The Family Board Meeting with Jim Sheils

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Transcription – WCI – 321
INTRODUCTION
This is the White Coat Investor podcast where we help those who wear the white coat get a fair shake on Wall Street. We've been helping doctors and other high-income professionals stop doing dumb things with their money since 2011.

Dr. Jim Dahle:
This is White Coat Investor podcast number 321 – The Family Board Meeting with Jim Sheils.

Today's episode is brought to us by SoFi, the folks who help you get your money right. They've got exclusive rates and offers to help medical professionals like you when it comes to refinancing your student loans. That could end up saving you thousands of dollars.

Still in residency? SoFi offers competitive rates and the ability to whittle down your payments to just $100 a month while you're still in training. Already out of residency? SoFi's got you covered there too with great plans and great rates that could help you save money and get on the road to financial freedom. Check out their payment plans and interest rates at sofi.com/whitecoatinvestor.

SoFi Student loans are originated by SoFi Bank, N.A. Member FDIC. Additional terms and conditions may apply. NMLS# 696891.

All right, it's great to be back with you. I've been off on a few trips. Not the one I told you about though. We had to cancel our climb of Half Dome. The main reason was because it rains all summer in Yosemite these days. I think for 14 days straight. It was supposed to rain in Yosemite and we just didn't want to be camping on a tiny little ledge hundreds of feet in the sky at 9,000 feet getting rained on for some reason. So we've had to postpone that trip.

But I was able to have a wonderful trip with my family. We went to Europe, visited London and Paris and Normandy with all four kids and just had a wonderful time over there. Very stressful to travel in new countries with all kinds of family members, of course, and lots of jet lag and all that sort of thing. But I had some really wonderful experiences with them there and had a good time.

Managed to fit in one adventure in the time that we were going to spend in Yosemite and went down to Zion National Park. It wasn't raining there. And did the Zion Narrows. This is a really hard hike to draw a permit for, to do the narrows from the top down. But you know what I discovered was very easy? It was to get a permit to float it. And in the spring when the water's too high for them to allow hikers in there, they will issue you a permit to float it. And so, that's what we did. We carried our packrafts for a few hours until the water got deep enough to float it, inflated them, and then floated out what used to take eight hours a hike, and we floated in two hours. It was wonderful. It was a great way to see the narrows. We had to skip a couple of rapids. They were just way too much for us to do in our packrafts, but easily portaged around. And I had quite an adventure doing that.

So, today we're going to be talking a little bit about family with the guest that we have on today, but I got a few things I need to get out of the way before we get into that interview.

 

QUOTE OF THE DAY

The first is our quote of the day. This one comes from PT Barnum of Greatest Showman fame, although I don't think he ever said this in the movie. He said, “Money is a terrible master, but an excellent servant.” I think that's so true because it is something that you can do a lot of things with. But when it becomes the most important thing in your life, you're going to have some problems in your life. And I think today's interview is going to really speak to that as well.

I also wanted to make sure that I thank you for what you do. Yesterday I was flat on my back. I was so sick I could not even sit up. And it only lasted six or eight hours, just some viral syndrome. But man, I felt terrible. And I know there's people out there that feel that way for far longer than six or eight hours. And you're the people working on the front lines helping them to get better. And that is a worthy work and I appreciate you. Even if I didn't need a doctor yesterday, I was very grateful for Ibuprofen and Tylenol and Gatorade.

By the way, if you're looking for a little extra income that you can do on the side while you're commuting or while you're watching TV or something to wind down on the evenings, check out our paid surveys at whitecoatinvestor.com/paidsurveys.

People actually pay you hundreds of dollars. Some people even make thousands of dollars a month taking surveys. Particularly if you are in a medical specialty that prescribes expensive medications. I'm talking rheumatology, I'm talking oncology, neurology, those sorts of specialties. You'd be surprised how much money you can make doing these paid surveys. They really do want your opinion on stuff.

 

INTERVIEW WITH JIM SHEILS

All right, enough about this. Let's talk about your families. Let's talk about your marriages. Let's get Jim Sheils on the line. You might know him from the real estate world, but we're not going to be talking about real estate today. We're going to be talking about how to strengthen your family. So, let's get him on the line.

My guest today on the podcast is Jim Sheils. Welcome to the podcast, Jim.

Jim Sheils:
Thanks for having me, Jim. Good to be here.

Dr. Jim Dahle:
Now, by way of disclosure, Jim and I have a bit of a business relationship. His company, Southern Impression Homes, helps White Coat Investors find turnkey properties that they want to invest in. But that's not actually what we're going to be talking about today. Today we brought Jim on because he's an author, an author of a very important book called The Family Board Meeting. And we're going to get a little bit into that and why he decided to write that book and what its message for you is. In the meantime, Jim, tell us where we're recording this from. Where are you at?

Jim Sheils:
I'm in Costa Rica right now, Jim. One of our favorite spots to try to get away to and work and play from.

Dr. Jim Dahle:
Now you say we. Who's we?

Jim Sheils:
My whole family. Me, my wife, and we got five kids. So, it's quite the gang.

Dr. Jim Dahle:
Okay. Oldest is how old and youngest is how young?

Jim Sheils:
We go from 20 to one. So, we've got quite a range.

Dr. Jim Dahle:
And you've got the 20 year old down there too.

Jim Sheils:
Yeah, he actually just left to go back because he has business, but he was down here. They love it here. This has been one of our favorite adventure spots. That's a big core value for our family, adventure. That's just so important to us and this is one of our favorite spots to do it.

Dr. Jim Dahle:
Very cool. Well, the book we're talking about today just came out with a third edition and I understand it's been rated pretty highly by the Wall Street Journal.

Jim Sheils:
Yeah, this is kind of exciting. My first podcast since I got the news because I got the news about an hour ago that we hit number one on Wall Street Journal, which our publisher called and said, this is incredible. Because it's normally fiction books. And we were the first non-fiction kind of self-help book to hit. And not only hit the list, but hit number one. So, we're really excited. I think it just shows people are really, really yearning for this family message and for some strategy and structure to help that important part of the life.

Dr. Jim Dahle:
Yeah. Now the copy I have is still the second edition. I haven't gotten my hands on the third edition yet, but I think we could probably work from that to talk a little bit about the message about the family board meeting.
Dr. Jim Dahle:
But before we talk about what the family board meeting is, let's talk about your motivation to write this. This came out of you kind of interacting with a bunch of other entrepreneurs and seeing a problem. Tell us about that problem.

Jim Sheils:
Yeah. It was many years ago, I went to support a friend who was going through detox, through an addiction treatment center. And on the final day, most people brought in family members to support this friend. And it was very interesting, Jim. I was in a room of a lot of parents. They all shared something in common. Two things in common. One, they all had a child who was an addict, which is a very, very difficult thing to go through.

The second thing is they were all successful in their career. They either owned their own practice or their own business. And it hit me like a cold baseball bat to the knees and just “ugh”, just to watch it. And there was this concern that I saw that these people in best intentions had built these bigger businesses or practices, but they had sacrificed so much quality time at home. The relationship had suffered and then sobriety had suffered as a result.

And it really made me think well before I even had a family of how could I do things differently? And that's what I wanted to do was do things differently. So I wasn't in that situation, or at least hopefully I would do everything to avoid that situation later in life.

