An emergency doc's budget

[FSU2013]

Since there are no easy answers and answering a question like this is bound to open up criticism but Im fine with that. Here is a broad based plan from me. Keep in mind I dont do this for a living. You surely wouldnt ask someone in economics or policy to reduce your fracture or suture up your kid.

Here goes.
1) End the war in afghanistan, cut 7.5% of our military spending, let the military decide where. Cuts by 1% per yr and 0.5% the last yr.
2) Allow the govt to negotiate prescription drug costs (somehow as docs we get screwed but big pharma reaps the rewards, they have one of the highest profit margins as a group of any publicly traded sector).
3) Medicare starts at 67 for anyone under 50 on Jan 1 2013
4) Legalize and tax weed like tobacco
5) Cut the 60 billion found in the dept of education.. cut it to about 1/3 of that. Fix whatever idiot rule allows the interest rate on this money to go to 6.8%. Mine were all cheaper and were not subsidized. I know this would cut some aid, so be it.
6) Repeal obamacare
7) simplify the tax code (I would be fine for an extremely simple tax code for example 10% VAT type tax plus 10% for all income above 150k leaving ONLY the mortgage tax deduction. NOTHING ELSE. I am open to other options).
8) I wouldnt touch social security but I believe I addressed the other 2 big ones.
9) Shrink federal govt employment by 10-15% through attrition, bring pay in line with private jobs.
10) Bring congress back into social security
11) Continue to stop medicare/medicaid fraud (10% of all costs of the program)
12) Cut aid to all countries that dont support us (Pakistan, Egypt etc).

I would then raise taxes 0.5% per yr across the board until we reach the pre bush tax cut numbers (assuming #7 is a no go).

Oh some extra money here..
http://www.coburn.senate.gov/public...&File_id=b69a6ebd-7ebe-41b7-bb03-c25a5e194365
My favorites:



In quotes is about 163 Million. Enough to throw a great party.


Send that to the CBO for scoring ok? I can help you.. it would bring us way in line.

Glitterbox What would you do? Keep in mind even if you taxed every penny earned over 250k you couldnt balance the budget.

Cue slow clap.

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[docB]

I dunno, tough subject. In theory I think it is unfair and anti-capitalistic. However, I feel that sometimes on the extreme ends of theoretical situations, observed real word consequences are more important than the principles of the theory. I think the number can be very high, such as $1M or even $1.5M per annum but I think there should be SOME limit. I don't want to limit entrepreneurship but I figure at that point someone would rather still strive to make $1.3M per annum and pay 30% taxes then make 400K paying 10% taxes (the numbers are not irrelevant, but as less important than the concept, very negotiable). I think if the annual salary threshold is high enough and the tax increase isn't ludicrous, then it will be a major source of income for the government without deterring those from pursing that kind of wealth.

Part of the reason I support this type of system is because a large majority of people with this kind of wealth inherited it. And while I do not think that we should have 50% estate taxes or be unable to create a fortune for oneself and every generation after, people born into extreme wealth (> $20M net) who have done nothing but won the genetic lottery can contribute a slightly better dish to the potluck.

Let me point out that in the past the left (Dick Gephardt specifically) referred to everyone who is successful as "Winner's of life's lottery." The idea of a "limit" on how much someone should be allowed by the government to earn or inherit is purely class envy. Inevitably what one thinks is "too much" is based on what one has. This is mob rule politics.

 

[EctopicFetus]

I agree. I wouldnt put on an extra tax on those making more. Whats the reason? They dont get more from the fed govt, they already put in more than everyone else. Why take even more. Also keep in mind there are not a ton of jobs that earn (using your number) 750k per yr. Many of the people who "earn" that amount are either one year wonders or do it through their investments.

Heck even the plastic surgeons or other medical folks who earn that dont report a number even remotely that high as their AGI. Perhaps at 750 you are looking at 0.2% of households. The reality is even an extra 5% tax on those incomes brings in very little money. It only extends the class war.

 

[EctopicFetus]

Some more food for thought..

http://www.bankrate.com/finance/taxes/8-tax-breaks-cost-uncle-sam-big-money-6.aspx

Im not a guy who is opposed to tax hikes. They just have to make sense. I would remove 3 or 4 of those.

 

[bad virus]

Under no circumstances would I do this. More than half of all new small business fail in under 4 years. See chart below for details based on sector.

Lending money to family to start a business is even worse because you have no direct control over the day to day operations (per what you said your plan was.) When the business fails, it changes the relationship you have with your sibling. Even if you take a laissez-faire approach and figure "easy come, easy go," your sibling will see that he or she "wasted" 300,000 USD of YOUR money. Good luck keeping the same relationship after that. My relationship with my sister is way more important than that.

Develop an asset allocation, put your money in low cost index funds, rebalance, and stay the course. ADMD developed a blog after (I believe) making this post. Check it out at http://whitecoatinvestor.com. It has lots of good information for doctors (and future doctors.)

Thanks CCFCP, this is exactly what I was looking for.

I never thought of it from the other side of the coin. I always thought, meh if my bro loses our money then so be it. But I never thought about how he would feel after losing my money. It would devastate him personally and probably alter our relationship. Thanks for pointing this out. I really only looked at it from my POV.

 

[MiracleforMD]

Let me point out that in the past the left (Dick Gephardt specifically) referred to everyone who is successful as "Winner's of life's lottery." The idea of a "limit" on how much someone should be allowed by the government to earn or inherit is purely class envy. Inevitably what one thinks is "too much" is based on what one has. This is mob rule politics.

I don't really disagree with you that much but I will offer a response for the sake of civil discussion. I don't think everyone who is sucessful is a "Winner of life lottery." But the kid who is born in 5 years to Zuckerberg and random model IS a lottery winner. They will immediately be where they are because of pure luck. I think it's reasonable for them to realize they live one of the most comfortable/extravagant existences of any of the trillion people to ever walk this Earth. They can pay a little more into the system so X familes can only miss rent for 3 of the 12 months a year instead of 4. The people I'm taking about are so rich the amount of money gone due to slightly higher tax bracket would barely be noticeable to them.

Edit: the phrase class envy to me is a little misleading. People who can not afford to feed their children are not really "jealous" of the people with $500K of disposable income per year. That word implies pettiness. Some of the financial hardships in this county and especially in the world are not petty.

