How will you escape the pit (the ER)?

[emergentmd]

I just ran across this and, well, hate to break it to ya but I alone have several middle/high school volleyball player patients. I guess I should mention I'm child psychiatry (which is why I hate to break it to ya).

From my personal experience with many many highschoolers, sports participation does not in any way guarantee or even lessen staying away from social media/drug using/sex finding (might be worse in many cases depending on what's going on in the sports crowd). I certainly encourage sports participation but not necessarily for those reasons. Think more along the unhealthy/out of shape parts, although some schools do random drug testing of athletes so that does act as a deterrence for drug use sometimes (definitely not all the time...). Certainly no linear correlation between amount of money spent vs likelihood of deterrence. I mean I think if you want to trade 10K for your daughter playing a sport she enjoys that's totally reasonable, but I'd just say that if that's the case.

I am sure you know much more than I do but I am N=1. She enjoys VB, she likes the competition, it is organized, and yes it does keep her off media. If she didn't have something she is committed to, I see the extra time just doing unproductive stuff such as more social media. I have no idea if doing less social media now translates to anything in the future, but it gives her something to look forward to.

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[doctalaughs]

Ya im shooting for 2-2.5 ish with the house paid off. Think thatll be fine.

2M at a safe withdrawal rate is about 60k/yr. No one (reputable) thinks that 4% swr is realistic anymore.

If you feel comfortable at 60k/yr for the rest of your life —- good for you. Most Americans would be lucky to have that. That being said, I don’t know too many doctors that spend that little annually — and I don’t feel that a lot higher spend is extravagant or ridiculous.

I guess it depends where you live in retirement - but just my property taxes would be 1/3 of that. And I live in a “medium” property tax area (plenty of places it would be half or more of 60k on any reasonable place).

 

[BoardingDoc]

2M at a safe withdrawal rate is about 60k/yr. No one (reputable) thinks that 4% swr is realistic anymore.

If you feel comfortable at 60k/yr for the rest of your life —- good for you. Most Americans would be lucky to have that. That being said, I don’t know too many doctors that spend that little annually — and I don’t feel that a lot higher spend is extravagant or ridiculous.

I guess it depends where you live in retirement - but just my property taxes would be 1/3 of that. And I live in a “medium” property tax area (plenty of places it would be half or more of 60k on any reasonable place).

@Mount Asclepius I'm curious about the eyeroll response to this. While I think the property tax estimate is probably higher than it is for most people provided they live in a cheaper area or more modest home, I generally agree with everything else that was written. Do you disagree with the calculation? The comment that 4% is likely too high of a SWR? That most doctors probably want to spend more than 60k/yr (pretaxes) in retirement?

 

[Mount Asclepius]

@Mount Asclepius I'm curious about the eyeroll response to this. While I think the property tax estimate is probably higher than it is for most people provided they live in a cheaper area or more modest home, I generally agree with everything else that was written. Do you disagree with the calculation? The comment that 4% is likely too high of a SWR? That most doctors probably want to spend more than 60k/yr (pretaxes) in retirement?

Perhaps an eye roll was too ‘harsh.’ I disagree with the property tax amount and more with the general sentiment - not necessarily the poster. They did qualify their thoughts and were commenting on physicians in general not necessarily themself or what they thought was the right approach. They aren't wrong that many physicians spend a lot.

I think that when someone has significantly more in retirement than the average person, yet doesn’t feel it is enough, then they have a spending issue not a savings issue. In retirement, you typically pay substantially less taxes, no longer make mortgage payments, don't pay for disability insurance, and usually are no longer financially supporting children. Your expenses go way down. You can live on $60K/year in retirement quite well and better off than the average person.

Many physicians make the mistake over and over again throughout their lives by errantly justifying that because they worked really hard with a resultant high salary that they can live like the uber rich. Live wealthy, not rich. Enjoy the simple things in retirement. Most of which don't take much money if any.

I don't disagree on the SWR of 4%. I also agree that the traditional amount of 4% may not be advisable anymore.

The amount suggested for property taxes is too high. I live in a moderate to high CoL state in a pretty nice home and don’t pay anywhere close to $20-30K/year in property taxes. If you pay that much, then you probably live in a fairly expensive home in a high property tax state. I also don’t think that is necessary in retirement. Once again, seems like a choice regarding spending.

 

[PianoMedic]

2M at a safe withdrawal rate is about 60k/yr. No one (reputable) thinks that 4% swr is realistic anymore.