Dr. Jim Dahle:
Let me read a little bit from the book from this section. You said, “That day I watched successful grown men and women sobbing at the clear knowledge they hadn't been there for their children when it was most important. It was enough to change me forever. That day I learned there was something more important than money, more important than fancy private schools and more important than empty gifts. That's something that's called quality time.

I sat in that room listening to the devastating stories and the heart wrenching regret of each parent as a hundred different threads wound themselves together in my mind. The disconnected entrepreneurs and corporate warriors I'd met over the years, the disconnected parents in the support group, the memory of my friends disconnected upbringing. It was like a slap in the face, an abrupt shock that left me wondering, what happened to these families?”

Tell us what you mean by quality time. This is something that's been thrown around a lot, but don’t know that anybody really ever puts a definition on it. What is quality time?

Jim Sheils:
Let's start, Jim, by saying what quality is not. Quality time is not putting your kid in the back seat, taking two phone calls and having the radio on and calling that quality time. Quality time is not being in a huge group and unavailable to the people that you love the most where you're giving them maybe 10% of the attention, maybe less. That's what quality time is not.

What quality time is, is intentional, planned and strategic time together. With certain principles added it is the difference of success or failure. And that was something that I really got honed in on and what creates quality time. And it's only a few components, which I'm sure we'll go over today.

Dr. Jim Dahle:
Very cool. All right, let's talk about an important question, and you call it in the book the most important question in the world. Can you tell us what the most important question is?

Jim Sheils:
Well, the most important question is have you spent time one-on-one with your child without electronic distractions for a day or a half a day? And if so, when and if not, why not? That's the underlying question that I ask so many people.

Dr. Jim Dahle:
It really boils down to what's more important, your work or your money or your children?

Jim Sheils:
Yeah. And in a lot of this, Jim, there are people so well intentioned. We both have families. There is pride, there is a deep responsibility to provide for our families. And for my doctor friends, couple that with the Hippocratic Oath. That's a very sacred oath to a lot of my doctor friends. So, there is some pull, there is some confusion.

But what I've found is the people that are able to put their family in a priority position and still not give up those other responsibilities seem to be happier and more well-adjusted than people that do not. When you put yourself in the position where your family just is constantly getting what's left over and we know from all the business, if we just give them what's left over, it can be very small. That's where I start to see problems really arise, at least with the thousands of families I've worked with over the last 12 years.

Dr. Jim Dahle:
Now, I think this concept, this idea of a board meeting might not be intuitive to doctors as much as it is to a corporate warrior. Tell us what a board meeting is and then let's transition that into what the family board meeting is.

Jim Sheils:
Yeah. A board meeting for me, Jim, when I first made up this term, it was a play on words because as you know my pastime is surfing, so I love surfing. So you hear about surfers talking about having a board meeting. They're not really in the boardroom, they're out on their surfboards. And so, that's what we originally called it because we had so much beach time. So it was kind of a play on words and it might sound a little more serious than it is.

But for our doctor friends out there that might not be so into this more business realm, they're more into the professional realm. A board meeting for everything that I've seen in successful companies is a time when you get together every 90 days to reunite the team and look forward to the next 90 days. That's what a real successful board meeting is for entrepreneurial companies that I've either owned or worked within.

And I decided a long time ago I wanted to do that same with my children. They are my most important investors, clients, key team members, and I wanted to make sure I gave them that time. So, every 90 days I get together one on one with each one of my children and I reunite my relationship with them. We have fun and we look ahead to the next 90 days. And I've been doing this now for 12 years, along with thousands of other families. We have to make this simple rhythm is probably being practice by over 300,000 families.

Dr. Jim Dahle:
Let's get into the nuts and bolts. How do you plan and carry out a board meeting?

Jim Sheils:
Absolutely. First thing, Jim, as we've talked about before in success, that which we schedule gets done. I know my doctor friends would never not schedule appointments with their patients. That just wouldn't make sense. So, that which we put on our calendar gets done.

Every quarter I schedule a day, half a day to a day with each one of my children. And then I follow three guiding principles. The one-on-one principle, the intermittent tech fasting principle, and then the fun activity and focus reflection principle. We can go through each one. When you combine these three, it is an absolute unfair advantage for having a deeper, more meaningful relationship with your children.

Dr. Jim Dahle:
Okay, let's go through the principles. Let's start with the first one.

Jim Sheils:
Yeah. This one, and I know I'm not supposed to say this, Jim, but I'm going to say it. If people stop listening after this one, I'm going to tell you, just listen to this one. Because it has made the most difference and it's so overlooked and so underrated. It still baffles me.

And this is the one-on-one principle. What I've learned with successful relationships between spouses, between them and their children is separate the parts to strengthen the whole. You have to get one-on-one with each member of your family to strengthen that individual relationship.

One-on-one time takes away distraction and it puts the magnifying glass on that individual relationship in a positive way. Big family gatherings are great. I come from an Irish Catholic family, which means I have like 4,000 cousins. And that's great.

But the real deeper conversations with my children, especially my teens, happens on one-on-one time. Because there's a lot of things we might not want to talk or open up with without that comfort of one-on-one.

And if you are the busy professional, you're a busy doctor or a busy business owner, and you're away from home more, well, it's really important that you have this one-on-one time because your child might naturally tend to lean towards your spouse who might be home more. So, one-on-one time is the starting point. And we found even this scheduled one-on-one time takes the relationship to a deeper level.

Dr. Jim Dahle:
Now, what if your spouse wants to participate? They don't want this to be one-on-one. They want it to be two-on-one. How do you break the news that this has to be one-on-one?

Jim Sheils:
Our book is a great starting point because it really does break it down in a non-aggressive way of why this is so important. Again, you're not taking away from the family dynamic by not all being together all the time. You're adding to it. In our days, if you remember the Brady Bunch, Jim, none of us want the next Jan Brady, you know, Marcia, Marcia, Marcia. This fights against that.

And really, you want to show your spouse this is not going to take away from the relationship. It's going to add to it. What I found a lot of the times, especially if there's a spouse at home more, they're going to support this because they want to see you, the busy professional that's outside the house, get this time because man, it's so important.

Dr. Jim Dahle:
What about when the kid pushes back? Can I bring my friend? They're always more willing to do stuff if there's a friend with them. How do you respond to that?

Jim Sheils:
Well, there's a couple ways. First, and this is principle three, and we'll jump ahead to it real quick and then come back to it later. I let them plan the day. Now, if it's something that I'm planning, Jim, I like surfing and one of my sons loves the ocean but he’s not in the surfing. If I go out to a surf spot with him for the day, he's not going to be as excited as if he got the plan the day.

So one of the things I let them do is plan the day. And then I just basically explained to them, “Hey, I'd like to bring my best friend too”, and I'll name one of my close friends. This is about you and me today. We'll have other times where we're getting together with John or Sally or whoever, but today is about me and you. And that is really important that we get time just the two of us.

I don't say it aggressively, I don't say it with authoritative action. I just kind of hand open say that to them. And I've yet to see too heavy a pushback. Maybe in the beginning if you haven't been spending time. But there are some things you can do to keep to open that up. But get them on that first one and we'll go over some things to make sure you don't betray that trust to help do that. And I think you're going to see results that most people are so scared to even ask this. They find out it was just a phantom. They were pretty scared about things they didn't.

