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Most physicians I know work more than full-time, and today’s interviewee is no exception. His days are long, the workload is heavy, and after more than 12 years of more-than-full-time work, his current job gives him almost 4.5 weeks off.
As you’ll see below when he shares his numbers, he can afford to work less. Is this the right time to make that move? If so, which of two options should he take?
He’s also got a number of specific questions regarding what to do with investments he’s got in various accounts that belong to him and his wife. You’ll see those at the bottom, and I hope you’ll find a minute to respond.
If you’re interested in participating in one of three interview series, please download the most appropriate form for your life situation: FIRE Starter, FIRE Crossroads, or Post-FI Notes.
Getting to Know You
Where are you on your financial independence journey? Have you crossed the halfway point in terms of net worth and/or passive income?
My family and I are at the crossroads of our financial journey. We are about halfway to our goal of being able to spend $120,000 per year in retirement.
Although we have thoughts about heading toward a more minimalistic lifestyle and not needing nearly as much. Our net worth is about $3 million. We have $2 million in retirement accounts.
[PoF: I’d say you’re more than halfway to your goal — you’re awfully close to being ether, in fact, depending on how much of that net worth is home equity. See How Much Money Does a Doctor Need to Retire?]
Tell us about your household. How many people and at what ages? Are you supporting anyone outside of your home? Where do you live?
Currently we live in St Louis, MO. My wife and I have been married for 13 years and we have four children — 3 girls and a boy. They are 11, 9, 6, and 4.
So, we are chasing them around like crazy folks with all their activities. We bought our reasonable doctor house to fit all these kids about 6 years ago and are on pace to pay it off in the next 5 years.
In what field are you working? How is your career going? What do you like best and least about your chosen profession?
I am a musculoskeletal radiologist at the same academic center where I did my residency and fellowship. I am in my 12th year of being an attending physician.
The good: I like teaching the residents and fellows and I do have a lot of direct patient care as a radiologist, which can be both good and bad. The residents and fellows are very bright, come from very different backgrounds, and want to learn from me. They keep me intellectually stimulated.
I’ve also started a financial curriculum for the residents and fellows in the last year thanks to the PoF, Physician Philosopher, and White Coat Investor.
My salary is OK but the golden handcuffs and benefits of my job are pretty nice. I have moved up the academic ladder over my career but I do not aspire to be the most well-known MSK radiologist in the world, head of the MSK section, or chair of a radiology department. I also have amazing colleagues that I will miss a lot.
The bad: I currently work too much for my liking (typically 11-12 hr days, 5 days a week with 6 weeks of nights and 6 weekends) and my job is somewhat stressful due to the volume of work I am doing per day and the difficulty/riskiness of some of the procedures I perform. I get 22 days of vacation per year which is very few for radiology. My current job is not very flexible as compared to many radiology jobs.
Non-direct patient care radiology can be performed from anywhere there is a high-speed internet connection. This is not something that is really offered currently for me in the job I have.
Do you feel you’ve come to a crossroads of sorts? If so, tell us about it. What options are you contemplating?
My crossroads: I am thinking about changing jobs or going part-time to acquire more time and flexibility with my time. I do however want to keep a similar salary so that I can continue to contribute similarly toward retirement.
My favored option currently is to join a MSK subspecialty teleradiology group full time and work part-time/per diem for my current employer. This would allow me to work from home and make slightly less salary on about 4 hours less of work/commute per day.
There is also a lot of flexibility in this job as I can do it from anywhere and anytime during the day. It would be much easier to coach my kids’ sports, make it to their school functions, and to occasionally have lunch with my wife with this flexibility.
I would also have much more vacation with this job than the previous job. I do worry about how I will deal with the relative lack of adult interaction as compared to my current job when I am relegated to working in my basement office for several hours a day.
The part time/per diem work would allow me to do some in-person teaching and have some direct patient contact plus make a little more money. I would, however, lose the golden handcuffs and benefits of the University. The big one being a very nice college tuition benefit for my four children.