If you feel comfortable at 60k/yr for the rest of your life —- good for you. Most Americans would be lucky to have that. That being said, I don’t know too many doctors that spend that little annually — and I don’t feel that a lot higher spend is extravagant or ridiculous.

I guess it depends where you live in retirement - but just my property taxes would be 1/3 of that. And I live in a “medium” property tax area (plenty of places it would be half or more of 60k on any reasonable place).

I would disagree with some of this. If you aren’t taking into account social security, then some of this might be true. But social security (despite everyone screaming it’s going bankrupt) will provide a significant chunk of most of America’s retirement income. Even if the trust fund goes fully bankrupt, beneficiaries can expect to get at least 70% of their full retirement benefit for their lifetime. Considering the trust fund isn’t allowed to invest in anything except treasuries, that is somewhat of a minor miracle. My social security alone is likely to provide me with close to $3200 per month in inflation adjusted income to todays dollars. I just need to come up with about $60k/yr to get to my goal of $100k per year so my best egg could technically be as low as $2mil. I will build in a little cushion, but this could be doable.

Regarding the 4% rule, I would give Michael Kitces as an example of one who has done research on it and with some modifications to the original rule, 4% is still reasonable. We don’t know what our sequence of returns will be which is the issue. If we get low or negative returns at retirement that is an issue. But most people would make adjustments to their spending, they wouldn’t keep adjusting it upwards indefinitely with inflation. Skipping one or two years of inflation adjustments per his research can resolve the sequence risk for many or most time periods. Taking a small reduction in spending of say 10% using a guardrail approach (portfolio down 20-30%, then take the reduction) can also help, especially when combined with skipping one or two years of inflation adjustment. True, it isn’t the exact 4% rule that Bengen laid out in the 1990s, but it is still very similar and more reasonable than what was originally laid out. The research was structured that way for simplicity, not reality. Bengen himself has redone the research adding in other asset classes which actually increased the safe withdrawal rate. Diversifying internationally is a hedge on the safe withdrawal rate, so being globally diversified can help some.

Can’t comment too much on property taxes, mine are fairly high but still less than what would be 10% of a $60k/yr income. My house isn’t a long term solution for a growing family but would be perfect for my retirement. To each their own on how much house they want.

 

[doctalaughs]

Perhaps an eye roll was too ‘harsh.’ I disagree with the property tax amount and more with the general sentiment - not necessarily the poster. They did qualify their thoughts and were commenting on physicians in general not necessarily themself or what they thought was the right approach. They aren't wrong that many physicians spend a lot.

I think that when someone has significantly more in retirement than the average person, yet doesn’t feel it is enough, then they have a spending issue not a savings issue. In retirement, you typically pay substantially less taxes, no longer make mortgage payments, don't pay for disability insurance, and usually are no longer financially supporting children. Your expenses go way down. You can live on $60K/year in retirement quite well and better off than the average person.

Many physicians make the mistake over and over again throughout their lives by errantly justifying that because they worked really hard with a resultant high salary that they can live like the uber rich. Live wealthy, not rich. Enjoy the simple things in retirement. Most of which don't take much money if any.

I don't disagree on the SWR of 4%. I also agree that the traditional amount of 4% may not be advisable anymore.

The amount suggested for property taxes is too high. I live in a moderate to high CoL state in a pretty nice home and don’t pay anywhere close to $20-30K/year in property taxes. If you pay that much, then you probably live in a fairly expensive home in a high property tax state. I also don’t think that is necessary in retirement. Once again, seems like a choice regarding spending.

Overall - we don’t disagree that living on 60k a year is perfectly doable and again, more than many Americans have.

Where we disagree is that physicians *should* have to settle for a doable/average retirement. We also might disagree how easy it should be to save 2M on an average physician income. From my perspective that might be a spending issue - but maybe during the accumulation phase not the retirement phase where it should be pretty easy to shoot much higher.

I also disagree that shooting higher is like trying to live like the “Uber wealthy” in this country too. Believe me- the CEOs, ibankers, high end law partners and family money (the true uber wealthy) have lifestyles that think 10m is pocket change.

I don’t think it’s unreasonable for a doctor to want a well-above-average (but not ultra-wealthy) retirement. Similar to plenty of successful but not outrageously successful small business owners.