I agree. I wouldnt put on an extra tax on those making more. Whats the reason? They dont get more from the fed govt, they already put in more than everyone else. Why take even more. Also keep in mind there are not a ton of jobs that earn (using your number) 750k per yr. Many of the people who "earn" that amount are either one year wonders or do it through their investments.

Heck even the plastic surgeons or other medical folks who earn that dont report a number even remotely that high as their AGI. Perhaps at 750 you are looking at 0.2% of households. The reality is even an extra 5% tax on those incomes brings in very little money. It only extends the class war.

That is a pretty good point. I did read somewhere recently that the amount of capital stored oversees by wealthy US citizens could bring in close to a trillion dollars per year if correctly taxed. I will have to try and remember where I read that.

 

[EctopicFetus]

Miracle.. One of the most important things related to a national sales tax is it would eliminate most of the cost to the US of money being made "under the table".

The IRS estimates the tax gap at 17%. Meaning 1/6th of money due to the government is never collected. Thats worth about 300 billion per yr. Not all but much of that would be recouped in a national sales tax/VAT system.

It would also do away with the tomfoolery of 401k 403b, SEPs etc. Surely CPAs would be mad.. so would attorneys but thats life. They are just middle men. Govt revenue would also go up from capital gains from these investments.

 

[MiracleforMD]

Miracle.. One of the most important things related to a national sales tax is it would eliminate most of the cost to the US of money being made "under the table".

The IRS estimates the tax gap at 17%. Meaning 1/6th of money due to the government is never collected. Thats worth about 300 billion per yr. Not all but much of that would be recouped in a national sales tax/VAT system.

It would also do away with the tomfoolery of 401k 403b, SEPs etc. Surely CPAs would be mad.. so would attorneys but thats life. They are just middle men. Govt revenue would also go up from capital gains from these investments.

OK, I gotcha. Just collect the money a more efficient way is what you're saying. Again, I say sir, well done.

 

[docB]

I don't really disagree with you that much but I will offer a response for the sake of civil discussion. I don't think everyone who is sucessful is a "Winner of life lottery." But the kid who is born in 5 years to Zuckerberg and random model IS a lottery winner. They will immediately be where they are because of pure luck. I think it's reasonable for them to realize they live one of the most comfortable/extravagant existences of any of the trillion people to ever walk this Earth. They can pay a little more into the system so X familes can only miss rent for 3 of the 12 months a year instead of 4. The people I'm taking about are so rich the amount of money gone due to slightly higher tax bracket would barely be noticeable to them.

Edit: the phrase class envy to me is a little misleading. People who can not afford to feed their children are not really "jealous" of the people with $500K of disposable income per year. That word implies pettiness. Some of the financial hardships in this county and especially in the world are not petty.

It's the "a little more" that's disturbing. Defining that tends to result in some wildly differing figures. Many on the left argue for confiscatory rates on anything above [insert arbitrary figure here].

As for the "luck" issue I disagree. Is it really up to us or the government to say how much a parent can leave to their child? I would like to leave money to my children. Why does the government get to say I can't or how much I can? You are really arguing that there is just some amount of wealth that is too much and when you die it should get collected and redistributed. That's really not what the U.S. is supposed to be about.

Most of this is pettiness, on the part of the tax raisers. Fist off financial hardships in other countries are irrelevant to a debate about U.S. tax policy. Financial hardship here are often due to behavioral issues such as crime and addiction. When someone can't feed their kids it's usually because they have squandered the benefits paid them by the myriad welfare programs. In any case raising taxes on the successful won't benefit the poor in the long term because the economy will contract. The only thing the poor get out of it is the warm and fuzzy misperception that they stuck it to the rich guy.

That is a pretty good point. I did read somewhere recently that the amount of capital stored oversees by wealthy US citizens could bring in close to a trillion dollars per year if correctly taxed. I will have to try and remember where I read that.

The best way to get at this money is to reduce the applicable taxes so that it makes financial sense to bring it home and invest it here. Again, the only thing we'll get out of trying to have a legion of government accountants match wits against a legion of private accountants to punish the account holders is a warm fuzzy feeling. It makes about as much sense as the war on drugs or trying to deport 16 million illegals. I suppose each side has their pet projects.

 

[Perrotfish]

Let me point out that in the past the left (Dick Gephardt specifically) referred to everyone who is successful as "Winner's of life's lottery." The idea of a "limit" on how much someone should be allowed by the government to earn or inherit is purely class envy. Inevitably what one thinks is "too much" is based on what one has. This is mob rule politics.

I think you give the American people much less credit than they deserve. It wasn't too long ago that Republicans achieved almost unified national support for making the Income tax less progressive, to deregulate the market, and to slash government programs like Welfare. The American people have not fundamentally changed in the past few decades.

As much as many of the rich hate to admit it, people DO have a basic sense of what is, and is not fair. That's why they showed almost unanimous support for income tax reform when the top progressive tax rate topped 90%. The problem is that, right now, things aren't fair. People realize, at a very basic level, that a CEOs work is not worth 231 times the work of his average employee, and any system that pays him that much more than his workers is fundamentally flawed. People realize that they are not fundamentally less hard working then their parents and grandparents, and that steady erosion of job security and benifits that they've seen over their lifetime is not fair, and that the rising tide of conservative economic theory is swamping their boats rather than lifting them. Finally people realize the difference between people making more because they're valuble and earning more money because they have money to earn money with, and a greater and greater proportion of our rich are earning their money sitting on their asses while the capital gains pile up. People are capable of looking at those who have more than them and realizing some people earned their success, some people 'won the lottery of life', and some people are flat out robbing them.

I will admit, its probably not the best solution to look to the government to provide the benifits and wages that work no longer will, rather than just making work pay. However conservatives have only themselves to blame for making work alone an untenable alternative to government intervention. Conservatives fought tooth and nail to elimiate the regulatory, trust busting power of the government to keep corporations small, and therefore part of a truely free market. The result is that most workers are employeed by supermassive corporations who would never set the precedent of raising wages for the sake of retaining a single employee, no matter how valuble. When employees turned to unions to save them conservatives neutered those too: right now the few union employees left exist almost entirely in the public sector, and even those are seeing steadily declining membership. When employees tried to at least keep jobs in this country, conservatives even made protectionism a ditry word: by refusing to set any restrictions on free trade whatsoever, we allow our salary and benifits packages to be set by the most unscupulous corporations in the third world. The only real worker protection we have left is an insanely low minimum wage that doesn't keep their jobs from going overseas. People are turning to the government to provide benifits because the government has failed to protect the benifits they used to earn by working.

