or live in your bubble. I'm done arguing about this.

MagicDrumSticks: It's possible to come from a lesser known school, but those kids either have connections or networked their asses off for three years. The vast majority on the street are from elite schools.

This is not true.

First of all, in this kind of an economy, banking jobs are few and far between. As in highly prestigious law firms, there is a high burnout. Your friends may tell you "I am starting off making 100k a year," but what they won't tell you is that over 5 years there is a massive burnout rate. Most investment bankers I know say that people enter the profession and leave within ten years to take their money into another career.

On the other hand, as a physician, our careers will last much longer than 5 to 10 years. We will not be fired in droves when recessions come.

And I'm willing to bet that once this financial regulation bill becomes law, we will be hiring these former bankers to work the front offices of our clinics.

 

[avatarftw]

a

 

[deleted116380]

I don't know, there seems to be many loopholes so that they can get their money. They still are raking it in. If the physician (or resident, more appropriately) is working the same hours as the banker but the physician works a longer career, maybe they are just more determined/hard working?

The biggest loophole used by small business owners (maybe even physicians with private practices) is paying yourself income in the form of capital gains.

Example:

You pay yourself, the employee, $50k over the course of the year in "normal" income...the income that gets taxed for SS and Medicare (aka FICA...and you pay double since employer[also you] matches it). The remaining income you receive from the business is in the form of capital gains. These are exempt from FICA taxes. Now if you REALLY want to "save" money from going to taxes, you get paid the capital gains in increments of more than ONE YEAR. This turns short term into long term capital gains.

What's the difference between short and long term? Short term gains are taxes at the ordinary income tax brackets. Up to 35% currently. Long term is taxed at a flat 15%...soon to go up to 20%.

I don't know how State income taxes pertains to that, but I live in FL and we don't have State income tax. I used to live in a State that did and hated the number crunching...it makes my tax filing easier and of course I pay out less by now living in FL (if I had an income, which I don't, LOL).

Plus, if you own your own business/practice, you can lease a "nice" car and write it off as a business expense. All that means is that you're using money that doesn't have to be taxed to lease the car. Saves 30% or so depending on your bracket. Of course you can't lease just any car under the sun. My friend's dad owns a real estate company and has leased cars like the E39 M5 (2001), SL 55 AMG (2004), and currently Maserati GranTurismo (2009). The most expensive of the bunch was the SL at $135k+.

If you REALLY want to make money, open your own practice and hire docs to do the work. Do NOT go solo. I know an ophthalmologist that does that and I'm pretty sure his secretary/manager/bookkeeper (yes, she does all 3) is embezzling money. He doesn't want to do an self-audit and she never takes vacation...pretty sure she's taking money.

With that said, I know a ton of people with loads of money and they're not happy. I don't understand the point of wanting a 5000 sq ft+ house. What a waste in both materials to construct and the amount of money to maintain it (property tax, a/c, cleaning, etc). Plus, all modern cars suck. Computers in the cars fail all the time and cost a lot of fix outside of warranty. They're ugly anyway...

 

[avatarftw]

a

 

[deleted116380]

^^sounds familiar, but it's been years since I've done anything involving business law, accounting, and finance.

Chapter S, C, LLC, etc, are MUCH better than sole proprietor...for the love of god to anyone that is reading this, do NOT start a business as a sole proprietor. You're exposing your personal assets to those that take you to court...

I will brush up on my corporation knowledge at a later date when I match into a residency and then get near to the end of that...we're talking 6+ years to finish my med school and the shortest residency out there. Then I'll form a corporation based in Delaware (best place in terms of business law...you need not practice there).

For those that want to make money at the expense of free time...start a practice and run it efficiently. Like the poster above said, reinvesting is a lot better than pulling money out, taxing it, and then investing.

If you want a vacation time, sick leave, 401k matching, no weekends, no paperwork, work for a hospital. Most people in med school are like that...I don't blame them. I prefer that lifestyle as well and will transition to that later in my life. If you want to make money, you do it by starting a business and prepare to give up all your free time to max out how much you can make. I'll sacrifice my youth and energy to make more to support my family in the long run. Then I'll take a break and work for a hospital after selling the practice.

Shaquille O'neal once said something along the lines of "I'm not rich...at the end of the day someone is writing my paycheck. He's rich."

 

[avatarftw]

a

 

[michaelrack]

The biggest loophole used by small business owners (maybe even physicians with private practices) is paying yourself income in the form of capital gains.
...