Investing
How is your nest egg invested? Approximately what percentage is allocated to stocks, bonds, real estate, and alternatives?
Our nest egg is entirely in index funds through TIAA at work and Vanguard personal accounts. The allocation is 72% stocks (47% US, 25% international), 20% bonds (15% total bond, 5% TIPS) and 8% REITs.
The bonds and REITs are all in tax-deferred or Roth accounts.
Are your investments primarily in tax-deferred, Roth, or “taxable” post-tax accounts?
403(b): $750,000 ($190,000 of that in Roth)
457(b): 330,000. Through a very stable employer with reasonable options if I were to leave the job.
Sep IRA: $145,000. I started this about 10 years ago when I started getting consulting income for a side gig.
Roth IRA: wife $98,000
My Roth IRA: $72,000. I put money in this account before I started a side gig and then started using a SEP IRA.
Taxable: $525,000
Wife’s 401(k): $28,000
Do you have investments in an HSA? How about 529 Plans?
We started using a high deductible insurance plain about 4 years ago when we were finished having children. Since then we have accumulated $23,000 in the account and have it invested in an aggressive low cost index fund with 90% stocks: 10% bonds. We do use our HSA to pay for most medical costs at present, instead, we’re saving the receipts and planning to reimburse them later.
We started investing in the Missouri 529 when we had our first child 11 yrs ago. We have about $250,000 in the plan and fund up to the maximum state income tax deduction every year ($16,000). With this money, I want to pay for my 4 kids’ undergraduate school plus $1,000 or so to each of our 30-plus nieces and nephews for college.
We do use some of this money (about $6,000) every year to help offset the kids’ private grade school. This account could be overfunded if I stayed at my current job through age 55 as there is a very good college tuition benefit in my current job. It would probably be about just right if I left my current job soon, continued funding at my current rate, and lost that sweet college tuition benefit.
What has been your best investment?
Our best investments have been starting our Roth IRAs while I was in residency. We started using a financial advisor while in residency and this was one of his recommendations.
Your worst investment?
I have two worst investments:
- We bought a $500,000 whole life policy on my wife about 9 years ago before we started learning a lot more about personal finance. This was sold to us by a family member. At this point, we are going to keep it and give it to our kids/grandkids as inheritance as we are to the point of reasonable gains.
- Not learning about personal finance much earlier. We ended up using a financial advisor for several years. His overall rate was reasonable and we did save a fair amount of money through him. But no one cares about your money as much as you do.
Into the FIRE
Numerically, what is your FI goal?
I like the round number of $5 million although that is more than necessary, given our spending. We tend to be pretty frugal and spend mostly on experiences, childrens’ activities, and charities but not things.
We spend less than we contribute to wealth growth every year. Our current spending is about $10,000 per month. We contribute about $150,000 per year to wealth growth. My guess is that, in retirement, we will move to a cheaper cost of living location and travel a fair amount making our living expenses less than $10,000 per month. This would give us a FI number of $3.6 million for 30 years.
When do you suspect you will achieve financial independence? Will you retire from your career once you’re comfortably FI?
Given our current retirement accounts at approximately $2 million, plus our high savings rate, we should hit our FI goal within the next 10 years by the time I turn 55. But, I would hope to like my job enough and be healthy enough to continue to work part-time. I’d spend the rest of the time chasing my kids, traveling, and working on the family farm that I grew up on.
What are your post-FI plans? How will your life change? What do you look forward to the most?
My post FI plans are similar to my pre FI plans but with just more time to do the things I like. We will travel more. We have set a goal to see all the national parks. We will probably buy an RV to help us on this journey. We will continue chasing around our kids and try to take them on many of these trips.
I would like to get back to playing in the outdoors more than I do now. Growing up, I would spend my extra time hunting and fishing with my 6 younger brothers and cousins. I’d like to get back to doing that more. I’d also like to go back to helping on the farm, particularly the crops work. Not so much on the scooping manure work 😉
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Have you made any major changes in your lifestyle or investments to accelerate your FI path?
