The Road to FISE: Top 10 Best Financial Decisions I have Made
June 20, 2020
I definitely dodged a financial bullet the last few weeks. Not a financial bullet meant for me, but for this blog’s readership. I was chatting with my property manager yesterday and catching up on the little details of two of our newer rentals. There were some minor issues about a window and a fridge, and since we are expecting them to be long-term tenants I told him to go ahead and fix those things for them with the higher end options. But then one of the tenants was being somewhat demanding and unreasonable, and I said no to something else. Tenants are not that different than patients, but with tenants I don’t have to worry about tenant satisfaction scores. I just deal with them how I think I should ethically and legally but also being fiscally responsible. They can move on if they are not happy. Most if not all our tenants are long term and reliable, so I think I’m doing the right thing. Here is my blogpost on real estate investing advice for MDs https://drplasticpicker.com/dr-plastic-picker-shares-real-estate-investing-advice-for-mds/. I’ve stated in the past that usually we buy single family homes and nice condos as rental properties, and mostly increase our networth through property appreciation and equity. We are not looking to replace our Two Assistant Boss Two MD income with real estate, but rather to diversify and build our net worth.
But as I was finishing our discussion about the two rental properties, our property manager mentioned that he saw my post about the outside blog offer to include our blog on a multi-blog user app https://drplasticpicker.com/fise-the-case-for-the-environmental-hobbyist/. He agreed that the outside blog was trying to make money off my content. And as an accountant’s daughter, I realized that as well. I’m sure they believe they are doing good as well by helping me spread my message, but in the end of the day you have to look at the dollars and cents.
What made me a bit irritated is that I have a very clear understanding of what is a gift and what is business. If I have family operating as a property manager, I pay them the going rate of 10%. If I give a gift, it is clearly a gift. And it amazes me that the basic understanding that this blog and it’s contents is for FREE alludes people. Do you see ADS? Do you see me plug some kind of PRODUCT? I’m taxed at almost a 40% tax bracket so even if I made any money, I would be taxed anyway. So the reason I was a bit irritated last night, and why I had a headache, was that essentially something I was gifting to my friends/family/patients/the earth was trying to be monetized by someone else. On that multi-blog user feature, there would be ADS and someone would be getting money for those ADS. And someone would be prompted to buy something because of those ADS, and those someones would be the readers. The point of this blog is for us to STOP MINDLESSLY CONSUMING the earth’s resources, maybe pick up some plastic, and maybe donate some money to a vetted environmental organization, and maybe read some fun and entertaining blog content for free. It’s the same thing as me chatting with my families in clinic. I don’t charge you for the jokes I tell you. And you don’t charge me for the wisdom you have given me. I have learned so much from my patients and their families. And with that, I feel so much better. Thank you for letting me throw those emotions onto the blogsphere and get rid of them. I will now return to being serene Dr. Plastic Picker.
Given the GOOD FINANCIAL DECISION I made for you not to agree to that outside FIRE Blog user app, I wanted to write about the Top 10 Best Financial Decisions I have made in my life. This post is for fun!
- Married Mr. Plastic Picker: This is true and it’s not why you think. Most people look at my husband and see a specialist specialist Assistant Boss who is a high-income earner. I see the the college junior English major boy I fell in love with. We were both premed but he loved to write short stories. I told him that I was willing to be the high-income earner and he could be the writer, but he chose medicine. One day he will write his great novel. But the best financial deicision I made was marrying someone that is great life-partner and a great financial partner. I’m the Household CFO but he lives the same values of hard-work, frugality and fiscal responsibility that I live. Having those similar values and being a good financial team together is crucial. Divorce is super expensive as well. We have iron-clad irrevocable generational skipping trust where everything goes tot he kids and safe from divorcing spouses. I love him but I’m not stupid.