Is this still possible? I though the IRS cracked down on this a few years ago (for S corp and LLC)?

 

[michaelrack]

^^sounds familiar, but it's been years since I've done anything involving business law, accounting, and finance.

Chapter S, C, LLC, etc, are MUCH better than sole proprietor...for the love of god to anyone that is reading this, do NOT start a business as a sole proprietor. You're exposing your personal assets to those that take you to court...
"

No matter what the form of business organization, a physician's personal assets are exposed in malpractice cases. Of course, their are other reasons for law suits (slip and fall, etc) and I agree that sole proprietorship is a risky form of business organization.

 

[MOHS_01]

Is this still possible? I though the IRS cracked down on this a few years ago (for S corp and LLC)?

Not according to any accountant or lawyer that I have been able to find / speak to. Distilled down and you're left with this: virtually every penny that your practice earns as profit is ultimately taxed as ordinary income. Sure, you can expense out some things -- car lease payments, cell phone, etc -- but these are small ticket items. If this is not true, and someone can substantiate their claims to the contrary, please post and PM me -- I have a list of people to sue for malpractice in their chosen field and I expect to recoup hundreds of thousands in taxes....

 

[gluon999]

No matter what the form of business organization, a physician's personal assets are exposed in malpractice cases.

So what are the ways in which a physician can protect personal assets?

Man, they should teach this sh** in medical school.

 

[MOHS_01]

Florida... homestead exemption. While it varies by state, for most of us there exists very little in the way of true asset protection vehicles.

 

[deleted116380]

Florida... homestead exemption. While it varies by state, for most of us there exists very little in the way of true asset protection vehicles.

Yeah, FL is one of the few states that let's you keep your place, lol.

I heard of a doc here that doesn't carry malpractice insurance and has all of his assets in his wife's name. I'm not sure how that protects the assets since they are married...aren't they both considered "one unit" so to speak? Maybe for things like that, if it's in the wife's name, they don't go after it. Still sounds risky to me....especially if your wife is crazy.

If having a corporation can't protect you enough, maybe get dual citizenship through some random country and open a Swiss bank account under that passport, lol.

 

[gluon999]

Florida... homestead exemption. While it varies by state, for most of us there exists very little in the way of true asset protection vehicles.

But isn't FLA highly litigious? So you get to keep your home but lawyer takes away everything else?

Have you discussed this with a financial planner or attorney?

 

[pulmonary kid]

Bankers/traders and the like make more on average than people in medicine. Believe it if you want or live in your bubble. I'm done arguing about this.

Average stock broker earns $50k. BUT the potential is endless. One of my best friends trades currency and options @ merrill lynch. He taught me enough about trading currency that $2000 investment paid for my BS, and my current investments will pay for whatever graduate studies I decide on. Truthfully, I only became interested in healthcare for the stability. The market is what makes millionaires.

 

[deleted116380]

Average stock broker earns $50k. BUT the potential is endless. One of my best friends trades currency and options @ merrill lynch. He taught me enough about trading currency that $2000 investment paid for my BS, and my current investments will pay for whatever graduate studies I decide on. Truthfully, I only became interested in healthcare for the stability. The market is what makes millionaires.

I tried to learn about forex, but didn't like the large number of scamming places for it. Not very many reputable places to go and trade. Everyone that talked about "making money" only did it in the fake practice trading world. I've heard stories of forex brokerages that will hold on to your position past the point you want so you lose out some more and they make a little more off of you.

 

[pulmonary kid]

I tried to learn about forex, but didn't like the large number of scamming places for it. Not very many reputable places to go and trade. Everyone that talked about "making money" only did it in the fake practice trading world. I've heard stories of forex brokerages that will hold on to your position past the point you want so you lose out some more and they make a little more off of you.

Yeah a lot of brokers that don't use external clearing houses (which is most brokers, unfortunately) may not honor your buy or sell orders immediately giving a larger spread, thus earning them a few more PIPs. A good place to do research for beginner info is Babypips.com. The issue with Forex in reality is, it's a zero sum game ( or negative sum if you account for the fee taken by the broker ). If you earn 100 PIPs it's because an accumulation of individuals lost 150 PIPS ( the initial 100 PIP loss plus whatever the brokers spread fee is ). But if you can figure out how to scrape 10 or 30 pips at a time on a high leverage account, you can earn big a good living. With practice accounts you can trick yourself into thinking you'll win 100% of the time because as soon as you set a trade order, it goes through. When in real life when you set a trade order, someone else must be buying at the same time, otherwise you can watch your positive position disappear.

