Covid-19 has been a catastrophic event affecting countless households resulting in both personal and financial loss for many. The political, social and economic effects will take years to be fully appreciated. One effect is that Covid and the response to it has shattered the stability of Medicine as a profession. Many physicians experienced the personal financial effects caused by Covid-19 and the shut-down measures instituted by State and Local governments. Surgeons have been unable to operate; Emergency departments have seen decreased volumes and some offices where completely shut down. In the field of Emergency Medicine, some practices had to cut shifts and hours due to these changes. It is sad to see that some physicians are experiencing financial hardship while caring for their patients and assuming the risk of exposure during the Covid pandemic. In addition, Covid highlighted the lack of control that many physicians have over their practices and how dependent they are on their INCOME for their financial well-being. We are classified as HIGH-INCOME EARNERS but like most in society we can be a few months away from ruin if our income is completely disrupted. This is a reality that most physicians do not think about. Physicians by nature focus on the Medicine and see their income as a secondary benefit…
Most physicians and medical professionals are in the HIGH-INCOME EARNER category which sounds great on paper but is actually a very stressful way to live. We reach this status by following a very similar trajectory. We spend four years in College, four years in Medical School and a minimum of four years in Residency. While we are going through this training we are focused on becoming Physicians and willing to take on massive debt to achieve our goal. Then when we get that first “big paycheck” we make the same “mistakes” of rewarding ourselves for the hard work we put into becoming a Physician. It is only natural to want to enjoy some of the good things after that long path of becoming a Physician…
In addition, we also experience a societal expectation whether we know it or not to buy the “Doctor house”, “Doctor car” etc and before we know it the “reward” of being a HIGH-INCOME EARNER quickly becomes a debt filled/lifestyle trap. If you are in this stage of life, understand that you are not alone. If you are a Medical student or Resident reading this then you are way ahead of the curve. You have the ability to avoid the HIGH-INCOME EARNER trap.
If you currently identify as a HIGH-INCOME EARNER who is completely dependent on monthly income then the way out is to achieve financial freedom by becoming an INVESTOR. To achieve this goal, you need to take stock of your current finances and determine your assets and liabilities. Robert Kiyosaki “defines an asset as anything that puts money in your pocket and a liability is anything that takes money out of your pocket”.
Once you determine your assets and liabilities you will want to develop a plan to decrease your liabilities and increase your assets. At Carpe Diem MD we believe that real estate is the best asset and Short-Term Rentals are a great way for an established physician to begin the journey of increasing their assets and progressing towards financial independence.