 

[doctalaughs]

I would disagree with some of this. If you aren’t taking into account social security, then some of this might be true. But social security (despite everyone screaming it’s going bankrupt) will provide a significant chunk of most of America’s retirement income. Even if the trust fund goes fully bankrupt, beneficiaries can expect to get at least 70% of their full retirement benefit for their lifetime. Considering the trust fund isn’t allowed to invest in anything except treasuries, that is somewhat of a minor miracle. My social security alone is likely to provide me with close to $3200 per month in inflation adjusted income to todays dollars. I just need to come up with about $60k/yr to get to my goal of $100k per year so my best egg could technically be as low as $2mil. I will build in a little cushion, but this could be doable.

Regarding the 4% rule, I would give Michael Kitces as an example of one who has done research on it and with some modifications to the original rule, 4% is still reasonable. We don’t know what our sequence of returns will be which is the issue. If we get low or negative returns at retirement that is an issue. But most people would make adjustments to their spending, they wouldn’t keep adjusting it upwards indefinitely with inflation. Skipping one or two years of inflation adjustments per his research can resolve the sequence risk for many or most time periods. Taking a small reduction in spending of say 10% using a guardrail approach (portfolio down 20-30%, then take the reduction) can also help, especially when combined with skipping one or two years of inflation adjustment. True, it isn’t the exact 4% rule that Bengen laid out in the 1990s, but it is still very similar and more reasonable than what was originally laid out. The research was structured that way for simplicity, not reality. Bengen himself has redone the research adding in other asset classes which actually increased the safe withdrawal rate. Diversifying internationally is a hedge on the safe withdrawal rate, so being globally diversified can help some.

Can’t comment too much on property taxes, mine are fairly high but still less than what would be 10% of a $60k/yr income. My house isn’t a long term solution for a growing family but would be perfect for my retirement. To each their own on how much house they want.

I personally will not be expecting a social security check. I don’t think the program is going away — too many depend solely on it— but I think it’s VERY highly likely if not inevitable that it will be “income checked” and the “wealthy” will pay in but not collect a cent.

 

[hundreddaysoff]

Overall - we don’t disagree that living on 60k a year is perfectly doable and again, more than many Americans have.

Where we disagree is that physicians *should* have to settle for a doable/average retirement. We also might disagree how easy it should be to save 2M on an average physician income. From my perspective that might be a spending issue - but maybe during the accumulation phase not the retirement phase where it should be pretty easy to shoot much higher.

I also disagree that shooting higher is like trying to live like the “Uber wealthy” in this country too. Believe me- the CEOs, ibankers, high end law partners and family money (the true uber wealthy) have lifestyles that think 10m is pocket change.

I don’t think it’s unreasonable for a doctor to want a well-above-average (but not ultra-wealthy) retirement. Similar to plenty of successful but not outrageously successful small business owners.

No disagreement with any of this, except that I hope to live a much better than average retirement from the ER spending <=$60k/y.

Probably still grossing >60k after ER retirement, so I guess Mr Money Mustache's police would put me in jail.

I'm just hoping to make retirement more about time and less about money overall. PoF seems like a decent model for this, except our family plans way less foreign travel than his.

Agree that we (<=40ish?) can't bank on SS, or other entitlements, or even a stable dollar going forward necessarily. We also can't bank on stonk number to go back up in the next 5--10 years. These things have definitely affected how I use my cash toward FIRE.

 

[Redrox]

I feel like this is so much down to our individual makeups. I've been an attending for over 4 years and I still don't see drunks, personality disorders, etc, as problems with my job. I mean, there are pros and cons to any job, and that's what I signed up for, and now that I know the tricks of how to talk real pretty to these folks, they aren't so hard to handle. Helping these people who lack the insight to help themselves at night the best I can gives me the good feels a lot better than would, say, doing spinal fusion$$$ that I know my already-mostly-healthy patients don't need and might even harm them but that make me bank.

Where I differ with Southerndoc, WCI, and many others is that as cool as my job is, I was never the type who wanted or needed to be a doc personality wise, and I can think of about 1000 things in the world I'd rather do other than medicine that no one's willing to pay me for. This is why I want to FIRE. I will never grow dull in my old age because assuming I can escape the ER, I'll be too busy starting a permaculture farm or tutoring kids or writing folk songs or learning probability theory or woodworking or creating a video game or any of the other things on my very long to-do list.

Not trying to argue, just find the difference interesting as to what us individual docs will or will not tolerate in a job.

Same same bro and nice to hear someone similar ( 7 years out myself )

 

[emergentmd]

If you live in an decent (ie major) city in texas, prop tax is about 2.5%. If u want to live in a safe, nice neighborhood that is close to amenities, you are talking about a 500k house today that will be 1M in 20 yrs. If u think the state will reduce prop tax rate, then I have a bridge to sell. There is 25k.