Dr. Jim Dahle:
Yeah. All right. Let's talk about the second principle.

Jim Sheils:
This one's really important.

Dr. Jim Dahle:
This is the one about your cell phone, right?

Jim Sheils:
Yes. Intermittent tech fast. We have lots of health professionals on here, and I'm no health expert, but I've practiced different forms of intermittent fasting where from what I've read, it helps revitalize the organs. Weight, maintenance, weight control. And you're not giving up eating, Jim, you're just deciding to eat between this time and this time. It's a disciplined action of when you're choosing to eat.

This is the same thing I encourage with quality time with your family, especially starting with this family board meeting that you do with each one of your children every quarter, or as in our third edition, when we start to talk about the importance of having a weekly date night with your spouse. My phone is not invited.

So, when I go onto these days with my children, Jim, my phone is not invited. You start to realize when you read the studies, how much interruption occurs and you never get below the surface or give full focus to people in front of us if we get that one text, if we get that Facebook thread that you don't even need to read, probably ever. If you're taking an email, that phone call, it pulls you out of the situation.

I'll tell you a quick story. Maggie's now eight. About three years ago, she's five years old. We go out, on a day coming home every day, I turn off my phone for one to two hours when I get off. So they can't contact me. I need to be completely and totally unavailable sometimes for my family. We go out, she says, “Daddy, let's get on the trampoline.” So it's her time. I get on the trampoline, Jim, I break my own rule. I left my phone in my pocket, and I hear that dreaded noise. Now, you know that noise. Everyone on here knows that noise.

We don't even have to look at the phone yet, but our mind's going into seven different things of what it could be. I pulled it out and I was doing a real estate closing on a deal that I was closing, and something fell through. A simple part of the title, and it was supposed to close. It didn't happen. Oh man.

So here I am frustrated, standing on the trampoline, talking in my head, and there's nothing I could do. It's 05:30, it's going to have to wait until tomorrow. And I have a moment of clarity, and I stop and I look, and there's my five year old daughter standing in front of me. She's got this really sad look on her face. And she goes, “Oh, daddy, why are you so mad at me?” And I'm like, “Oh, just turn the knife.” It just was so, so shocking to hear that I had been so out of it.

We think we can handle two things at once. We don't realize what it's doing to people in front of us. And that's why I want time to complete and total unavailability. You cannot reach me when I'm on one of these board meetings with my children and I follow suit. I set the example and they have to turn off their phone because we all know if all of a sudden we're about to get into deep conversation, we float into a social media thread or get a text or a phone call, the moment stops.

So, what I've found for the most successful family connection points is we got to turn off technology. I'm not telling them they have to move to a survival ranch in Montana, although that sounds tempting to me sometimes.

But what I'm saying is, have times of unavailability. Interesting fact as well, 60 years ago, Jim, the average family dinner was about 90 minutes, which you and I look like, “Gosh, 90 minutes. That's a long time.” But today, the average family meal for dinner is 12 minutes. 12 minutes.

I have the belief and experts I've talked to that people are rushing off to something. And normally it's to electronic device. So, I'm saying, look, if you're going to go on a date with your spouse, turn off your phone for the night. Have one emergency phone with a babysitter. If you're going to go on one of these board meetings with your children, have your phone off for those four to five hours. Your business or practice should not explode.

If you're coming home every day, take an hour, one hour where everyone's phones are off because then you're not rushing away, then there's not distraction. Then there's deeper conversation. Intermittent tech fasting is one of the most important principles that I found to settle family strife and even distance and bring people closer together.

Dr. Jim Dahle:
Very cool. All right. Well you alluded to this earlier, but let's talk about the third principle.

Jim Sheils:
Yeah. People say, as you said, Jim, well, what if they don't want to do it? What if they're not wanting to spend the time? Well, I got to tell you, what I found is for me, I'll guilt myself. When I'd want to spend time with my older boys or any of my children, in best intentions sometimes I would try to pick the day and they might want to do something totally different if I let them build out the day on their own. So, that which we help create, we take ownership in. A fun activity of their choice. Every quarter they plan the day and I go all in. I've had more princess parties than I probably want to admit to you, Jim. But that's what my daughter wanted to do and I went all in. And that's their currency of fun, going in on what they want to do.

My son, for example, he loves fishing. Now I like fishing Jim, but if I have a chance to go surfing or fishing, I'll choose surfing 10 out of 10 times. But my son loves to fish. So starting in age seven, when we started to take these board meetings and he started doing fishing, we did that a lot. I went all in. Well, today he owns his own charter fishing business.

So you never know where these things are going to turn out. But thankfully I didn't say, “No, let's go surfing. No, let's go to this.” Because that's what seems to happen. We let them build the day and go all in.

And then at the end of the day, you have the chance to have some open communication. See what occurs when you can read about this in the book, when you're four to five hours in, you've had no distractions, you're having a good time, you've probably shared a meal. There's something that occurs that’s called decompression. It's almost like the guards have come down. This is when real communication can happen.

And what I've found for thousands of people I've spoke to, and even myself of my own recollections, this is the time where if I make a sincere compliment or genuine apology, I go deeper with my children. Look, we all get short, we all get impatient. We all have times where we make a promise and it gets run over by career goals, deadlines, this and that. We have times where our children have worked really hard on something and we haven't taken the time to actually give them some credit where credit is due or a real compliments.

And so, I found that if I will go all in, stay open to conversation, just ask the question, “What did you enjoy today?” And have myself have the courage to make an apology or sincere compliment, which honestly I didn't really get as a child. So, weren't easy for me. This is where the relationship can get strong.

Dr. Jim Dahle:
Okay. So, this activity that they plan and you've turned your phones off for and it's one-on-one. How does this work? Give us a couple of examples of family board meetings you've done.

Jim Sheils:
Okay. Well, let me give you one in the book that has gotten even more famous now, because we did a catch up, where are they now, my kids. My son Leland, he's six years old. You've been, I think to St. August. We have a beautiful lighthouse there. Just the view is just sprawling. His big brother, a quarter before had gone the lighthouse. He said, “Dad, I want to go to the lighthouse. I want to go the lighthouse for my next board meeting.” I said, okay, no problem.

Now the catch here is, Jim, Leland was terrified of heights. He could not stand heights. And I'm going, “Okay, how is this going to work? He's scared of heights. I know big brother just went.” So we get to the base of the lighthouse, he starts freaking out. And I'm like, “Look buddy, we don't need to do this. This is your day. We'll go all in, do what you want to do.”

I said, “I tell you what. What if we just climb the first landing? When you go up, there's landings and there's benches. We could climb the first 20 steps and sit there. If you want to come back down, we'll come back down.” So little hem and hawing, we get out, we do that. We get up the first landing, finally. We sit there for a while. “I don't know about this. – Well, hey, why don't we just try the next landing?” We go up again. Boom.

Then we get up another landing and another landing. And now he's like, “Well, I'm not sure.” And I'm like, “Well, look buddy, we're closer to the top than we're at the bottom. Maybe try one more landing.” Well, we do this the whole way up, Jim. He gets to the top. He is proud as punch. The view is just such a reward. We rushed down, we climb it two more times. And he's just ecstatic with himself.

