Many physicians believe they can’t escape burnout or an unsustainable career until they’ve become financially independent. Thankfully, it’s not true.
The idea of financial independence (FI) is simple: build enough wealth such that earned income becomes optional. For financial planners, financial independence is a mathematical problem to solve. I might be able to run your numbers in a Monte Carlo analysis and demonstrate you have, say, an 84 percent chance of achieving financial independence in 21.3 years.
But our lives as physicians cannot be boiled down to a simple math problem. Too often, physicians take that to mean they either must maintain the status quo for another 21.3 years or earn more or spend less to achieve freedom prior to that. Thankfully, financial independence is a continuum, not a binary variable.
One of the best aspects about investing is that your portfolio contributes more to itself the larger it grows, and the amount you contribute each year becomes relatively less important. Examples (using simplified assumptions for purposes of illustration):
- Physician A has $300,000 in retirement savings that generate 5 percent in a year. She contributes $30,000 at the end of the year. The portfolio grows by $45,000; $30,000 from her contributions and $15,000 from the portfolio itself.
- Physician B has $600,000 with the same investments and annual contribution amount. The portfolio grows by $60,000; $30,000 from his contributions, and $30,000 from the portfolio itself.
- Physician C has $1.2 million with the same investments and annual contribution amount. The portfolio grows by $90,000; $30,000 from her contributions, and $60,000 from the portfolio itself.
Physician C may not be financially independent, but all else being equal, she has far more ability to stop taking weekend call compared to Physician A or B. This example highlights one of the core points of this article:
As your investments grow, there is a financial sweet spot where you still must hustle, yet you have the agency to prioritize what really matters. It’s not easy to get there, but it’s a lot closer than most doctors think.
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There’s no secret hack to getting there. It takes years of consistent financial planning fundamentals. Things like positive cash flow, protection from financial catastrophes, and the steady conversion of earned income into income-generating assets. These are as essential to your financial health as good nutrition, sleep, and exercise are to your physical health.
It takes years. But it doesn’t take decades. If you set up the fundamentals now, the sweet spot may be closer than you think. On more than one occasion, I’ve encountered a physician who was there already and had no idea.
I’ll present myself as a case study: Financial independence is over a decade away for me, and my family depends on my wife and me both earning income. I care for some of the most vulnerable patients in my community as a cardiologist, and I give my all to my financial planning clients who have entrusted me with their financial wellness. Like you, I work very hard.
But my health and marriage are in great shape. I eat breakfast and dinner with my kids every day. I take weeks off without pay every year to build memories with my family, no permission needed from anyone. I give my time and money to the people and causes I care about most. Because without all that, the pursuit of money is pointless to me personally.
Recognizing that I’d reached the sweet spot gave me the power to drastically change my career and life for the better, even though I’m not yet financially independent. Where are you on the FI continuum? Are you still years away from the sweet spot? Or have you unknowingly surpassed it already?
If you don’t know, you are not alone. Many physicians at all wealth levels have no idea where they stand. A good financial planner can help by providing an objective assessment of your financial situation. A great financial planner can take it a step further by helping you answer an even more important question: What would your career and life look like with more autonomy, and when could that vision become reality? No matter where you stand, remember that you are incrementally gaining more agency with each step you take forward on your FI journey. Use that agency to build the career and life you deserve, long before you become financially independent.
This essay is cited in the KevinMD record on physician personal finance.
Stanley Liu is the only prominent practicing cardiologist who also practices as a 100 percent fiduciary, fee-only financial planner in the United States. He is the founder and principal financial planner at DocEmpowered, LLC, a financial planning firm dedicated solely to physician financial wellness.
His career pivot into the financial side of physician wellness began with a choice between walking away from his career as a beloved academic cardiologist and telling his young son he could never walk him to the school bus stop in the morning. Liu chose to walk away, creating his own financial plan to ride out an 18-month, 20-mile noncompete with his family and emerging on the other side with autonomy he once only dreamed of. Today, he practices medicine sustainably and with purpose as a self-employed cardiologist. He eats breakfast and dinner with his kids every day, salsa dances with his wife, and is a dedicated volunteer, advocate, and philanthropist for his community.
Liu also became a licensed financial planner, earned a Certificate in Financial Planning from Emory University, and passed the CFP examination, one of the most highly respected accomplishments in the financial planning profession. As a financial planner, he has helped physician clients across the United States reclaim autonomy in their lives and careers while staying true to their highest values.
Liu is a highly sought-after speaker for his expertise in financial planning and his unique ability to apply it to the physician community as a trusted peer. His insights have been featured in Medscape and PracticeLink Magazine, and he has been an invited speaker for multiple medical societies, including the American College of Cardiology, the American College of Physicians, and the Society of Cardiovascular Computed Tomography. He brings his audiences a rare perspective on the underrated connection between physician wellness and financial planning.
His mission is simple: Give every physician the financial power to serve their patients, families, and communities on their own terms. He shares more on his DocEmpowered blog, LinkedIn, Facebook, and X.