My current home is 27k In prop tax and if I didn’t have homestead exemption it would be 60k.

I have a nice/big house that I paid for 800k for 10 yrs ago that isn’t really crazy when I made 4-500k/yr and debt free.

I want my retirement to be close to bulletproof and not at the whims of the market.

2M for 95% of the docs are not what they would call a decent retirement.

2M in 20 yrs (avg 40 yr old doc) would be 60 which is like 40k in todays buying power.

Also, what happens when the market corrects by 50%? What happens if u need a new 10k Hvac unit? 15k roof? 25k home siding? 5k engine repair?

Not to be disrespectful, but 60k is not retiring comfortable. It’s living close to poverty

 

[dadaddadaBATMAN]

If you live in an decent (ie major) city in texas, prop tax is about 2.5%. If u want to live in a safe, nice neighborhood that is close to amenities, you are talking about a 500k house today that will be 1M in 20 yrs. If u think the state will reduce prop tax rate, then I have a bridge to sell. There is 25k.

My current home is 27k In prop tax and if I didn’t have homestead exemption it would be 60k.

I have a nice/big house that I paid for 800k for 10 yrs ago that isn’t really crazy when I made 4-500k/yr and debt free.

I want my retirement to be close to bulletproof and not at the whims of the market.

2M for 95% of the docs are not what they would call a decent retirement.

2M in 20 yrs (avg 40 yr old doc) would be 60 which is like 40k in todays buying power.

Also, what happens when the market corrects by 50%? What happens if u need a new 10k Hvac unit? 15k roof? 25k home siding? 5k engine repair?

Not to be disrespectful, but 60k is not retiring comfortable. It’s living close to poverty

There are a lot of assumptions built into this.

Live in a paid off 300k home. I feel safe where we live to say the least.

Wife self and kids live on about 55k a year (just reviewed our expenses for the year, 19k thus far), and we don’t exactly live as cheaply as we can. Could easily shave another 5-10k off without making life too miserable (take a nice vacation a year, and there is no will from the other half to actual budget which would save another 5k probably).

Life insurance is a major expenditure that will go away as we develop more assets, would save around 8k

Nice vacation splurge was 10k

confident we could live on 40k without too much suffering based on that.

Living in a low cost of living area is awesome if you enjoy hiking and living in a semi rural area.

Having said, we plan to upsize about 100k at some point in home, and will move to a nicer school district (but not paying for private school) which will increase property taxes about 50%.

Also, I plan to work part time till I die, though probably not in em. Keeps the vacation life from becoming pseudostressful. If you don’t have real stress in life, your mind makes stuff up to stress you out. Look at all the unhappy 80 yr old ladies who are mad about what someone said at church 6 weeks ago.

 

[doctalaughs]

There are a lot of assumptions built into this.

Live in a paid off 300k home. I feel safe where we live to say the least.

Wife self and kids live on about 55k a year (just reviewed our expenses for the year, 19k thus far), and we don’t exactly live as cheaply as we can. Could easily shave another 5-10k off without making life too miserable (take a nice vacation a year, and there is no will from the other half to actual budget which would save another 5k probably).

Life insurance is a major expenditure that will go away as we develop more assets, would save around 8k

Nice vacation splurge was 10k

confident we could live on 40k without too much suffering based on that.

Living in a low cost of living area is awesome if you enjoy hiking and living in a semi rural area.

Having said, we plan to upsize about 100k at some point in home, and will move to a nicer school district (but not paying for private school) which will increase property taxes about 50%.

Also, I plan to work part time till I die, though probably not in em. Keeps the vacation life from becoming pseudostressful. If you don’t have real stress in life, your mind makes stuff up to stress you out. Look at all the unhappy 80 yr old ladies who are mad about what someone said at church 6 weeks ago.

I applaud you for being happy with this level of spend.

That being said, 300k in my area wouldn’t get you a nice 1 bedroom apartment. And I don’t live in NY, SF, LA, DC, Boston etc.

Also - I want to travel internationally, eat out regularly (not at Applebees or outback), help my kids with college and go on ski trips during the winter. I also don’t want a new furnace/ac or fence to eat up 25% of my budget for the year.

I would agree these things are not necessary and are a “privilege” many middle income families can’t have. That being said - they are not unreasonable for a retired doctor and they are pretty incompatible with 55k/yr in most major cities.

Don’t live in Texas - but my prop taxes were 18k/yr last year. My friend in one of the aforementioned “notorious” tax cities paid 45k.

 

[dadaddadaBATMAN]

I applaud you for being happy with this level of spend.