We have not really changed our lifestyle to change our FI path. Our saving rate has always been fairly high because we are frugal and good savers. What has really helped me to understand our FI path better is becoming financially literate and understanding how much we “need” in retirement and where we are in our journey to get to FI.
It has also helped me to understand the importance of decreased spending and how that would decrease our FI number. It has also helped me to understand that I can change jobs and we will still be OK financially (so-called FU money).
Are you facing any unique challenges making FI or RE more difficult?
Our main challenge to FI/FIRE right now is trying to decide about what to do with my career and how that might change our ability to save as much money.
Additionally, my current job has some golden handcuffs (large dependent college tuition benefit) that we need to consider with job changes. We have been hedging on this bet ever since we started investing in 529s with our first child so we should be OK, regardless.
What advice do you have for others who are seeking financial independence?
I give my residents and fellows a lot of the same advice that I have read over and over on the PoF, Physician Philosopher, and White Coat investor.
- Avoid rapid lifestyle creep.
- Save a lot but don’t skimp on experiences that you and your family can enjoy together to make memories.
- Get financially literate (so you don’t buy whole life, pay a financial advisor too much or any money at all, or put all your money in a speculative asset).
- Finally, my favorite financial quote. “No amount of money ever bought a second of time.” Tony Stark in Avengers: Endgame. This quote helps remind me that your time here is relatively short/finite. Money is important but should not dictate all things in your life. You should, however, be aware of and consider the money consequences of your decisions.
Finally, is there anything under the sun that you’d like some help with? The hive mind would be happy to weigh in.
I would love to talk about the financial implications of changing jobs. I have not done this before.
My 403(b) is through TIAA and has reasonable investing options and fees. Should I transfer it to my Vanguard account?
I can’t move my 457(b). What is my best option for handling my current 457(b)? I have 60 days to decide what to do with it. My disbursement options included single lump sum, fixed period payments between 1-15 years, a lifetime annuity, a fixed period annuity, minimum distributions, or partial lump sum with an annuity.
What do I do with my HSA? Transfer also to new job HSA in order to have all HSA money in the same place?
My wife has a 401(k) from a former employer that does get charged some fees every few months that is more than I’d like. Should I move the 401(k) money to decrease the fees?
Finally, we give over $10,000 per year to various charities and our church. We expect that this amount will increase over time. We also don’t really plan on giving our kids/grandkids much more than the whole life policy and any land that we have when we die. Left over funds we would want to go to our favorite charities. Does it make sense to start a DAF now?
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I’ve shared my feedback privately with today’s guest. I wouldn’t want my opinions to influence yours. Please give your take in the space below!
Again, if you’d like to partake in a future Q&A, please download a FIRE Starter, FIRE Crossroads, or Post-FI Notes interview form.
15 thoughts on “FIRE Crossroads 003: Academic Radiologist with 22 Vacation Days a Year”
Similar situation but only a few years out. We had a good college tuition benefit and other benefits were great too. I looked at it from the perspective of how much does that pay yearly based on kids I had. Found a job that paid more (before partnership) and had about 50% more time off. So far it has worked well. Another hard thing for me which may not be the case for everyone was leaving the ivory tower and becoming apart of “outside hospital”. Good luck!
The amount of “flexibility” academic chairmen have is a well known secret.
Find out how much vacation time he has – you may be surprised. Often you just have to ask. Also in many academic environment CME/Trip time is considered part of the ‘time off’ and should be used as such. I increased my ‘days off work’ by 60% but simply planning to use every last CME day available. Even if it’s for a ‘virtual conference from my home office or cell phone’.
Aggressively placing guard rails on how much free work you do for the institution may allow you to keep a job you like and still avoid overwork.
The coincidences between your life and mine are astounding. Married with 4 kids? Check. (former) academic radiologist? Check. 12 years out of training? Check. Apprehension about giving up tuition benefit? Check (that’s not insignificant with 4 kids).
I got out of academics recently for similar reasons you gave. You’ve done really well for yourself which gives you flexibility. The kids aren’t getting any younger and there’s no time like the present to spend more time with them. Also, don’t forget about the benefits of personal free time which is hard to come by with a large family and full time work.