It's not 'mob rule' to expect decent compensation and security in exchange for a lifetime of hardwork, or to realize that the system is broken when it no longer provides that. People right now feel bullied: they're working in a market they are told is free but in which their actual employers are a few superpowerful entities that collude against their interests, and there doesn't seem to be a clear path to the middle class (or above) for many people that weren't born there. There are exceptions (medicine is common source of them) but the fact is most people who end up in the top 1% were born in at least the top 10%. Everyone else works a lifetime producing all the real goods and services we actually use, mostly for the incredibly discounted rate of 15,080/year that you earn working full time on minimum wage, and are then called 'moochers' because out of that they only paid payroll tax and state level taxes. Its reasonable and right that they want to fight back. Its probably a shame that we're creating massive federal government programs to supply employees with the benifits that their employers no longer pay, rather than just making work pay in the first place, but the American people aren't wrong that something needs to change in a system that demands so much from the average working American and gives him so little in exhange.

 

[MiracleforMD]

It's the "a little more" that's disturbing. Defining that tends to result in some wildly differing figures. Many on the left argue for confiscatory rates on anything above [insert arbitrary figure here].

As for the "luck" issue I disagree. Is it really up to us or the government to say how much a parent can leave to their child? I would like to leave money to my children. Why does the government get to say I can't or how much I can? You are really arguing that there is just some amount of wealth that is too much and when you die it should get collected and redistributed. That's really not what the U.S. is supposed to be about.

Most of this is pettiness, on the part of the tax raisers. Fist off financial hardships in other countries are irrelevant to a debate about U.S. tax policy. Financial hardship here are often due to behavioral issues such as crime and addiction. When someone can't feed their kids it's usually because they have squandered the benefits paid them by the myriad welfare programs. In any case raising taxes on the successful won't benefit the poor in the long term because the economy will contract. The only thing the poor get out of it is the warm and fuzzy misperception that they stuck it to the rich guy.



The best way to get at this money is to reduce the applicable taxes so that it makes financial sense to bring it home and invest it here. Again, the only thing we'll get out of trying to have a legion of government accountants match wits against a legion of private accountants to punish the account holders is a warm fuzzy feeling. It makes about as much sense as the war on drugs or trying to deport 16 million illegals. I suppose each side has their pet projects.

I'm out for tonight but will read tomorrow.

Agree with the bolded. It's the last thing I want. We already live in a country that has to many "services" with superficial value when we need more production whether in the form of globally valued services or products.

 

[TrumpetDoc]

If its so unfair for a CEO to make such money (most of the going to school, grad school, and working their ***** off to get there)...where's the outcry about the athlete making millions per year????

 

[Perrotfish]

If its so unfair for a CEO to make such money (most of the going to school, grad school, and working their ***** off to get there)...where's the outcry about the athlete making millions per year????

I think people respect athletics as one if the purest meritocracies in America. The children of athletes, or of the rich in general, don't dominate the top levels else of sports the way that the children of the rich dominate business, law, and finance. The children of the wealthy are, if anything, under represented. People believe that athletics is a field where you get to the top through a combination of having the most talent and working the hardest. They no longer believe that about business.

That's actually a great example of how Americans don't just hate those with more than them. If it was class envy driving liberal politics there would be as much anger towards NFL players and entertainers as executives, heirs, and wall street. What Americans hate is unfairness.

 

[deleted109597]

I think people respect athletics as one if the purest meritocracies in America. The children of athletes, or of the rich in general, don't dominate the top levels else of sports the way that the children of the rich dominate business, law, and finance. The children of the wealthy are, if anything, under represented. People believe that athletics is a field where you get to the top through a combination of having the most talent and working the hardest. They no longer believe that about business.

Bull****. Look at the average number of NFL players who are children of NFL players. Hell, look at the Manning family, or the Colquitt family.

Baseball isn't as bad.

Basketball? Lots of children of ex-pros.

You know why it is? Because the pros are able to teach their children what they need to know to go pro. Also, they're considered better odds with family lineage.

That's actually a great example of how Americans don't just hate those with more than them. If it was class envy driving liberal politics there would be as much anger towards NFL players and entertainers as executives, heirs, and wall street. What Americans hate is unfairness.

They don't hate unfairness (whatever the hell that's supposed to be). They hate people who have more stuff than them when they can't figure out why that is. Why do you think nurses tell residents "you're making the big money" when they sometimes have to help them out with something? Because they have no idea what it takes to become a physician. They don't understand call. Yet they are upset that this person, who may be younger and not as experienced, earns more than they do.
People envy athletes as well, but at least they can see the product that makes them earn money. They don't see the long hours lawyers put in. Or junior members of the company.

 

[EctopicFetus]

Agreed. Listen we are all smart. We all worked hard. Lets accept the fact that people in medicine with few exceptions are among the top in intelligence, hard work and perseverance.

If anyone on here doubts it.. go to work. Those are average people and if you dont think you are smarter than them I am sorry for you. Either you are deluded or are such a bleeding heart you miss it.

I went to public school. 900 kids started with me a a HS freshman, we graduated 616. I finished way up high as a percentage. The kid who finished 300th in my class either wasnt as smart as me, didnt work as hard as me or something. There is a difference. I kept working hard in college and med school too. People fail throughout the way.

I was lucky enough to attend an Ivy league school and even there 2/3 of the pre-meds dropped out. Listen maybe I cant shoot 3s like Ray Allen or have the genetic gifts to be 6'8 260 like lebron and dunk on people but I worked my tail off and am now reaping the rewards.

 

[docB]

I think you give the American people much less credit than they deserve. It wasn't too long ago that Republicans achieved almost unified national support for making the Income tax less progressive, to deregulate the market, and to slash government programs like Welfare. The American people have not fundamentally changed in the past few decades.

I not sure when you're talking about here. The Reagan administration? He cut tax rates but welfare reform happened under Clinton.

I would argue that the American people have changed. Never have so many in the population paid no federal taxes, worked for the government or both. How can that not cause people to change.

