While there are elements of truth to your armchair assessment, being a bad money manager is not because money is unimportant (which is what it sounds like Thom's GF has an issue). Most physicians don't make a lot of money (contrary to what you believe Snipe), in fact most Fam Practice/Pediatricians make less than top policemen/firemen - check it out if you don't believe me. There are exceptions like plastic surgeons and dermatologists who do a cash business, and get home at 4 with Wednesdays off.

It is not so much that there is a lot of disposable income, it is that "Finally I'm done and earning more than $40K/yr" that leads to spending

In addition, there is an impression that all physicians make a lot of money and if they don't drive a MB and live in an exclusive neighborhood, they must be bad physicians (because they're not successful - this is not simply a ploy, patients have told me this). Physicians are expected to live the "good life" despite not had a meaningful earning position until they are in their mid 30's at the earliest. Do your own math, they are desperately trying to catch up with folks who have been putting $2K in Roth IRA's faithfully since they were 21, buying a house good enough to entertain in, buying a couple of "nice" cars, funding their own retirements (because the government don't do that vs the firemen and teachers), paying off $250K or more in school loans, and getting slammed by the government in taxes (made worse by the AMT) because of the "windfall" of income they are now receiving vs when they were meager residents. This is why they are asset poor.

In an effort to make the most of their money, they also try to invest. They don't have the time to do all the homework that they probably should, and often depend on their broker. A good place to lose money. And per my observations, the most likely avenue of actual asset loss.

Then many are "renaissance" individuals who fancy wine making, restaurants etc. Some of these work out, some do not.

You sound like you know a lot more about this than me, so i will defer.

I really have only ever known a few docs, but neither one of them were hurting at all.

Peter, your points are well-taken. You are correct that most physicians don't earn a king's ransom. I'm just trying to figure out an explanation why there are more docs than average with financial challenges. No insult intended. My core point that doc's are defined by their craft is meant as a compliment. I want them helping me when I'm sick, not advising me on investments.

PM me if anyone want me to manage your money. :D

What - given up your career as a fluffer? :D

No, I just like to negotiate many 'balls' simultaneously.

You are precisely correct.

A lot of doctors make a sincere effort to learn how to invest responsibly but they generally fail. Myself included. I have no passion for it. Money doesn't mean much to me.

no

I would also tend to agree with Mr Plumley's assessment. My mother is the only exception to this of which I am aware, but she is the sharpest human being I have ever come across.

My 2 pence.

My wife is a brilliant Harvard fellowship trained physician. Her money management skills are terrible. She pays her bills on time, but dear lord the big picture stuff is just terrible. I did her distribution in 401k, for her. She just has no grasp of how the financial system works.

After 12 years of being married to a doctor, I can report that most are 100% eggheads. Brilliant people, but so engrossed in their professions that they tend to be limited in other ways. Ever hang out a lot with doctors in academic medicine in a social setting?.....yeah, thank god for Laphroaig.

Don, none taken. I would suggest that the reasons why there are so many with "financial challenges" are present in my above post. Moses (who has subsequently posted his opinion) is in a procedure based specialty that is remunerated at higher levels than your average MD. I am too. But I have plenty of friends who are in the other boat.

In fact, a couple (married) in my class left school almost 20 yrs ago now that had $250K in debt. They weren't from well to do fams and had been in college and med schl on whatever scholarships they could get + mostly loans, and had the prospect of making being residents for the next three years (40K/yr). The majority of loans probably could be deferred for payment (with all that interest capitalizing) while they were in residency, although I hope that they started to pay some of the higher interest loans off (I think around then it was 12%). After they got done with residency, they would be looking at moving, buying house etc.... They would also be around thirty. Max reasonable salary expectations 120-150K/yr each. That's certainly nothing to sneeze at, but think of all the debt on their shoulders and the amount they are servicing. God forbid if they bought in Cali in a 600K starter home. And remember the dreaded AMT.

To add insult to injury, back then folk didn't get to deduct for the interest they were paying on their school loans too.

As you rightly suggest, medicine can be consuming, so much so, that the ones that aren't renaissance types become boring in common conversation, and there is not enough time to devote to learning how to invest. So they depend on hot tips from their brokers, and we all know how that turns out.

Another thing I just thought of, is divorce. Don't know rates (seem higher than average), but bet that ex's attys eyes light up when they hear they can go after an MD's income.

For HD: Academicians in almost any scientific or applied scientific field are that way.

My son is going through this right now.

lol, that is silly.

But I still love you man.

My wife manages all our accounts and is a wizard...she is also frugal, which is great since I am not by nature.

She is an engineer by trade and she approaches the household budget in a very disciplined manner.

I do run the investment portfolio...I am very conservative in my investment strategy so we're a good match.

I can't remember ever arguing about money, thank god.

Not entirely true. There is such a thing as too much money as well. I remember watching a news report about big money lottery winners where they reported that something like 80% of married winners end up divorced.

As for the wife, I married an accountant who is now a stay at home mom. Good luck managing the household finances if you marry an accountant. It's not a problem for me though, she's better at it and has more free time. It's win-win. I'm really more interested in investing anyway, she lets me handle that.

My parents are pretty much joint on everything, from managing money to major purchases. I can't recall a time where one of them has made a purchase of more than a few hundred dollars without consulting the other (outside of necessity type stuff). It seems to work pretty well for them.

Hey, we can't all do it my way now can we?
Ha!

There's some history behind that, but if your wives are happy and you're happy WTH?

Matt, I read that too. Wish I could find it in print somewhere? Stats for lottery winners aren't so good. Kinda like the concept of the grass is always greener on the other side of the fence. Problem with that is when you jump the fence and start caring for the grass, it ends up looking just the same as what you left behind, or in most cases worse! Ha.

My wife is an accountant too; she counts the profits ;)

As for the doctor thing; I've got a few friends that are docs. Now in Canada it's very different than the States, here the med docs are gubmint employees for the most part. They make a good income, but pay huge taxes on it. So although they have the feeling of making alot of money, in reality they don't. Most of them live beyond their means.

I read a stat that the average doc gets out of debt at age 58. Not sure on that one?

As for Dentists, they're a different breed. One of my buddies makes a $150K/yr in his practise and another makes $450K/yr in his. Most of the difference that I see is the person managing the office and the appointments.

What does a med doc make in the States? I think the average doc here makes about $150K. A friend of mine (doc) said he could make double in the States?