We leave, we go have a meal at his favorite cafe that he likes to eat at. And then we stopped near our home before going home, just climb on some jetty rocks. And I said, “What was your favorite part of the day today, buddy?” And he was like, “Oh, climbing the lighthouse. I can't believe that I was able to do that.” I said, “Yeah, I was really proud of you.”

And he stopped and said something to me, which at first with the male bravado, you should be proud of. And then I was like, “Wow, I'm really not doing a good job displaying who I really am.” He said, “Dad, have you ever been afraid of anything?” And I thought, “Ah, what?” Because coming from a six year old and grown man who still has plenty of fears and setbacks and hesitancies, he's thinking that he's trying to live up to someone who was never afraid. And that just was not true.

So I had to say, “Wow, buddy, let me list as far as I can remember, back around your age, all the things I was afraid of.” And it was just such a connection point to that day. First of all, he overcame it. And I was able to see something that I was seriously doing wrong. Where, yeah, I was in good intention, make him strong, make him self-reliant. But if I'm setting up this Superman image that I have no vulnerabilities, first of all, it's a lie. And secondly, how can he ever feel as a six year old that he can relate to? And that was a really important thing.

Fast forward to today, Jim, this little boy who is afraid of heights, and I didn't even realize this till our editor said, “Do you realize that this famous story of him being afraid of heights, he now owns a gutter cleaning business where he is up on roofs all day?” So, that's one of my favorite stories.

Another story. I know there was a friend of mine who owned a large practice, had a messy divorce. His daughters were teens, twins. He started to practice these board meetings and he said on the second board meeting both of his twin daughters who he did them separately with, they were always together, but he got together with them separately and had a day with each one of them.

He said, they said the exact same thing and he knows that they didn't script it to each other. They basically said, “Dad, we didn't care about the big practice. We didn't care about any of the big stuff. We just wanted time with you.” And he said it was an absolute aha. It was a comfort, it was a rebuilding of his confidence. And it changed the way that he went into the next phase of his career, the rest of the relationship he had with them into adulthood.

So, those are just two stories that stick out. But we're lucky to have thousands and thousands of people using this system though. But those are just two that are good to share.

Dr. Jim Dahle:
Let's talk about what you're supposed to do at the end of this time together. This sort of reflection time. Tell us about that and how hard it is, how involved it is, how easy it is, etc.

Jim Sheils:
You remember those old commercials, Jim, with the crash dummies for cars? And they say you can learn a lot from a dummy. I always joke, I say, you can learn a lot from a dummy, meaning me. What you don't want to do when you first get on these board meetings is you don't want to try to fit in 50 lectures. You don't want to get on your soapbox and start disciplining of the ways they can improve their life, the things that they're not doing right. This is a betrayal of trust and it will kill the magic of the board meeting.

And as you said, that's what's going to prevent your kids from wanting to go on another one. Keep the next 50 lectures for another time. This day is not about that. This day is about just a relationship, not about the rules, not about all those other things. They can wait.

So, during these reflection times, it's a time to be vulnerable. It's a time to lower your guard and admit things. Like I've said, I have two young sons going to their own businesses. I share my struggles on our recent board meeting all the time because I know they're going to be able to relate to that. And I don't leave it like, “Hey, it was terrible. It was awful.” I say it was really hard. Here's what I tried to do to work through it. And after they ask me questions.

I always try to let them have the playing field and not make them talk too long. A focus reflection can honestly be four seconds. They say, “What did you like about today? – Just getting the chance to spend time with you because I don't do it enough and I'd like to do it more.” Boom. A sentence like that can really implant into a child and make them wanting to come back for more. Especially if you're doing it enthusiastically and authentically. Obviously you don't want to try tactical. But that's all that the focus reflection is about, Jim. It’s just, again, sincere apologies. Maybe you're holding back a compliment. Maybe there's a story at their age of yourself that doesn't make you look like a superhero but it's certainly not about lecture.

Dr. Jim Dahle:
Well, let's talk about the third edition. I haven't read the third edition. What's in the third edition that I don't have in my book?

Jim Sheils:
In the third edition, there's just some more stories. We went deeper into a few of the principles, the one-on-one principal, the intermittent tech fasting, and this fun activity with focus reflection, which by the way, that's the shortest definition of experiential education.

But what we added was this rhythm that my wife, Jamie, and I have been teaching at different business groups. And that is the importance of date nights. We were working with some pretty influential groups out there and I would say, “When was the last time you went on a date with your spouse?” And they're like, “Oh, seven months ago, eight months ago. Yeah, we tried.”

One thing that my wife and I got really good at out of necessity was the weekly date nights. And there's a little system to how we do it to make sure that we don't miss it and we make the most of it. And that's what we go into in the book is adding the principles of the one-on-one, the intermittent tech fasting and then also adding some guardrails of what date night looks like.

And this is something really important. If you're not having a weekly date with your spouse, I believe you are setting yourself up for a dangerous situation and nobody wants to be in that situation. And if you do do it, it is such a reset. It's something to look forward to. It's continually built the love and friendship that I have with my wife today. And I'm happy to share a few of those main points that people can chew on.

Dr. Jim Dahle:
Sure. Let's hear some of those main points.

Jim Sheils:
Okay. Well, hey, our doctor friends, Jim, they're really busy. A week goes by in blink of an eye. If we're every week saying, “Okay, let's schedule a date. Well, how about Thursday? Well, no, Thursday. Well, maybe Friday. Tuesday, yes. Tuesday. Oh, we can't get the sitter on Tuesday.” It moves too fast.

So going back to Burt Ward, days of Batman, same bat time, same bat channel. See, I'm an entrepreneur, Jim, you know me pretty well. I need structure. I need some structure, some guardrails around me. And I used to miss eight night and it would break my wife's heart and I'm really ashamed to say that. But once we put it on the same day, every Wednesday, 05:30 to 08:30. Every Wednesday, 05:30 to 08:30.

What does that do when you put it on the same day and same time? Well, first off for us, we can get a sitter. We have a standing babysitter every Wednesday night. We don't take podcasts on Wednesday nights. I don't do client dinners on Wednesday night. I can work around it. I know if I'm traveling to an event, I usually can leave Thursday morning. So it's right after that. That's how we picked our date.

So if you find them a day that's going to work, and we found on the weekends it might be harder to get into our restaurants. Plus we like hump day. But we know when it is and what to expect. And I find that most people, as I said before, why do our board meeting strategy with children fail is because most people don't schedule. If they will just schedule the date night for that same night, it doesn't take away excitement, it doesn't take away any enthusiasm. Actually, it gives you something to depend on. And it's really nice.

Now, once you get on the date, Jim, I ruined plenty of dates in the beginning, sad to say because I had my phone. That text, that phone call. I'm embarrassed to think back of that guy who was at the table with my beautiful wife. So, my phone's uninvited.

But when we go on a date, I don’t know about you, Jim. My wife is my best friend. We have a great relationship, I’m really attracted to her. But even with that, we can get stuck in the fast of life with the surface questions. How was the kids' day at school? What's the weather supposed to be like tomorrow? What errands are we running on Saturday? Real romance builders, right? And we want to avoid those.

So what Jamie and I started to do is we started to bring, because we read something of better questions, better relationship. And so we started to mount up and just find questions from the internet in different spots of really deep, powerful questions to help us get to know each other, to keep dating each other.