- Moved Back to My Hometown: When we finished our training in Boston, we had to make the decision of where to move for our first real post-training careers. The decision was between suburbs of Boston, my hometown in Southern Califronia, and New York City/New Jersey. I had an offer to stay on as a research associate at NIH which was very generous in the research world for about 150K, but as an MD who loves clinical medicine – that made no sense. We chose my hometown in Southern Califronia eventhough monetarily it was the lowest salary for Mr. Plastic Picker because it was closer to my family. It made sense for both of our careers. The ironic thing is the higher monetary job offers for Mr. Plastic Picker were at practices that have since folded. For physicians, we didn’t go chasing the almighty dollar but looked for career longevity and an organization that offered work-life balance. As a woman physician middle manager, much of why I am able to do what I do – balancing the crazy life of mother and work – is because I live with my mother-in-law and within 5 miles of my own mother. We’ve never been that stressed for childcare because there was always two grandmothers and my sister-in-law to swoop in with either childcare or dinner if needed.
- Maxed Out On Both Retirement Accounts Yearly: The financial power of two highly educated and high-income wage earners is huge. The key is to try to find balance during those first years to be able to continue both careers with young children. That would be a whole other blogpost! But the financial power of a dual-income couple is that both can max out in their retirement savings. Our financial freedom now is because we both worked since finishing residency and continued our careers without a break. It was not easy but we are reaping the benefits now in our early and mid 40s. My continuity preceptor in residency had recommended I read a book called the Ten Year Nap by Meg Wolitzer. I forgot until today how much it has affected my career. It’s a cautionary tale for mothers who sit out the 10 crucial years of your career that coincide with raising young children. Financially that is due to not being able to save for retirement. In terms of your career, no matter what your career will take a hit and you won’t be able to recover. Again that’s a whole other post.
- Took Over as Household Financial CFO: I had let Mr. Plastic Picker manage all our finances from the time we were dating until about 6 years into our marriage. Now that I think about it, my father would send Mr. Plastic Picker money so that he could take me out on dates. Mr. Plastic Picker’s family was not as well off as mine. I had been raised with an accountant father who took care of everything financially for me. He showed me how to manage money by example, but he and I assumed my future-husband would take care of me. So I let Mr. Plastic Picker take care of me financially and it was a disaster! We had a few big financial mistakes early in our marriage which included at million dollar condo at the height of the real estate bubble that had a $1000 condo fee. Let’s not go there. I had voiced my opinion but I was not emphatic enough. We grew in our relationship, but about 11 years ago I took over as Household Financial CFO and our networth has skyrocketed since. Mr. Plastic Picker earns much more than I do, but I still earn quite a bit and I’ve calculated out that half our networth if due to my earnings and my investments on our behalf. If you ask Mr. Plastic Picker, he is much happier. He works and deals with the cars, and his parents expenses (which I oversee the totals), the kids’ scholastic activities, and the bunnies and puppy. These things make him happy. Looking at our financial spreadsheets makes me happy. It took us 8 years into our relationship to learn that about one another.
- Maintained a High Savings Rate: We lived like paupers and bought rental properties like land barons. Right when we started making attending level salaries, we kept our living expenses still relatively low. During the recession in 2009-2012, we bought rental properties like crazy. We bought all those rental properties with at least 20% downpayments from earnings we did not spend. We lived frugally to also be able to have enough cash cushion to deal with the costs of having renal properties which can be significant.
- Grew Our Networth Through Our Primary Homes: Much of our networth now is through equity and real estate appreciation and tax deductions from our primary homes. The last two primary residencies we had, we bought in up and coming neighborhoods with good real estate appreciation. We were able to maximize the tax deductions from our 30 year fixed mortage payments. We did not overimprove our homes and saw any home furnishings as what they were, discretionary expenses. One home was able to help us upgrade to a bigger home. Younger doctors will look at our home and wonder how we were able to afford it. No one from our family handed us this home. It was smart refinancing moves, and market timing and the 50-68% savings rate. When we were at 68%, that was kind of ridiculous.