 

[MOHS_01]

I heard of a doc here that doesn't carry malpractice insurance and has all of his assets in his wife's name. I'm not sure how that protects the assets since they are married...aren't they both considered "one unit" so to speak? Maybe for things like that, if it's in the wife's name, they don't go after it. Still sounds risky to me....especially if your wife is crazy.

If having a corporation can't protect you enough, maybe get dual citizenship through some random country and open a Swiss bank account under that passport, lol.

In my state having things in a spouse's name protects nothing, but it may vary some from state to state. The Swiss bank account protections were eliminated courtesy of our government a year or more ago.

But isn't FLA highly litigious? So you get to keep your home but lawyer takes away everything else?

Have you discussed this with a financial planner or attorney?

Yes, FL is a bitch of a lawyer run state. I'm in a low risk specialty where it is easy to cover your tail, so I'm not terribly worried about it.

I'm not sure that you follow -- if you're facing financial Armageddon from creditors, liquidate everything you have prior to losing access to those funds and purchase a primary residence in FL. This constitutes a loss mitigation strategy, not a long term investment strategy. Real estate in the form of single family unit housing is a poor "investment" by my way of thinking -- despite the propaganda that has surrounded it over the years.

 

[MadRadLad]

In my state having things in a spouse's name protects nothing, but it may vary some from state to state. The Swiss bank account protections were eliminated courtesy of our government a year or more ago.



Yes, FL is a bitch of a lawyer run state. I'm in a low risk specialty where it is easy to cover your tail, so I'm not terribly worried about it.

I'm not sure that you follow -- if you're facing financial Armageddon from creditors, liquidate everything you have prior to losing access to those funds and purchase a primary residence in FL. This constitutes a loss mitigation strategy, not a long term investment strategy. Real estate in the form of single family unit housing is a poor "investment" by my way of thinking -- despite the propaganda that has surrounded it over the years.

If you don't mind me asking, what specialty are you in?

 

[gluon999]

Thanks for the info MOHS.

If you don't mind me asking, what specialty are you in?

Judging by his name, Derm (or may be plastics, but I wouldn't call it 'low risk').

 

[michaelrack]

So what are the ways in which a physician can protect personal assets?

Man, they should teach this sh** in medical school.

A doc could live off the grid, buy gold and silver in small amounts (a couple thousand dollars worth at a time) and store it in a home safe. Of course, if you are sued successfully, I believe you have to list your assets. If you wanted to protect your gold/silver, you would have to be willing to lie and not list those assets with the court (lying to the courts is not something I would recommend).

Another way of protecting your assets is to have your money invested in highly leveraged ways (houses or businesses with large loans against them). Basically being highly illiquid. this is risky, however.

 

[Vaderize]

A doc could live off the grid, buy gold and silver in small amounts (a couple thousand dollars worth at a time) and store it in a home safe. Of course, if you are sued successfully, I believe you have to list your assets. If you wanted to protect your gold/silver, you would have to be willing to lie and not list those assets with the court (lying to the courts is not something I would recommend).

Another way of protecting your assets is to have your money invested in highly leveraged ways (houses or businesses with large loans against them). Basically being highly illiquid. this is risky, however.

If you're married and trust your spouse, the easiest way to protect your assets is to transfer ownership of them to said spouse. Joint assets in a marriage can rarely be used to pay malpractice claims.

Alternatively, you could incorporate and keep most of your assets there, but you would have to run an honest corporate structure with meetings that have well-documented minutes, etc (or else risk having the umbrella pierced as a "dummy" corporation).

Good luck.

 

[Cyradis]

here's an article that touches on the medicine/finance tradeoff:

http://www.nytimes.com/2006/11/27/business/27richer.html?_r=2

Very interesting article, thanks for posting it.

 

[pulmonary kid]

Very interesting article, thanks for posting it.

Just read that article ...

" one in every 325 households had a net worth of $10 million or more in 2004"

 

[MagicDrumSticks]

This is not true.

First of all, in this kind of an economy, banking jobs are few and far between. As in highly prestigious law firms, there is a high burnout. Your friends may tell you "I am starting off making 100k a year," but what they won't tell you is that over 5 years there is a massive burnout rate. Most investment bankers I know say that people enter the profession and leave within ten years to take their money into another career.

On the other hand, as a physician, our careers will last much longer than 5 to 10 years. We will not be fired in droves when recessions come.