And actually, as we built them, we put them as a joke into a deck of cards. 52 questions and a little one you could fit in your pocket. And we'd bring these on our date. And every date we ask one or two of these questions. Not 17 for our overachievers. This isn't a contest. But one or two. And one or two questions, Jim. Instead of how's the weather today? It's like, “Hey, tell me about the most influential teacher you had, whether from kindergarten or college. And why?” That one question, what I learned about my wife and what I learned, she learned about the person who influenced my life to a huge degree, a teacher was huge.

What were our best three vacations and which one would we take first again, if we could? Name a time that we were going through a tough time and you feel like I didn't show up for you and how I could have done that better. Now that's a tough one. The duke's got to go down, right? Lower the guard.

But the beauty here is, Jim, if you set it up at same bat time, same bat channel, for us every Wednesday, 05:30 to 08:30, every Wednesday, 05:30 to 08:30, and every week I'm asking one or two powerful under the surface questions to my wife, think where you'll be in a year compared to the last year.

Now, a lot of the groups that we've worked with, they've only gone on four dates and asked one of those questions. You feel more aligned, you feel closer to each other, you feel more respected, you feel more heard. All the things we all want.

And so, that is a big part of the addition number three. Because the relationship between us and our children is one of the most important things to me in my life, Jim. I love real estate, but it's very secondary to the relationship I have with my family. And that can't just be with our children. I believe it has to be with our spouse. And that's why we added that in the book.

Dr. Jim Dahle:
It's very true. And I've been saying this for many years, that date night is your best asset protection move.

Jim Sheils:
There you go.

Dr. Jim Dahle:
Because doctors are all worried about losing their money to their patients. And the truth is, almost no doctors ever lose any of their personal money to a patient. Almost always, even when they're sued successfully or have to settle something, they're playing with the house money, they're playing with the insurance company money. Who do they really lose their money to? Spouses when they get divorced. That's where they lose their money. So even if you look at it just from a financial perspective, date night is a great move.

Jim Sheils:
It's a great move. Yes. And it's got equity in many, many different areas. And so, what I found is too, as we went onto more dates and asked more of these questions, the level of trust we've had has grown.

And for financial success, Jim, my wife and I are very aligned financially, in our mindsets and our goals. We both know where our assets are, how they are working. And I'd like to say that that wasn't always the case, but we built a trust and a camaraderie through these dates that really binded us.

And I can tell you our wealth, not only have we been far from the side of divorce, but we've grown our wealth more sustainably and more enjoyable. And that makes all the sense in the world to me and hopefully to a lot of people listening.

Dr. Jim Dahle:
Yeah, absolutely. In preparation for this, I read through some of the reviews of your book on Amazon. I don’t know if you've ever read these, but it's always fun and you have lots of very nice reviews. 91% of your reviews are four or five stars. Lots of people say very nice things about you.

I found the worst review on here. This is from a lady by the name of Laura W who said, “One star. Let me save you the money. Spend time with your kids one-on-one doing something they like to do. Tremendous waste of time with very little content. In fact, I can save you $10 by giving you the entire message reiterated 50 times in this pathetic book. Spend some one-on-one time with your kids. Here's the big secret, the twist. Doing something they want to do. Seriously? That's it? The title and subtitle of the book are more interesting than any of the content. Frankly, I'm embarrassed that I bought this book, who would give it zero stars if that were an option.”

Now here's my question for you, Jim. If you had a chance to sit down in a room across from Laura W, what would you talk about?

Jim Sheils:
I would try to very nicely ask “What have you done with your children to keep a strong relationship?” And sometimes when people are that charged, it doesn't feel like they're mad at me, Jim, they're mad at someone else. And so, I can kind of laugh at those a little bit. But I would say, “Wow, you really summarized my book well.”

Because here's what I would say is what I've learned, Jim, and I would tell Laura, this is a short book. We made it like that on purpose. And the concepts are simple to understand and to put into action. We did that on purpose because I'm always saying “Today, especially, gosh, for different strategies for strengthening your family or relationships, it's almost like you have to a psychologist or family therapist to understand them.” And not all of us have the time or the desire to do that.

The world is choking on content, but starving for execution. My book is not content overload. In fact, it's very content generalized and how do we put it into action. Because honestly Jim, the book is a failure if you don't take action. That's the biggest compliment I can get. It's too simple.

And what I've found is, sadly, I've had some friends who are good friends and they'll say, I thought it was too simple. I ignored you. Three years later, I finally started. Now I get it.

I'd say with Laura, also, “Have you practiced this? Have you tried it? What were you doing before?” Because back in the day, Jim, I’d cross my arms, “Who's this Laura? Where does she live? Do I have her Facebook?” You take it very personally, but now I'm starting to see it's very vulnerable when we start to talk to people about their children. This is a very personal relationship. We put a lot of pride in it. We have a lot of hurt, we have a lot of resentment towards ourselves. And so, I see when people write comments like that, luckily I don't get many. They're probably not mad at me. They're mad at something else, normally themselves.

Dr. Jim Dahle:
Yeah. Well, awesome, Jim. It's been great spending time with you talking about the family board meeting. You've got the ear now probably of 35,000 or 40,000, mostly doctors, but high income professionals for the most part. What have we not talked about today that you think they ought to know?

Jim Sheils:
Jim, I have a lot of doctor friends as you know. They are some of the most hardworking, honorable people I know. They're also very hard on themselves because they had to be of that perfection to learn their skill set, which thank God they do. You know the stories of what I talk about at white coat events, anything from kidney donations to what doctors have done are huge.

Just know even with all your skills, there is no perfect family. And don't put that pressure under you, your spouse or your children. Family life, if I've learned anything, is not about perfection. It's about bridging our imperfection and making the most of the time we have together, because that is a huge unknown. And I learned that more and more each day that I live.

So, I just tell all of my friends, but my doctor friends out there, you guys are working hard. You're doing great work. Don't put the pressure of perfection on you for the perfect family life. I don't know whoever created that silly saying the perfect family. I haven't met the in thousands and thousands of families and that's not what it's about. So when you take that pressure off, you might actually get to enjoy each other a little.

Dr. Jim Dahle:
Very cool. Thanks for sharing. So, if you're interested in the Family Board Meeting, you can get it on Amazon, make sure you're buying the third edition now. It's brand new out. But if you look for the ones with the most reviews, that'll be the first or second edition. So, look for the third edition to make sure you get all that good stuff about date night in there.

If you're interested in connecting with Jim professionally, the best link to use is whitecoatinvestor.com/sihomes. And that'll take you to his professional pursuit, which is obviously not his greatest priority, but if you're interested in getting into turnkey rental properties, he can assist you with that as well.

Jim, thank you for your time. Thank you for coming on the White Coat Investor podcast and sharing your thoughts on how to strengthen our families and our marriages.

Jim Sheils:
Thank you, Jim. I appreciate you having me.

Dr. Jim Dahle:
All right. I hope you enjoyed that interview. I thought it was great. It was really good for me. I read the book a while back, but because I hate scheduling stuff, and ask White Coat Investor staff members how much I hate scheduling stuff, I have not actually implemented this despite meaning to after reading the book. And that is the hard part, isn't it? It’s implementing and following through.