As much as many of the rich hate to admit it, people DO have a basic sense of what is, and is not fair. That's why they showed almost unanimous support for income tax reform when the top progressive tax rate topped 90%. The problem is that, right now, things aren't fair. People realize, at a very basic level, that a CEOs work is not worth 231 times the work of his average employee, and any system that pays him that much more than his workers is fundamentally flawed. People realize that they are not fundamentally less hard working then their parents and grandparents, and that steady erosion of job security and benifits that they've seen over their lifetime is not fair, and that the rising tide of conservative economic theory is swamping their boats rather than lifting them. Finally people realize the difference between people making more because they're valuble and earning more money because they have money to earn money with, and a greater and greater proportion of our rich are earning their money sitting on their asses while the capital gains pile up. People are capable of looking at those who have more than them and realizing some people earned their success, some people 'won the lottery of life', and some people are flat out robbing them.

I'm not saying this to be provocative or inflammatory but this is Communism. Saying that the system is unfair and concentrates wealth among the rich necessitating redistribution is Marx just substituting the government for revolution. This exact argument, that the worker in the factory is more valuable than the owner of the factory (or the CEO) is at the heart of that ideology.

I will admit, its probably not the best solution to look to the government to provide the benifits and wages that work no longer will, rather than just making work pay. However conservatives have only themselves to blame for making work alone an untenable alternative to government intervention. Conservatives fought tooth and nail to elimiate the regulatory, trust busting power of the government to keep corporations small, and therefore part of a truely free market. The result is that most workers are employeed by supermassive corporations who would never set the precedent of raising wages for the sake of retaining a single employee, no matter how valuble. When employees turned to unions to save them conservatives neutered those too: right now the few union employees left exist almost entirely in the public sector, and even those are seeing steadily declining membership. When employees tried to at least keep jobs in this country, conservatives even made protectionism a ditry word: by refusing to set any restrictions on free trade whatsoever, we allow our salary and benifits packages to be set by the most unscupulous corporations in the third world. The only real worker protection we have left is an insanely low minimum wage that doesn't keep their jobs from going overseas. People are turning to the government to provide benifits because the government has failed to protect the benifits they used to earn by working.

Protectionism just doesn't work in the long term. It leads to economic isolation and eventual collapse. I think the working class is ok with that as long as the can gets kicked down the road far enough. But it always lands in the same place.

It's not 'mob rule' to expect decent compensation and security in exchange for a lifetime of hardwork, or to realize that the system is broken when it no longer provides that. People right now feel bullied: they're working in a market they are told is free but in which their actual employers are a few superpowerful entities that collude against their interests, and there doesn't seem to be a clear path to the middle class (or above) for many people that weren't born there. There are exceptions (medicine is common source of them) but the fact is most people who end up in the top 1% were born in at least the top 10%. Everyone else works a lifetime producing all the real goods and services we actually use, mostly for the incredibly discounted rate of 15,080/year that you earn working full time on minimum wage, and are then called 'moochers' because out of that they only paid payroll tax and state level taxes. Its reasonable and right that they want to fight back. Its probably a shame that we're creating massive federal government programs to supply employees with the benifits that their employers no longer pay, rather than just making work pay in the first place, but the American people aren't wrong that something needs to change in a system that demands so much from the average working American and gives him so little in exhange.

The average American who gets so little compared to who? The guy doing the same job in Sri Lanka? Again, anything the government does to try to correct any of these perceived problems will ultimately damage the people they purport to help.

 

[MiracleforMD]

I feel like I'm in the middle of a tug of war match. I just keep getting pulled from one side to the other.

 

[deleted109597]

I feel like I'm in the middle of a tug of war match. I just keep getting pulled from one side to the other.

You have to choose what's more important. Fiscal or social issues. You only have to look at yourself in the mirror. Don't care what other people think. And there's no real penalty for changing sides. Sure, you might lose some friends, but if you have friends that don't respect you for your decisions, you don't want them anyway.

 

[DrTDH]

Dude.......I fast forward to the last page of this thread and the conversation has seemed to take a dramatic turn.........**scratching my head why**

Anywho, I was wondering if any residents had examples of their budgets? Especially those who live in major metropolitan cities where the cost of living may be higher.

This has been an EXTREMELY useful thread. Thanks for starting the conversation. I wish financial management was taught in med school.

 

[winkleweizen]

Dude.......I fast forward to the last page of this thread and the conversation has seemed to take a dramatic turn.........**scratching my head why**

Anywho, I was wondering if any residents had examples of their budgets? Especially those who live in major metropolitan cities where the cost of living may be higher.

This has been an EXTREMELY useful thread. Thanks for starting the conversation. I wish financial management was taught in med school.

ooo I agree with this...any and all resident budgets would be appreciated.

 

[JoBreeze]

ooo I agree with this...any and all resident budgets would be appreciated.

Also, ^^^communism is such a terribly butchered word in common usage as you did above. FYI I agree with basically all your posts, but let's call spades here, and skip the slippery slope fallacies.

 

[docB]

I want to see what resident income and budget looks like after taxes.

Also, ^^^communism is such a terribly butchered word in common usage as you did above. FYI I agree with basically all your posts, but let's call spades here, and skip the slippery slope fallacies.

I disagree. Communism as a political ideology is espouses that when a system is determined to be unfair by the workers they are justified in and obligated to seize the means of production (wealth) and manage it as a collective. I wasn't using it as a loaded word or an insult. I was using it as a description of a specific political ideology. My BA is in political science. When I say something is Communist or communist (there's a difference) or socialist or even fascist I'm using the word correctly.

 

[JoBreeze]

.

 

[shopsteward]

I disagree. Communism as a political ideology is espouses that when a system is determined to be unfair by the workers they are justified in and obligated to seize the means of production (wealth) and manage it as a collective. I wasn't using it as a loaded word or an insult. I was using it as a description of a specific political ideology. My BA is in political science. When I say something is Communist or communist (there's a difference) or socialist or even fascist I'm using the word correctly.

It can be argued that the workers (through their pension funds) have come to own the means of production (shares in companies). The problem is that it is an imperfect system which has allowed people involved in finance and investment, with the connivance of workers at the top of the companies, to cream off profit at the expense of workers at the bottom. Much like the practices of what has traditionally been called Communism, in fact.

When I see people on this forum (med students/residents, mainly) saying "I could earn a lot more working in finance" what they are really saying is "Instead of doing a highly useful and productive job as a doctor for a decent reward, I could be a parasite on the backs of the workers." (And before the howls of anguish, I'm not talking here about entrepreneurs who invent, improve and invest to the benefit of us all, but the people who create more and more complicated ways of creaming a percentage off the financial system.)