And I'm willing to bet that once this financial regulation bill becomes law, we will be hiring these former bankers to work the front offices of our clinics.

Medicine has its fair share of burnouts as well, only Doctors make their careers sound more Grandiloquent than IBankers do. And yes, while it MAY have a high burnout rate, Investment Banking provides one with an Iron-clad resume which will help them get top level financial executive jobs with less burden than IBanking.

You win either way in that field (which is why so many people are attracted to it) because even if you don't get invited back to your firm (which is a VERY good sign, Managing directors make disgusting money), you are still guaranteed a bright future.

 

[bomberJV]

I come from a line of physicians, and my dad makes 1M a year, and knows someone who makes up to 10M, he has some special technique for Endoscopic Discectomy or gets rid of patients quickly and charges a lot. He has a very nice mansion as well.

 

[financialfreeMD]

The idea of being a millionaire has captivated the collective psyche of many people in the United States and the medical community. The problem is not so much how much money you have, but rather, can you accomplish the goals for your life with that money. Remember the old at adage "money can't buy happiness". This is particularly true if you have no goals to fulfill using that money. Having extra money just to be able to buy new toys really makes you no more successful or happy.

41% of physicians will face symptoms of burn-out despite high salaries. It is estimated that more money moves through Drs. hands during their careers yet they keep less of it than any other professionals. This is in large part due to lack of education and failure to ask for appropriate help.

As physicians, we have been taught to ask for consultations when we don't know the right answer for a patient but somehow we fail to do that for own finances and we end up struggling to achieve that elusive financial success that we feel we deserve. Don't give up on being financially successful, just don't try to do it through your medical practice. You'll be overworked, overstressed and you simply can't increase income by seeing more patients.

Instead, learned to put your money to work making money for you. Enjoy your practice, don't destroy your calling to medicine by making it your wealth generating strategy. Use your wealth building strategy to make you wealthy and enhance your medical practice.

 

[financialfreeMD]

The key to choosing an entity is communicating to your tax professinal about the benefits, responsibilities and risks for you from each entity structure. I have known a lot of people to create an LLC only to fijnd out that what they thought were acceptable expenses were not allowed.

Remember though, "your money working to make you money will always make more money than you working to make money". I think that was said by Napolean Hill (author of Think and Grow Rich).

Educate yourself on who can help you direct your money. Not everyone is qualified or honest.

 

[NRAI2001]

The idea of being a millionaire has captivated the collective psyche of many people in the United States and the medical community. The problem is not so much how much money you have, but rather, can you accomplish the goals for your life with that money. Remember the old at adage "money can't buy happiness". This is particularly true if you have no goals to fulfill using that money. Having extra money just to be able to buy new toys really makes you no more successful or happy.

41% of physicians will face symptoms of burn-out despite high salaries. It is estimated that more money moves through Drs. hands during their careers yet they keep less of it than any other professionals. This is in large part due to lack of education and failure to ask for appropriate help.

As physicians, we have been taught to ask for consultations when we don't know the right answer for a patient but somehow we fail to do that for own finances and we end up struggling to achieve that elusive financial success that we feel we deserve. Don't give up on being financially successful, just don't try to do it through your medical practice. You'll be overworked, overstressed and you simply can't increase income by seeing more patients.

Instead, learned to put your money to work making money for you. Enjoy your practice, don't destroy your calling to medicine by making it your wealth generating strategy. Use your wealth building strategy to make you wealthy and enhance your medical practice.

What's the point of your post? Most generic post ever..

 

[DocProtector]

I have well over 100 medical clienst making over $1 million per year. The one thing they all have in common is that they have take a business approach to medicine.

 

[Stroganoff]

The title of this thread drives me nuts. Millionaire refers to net worth, not annual income or net profit, yet the OP meant the latter.

 

[usmletools]

To make a Million Dollars a year.. you dont have to be good in medicine ... you have to be great at buisness.. Because Million dollar salaries are few and far between.. These salaries are reserved for those in managment.. Otherwise you achieve that by starting a buisness and inversting in yourself..
If your interested connect with me either here or on twitter..for more advice

 

[V3NOM]

I thought I was ambitious to enter dentistry asking for 200k to 400k salary. Even with 100k-150k you can have some pretty great living.

 

[Mapplicant]

The title of this thread drives me nuts. Millionaire refers to net worth, not annual income or net profit, yet the OP meant the latter.

At a recent financial seminar for residents, a speaker was talking about a client they knew who makes 500k but spends 600k a year. So yeah yearly income means squat if you don't know how to accumulate wealth.