So, I'm going to make a commitment to all of you, 35,000 of you or whatever, that are going to listen to this podcast. I'm going to do a far better job implementing a weekly date night and a quarterly family board meeting with my kids and do a better job of strengthening what really does matter the most to me. And I hope you'll join me in doing the same and shoot, send me an email, let me know how it goes.

 

SPONSOR

All right. As I mentioned at the top of the podcast, SoFi could help medical professionals like you save thousands of dollars with exclusive rates and offers for refinancing your student loans. Visit sofi.com/whitecoatinvestor to see all the promotions and offers they've got waiting for you. One more time, that’s sofi.com/whitecoatinvestor.

SoFi Student loans are originated by SoFi Bank, N.A. Member FDIC. Additional terms and conditions may apply. NMLS# 696891.

Don't forget about those paid surveys as well, whitecoatinvestor.com/paidsurveys. And thank you for those of you who leave us five star reviews, not the one star review I mentioned of Jims, but the five star reviews about the podcast. They actually help us to spread the word about this podcast.

Our most recent one comes from an unidentifiable amount of letters and numbers. But they say, “I wish I knew about you years ago. Saddened about the time and money I wasted. Optimistic about the knowledge I’m getting from the White Coat Investor.” Five stars. Thank you so much for that review.

Keep your head up, shoulders back, you've got this, and we can help. We'll see you next time on the White Coat Investor podcast.

 

DISCLAIMER

The hosts of the White Coat Investor podcast are not licensed accountants, attorneys, or financial advisors. This podcast is for your entertainment and information only. It should not be considered professional or personalized financial advice. You should consult the appropriate professional for specific advice relating to your situation.

Transcription – MtoM – 124
INTRODUCTION

This is the White Coat Investor podcast Milestones to Millionaire – Celebrating stories of success along the journey to financial freedom.

Dr. Jim Dahle:
This is Milestones to Millionaire podcast number 124 – The two doc couple splits their student loan plan.

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Good ad to run today, as you will hear in the podcast. Our podcast guest actually is a client of studentloanadvice.com, as you'll hear.

All right, if you want to be on this podcast, this is the Milestones to Millionaire podcast. These drop every Monday. The regular White Coat Investor podcast also on this same feed drops on Thursdays. It's driven by what you want to hear. Guests you've requested, questions you call in about.

But this podcast is designed to inspire you. We bring you on. We want to celebrate your financial successes, whatever milestone you've reached, and use them to inspire other people to do the same. If you'd like to come on and share your milestone, you can do that at whitecoatinvestor.com/milestone, and we'll bring you onto the podcast and use your stories to inspire others. So, thanks for the 123 others who have come on in the past, and I'm sure there's 123 more people out there with great financial successes that we can celebrate.

Okay, let's get the interview and then stay tuned afterward, we're going to talk a little bit about what I call the five money activities of your life.

 

INTERIVEW

Our guest today on the Milestones Millionaire podcast it's Caleb. Caleb, welcome to the podcast.

Caleb:
Hey, Jim. Thanks for having me on.

Dr. Jim Dahle:
You have accomplished actually a couple of milestones. Let's talk about the debt one first. What have you done?

Caleb:
We just paid off my wife's loans. She had about $130,000 of student loan debt, and we paid that off just a couple of months ago.

Dr. Jim Dahle:
Awesome. Congratulations on that. That's awesome. Okay, we need some background information. What do you do for a living? How far are you out of training? What does she do for a living? How far is she out of training?

Caleb:
Sure. Yeah. I am a pediatric hospitalist. I'm about two and a half years out of training at this point. And then she is an OB-GYN. She's about a year and a half, so about a year more of training for her. And we're up in northeast Ohio area, so Midwest.

Dr. Jim Dahle:
Okay. And we're talking about her loans today. Why don't you clue us into what's going on with your loans too?

Caleb:
I have about $255,000 or so. I'm working on PSLF. Paying minimum. I’m paying nothing right now during the deferment period but I’m planning on paying minimum until I can get that paid off. I got another about four and a half years until PSLF will hopefully take effect.

Dr. Jim Dahle:
Yeah. It wouldn't surprise me if your payments as they start up here in September are still what they were in training.

Caleb:
Yeah, hopefully.

Dr. Jim Dahle:
Because you haven't recertified in a while, right?

Caleb:
Right, yeah. I made sure that we were on the right payment plan, just since we're doing married filing separately to make sure that her income doesn't affect that for me.

Dr. Jim Dahle:
You're playing all the games, married filing separately. Are you enrolled in pay?

Caleb:
Yes. The pay one. Yeah. Andrew, actually helped us out with that to make sure that we were on the right plan for that.

Dr. Jim Dahle:
Hey, that's a beautiful advertisement. He's talking about Andrew at studentloanadvice.com. If you need help, if you have a complicated situation like this, one of you is going for PSLF, one of you isn't, and trying to figure out how to file your taxes and which retirement accounts to do and which plan to be in, it’s a great reason to spend an hour with Andrew at studentloanadvice.com. It's flat fee and just make sure you're doing it all right because it's worth a lot of money. How much do you expect to have forgiven?

Caleb:
I can't remember. I believe it'll be about $200,000. It'll be a little tricky depending on when the payments actually start up again and where my payments are to begin with. But I believe about $200,000 will be forgiven.

Dr. Jim Dahle:
Yeah. $200,000 plus in after tax money.

Caleb:
Yes.

Dr. Jim Dahle:
Even to a two doc household, that's a significant amount of money.

Caleb:
It's huge. It's huge.

Dr. Jim Dahle:
How many more years you got?

Caleb:
I believe about four and a half at this point. Yeah.

Dr. Jim Dahle:
Okay. So making progress. Well, maybe we'll have you back on the podcast in four and a half more years. But for today, let's talk about wiping out her loans. Why is she paying off her loans, where you didn't? Her job's not at the same place as yours or something, what's going on?

Caleb:
Yeah, it was more the financial. Her income was higher, so she makes about $300,000. Compared to her student loans were only about $130,000. So because of that, if she would've tried to go for PSLF, she would've ended up paying it off through the IDR, so it wouldn't have worked out. So, we just decided we were going to refinance hers, got a low rate on that and we just kicked it in the butt and did everything we could to get rid of it.

Dr. Jim Dahle:
What rate did you get?

Caleb:
About 3%.

Dr. Jim Dahle:
3%. And that was how long ago?

Caleb:
That would've been about a year and a half ago.

Dr. Jim Dahle:
Year and a half ago. Wow.

Caleb:
Yeah.

Dr. Jim Dahle:
Nobody's getting 3% today, unfortunately.

Caleb:
Yeah, we initially got a variable rate and that started to climb up. We actually refinanced again and got 3%. So, it all worked out really well.

Dr. Jim Dahle:
It's interesting because the people that got a variable rate a year or two before that, it went down, not up. It was actually a great move for them. Funny how interest rates changing changed that, but a lot of people are going to be looking at this in August and September. “I'm coming out of the 0% period, do I refinance? Let's check rates.”

And what they're going to find is they're going to be able to go from their 5.5, 6, 6.5, 7, 8% loans to 5.5, 6. Maybe you can get 5% now, but even that's going to be tough. So interest rates are higher. Those who waited to get maximum time in the 0% plan aren't going to get as good a rates as those who pulled the trigger earlier. Which one works out better I guess just depends on how long you take to pay them off.