Apologies for adding to thread derail.

 

[EctopicFetus]

It can be argued that the workers (through their pension funds) have come to own the means of production (shares in companies). The problem is that it is an imperfect system which has allowed people involved in finance and investment, with the connivance of workers at the top of the companies, to cream off profit at the expense of workers at the bottom. Much like the practices of what has traditionally been called Communism, in fact.

When I see people on this forum (med students/residents, mainly) saying "I could earn a lot more working in finance" what they are really saying is "Instead of doing a highly useful and productive job as a doctor for a decent reward, I could be a parasite on the backs of the workers." (And before the howls of anguish, I'm not talking here about entrepreneurs who invent, improve and invest to the benefit of us all, but the people who create more and more complicated ways of creaming a percentage off the financial system.)

Apologies for adding to thread derail.

I think this is a narrow perspective. while ownership in some companies is done by the employees, the people who work for most companies have NO ownership. This is true for the consulting firms, mcdonalds, and most small businesses who are not run by one or 2 proprietors.

There is a lot of money in finance, I probably like you know many people who do this for a living. While it is easy to despise their role understanding what they do may lead you to feel differently. Knowing that the term finance is broad are you referring to investment banking?, private equity? Commodities traders?

Perhaps it is the current hot topic of loan swaps. Keep in mind all that exists for a reason much like the commodities markets and futures markets.

 

[shopsteward]

I think this is a narrow perspective. while ownership in some companies is done by the employees, the people who work for most companies have NO ownership. This is true for the consulting firms, mcdonalds, and most small businesses who are not run by one or 2 proprietors.

There is a lot of money in finance, I probably like you know many people who do this for a living. While it is easy to despise their role understanding what they do may lead you to feel differently. Knowing that the term finance is broad are you referring to investment banking?, private equity? Commodities traders?

Perhaps it is the current hot topic of loan swaps. Keep in mind all that exists for a reason much like the commodities markets and futures markets.

I was thinking of ownership in the terms of share ownership of public companies - workers are saving into pension funds, which invest in shares in those companies, and so the workers are the real owners of those companies. A similar argument can be made for the investments made by insurance companies with the money they hold against future claims - it is a form of investment held by the people who take out insurance contracts with those firms.

As to workers in finance, I was thinking of London, where I know both City workers and people who have tried to regulate them. A lot of financial structures, such as futures and derivatives, started off with an obvious and useful purpose, but have more recently been used as the starting point for people to cream money off the top through ever more complicated deals whose only purpose is to make money for the people doing the deal - much the same principle as financial advisers churning investments to charge unnecessary transaction fees from their clients. And the City/Wall Street reward top managers in public companies for going along with this. So for instance "payment for failure" to management at the top of public companies is really "payment decided by a very few people and made return for having supported a system which is very lucrative to those very few people.".

If shareholder capitalism worked as it should, it would be benefitting the people who own those shares through their pensions and other investments. Instead, there is a break in the system which has allowed the middle men, at the top of companies and in the City/Wall Street, to cream off a disproportionate amount of the reward.

Rant over (for now).

 

[45408]

Dude.......I fast forward to the last page of this thread and the conversation has seemed to take a dramatic turn.........**scratching my head why**

Anywho, I was wondering if any residents had examples of their budgets? Especially those who live in major metropolitan cities where the cost of living may be higher.

This has been an EXTREMELY useful thread. Thanks for starting the conversation. I wish financial management was taught in med school.

Sure, I'm not in EM, but my resident's salary is the same anyway. It's been interesting to see the attendings' expenses.

I'm a PGY-3, and my annual salary is $55K. I pay no health insurance premiums, as those are covered by my employer. I've got a wife and two kids.

Gross: $2120 biweekly
Net: $1700 biweekly (two deductions claimed)
Wife's salary (part-time nurse) after taxes averages around $500-600/biweekly

Mortgage $1050 (includes property taxes and homeowner's insurance)
Savings account $600 (automatic deduction)
Tithe/charity $350
Utilities $150-250 depending on the season
Cell phones x2 $65
Daycare $350
Groceries $400
Fast food or restaurants $100
No car payment, both vehicles paid for in cash
Auto insurance $50 (average - I'm paying it annually for this year now)
Auto repairs average $50/month (tires, oil, batteries, etc)
Gas $150
Term life insurance $50
Internet $55
Cable TV was $80, but I just canceled it
Netflix $19

= about $3500 in relatively fixed monthly costs. We usually come out to a bit over $4000/month.

Vacations and weekend trips = $3000/year. Savings account is used for home repairs, new computer, vehicle purchases, things like that. Not putting anything toward retirement now.

 

[TrumpetDoc]

As we were all resident before, we. An all relate.

Now, some would say to simply live like a Resident while an attending, and for some that's fine. However, my wife has supported me and literally kept up out of total collapse since college, and my intentions from the outset were to be able to provide well for her and my family. Does this mean like a rock star... NO. But I want to know all the training actually meant something and had some intrinsic value.
Now, let's not get it wrong, we DO NOT drive fancy "doctor cars". We have rather crapped out ones but one being a large SUV was Jidda expensive and BC of its size is really un tradable in sellable.
We have a nice home but very modest in comparison to my peers.

We have three kids and two have special needs expenses.

What kills us is our old credit card debt and the loans in combination with the kids school expenses. It appears that we are unlike so many docs, but our parents could not help with a dime during college and med school. So we worked as much as we could but did find we had to use CC a lot.

As physicians, at the very least we should be able to give our kids the best chance in education. And unfortunately in LV that is usually pvt school (and certainly is if your kids have any issues)


These things add up very fast.
Add college savings to the mix and upgrading your insurance policies (if you are a doc and don't have VERY good auto and umbrella ins. You are VERY brave)

It is very easy to get to almost 10k in expenses and NOT have much to show for it.

 

[winkleweizen]

Sure, I'm not in EM, but my resident's salary is the same anyway. It's been interesting to see the attendings' expenses.

I'm a PGY-3, and my annual salary is $55K. I pay no health insurance premiums, as those are covered by my employer. I've got a wife and two kids.