In the book Millionaire Next Door, it's surprising to read about how incompetent alot of physicians are with money. And of course how most millionaires don't live in mansions or drive ferraris.

 

[circulus vitios]

I have well over 100 medical clienst making over $1 million per year. The one thing they all have in common is that they have take a business approach to medicine.

Does this mean they have health employees (mid-levels, other physicians) generating revenue for them? Are there any guys flying solo making $1 million/year net?

 

[fuzzytoad]

Not just employees, but equity stake in businesses and other investments. "Flying solo" isn't really the right phrase here - is a venture capital manager "flying solo"?

The Napoleon Hill had the right of it: money makes money better than any person could.

Does this mean they have health employees (mid-levels, other physicians) generating revenue for them? Are there any guys flying solo making $1 million/year net?

Also, it completely blows my mind that some people on this forum actually think that doctors make more (on average) than management consultants, investment bankers, or front desk traders & portfolio managers - even taking into account job stability (waaay exaggerated). When people defend medicine they get all wide-eyed with "oh the economy is going to crap, medicine has the best job stability", forgetting that the bulk of unemployment is from manufacturing or service. Hiring in finance stagnated for about a year after 2008 but is as robust as its ever been today.

 

[anbuitachi]

i just rotated thru a PMD clinic, and it's a LLC. the building/LLC also houses like 3 other doctors though, but the specific doctor i worked with has a bentley, rolls royce, and porsche, so my guess is hes pretty rich and good at business haha

 

[Perrotfish]

i just rotated thru a PMD clinic, and it's a LLC. the building/LLC also houses like 3 other doctors though, but the specific doctor i worked with has a bentley, rolls royce, and porsche, so my guess is hes pretty rich and good at business haha

I would guess that he's poor and terrible at business. Multiple status symbol cars aren't actually pathognomonic for poor financial planning, but there seems to be a pretty strong correlation. There's always the chance that he's pulling in a million a year or just happens to be a very car obsessed, but there's also a very real chance that his net worth is less than the value of those cars.

 

[TexasPhysician]

I would guess that he's poor and terrible at business. Multiple status symbol cars aren't actually pathognomonic for poor financial planning, but there seems to be a pretty strong correlation. There's always the chance that he's pulling in a million a year or just happens to be a very car obsessed, but there's also a very real chance that his net worth is less than the value of those cars.

Possible. I know 3 brothers who are all physicians and drive really nice cars. They all have a degree of family money plus sizable outside investments. It is very rare to be substantially wealthy just practicing medicine though.

 

[thesauce]

i just rotated thru a PMD clinic, and it's a LLC. the building/LLC also houses like 3 other doctors though, but the specific doctor i worked with has a bentley, rolls royce, and porsche, so my guess is hes pretty rich and good at business haha

I agree with perrotfish: I would come to the exact opposite conclusion. It's like the book "the millionaire next door." People that look like they have a lot of money...generally don't. What he has shown is that he makes poor financial decisions by spending lots of money on depreciating assets.

 

[LaughingMan]

I would guess that he's poor and terrible at business. Multiple status symbol cars aren't actually pathognomonic for poor financial planning, but there seems to be a pretty strong correlation. There's always the chance that he's pulling in a million a year or just happens to be a very car obsessed, but there's also a very real chance that his net worth is less than the value of those cars.

+1,

It's quite dangerous that the media puts out this image that the wealthy live so lavishly and spend money on new depreciating assets each year.

 

[mgdsh]

Sometimes a car can actually be good financial planning from a business perspective. Also isn't it a bit judgmental to assume poor decisions have been made for everyone with a nice car, or several nice cars?

 

[TexasPhysician]

Sometimes a car can actually be good financial planning from a business perspective. Also isn't it a bit judgmental to assume poor decisions have been made for everyone with a nice car, or several nice cars?

In a few fields like real estate and Hollywood plastic surgery, sure. Rarely is this the case though.

It really depends on what you are looking for though. If I'm searching for a new business partner that is willing to run lean, I'd second guess anyone driving a fancy car without explosive wealth.

Someone "hungry" to improve their situation usually works harder than someone spending lavishly.

 

[thesauce]

Sometimes a car can actually be good financial planning from a business perspective. Also isn't it a bit judgmental to assume poor decisions have been made for everyone with a nice car, or several nice cars?

"judgmental" in the same way that saying an obese person is more likely to not be a marathon runner. It's making an educated guess based on the facts before us.