It’s hard to know which direction to go. There are tons of jobs out there. Many may require skills that you have lost after being in academics for so long. I knew I needed to be around others and continue to teach in a hospital setting. I was able to find a great job doing mainly my fellowship training, same pay, better benefits, great coworkers, and MUCH better lifestyle. FYI we may be hiring soon if interested, St. Louis area
To answer some of your questions: I stayed on as adjunct professor at my former employer and can keep my 457 indefinitely as long as I remain on staff. I also kept my 401a/403b at former employer out of convenience, low fees, and good bond fund options. I did transfer my HSA to new employer acct to have it in one place. Regarding your wife’s 401k, where would you move it to? Rollover IRA would disallow back door spousal Roth contribution. I would probably just keep it there as long as her former employer lets her. We also give a fair amount of money to charity and have funded a DAF. One of the best financial decisions you can make if you’re committed to giving money to charity. Great for tax gain harvesting in brokerage acct.
Good luck with your decision and feel free to reach out if POF gives you my email.
I have a couple of thoughts about children that I would like to share.
1. I have four adult children. We still like to travel with them. Unfortunately the expectation is that my wife and I will still pay for the travel. Well, with four children, spouses boyfriends/girlfriends the costs soar. I am just finishing up a trip that started with me paying for five people to fly across the country. I’m also paying for Airbnb‘s at multiple locations. The take-home point is that once your kids come of adult age, you are still paying a lot of money to support them in a sense.
2. As far as the free tuition, one thing to keep in mind is that many kids these days don’t want to go to school in their hometown. They would much rather go to some other school that is out of state. Obviously, it is good that you have a 529 set up to address this possibility.
3. You may not want to “fully” fund the 529 now if it looks like one of your children will receive scholarships as one of mine did. You can always put more money in the 529 when the last child starts college, when you will have a much better handle on total amount needed.
I have a strong suspicion that the poster works at the academic institution where I did my residency and fellowship training (not in radiology). It was so interesting to me how much this tuition benefit got talked about amongst the faculty. The salaries there are low so I guess it’s justification. But honestly working all those years and hours just for your kids’ college tuition doesn’t make sense to me. Everyone in my immediate family earned full college scholarships (not necessarily to Harvard but to decent private or public schools), and as someone else mentioned more kids in the future might chose a tech program or something over college anyway. You never know what is going to happen. And also, similar to WCI, I don’t feel like I owe my kids full tuition to a $50k/year university. If he loves the job, working 50-60 hours per week is not crazy for any high paying field, but it sounds like the love of the job is not outweighing what he’s giving up anymore.
Funny, I’m in almost the exact position. Academic radiologist, 12 years out, $3M net worth (no mortgage), $2M invested, kids are slightly older, 22 weeks vacation (+20 meeting days) but fewer hours a day (8am-4 or 5pm) with an “academic day” per week. I recently dropped to 0.8 FTE so I have one day a week to “play with.” I try to “batch” this unpaid time. I was able to convince my section chief to allow me to get away for a month last April. Otherwise, I just use it to work on “encore career” ideas (medicolegal, writing, speaking, research, home duties). Stopped saving as aggressively (still have a target of $60K/year), but now loosening the purse strings and remodeling and splurging on some things we’ve usually balked at. Hoping this “coast-FI” approach is enough to keep me from needing to jump ship or change jobs.
** correction to above: 22 days not weeks
2 million in savings + brute savings of 150k a year will bring you to 3.6 in 10 years assuming 0% growth in investments. 0% growth is unlikely.
If you added NOTHING to investments, assuming a 5% real rate of return, 10 years from now you would have 3.2 million. You are CoastFI depending on your rate of return.
Know what else will happen in 10 years? Your kids will be 21, 19, 16, and 14. Working 12 hours a day will be a trade off to miss out on some cool stuff with your kids.