Gross: $2120 biweekly
Net: $1700 biweekly (two deductions claimed)
Wife's salary (part-time nurse) after taxes averages around $500-600/biweekly

Mortgage $1050 (includes property taxes and homeowner's insurance)
Savings account $600 (automatic deduction)
Tithe/charity $350
Utilities $150-250 depending on the season
Cell phones x2 $65
Daycare $350
Groceries $400
Fast food or restaurants $100
No car payment, both vehicles paid for in cash
Auto insurance $50 (average - I'm paying it annually for this year now)
Auto repairs average $50/month (tires, oil, batteries, etc)
Gas $150
Term life insurance $50
Internet $55
Cable TV was $80, but I just canceled it
Netflix $19

= about $3500 in relatively fixed monthly costs. We usually come out to a bit over $4000/month.

Vacations and weekend trips = $3000/year. Savings account is used for home repairs, new computer, vehicle purchases, things like that. Not putting anything toward retirement now.

Thanks, but No school loans?

 

[45408]

Thanks, but No school loans?

Of course I do, but I'm not paying them. They're in forbearance. The monthly payments will be between $2500-3000 when I'm done, I believe. The IBR they calculated for my income was more than I could pay while raising a family.

 

[EctopicFetus]

I was thinking of ownership in the terms of share ownership of public companies - workers are saving into pension funds, which invest in shares in those companies, and so the workers are the real owners of those companies. A similar argument can be made for the investments made by insurance companies with the money they hold against future claims - it is a form of investment held by the people who take out insurance contracts with those firms.

As to workers in finance, I was thinking of London, where I know both City workers and people who have tried to regulate them. A lot of financial structures, such as futures and derivatives, started off with an obvious and useful purpose, but have more recently been used as the starting point for people to cream money off the top through ever more complicated deals whose only purpose is to make money for the people doing the deal - much the same principle as financial advisers churning investments to charge unnecessary transaction fees from their clients. And the City/Wall Street reward top managers in public companies for going along with this. So for instance "payment for failure" to management at the top of public companies is really "payment decided by a very few people and made return for having supported a system which is very lucrative to those very few people.".

If shareholder capitalism worked as it should, it would be benefitting the people who own those shares through their pensions and other investments. Instead, there is a break in the system which has allowed the middle men, at the top of companies and in the City/Wall Street, to cream off a disproportionate amount of the reward.

Rant over (for now).

Im not here to defend wall street but lets take some companies as examples.

Apple - How much do the dudes in the Apple store own of that company? Its all management. Also their manufacturing is outsourced (as has been well discussed in the media).

Your argument is amiss. Since like you probably know the board decides the executive team. The board is voted on by shareholders. If your argument (which I reject) is that companies are owned by their workers then they have control of the board and therefore the management team and therefore bonuses. Thats simply not the case however.

There may be a few companies where blue collar workers really do own a decent share. I cant think of many.

 

[shopsteward]

Im not here to defend wall street but lets take some companies as examples.

Apple - How much do the dudes in the Apple store own of that company? Its all management. Also their manufacturing is outsourced (as has been well discussed in the media).

Your argument is amiss. Since like you probably know the board decides the executive team. The board is voted on by shareholders. If your argument (which I reject) is that companies are owned by their workers then they have control of the board and therefore the management team and therefore bonuses. Thats simply not the case however.

There may be a few companies where blue collar workers really do own a decent share. I cant think of many.

NASDAQ shows the top five institutional holders of Apple stock - Fidelity, Vanguard, State Street, Barclays and T Rowe Price- http://www.nasdaq.com/symbol/aapl/ownership-summary None of them are putting their own money into that Apple stock. So whose money are they putting in? That of investors - that is, people (workers) building up their pension funds, buying insurance, making savings and investments.

You say an executive board is voted on by shareholders. In fact it is voted on by investment firms acting on behalf of the people (the workers, the savers, the pension investors, the people carrying insurance) whose money is what buys the shares which are held by the investment firms. The people whose money buys the shares don't get a look-in, because the system means that the (highly paid) people in the investment firms support the (highly paid) people managing the firm, to their mutual benefit but to the point where the rewards to the workers are proportionately less and less. It's a system problem.

The difference between us is that you say that workers do not own companies, and cite the fact that workers do not control companies as evidence. I say that workers do own companies, but that the system through which they own them negates the control that the ownership should bring, and puts it in the hands of small, self-serving, self-rewarding and mutually supportive groups of people in top management and at the top of financial investment firms.. To the cost of all of us (including medics) who produce things for our living and have to invest our savings, our pensions and our futures through that oligarchy.

 

[EctopicFetus]

NASDAQ shows the top five institutional holders of Apple stock - Fidelity, Vanguard, State Street, Barclays and T Rowe Price- http://www.nasdaq.com/symbol/aapl/ownership-summary None of them are putting their own money into that Apple stock. So whose money are they putting in? That of investors - that is, people (workers) building up their pension funds, buying insurance, making savings and investments.

You say an executive board is voted on by shareholders. In fact it is voted on by investment firms acting on behalf of the people (the workers, the savers, the pension investors, the people carrying insurance) whose money is what buys the shares which are held by the investment firms. The people whose money buys the shares don't get a look-in, because the system means that the (highly paid) people in the investment firms support the (highly paid) people managing the firm, to their mutual benefit but to the point where the rewards to the workers are proportionately less and less. It's a system problem.

The difference between us is that you say that workers do not own companies, and cite the fact that workers do not control companies as evidence. I say that workers do own companies, but that the system through which they own them negates the control that the ownership should bring, and puts it in the hands of small, self-serving, self-rewarding and mutually supportive groups of people in top management and at the top of financial investment firms.. To the cost of all of us (including medics) who produce things for our living and have to invest our savings, our pensions and our futures through that oligarchy.

Why isnt Calpers on that board? I dont know how much you know about apple but their workers are almost all white collar. The dudes in the stores make $10 and dont get much if any apple stock. Fidelity and those others arent just investing the money of those who work at apple its guys I work with too.

Regarding the board. If you dont like that model and if people really cared (which they dont and even fewer understand this) then dont invest your money in those funds. Thats your choice. Regarding investments people have some control over where they put their money.

No we disagree on something totally different. I say that the blue collar people who work for Disney, Apple, Walmart, GE etc own a tiny percentage of those companies. Not enough to matter. You believe that they own a large portion of it and are somehow being screwed.

While some on wall street are highly overpaid they provide value and thats why they are compensated the way they are. A line worker in a manufacturing job is likely (there are exceptions) poorly educated and has few skills and MOST importantly is easily replaceable.