Caleb:
Right. I'm glad we had our plan early and we went for it and it really worked out well for us.

Dr. Jim Dahle:
Okay. So how'd you guys do this? I know it's two docs. It's a hospitalist and it's an OB-GYN, but still $130,000 in a year and nine months. You wrote big checks each month. How'd you do that?

Caleb:
Yeah, we sure did. I figured out it was over $7,000 every month on average that we paid off. So, there were a couple different pieces. The biggest thing was that as soon as she got out of training, we really sat down and we wrote down what our financial goals were going to be.

And of course, the big one was going to be trying to get rid of her debt as soon as possible. We would budget pretty much every month and it wasn't so much, “Oh, we got to cut back here”, but it was just making sure what money is going where. Is this following our goals? Is our money doing what we want it to do? And like I said, we refinanced. That made a big difference. And just having that plan and sticking to it.

Dr. Jim Dahle:
How'd you balance investing versus paying debt?

Caleb:
Well, for us initially, it wasn't too tricky of a situation. We wanted that debt gone and so, we certainly maxed out our 403(b)s, did our backdoor Roth, did all of those retirement accounts that were beneficial to us. But pretty much everything else, we just put it towards all those student loans.

Dr. Jim Dahle:
Yeah. So, when people asked you student loans or invest, you said yes.

Caleb:
Right.

Dr. Jim Dahle:
Okay. Which explains this other milestone you hit. Tell us what other milestone you hit recently.

Caleb:
Yeah, we were also back to broke back in October of 2022. So, that also felt really good to see.

Dr. Jim Dahle:
Yeah, just two or three years out, depending on which one of you were talking about, back to broke. Which this might sound dumb to those of you who aren't doctors listening to this podcast. This is a big deal for a doctor to get back broke. We started our professional lives, in this case you guys, it sounds like you started almost $400,000 in the hole. So, just getting that net worth up $400,000, even though you still have debt is pretty significant milestone and maybe the first one most people hit. So, congratulations on that as well.

Caleb:
Thank you.

Dr. Jim Dahle:
All right. So, paying off this debt. Easier or harder than you thought it was going to be at the beginning?

Caleb:
I would say it was easier. Once we had that plan in place, it really just kind of took care of itself and we did our best not to let our lifestyle creep up. I wouldn't say that we were quite living like a resident for these past couple of years, but we did our best. We went on vacations, but they weren't anything lavish. We did what we needed to do in order to get that student loan taken care of. So, it ended up being easier for us than I thought.

Dr. Jim Dahle:
Okay. There's a lot of pre-med, early medical students that are worried about the debt. They're like, “I don’t know if I want to go to medical school because it's really expensive and I'm going to have to borrow it all.” Yet, here you are two to three years out of residency, hers are gone. You've got a solid plan in place for yours, which sounds like it's going to work out great. What do you say to that person that's like, “I don’t know if I can be a doctor, there's no family help coming for me? I'm going to an expensive school, I'm going to borrow it all. Maybe I'm going to owe $400,000.” What do you say to that person?

Caleb:
It certainly seems daunting. And when I was applying for med school, I don't think it was anything I really considered that strongly, but once you're in it and it starts to pile up, it does seem quite daunting. But I think that pretty much every doc is going to be making more than enough to take care of that. All you have to do is just, like I said, having that plan in place for us was definitely the biggest thing. And we had it already. And as long as you stick to it and make sure you're living within your means, it really ended up being pretty easy to take care of.

Dr. Jim Dahle:
You still think it's a good financial investment to go to medical school.

Caleb:
Absolutely.

Dr. Jim Dahle:
All right. Both of you are enjoying your practices?

Caleb:
Oh man, we sure are. We have a couple of really, really nice jobs. We feel like very stereotypical millennials. As a hospitalist, I work 24. I only work about six shifts a month, which is full-time. And then as an OB-GYN, she is on call about every other day, but it's a home call and her service isn't that busy right now. It hasn't been since she started. So, it's working out really well and hopefully it'll keep working well now that we have a baby, just had one couple weeks ago now. So, we’re hoping that schedule works out well for us, for him too.

Dr. Jim Dahle:
Yeah, yeah, certainly. Certainly that's going to cause some complications in a two doc couple. And sometimes the lesson I think two doc couples have to take there is that that's a cost of doing business. Whether it's a housekeeper or someone doing the lawn or a nanny or somebody coming in preparing some meals during the week or whatever It’s just a cost of being a two doc couple.
Dr. Jim Dahle:
What advice do you have for two doc couples out there with complicated student loan situation like yours?

Caleb:
Well, like I said, talking to Andrew, talking to him. Actually, before we met with him, I had sat down and tried to go through every situation to figure out what was best. And then the couple hundred dollars we spent talking to him was more than worth it for him to confirm that the plan that I had in place was the right one. It felt very good to have that knowledge that what we were doing was the right thing. So, that was definitely a huge help.

Dr. Jim Dahle:
Cool. Well, other than you getting PSLF in four and a half more years, what other financial goals are you working toward now?

Caleb:
Well, now that we're not focusing too much on that debt, I've been able to automate some more investing. So, putting more into a brokerage. We increased our payments on our house, so planning to pay that off in at least 15 years, at most. And now that we have our kiddo, putting some money into a 529. I actually ran into a small business opportunity as well. So, I actually might be considering going back to school to get a dietician license as well.

Dr. Jim Dahle:
That's interesting.

Caleb:
Yeah. Yeah. It could have a huge benefit. We're working on the details to see how that might work out, but it could be really interesting.

Dr. Jim Dahle:
So, no Tesla or European vacation coming up soon?

Caleb:
Not right now, no. Especially now with the baby, but yeah, we'll see. Now that we have that deck gone, feeling that relief on our shoulders, maybe we'll have a little bit nicer something every once in a while.

Dr. Jim Dahle:
Awesome. Well, congratulations to you. You've done fantastic. I hope your story inspires somebody else to do the same, and I wish you all the success in your career and your finances that you can have.

Caleb:
Thank you. And thanks again for having me on.

Dr. Jim Dahle:
Okay. I hope you enjoyed that interview. What I loved about that is it demonstrates the complexity of our financial lives as doctors, right? We're going to be talking in a few weeks, I just recorded a podcast that runs in about a month about the Dave Ramsey baby steps and how they work, but maybe they're not ideal for the very complex financial lives that we have as doctors and particularly as two doctor couples.

But in this situation, we got docs, they're each doing a different thing with their student loans and meanwhile they're trying to balance all these retirement accounts and they're trying to get started in their life. They're having babies and all this stuff. It's just complex. There's a lot of moving parts. Sometimes you need advice, sometimes you become a hobbyist and you become your own financial planner and investment manager.

Either approach is fine, but you got to pay attention to this stuff. Your life is just too complex and there's no guarantee. You are not guaranteed to become wealthy, to be financially successful just because of your high income. Yes, you've done 90% of the work, but without that other 10%, you can have surprisingly poor financial outcomes.

When they survey doctors in their 60s and ask them, “What's your net worth?” 11 to 12% will tell you that their net worth, everything they own, minus everything they owe, is less than half a million dollars. These are doctors who have been making $150,000, $200,000, $250,000, $300,000, $400,000 a year for the last 25 or 30 years, and they're worth less than half a million dollars. That's everything. That's their house, their cars, their retirement accounts, their investments, everything.