That being said, 300k in my area wouldn’t get you a nice 1 bedroom apartment. And I don’t live in NY, SF, LA, DC, Boston etc.

Also - I want to travel internationally, eat out regularly (not at Applebees or outback), help my kids with college and go on ski trips during the winter. I also don’t want a new furnace/ac or fence to eat up 25% of my budget for the year.

I would agree these things are not necessary and are a “privilege” many middle income families can’t have. That being said - they are not unreasonable for a retired doctor and they are pretty incompatible with 55k/yr in most major cities.

Don’t live in Texas - but my prop taxes were 18k/yr last year.

This is kind of my point, which I guess I didn’t phrase well.

I’m not bragging about my expenditures (well not just that anyway)

Living at my same level of expenditure in California would probably be between 2-3x as much. It would also be much more expensive in areas of Maine, Connecticut, Colorado, or a any number of other areas that are more expensive than where I live.

And many people aren’t happy with my level of living, and that’s ok.

Point is mostly that people may be talking past one another as “2 million is unrealistic” depends on a huge number of factors from what’s acceptable to just where do you live.

Even with my lifestyle you might need 4 million or more in a different area.

 

[doctalaughs]

This is kind of my point, which I guess I didn’t phrase well.

I’m not bragging about my expenditures (well not just that anyway)

Living at my same level of expenditure in California would probably be between 2-3x as much. It would also be much more expensive in areas of Maine, Connecticut, Colorado, or a any number of other areas that are more expensive than where I live.

And many people aren’t happy with my level of living, and that’s ok.

Point is mostly that people may be talking past one another as “2 million is unrealistic” depends on a huge number of factors from what’s acceptable to just where do you live.

Even with my lifestyle you might need 4 million or more in a different area.

No argument with that.

It’s just that some posters act like a 10M portfolio means you are riding around in your private jet, eating caviar for breakfast and supporting your 3 wives and 2 vacation homes.

The truth is it’s a pretty reasonable number for an upper class (not ridiculously extravagant) lifestyle in many/most major US cities. And doctors act like this is unattainable/silly money when many of my neighbors are in IT, small business owners, sales, consulting etc with easily the same spend/retirement goal or more. Doctors don’t make as much or retire with as much as they think, compared with the rest of the professional working society. Especially when you consider the debt and lost opportunity costs.

 

[NITRAS]

I applaud you for being happy with this level of spend.

That being said, 300k in my area wouldn’t get you a nice 1 bedroom apartment. And I don’t live in NY, SF, LA, DC, Boston etc.

Also - I want to travel internationally, eat out regularly (not at Applebees or outback), help my kids with college and go on ski trips during the winter. I also don’t want a new furnace/ac or fence to eat up 25% of my budget for the year.

I would agree these things are not necessary and are a “privilege” many middle income families can’t have. That being said - they are not unreasonable for a retired doctor and they are pretty incompatible with 55k/yr in most major cities.

Don’t live in Texas - but my prop taxes were 18k/yr last year. My friend in one of the aforementioned “notorious” tax cities paid 45k.

My house is appraised at close to $450k and I paid $8.5k in property taxes. Once you turn 65, they limit the growth of your property taxes. Other option is to get an ag exemption.

You could move to OK where they don’t have property taxes. . . .

$60k/year is easy to live on with no kids, no mortgage, and realistic expendatures. . .. , you can’t live in a $ 2.5M property though or have $50k in cars.

Calling $2M poverty level is hyperbolic. I have no plans to retire so little Savings, (kinda plan to hit the $10M mark. . But we will see).

I’m not saying you should retire on so little, or what your goals should be, but the vast majority of Americans retire on way less. And no plan is completely bulletproof. Some things are just out of your hands.




And $8k/year in life insurance means someone needs to run away from cash value life insurance. Horrible product. @dadaddadaBATMAN

WCI and Dave Ramsey have good articles at just how bad this is.

 

[thegenius]

If you live in an decent (ie major) city in texas, prop tax is about 2.5%. If u want to live in a safe, nice neighborhood that is close to amenities, you are talking about a 500k house today that will be 1M in 20 yrs. If u think the state will reduce prop tax rate, then I have a bridge to sell. There is 25k.

My current home is 27k In prop tax and if I didn’t have homestead exemption it would be 60k.

I have a nice/big house that I paid for 800k for 10 yrs ago that isn’t really crazy when I made 4-500k/yr and debt free.

I want my retirement to be close to bulletproof and not at the whims of the market.

2M for 95% of the docs are not what they would call a decent retirement.