In this new era where most manufacturing is abroad this isnt even a real discussion. Few blue collar workers own any real amount of the company.

Corporations are there for their investors and not their employees.

 

[docB]

It can be argued that the workers (through their pension funds) have come to own the means of production (shares in companies). The problem is that it is an imperfect system which has allowed people involved in finance and investment, with the connivance of workers at the top of the companies, to cream off profit at the expense of workers at the bottom. Much like the practices of what has traditionally been called Communism, in fact.

When I see people on this forum (med students/residents, mainly) saying "I could earn a lot more working in finance" what they are really saying is "Instead of doing a highly useful and productive job as a doctor for a decent reward, I could be a parasite on the backs of the workers." (And before the howls of anguish, I'm not talking here about entrepreneurs who invent, improve and invest to the benefit of us all, but the people who create more and more complicated ways of creaming a percentage off the financial system.)

Apologies for adding to thread derail.

Your point is well taken. However your argument shows a need to reform the financial system, not to simply tax and redistribute the earnings of everyone above an arbitrary income level.

On a separate note several of us, including me, have hijacked a useful thread. Would anyone like me to split off the political discussion to its own thread and leave the resident budget posts here?

 

[Anonymous M4]

My mom worked 31 years for a major retailer and raised us as a single parent. You give more to charity per month than she, my brother and I lived on growing up.

Your contribution is very inspiring and a big part of why I'm walking this long road to get to where you are someday.

You are awesome. That made me like people this morning.

 

[AmoryBlaine]

When I was in my final year of residency a month looked about like this:

net paycheck: $3300
moonlighting income: $500-1000
rent: $1300 (fairly expensive mid sized city)
utilities (inc cell phone): $180
disability insurance: $120

I did not have a car.

Basically I started residency with about $3000 in CC debt, wiped that out immediately, and ended residency with $10000 in 401k (3% adds up folks) and about $3k in cash savings.

Took some nice trips (Europe, skiiing, Caribbean) and was never that stressed about money.

The key to financial success as a resident is not doing big stupid stuff like buying a Beemer. If you keep your fixed monthly outlay relatively low you can splurge when you need to and not sweat it.

The key to financial success as a young attending is not to grow into your salary. You can start living a little higher on the hog but don't go crazy. I love to treat family and friends to dinner so I do that a lot now. But I drive a relatively inexpensive car and didn't go crazy on housing either.

Trust me guys, it's a hell of a lot easier to enjoy a vacation you paid cash for than one you put on the Visa.

Many of my classmates graduated with >$10k on credit cards.

 

[45408]

Took some nice trips (Europe, skiiing, Caribbean) and was never that stressed about money.

The key to financial success as a resident is not doing big stupid stuff like buying a Beemer. If you keep your fixed monthly outlay relatively low you can splurge when you need to and not sweat it.

I've gone on a few trips to the Caribbean as a resident, but going to Europe just seems like a lot of time spent traveling to the destination and less time being there. I went between M1-M2 and loved it, but I went for two weeks. I can't wait until my kids are older and less of a burden on family members watching them (or can just come along) and I can go back.

Definitely agree about minimizing your mandatory expenses. You'll feel rich if you have plenty of unaccounted for money that you can spend at your whim, rather than having it all spent as soon as all of your bills roll in.

Trust me guys, it's a hell of a lot easier to enjoy a vacation you paid cash for than one you put on the Visa.

Many of my classmates graduated with >$10k on credit cards.

It's even more enjoyable if you get a lot of cash back when you pay for the trip with your MasterCard and then pay it off at the end of the month I've never carried a balance though, and I'd feel very nervous doing so.

 

[John146]

PGY-1

$50,000 annually (pre-taxes)

Net: ~$3k monthly

Loan repayment $1100
Rent (including utilities) $850
Car paid off, but someone recently hit-and-ran ($2400/12 months) $200
Auto insurance - parents still paying lol
Gas $100
Cell phone $100
Groceries $50
Restaurants $300
Beer $150
Recently jumped/robbed in Baltimore ($300 for new phone, $500 for new key fob, $1k cash/wallet/keys/changing locks / 12 months) $150

~$3k in monthly costs

NET = living the dream baby

 

[DreamingTheLive]

I can show you some pretty sweet jobs that pay 200-250/hr.... You can make 500-700K per year at one of those jobs if you work you tail off.

Here is the almighty question and I think its hard for anyone to grasp until 'you get there'. For must of us who entered this profession from middle class families at best, maybe some people occasionally have doctors for parents or parents even much better off... anyhow, 150-300K is a BOATLOAD of money. I am not arguing that 600K is ALOT more... but if you are making 600K as a doctor, you are not enjoying life/family and are literally working your tail off... Most of us would rather work a tad bit less, make a tad less, but still well into an upper class income... and watch our kids grow, visit family, travel a bit, etc....

There is a misconception sometimes that doctors are 'rich'. We are, but we are not. We are the working rich. We all can more than easily provide a nice newer home for a our family, clean clothes, reliable cars, and nice family vacations... we cannot rent out french chateaus for a month, have private jets, charter private yachts, etc. You can't do that on 300K income, you can't do that on 600K income.....You are going to need to see another zero on your income to obatin that type of status...

Exactly. It's all relative. Grew up in single parent home with maybe 60 - 75K income. Anything over 175K is PLENTY. But have many friends who are the product of 2 physician households and many seem to have a pretty warped sense of money. Again, WHERE you choose to live is hugely influential in this equation as well.

 

[FSU2013]

PGY-1

$50,000 annually (pre-taxes)

Net: ~$3k monthly

Loan repayment $1100
Rent (including utilities) $850
Car paid off, but someone recently hit-and-ran ($2400/12 months) $200
Auto insurance - parents still paying lol
Gas $100
Cell phone $100
Groceries $50
Restaurants $300
Beer $150
Recently jumped/robbed in Baltimore ($300 for new phone, $500 for new key fob, $1k cash/wallet/keys/changing locks / 12 months) $150

~$3k in monthly costs

NET = living the dream baby

Making me reconsider that Hopkins interview, lol.

 

[Postictal Raiden]

Just wondering about something, you guys spend too little on food. Between me, my wife and our toddler son, we spend close to 600/month on foods. We cook most of the time and buy fast food too. If I had more money, we would probably spend near 1000 on food because we often feel deprived of some foods we crave.

So do you guys eat at work? or do you only eat one meal a day?