And that's a real tragedy. I hate to see that happen, but that's what can happen if you just let what happens automatically happen. So don't do what's automatic, get out there, live your life deliberately, take care of your financial business and don't end up like some of those docs do.

It's interesting because there's another 11% or 12% or 13%, a total of 25% of doctors don't even become millionaires by the time when they're in their 60s. So, it's a good segment of docs. If you look around your med school class of 100, 25 of those doctors are going to get into their 60s with a net worth less than a million dollars. And that puts some financial pressure on the last 20, 30, 40 years of your life that you don't really need to have. And there's really very few reasons that somebody ought to be in that situation. Most of the time it's just because they didn't pay attention to their finances.

 

FINANCE 101: THE 5 MONEY ACTIVITIES

Okay, let's talk about the five money activities and what are these. Well, earning, saving, investing, spending, and giving. And these are the five big things we do in our life. And if you're like most people, you're naturally good at one or two of these and you're okay at one or two more and you're really not that good at one or two more.

And so, what I want to encourage you to do is to look at your weaknesses and maybe work on those. Some people have an earnings problem. Frankly, most Americans have an earning problem. They don't earn as much money as they would like to be earning, as the lifestyle they would like to be living.

And a lot of people too just overestimate the difficulty of doubling their income. It is not as hard as you might think it is to increase your income. Now are there sacrifices involved? Yes, there are sacrifices involved. Look what you did to get a physician income to start with. Four years of undergrad, four years of med school, three to six years of residency or fellowship. It's not easy, but it's doable.

And even once you're done with your training, there are things you can do that increase your income. Other doctors have done it before you. I'm always more impressed with the intra specialty pay variation than I am with the inter specialty pay variation that you see on salary surveys.

I've met pediatricians making $80,000 a year. I've met pediatricians making seven figures. I have met plastic surgeons that are struggling to just live, to make the payments on their rental apartment, making less than a hundred thousand dollars a year. And I've met plastic surgeons that are making $2.5 million dollars.

It's not all about specialty. It's not all about where you live. There are variations. There are doctors out there making more money than you. You ought to at least know what they're doing to do that. You may choose not to do that. You may choose not to practice that way, and that's perfectly fine. But at least know what the options are and be aware and choose where you want to set that ability to earn at. And it's something that's always worth looking at from time to time, seeing how you can optimize your earning.

Of course, once you earn the money, you've got to save some of it. My recommendation is 20% for retirement. If you want to save for other stuff, you want to save for a Tesla or a European vacation or your kids' college or whatever else, that's above and beyond the 20%. 20% is for retirement.

And this is where a lot of doctors struggle. They don't struggle to earn, they struggle to save. And they get so many payments that all their money's going toward interest and it's going toward their mortgage and the mortgage on their second home and two or three car payments and maybe some credit cards. And they've still got student loans 15 years out of training. They're just struggling to save money and they're spending it all. Whether it's going toward payments or going towards their current lifestyle.

So, you've got to get good at saving. It's impossible to be a good investor if you don't have anything saved. You just need something to invest. And where that comes from, for most of us, that comes from our earnings and carving it out of our earnings. So, work on becoming a better saver.

Now, some of you are awesome savers and you're at risk of becoming Scrooge McDuck. You’re at risk of becoming the original Scrooge from Charles Dickens. And maybe you need to loosen the purse strings and spend a little bit more money and you're already good at saving.

But the truth is, most doctors aren't that good at saving. So, get that retirement up to at least 20%. If you want to retire early, it's probably got to be higher than that, but 20% will get you where you need to go. If you start early in your career and you don't invest like a crazy fool, 20% is enough. It's going to get you there.

The next activity, investing. And frankly investing, once you kind of figure it out, it's the easiest of these five money activities. Now, we wrote up an investment plan in 2004, 2005. We're still following it. It's not that complicated. Especially when you're using a handful of broadly diversified low cost index funds.

What do I invest my money in this month? Well, it was my plan to invest in. And I go back and I can look at the plan, the plan is memorized at this point, obviously, but I can go back and look at the plan and that's what I invest in. I don't have to think every month, “Is this money going to go into Tesla stock? Is it going to go into Bitcoin? Should I be shorting the market? Should I pull all my money out?” No, I just follow the plan.

And a lot of people struggle with investing. It's hard to not try to time the market or pick stocks. You get into these short term mentalities when you realize that investing over the long run is surprisingly simple. It's just not that complicated. Stop performance chasing, stop panic selling and just put in a little bit of time, get a plan in place.

If you don't have a plan, get one. If you don't feel qualified to write it yourself, consider taking our Fire Your Financial Advisor online course. Consider hiring a financial planner to help you draw it up. We've got a list of recommended people on the main website. But get a plan in place and become a good investor. Not that hard. Surprisingly simple.

The fourth money activity is spending. Now, those of you who are good savers often struggle with spending. And there are things that you can spend money on that will make you and your family, your friends happier. So, see if you can figure out what those are. Go buy some of those things.

Those of you who are spendthrifts, maybe what you ought to do when you're working on this category, maybe you ought to think, “Am I really getting the most bang for my buck out of this? Am I spending my money on the things that actually make me happier?” It may be that you're just doing retail therapy, that it feels good to buy some. Well, you need to find a therapist instead of a retail therapist, if that's the case.

And maybe you're spending all your money on cars, when what you really would be happier doing is traveling or you're spending on traveling when what you'd be happier with is a renovated home. Just make sure you're spending your money on what actually brings you happiness and joy.

The fifth money activity, assuming you've become successful at the other four, is giving.
And most White Coat Investors that find this website, this philosophy in the first half of their career are going to have this problem at some point.

Giving refers not only to leaving money behind when you die, but to giving money to your heirs, children, nieces, nephews, friends, et cetera, while you're alive, as well as supporting charities while you're alive. And you'd think giving money away would be super easy. It's not. It takes work. You want to make sure your money is going as far as it can. You want to make sure you're not ruining anybody's life by giving your money. And so, that takes some effort as well. And it's worth spending some time making sure you're good at giving.

All right, those are the five money activities. Earnings, saving, investing, spending and giving. Figure out which one of those you're good at, figure which one you need maybe a little bit of work on and commit to work on that a little bit harder this week and this month.

 

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All right, it's been another great episode. I hope you enjoyed it. I enjoyed making it for you. I'm thankful for what you're doing out there. I know your job's not easy. I know your family life's not easy. It's stressful and life's hard these days. Life's complicated. Let's get the financial part of it out of the way, and then you can concentrate on the other challenges and struggles there are in life.

You can do this. White Coat Investor can help. We'll be here with whatever you need financial wise, whenever you're ready for it. So, whether that's education, whether that's referrals to trusted resources, whether that's just a little bit of inspiration like maybe you got today from today's podcast, we're going to be here. We're here to help. Thank you so much for your time.

DISCLAIMER

The hosts of the White Coat Investor podcast are not licensed accountants, attorneys, or financial advisors. This podcast is for your entertainment and information only. It should not be considered professional or personalized financial advice. You should consult the appropriate professional for specific advice relating to your situation.