- Living Harmoniously with Mr. Plastic Picker’s Parents. Somethings in life are non-negotiable. For Mr. Plastic Picker it was that his parents have the option to live with us if they chose that. One of my biggest accomplishments in life is living harmoniously with my parents-in-law. This has been a relationship built over decades of give and take and negotiations. Even when both parties have good hearts, it is difficult. Lets just say, we are thriving now and it was all due to me and my father-in-law. That could be an entire blog in itself! But Mr. Plastic Picker is essentailly his parent’s retirement. They have their own limited funds. But given that he wanted to take care of them, it is much more economical to do it within the same household unit. I know this is not feasible for most families, but part of why we moved to our current home is that I was able to design the home the way I needed to keep everyone happy. The laundry is located near my mother-in-law because she likes it a certain way. They have a separate office and egress and porch area, that is theirs and I can’t see their clutter. We have three sinks in the kitchen and a large 6 burner stove, so that everyone can cook and not run into eachother. It took me many many many years to get to this point. Mr. Plastic Picker and I deferred many fancy vacations and invested to have this type of home that works for our multi-generational family. But in the end it is much more economical than supporting them in a separate home with possibly a condo fee and other maintenance cost. Plus I get free babysitting and my mother-in-law does our laundry. I already have a designated room for a future care-taker when we get to that point. Dr. Plastic Picker always thinks ahead.
- Becoming Dr. Plastic Picker!!! I initially started this blog writing about how I was not financially benefiting from this blog. In truth, this blog costs me $25 a year. But I’ve benefited financially but not in the way you think. I don’t generate any income from this blog, but plastic picking and writing gave me back my sanity and my center. I started this blog when I was suffering physician burnout and was in a difficult place emotionally. And now I am healthier because I am trying to help you and the world, and it helped me find meaning in the difficult work of being a doctor again. I am still working as a pediatrician middle manager. And I am happy now and because I am still working and have continued on with my career. I still make money and add to my retirement accounts. I still save more than 50% and still invest. I could have retired early last year, but chose not to do so. In reality this blog increases my networth by at least $350,000 a year when all the benefits of salary, retirement, pension and not doing things that would otherwise cost money are accounted for.
- Not Upgrading to Another House: We are in our final forever home. But there is always a tempting upgrade out there. We recently pondered moving from a very nice area to a nicer area. Some square footage but actually on shore with beachfront views rather than roofdeck ocean views. But we have seen older colleagues suffer financially stresses when they took on greater financial burdens in their 40s, and Mr. Plastic Picker and I decided that this house is enough. I think we will look back and realize this was a very smart financial move on our part. One of my friends always said I have house ADHD, but no longer!
- Trying Veganism: This is also a work in progress but we’ve already seen so many financial benefits and more importantly health benefits. I recently realized a 25 lb sack of black beans is only $15 at Costco. That is about $0.62 a pound. Compare that to the expense of meat or even a vegan burger which is $10 a pound. We really started on this vegan journey due to the environmental effects of meat and dairy. But we’ve noticed our food bill is dropping, and more importantly since everyone is eating more vegetables that the entire family is healthier. Health is ultimately our greatest wealth! That we decrease our food expenditures is a side benefit.
That was a super fun and light hearted post! I know I have been posting a lot but I really appreciate you reading. The first picture is our bunnies. They weren’t a waste of money, as they were rescue bunnies but those two bunnies aren’t cheap. My one regret is buying that extravagant bunny stroller which they never go in. It was one of those vanity purchases that now takes up space in our game room. I get some affection from the bunnies, as I used to lay on the gameroom rug and they would bounce around me. Bunnies when they are happy will actually twirl.
But then we got the love of our lives. She is below. She has been the best financial decision because she lowers our blood pressure. She sits under the kids’ desks and licks their toes when they are having the tough studying sessions. She demands Mr. Plastic Picker take her out on walks and get some exercise. She saved my mother-in-laws life, which is another whole blog post. The best financial decision we have made have always been ones that we chose with open hearts. Picking up plastic, environmentalist, veganisms, devotion to family – and this little black fluffy dog that makes us so happy.
Like my take on personal finance? Click here to read about what a famous blog approached me about my content. The Road to FISE continues here https://drplasticpicker.com/wannabe-personal-finance-blogger-but-i-dont-want-to-retire-until-58/