 

[JacobMcCandles]

Another resident's budget:

Pre-tax: ~$48,000

Monthly contributions taken out for health, dental, vision: ~$100

Net monthly take home: ~$3,000.

Rent (includes water/trash): $680
Student Loans (IBR): $380
Utilities (electric, gas, internet, DirecTV) : $130
Car (insurance covered by parent): $0
Gas: $200
Groceries: $200
Restaurants: $100
Entertainment: $100
Misc (random expenses that may come up but not every month, i.e., oil changes): $200
Gym: $30
Cell Phone (family plan paid by parents): $0

Total: $2020

Leftover: $980

My monthly total will fluctuate slightly under a lot of these categories but ~$2000 is what I end up spending every month. The leftover goes towards reaching my emergency fund target, Roth IRA, and paying down my highest interest rate student loan (7.9%).

 

[Croooz]

Making me reconsider that Hopkins interview, lol.

Expect that either you or your car will be mugged/robbed at JH. I've had three friends who were residents at JH in different programs and one friend who visited the hospital and they were all baptized by either being mugged or having their cars broken into. None had cars worth breaking into but it's doesn't matter in B-more. It's literally across the street from the grut of the ghetto. Be safe!

 

[Arcan57]

Expect that either you or your car will be mugged/robbed at JH. I've had three friends who were residents at JH in different programs and one friend who visited the hospital and they were all baptized by either being mugged or having their cars broken into. None had cars worth breaking into but it's doesn't matter in B-more. It's literally across the street from the grut of the ghetto. Be safe!

Walking to Shock Trauma (in daylight) was far scarier then leaving Grady at 2am. I've never been so ready to hit the ground and crawl to cover in my life.

 

[Croooz]

Walking to Shock Trauma (in daylight) was far scarier then leaving Grady at 2am. I've never been so ready to hit the ground and crawl to cover in my life.

 

[45408]

Just wondering about something, you guys spend too little on food. Between me, my wife and our toddler son, we spend close to 600/month on foods. We cook most of the time and buy fast food too. If I had more money, we would probably spend near 1000 on food because we often feel deprived of some foods we crave.

So do you guys eat at work? or do you only eat one meal a day?

Well, I do have a decent amount of money on my meal card, but my wife cooks quite a bit. If you're spending $1000/month, then you're either not shopping with coupons and getting stuff on sale, or you're buying a lot of fresh produce, seafood, red meat, or less commonly found imported/ethnic items.

 

[ccfccp]

Well, I do have a decent amount of money on my meal card, but my wife cooks quite a bit. If you're spending $1000/month, then you're either not shopping with coupons and getting stuff on sale, or you're buying a lot of fresh produce, seafood, red meat, or less commonly found imported/ethnic items.

This is a huge difference between married (and parent) residents and single residents. I know some single residents that basically had no food budget (except eating out... which can be terrifically expensive if you let it.) The rest of the time they ate at the hospital.

My wife and I (and our daughter as a senior) probably were in the 400-600 dollar range for food. We rarely ate out.

 

[cincincyreds]

We had someone come to my medical school once who outlined an ophthalmologist making $350K a year and spending $380K a year. I found it very helpful. I think some current students might find this enlightening as well. I remember thinking as a student how easy it would be to live off $50K so $200K must be cake.

My wife and I don't consider ourselves big spenders and here is an example of a recent monthly budget for us.

Gross Pay $17,647

Fixed Expenses

Mortgage $3180
Other mortgage (still trying to sell it) $816
Taxes (Federal, State, SS, and medicare) $3925
Utilities $608
Insurance (Life, disability, property, liability-not malpractice) $700
401K $3406
Charity $1990

Subtotal of Fixed Expenses: $14,625

Variable Expenses
Gas $336
Food $829
Various other stuff such as entertainment, clothing, home furnishings, kids sports, gym memberships, "allowances", gifts, healthcare etc $1235
Savings towards next car, next vacation, emergency fund etc $622

Subtotal of Variable Expenses $3022

Total Expenses $17647

Notice the absence of student loan payments, car payments, and credit card payments.

For four years out of residency (while in the military) we lived much more cheaply (only had about 60% of the income) and only recently upgraded to the "attending lifestyle." (Note the size of the last mortgage payment.)

My point is that there is plenty of money if you do some planning and budgeting, but that it is very easy to spend 5 figures every month with little to show for it. Not to mention the only tax break you get is the cap on SS taxes-you're phased out of the earned income credit, the child tax credit, the student loan interest credit, and if some politicians have their way, soon the home interest deduction,the charitable contribution deduction, and the retirement savings account deductions.

As a partner in a year or so, my gross income will be higher, but I'll also be covering my share of the overhead, malpractice, and my health and dental insurance premiums so I don't expect my take home to go up dramatically.

Obviously, I could save less for retirement, have gotten a 30 year mortgage instead of a 15 year one, give less to charity, and hopefully soon have the old house sold (or put a renter in it), but you have to choose what life you want to live.

Whatever you do, don't plan a dramatic upgrade to your lifestyle immediately upon leaving residency. It's much harder to cut back later. And don't take out any more loans than you need as a student or live beyond your means as a resident. All that debt will come back to bite you..

Why is your attending salary so low? I think you need to sell that other house. The charity of $1990 is ridiculous. You need to retire one day also. Lastly, maybe a higher paying job. I thought EM makes $200/hour.

 

[deleted109597]

Why is your attending salary so low? I think you need to sell that other house. The charity of $1990 is ridiculous. You need to retire one day also. Lastly, maybe a higher paying job. I thought EM makes $200/hour.

Did you read anything he wrote?

He was trying to sell the house.
It's his money, he can do what he wants with it. Even if the charity is PETA.
You don't think he's putting enough into his retirement?
EM doesn't make $200/hr everywhere.

 

[EM_Rebuilder]

Why is your attending salary so low? I think you need to sell that other house. The charity of $1990 is ridiculous. You need to retire one day also. Lastly, maybe a higher paying job. I thought EM makes $200/hour.

...or maybe he chooses to work 80 hours a month. And instead, coaches his three kids ball team, takes trips every month with his wife, and is on the city council.

I have no clue, but I am just saying that I am certain there are EM physicians that are doing the above.

At 200/hr, that gross income is actually 88 hours per month.


I cringe when I hear burnout in EM and like to refer to the above scenario.... and the above scenario would not be a top secret, hard to find job. They are a dime a dozen!!