2M in 20 yrs (avg 40 yr old doc) would be 60 which is like 40k in todays buying power.

Also, what happens when the market corrects by 50%? What happens if u need a new 10k Hvac unit? 15k roof? 25k home siding? 5k engine repair?

Not to be disrespectful, but 60k is not retiring comfortable. It’s living close to poverty

It's true ascelpius. you can run the list of expenses, inflation, etc. It's just not that much money. Most people who make 60K a year live paycheck to paycheck with minimal savings. Once you pay taxes on it....say it's 20%...you have 48K/year which is only 4K/month.

 

[Apollyon]

supporting your 3 wives and 2 vacation homes.

That makes me laugh, because, I've said many a time here on SDN that, to be a successful EM doc or anesthesiologist, "have one or fewer houses, and one or fewer spouses"!

 

[dadaddadaBATMAN]

My house is appraised at close to $450k and I paid $8.5k in property taxes. Once you turn 65, they limit the growth of your property taxes. Other option is to get an ag exemption.

You could move to OK where they don’t have property taxes. . . .

$60k/year is easy to live on with no kids, no mortgage, and realistic expendatures. . .. , you can’t live in a $ 2.5M property though or have $50k in cars.

Calling $2M poverty level is hyperbolic. I have no plans to retire so little Savings, (kinda plan to hit the $10M mark. . But we will see).

I’m not saying you should retire on so little, or what your goals should be, but the vast majority of Americans retire on way less. And no plan is completely bulletproof. Some things are just out of your hands.




And $8k/year in life insurance means someone needs to run away from cash value life insurance. Horrible product. @dadaddadaBATMAN

WCI and Dave Ramsey have good articles at just how bad this is.

It’s term, I just haven’t done any of their screening, which means I get a dumpster fire rate, and I have a generous policy for my wife. I’m just barely worth more alive than dead. It was a recent add on that I’m sore about, and is meant to be temporary. Will be probably 40% or so less if I do the screening.

 

[doctalaughs]

That makes me laugh, because, I've said many a time here on SDN that, to be a successful EM doc or anesthesiologist, "have one or fewer houses, and one or fewer spouses"!

I follow that rule strictly (and I’m not in EM or an anesthesiologist).

I stick with my guns and my personal 10m number. Agree that lifestyle wants/needs vary - but I don’t want to be forced to move to Oklahoma because the 650k house I bought 15 years ago happens to be 1.7 m now (probably due to an unhealthy market) and is worth 2.5 when I retire. I also want to be able to move anywhere within reason if I decide to be near my grandkids in my old age.

 

[cyanide12345678]

2M at a safe withdrawal rate is about 60k/yr. No one (reputable) thinks that 4% swr is realistic anymore.

If you feel comfortable at 60k/yr for the rest of your life —- good for you. Most Americans would be lucky to have that. That being said, I don’t know too many doctors that spend that little annually — and I don’t feel that a lot higher spend is extravagant or ridiculous.

I guess it depends where you live in retirement - but just my property taxes would be 1/3 of that. And I live in a “medium” property tax area (plenty of places it would be half or more of 60k on any reasonable place).

My wife and i spend 85-90k post tax right now. Live very comfortably - have a 6000 sqft home, 2 relatively new cars, take 4 or so vacations a year (heavily subsidized by cme funds), spend 2k a month on childcare. 90k post tax is more than 70 ish percent of American families. So don’t make it sound like it’s peanuts and absolutely impossible to live on. It’s not, most people live on much less fairly easily.

A 4% withdrawal rate itself even assumes no future ancillary income, no social security, no adjustments for the market - pretty much nothing. those are the assumptions of the original paper. If someone like me retires at age 40, which is 7 years from now, there is a very very low chance that I’ll do absolutely nothing. I’ll probably still make a few bucks here or there. The 4 percent withdrawal rule doesn’t take that into account. Also, not everyone has a 70:30 portfolio of stocks and bonds, some of us have a real estate portfolio that gives a 6 to 10 percent rental income after expenses, and then appreciates with inflation. So you might think 4 percent real yield is low likelihood, it’s really not for someone who isn’t a traditional stock bond investor. For example: just about to get into my 13th syndication - a 7 cap rate 96 percent occupied retail plaza with dsw, chipotle, jasons deli, tj max and 10 other tenants. Will enjoy a 10 percent cash on cash yield as the rents appreciate over time, making the property appreciate.

There are degrees of FI - fat fire, lean fire etc. i think most people could lean fire around 2-3 million, even doctors. It would require a little adjustment, but it’s easily doable.