FIRE Crossroads 003,
The topic of 403b and 401k rollovers has the following categories that you must consider:
Expenses (expense ratios and plan administrative fees)
Protections (401ks have unlimited creditor protection under ERISA; 403b plans do too, if they are ERISA governed)
Liquidations (what withdrawal options are offered? Lump sum, partial payments, and reoccurring? Additionally, with 401k and 403b plans, a mandatory 20% federal withholding is required while with IRAs there is no minimum withholding requirement)
Options (investment choices; are they sufficient for your goals or do you want more flexibility?)
RMDs (not likely applicable, but 401ks require an RMD from each account while IRA RMDs can be aggregated, as can 403b RMDs)
Ease (Can you easily manage all of your accounts separately or would you prefer to simplify?)
Services (Are there services your 401k or 403b provider offer or that your IRA provider offers that are compelling enough to leave the account with them or consolidate?)
I call this method ExPLORES, as rolling over a qualified retirement requires a self discovery session that ExPLORES all of your options. I wrote a detailed blog post here on the subject: link
At the end of the day, some people prefer low fees and that drives all choices. For others, certain services or investment options will matter more. So, ask yourself and your wife which are the most important to you both and then decide.
Wow. Very sad. I’m also Msk radiologist and work telerad 3-4 hours per day making multiples of what the author makes. Every day for me is a vacation. I exercise/play every day and pick up the kids every day and after 3pm is family time.
There’s absolutely no “benefits” worth staying if you are killing yourself in this job. Working 11-12 hours a day is killing yourself in every field. You are paying for these so called “benefits”.
Get out of there ASAP and join either a tele rad group that pays well or a private practice that is flexible.
You could do per diem academics 2-3 times per month if you want to keep doing the “cool” procedures and hanging out with colleagues/residents.
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Ditch the job. Too much riding on college tuition benefit that may or may not be utilized by children who may want to attend college elsewhere or not at all.
Private practice job could likely double PTO and maintain or even increase salary (very reasonable for MW Rads groups)
Doubling the poster’s PTO results in an additional YEAR off in the next decade (45 weeks current situation vs estimated 100 weeks at new job). Would also likely reduce daily hours.
The poster needs to cut back ASAP. Golden handcuffs only exist if you let them exist. The poster I think already knows those college golden handcuffs are an absolute illusion. How do I know? He wrote “We have been hedging on this bet ever since we started investing in 529s with our first child so we should be OK, regardless.” That “ok, regardless” cannot just be dismissed. That means the OP knows he is fine for college. I would not use the college tuition reduction as a reason to stay in the current situation. Poster is working way too much given children at home, and will regret this in the future.
One other comment/question is the poster still consulting as a side gig and thus contributing to the SEP-IRA? Either way, creating that was a mistake. Start an i401k before the end of the year if still doing side consulting. Otherwise, I bet the current 403b accepts incoming rollovers, and the poster should roll all SEP money into that so he can do the backdoor Roth IRA.
As for questions, 1) What vanguard account? The SEP? No, do it the other way around. The 403b sounds very reasonable and the SEP money should go there. 2) If you retire before 55, use fixed payments for 10-15 years. Probably the same thing if you retire at 55 or later. 3) Transfer if the fees are also reasonable. 4) Move her 401k where exactly? What are the fees in the current account? 5) Consider a Charitable Remainder Trust
4 weeks off is INSANE given how much he is working. The author will look back someday and regret how much her worked if he continues this job. Negotiate more time off or move on.
Golden handcuffs are indeed just that, handcuffs. I definitely feel you on this as my workplace (private multi specialty clinic) has a few golden handcuffs as well that are tempting (one that requires 20 years of service which would be 3 years more than I plan to do according to my FIRE plan).
I looked into teleradiology as well but was kind of appalled by the low pay you get for reading these studies. Sure the company provides everything by setting up equipment etc for you with no out of pocket expense but getting less than $20 to read an MRI was a hard pill to swallow.
I think you have set a reasonable goal and timeline but warn you that if you are like me when you get there the goal posts often change.
Best of luck!
Thanks for sharing. Strikes me that the only really important question you need help answering is what you want out of our job and out of your life. You will be fine financially, no matter what you do.