 

[Mount Asclepius]

If you live in an decent (ie major) city in texas, prop tax is about 2.5%. If u want to live in a safe, nice neighborhood that is close to amenities, you are talking about a 500k house today that will be 1M in 20 yrs. If u think the state will reduce prop tax rate, then I have a bridge to sell. There is 25k.

My current home is 27k In prop tax and if I didn’t have homestead exemption it would be 60k.

I have a nice/big house that I paid for 800k for 10 yrs ago that isn’t really crazy when I made 4-500k/yr and debt free.

I want my retirement to be close to bulletproof and not at the whims of the market.

2M for 95% of the docs are not what they would call a decent retirement.

2M in 20 yrs (avg 40 yr old doc) would be 60 which is like 40k in todays buying power.

Also, what happens when the market corrects by 50%? What happens if u need a new 10k Hvac unit? 15k roof? 25k home siding? 5k engine repair?

Not to be disrespectful, but 60k is not retiring comfortable. It’s living close to poverty

I think this post demonstrates that you are probably out of touch with how many people live. They live safely, make far less, have less and can retire comfortably. Most people don't have a 2M nest egg nor have the luxury of having a 4% SWR of 60K. That's not poverty. It's perspective.

Furthermore, we were also discussing property taxes today, not in 20 years. I live in a very desirable state and the property taxes are far lower (approximately 6x lower). We are also talking 2M today, not 2M in 20 years.

 

[Mount Asclepius]

It's true ascelpius. you can run the list of expenses, inflation, etc. It's just not that much money. Most people who make 60K a year live paycheck to paycheck with minimal savings. Once you pay taxes on it....say it's 20%...you have 48K/year which is only 4K/month.

Disagree. I've lived on ~$50K/year in residency and walked away with pretty decent savings. Never felt like I was living paycheck to paycheck. It's a lot of money to many people. You also don't pay an effective tax rate of 20% on 60K. Either way, you could live on 4K/month. I think @dadaddadaBATMAN said it well above. We are just talking past each other at this point. I'm fine with a glass of wine at sunset (plus luckily get to enjoy much more), while others feel like they 'need' fancy first class international trips every other month and couldn't possibly retire on less than 10M. I think this just further embodies the entitled 'rich' doctor stereotype.

 

[PianoMedic]

Disagree. I've lived on ~$50K/year in residency and walked away with pretty decent savings. Never felt like I was living paycheck to paycheck. It's a lot of money to many people. You also don't pay an effective tax rate of 20% on 60K. Either way, you could live on 4K/month. I think @dadaddadaBATMAN said it well above. We are just talking past each other at this point. I'm fine with a glass of wine at sunset (plus luckily get to enjoy much more), which others feel like they 'need' fancy first class international trips every other month and couldn't possibly retire on less than 10M. I think this just further embodies the entitled 'rich' doctor stereotype.

Agree with this. Also left residency with $8k in the bank, and 10k in my 401k. I made more money in residency than my wife and I had ever made combined. My full time job out of undergrad I was making 20k per year and saved about 1k into my 401k for the first year out that my employer matched 100% (then switched and decided to do med school as the great financial crisis wasn’t helping job prospects in the slightest). Paycheck to paycheck has more to do with what you’re spending and less about what you’re making. I did go out and get beers/wings with the guys once a week doing that job and did spend money and enjoy myself. It wasn’t full on deprivation. I had a roommate and made my own food to take to work, sure. There are ways around the paycheck to paycheck cycle, even without much income. Oh and I definitely paid almost nothing in taxes at the time, I should be clear about that. Like a couple hundred in federal and state.

 

[Mount Asclepius]

Another random point to consider. Every state gets their tax dollars. I pay state income taxes, where as those of you in Texas don’t have them. Instead you have higher property taxes. If it’s that important to you, consider working in a state without state income tax and retiring in a state with lower property taxes. I doubt this calculus will matter to most people. Just like I think your personal spending habits (also including the concept of one spouse, one house, as @Apollyon rightly states) matters more.

 

[doctalaughs]

There are degrees of FI - fat fire, lean fire etc. i think most people could lean fire around 2-3 million, even doctors. It would require a little adjustment, but it’s easily doable.

Oh, that I would agree on.
No one is saying you can’t live on 2M and retire simply / happily and lean FIRE.
Let’s not pretend that you are going to be able to vacation frequently, help the kids/grandkids financially if desired, eat in pretty nice restaurants regularly, choose semi-expensive hobbies etc.

No doubt - I prefer Fat FIRE.

 

[doctalaughs]

Regarding property tax, most is local but the averages by state is from about 0.28 to 2.5. That means many/most states 1% is a good estimate not counting other special categories of local taxes. If you live in a 0.4% city you are a lucky exception to the rule.

Property Taxes By State: Highest To Lowest

Property taxes can vary greatly depending on the state that you live in. So we took a closer look into property taxes by state to give you a comparative look.

www.rocketmortgage.com

So a 1 M house that’s 10k. A 1 M house in many major cities is nothing extravagant anymore. So 10k of a 55k budget is cutting into near 20% of your income. Sucks if you live in the 2.5% states.

I don’t think there’s going to be many 400k or 500k places to live in the future…. Just saying.

 

[deleted941485]

Regarding property tax, most is local but the averages by state is from about 0.28 to 2.5. That means many/most states 1% is a good estimate not counting other special categories of local taxes. If you live in a 0.4% city you are a lucky exception to the rule.

Property Taxes By State: Highest To Lowest

Property taxes can vary greatly depending on the state that you live in. So we took a closer look into property taxes by state to give you a comparative look.

www.rocketmortgage.com

So a 1 M house that’s 10k. A 1 M house in many major cities is nothing extravagant anymore. So 10k of a 55k budget is cutting into near 20% of your income. Sucks if you live in the 2.5% states.

I don’t think there’s going to be many 400k or 500k places to live in the future…. Just saying.

If you live anywhere in the NE, the only towns that have that are ones with serious school and crime issues. Also 500K means nothing in those places.

 

[Mount Asclepius]

Regarding property tax, most is local but the averages by state is from about 0.28 to 2.5. That means many/most states 1% is a good estimate not counting other special categories of local taxes. If you live in a 0.4% city you are a lucky exception to the rule.

Property Taxes By State: Highest To Lowest

Property taxes can vary greatly depending on the state that you live in. So we took a closer look into property taxes by state to give you a comparative look.

www.rocketmortgage.com

So a 1 M house that’s 10k. A 1 M house in many major cities is nothing extravagant anymore. So 10k of a 55k budget is cutting into near 20% of your income. Sucks if you live in the 2.5% states.

I don’t think there’s going to be many 400k or 500k places to live in the future…. Just saying.

Agree that it's more local than state based. My city is lower than my state as a whole. It was part of my evaluation when I chose where to reside. It's all a choice. You can choose to live in a local closer to 0.5% or as high as 2.5%. You can also choose a $250K, $500K, $1M or $1M+ home. In retirement, you are often going to downsize from the more luxurious family home you might live in before that. I disagree and think there are still going to be a decent amount of okay homes in the $400-500K price point in the near future. I don't suspect in the distant future most retiring EPs will live at this price point mainly due to appreciation, but it's hard to predict and it's still a choice. You can determine how you allocate your budget during retirement. Do you want 20% of your budget going to property taxes or do you want to decrease it to 10% so you can spend more money on other experiences? If you think you want it all, then you are going to have to work harder and longer.

In Emergency Medicine, you can have anything you want, but not everything you want. I think its unrealistic for most EPs to think they are going to Fat FIRE unless they really work for it (extra hours plus side hustles with lean expenditures during working years). By definition you aren't retiring early if you work until 50-60+ to achieve that 10M+ net worth. I also don't think most people really want it all. I think most of us get by very well on less than we think. Chasing after more and more materialism and/or expensive experiences is chasing after never ending shifting goalposts demarcating your level of happiness derived from things money buys.

FWIW and in full disclosure, I'm shooting for balance. I spent more on my home, because I spend a lot of time here, local appreciation has been better than nationally for 20+ years (I think will cool off some) and property taxes are low. I spend little on travel as I did that a lot more when I was younger and don't have the desire to travel as much currently. Most of my travel currently is within the state and to the outdoors (i.e. cheap). I'm guessing I'll leave EM before many with likely more than $2-5M net worth based upon my well paying job and lean living with aggressive saving. However, given my decreased earning years compared to some I doubt I'll hit 10M+. I don't think the extra net worth is worth the trade off of a longer career that I'm no longer as passionate about or by chasing after a lot of side hustles that I don't have interest in.

 

[emergentmd]

60k/yr fire. Sure anyone can Fire on 60k. My parents lived on much less raising 5 kids.

But I am sure not going to fire at 60K which would mean selling my house, moving somewhere I do not desire, and essentially living close to poverty.

60K for two retired persons.
400K house in many major Texas (1800 sqft home) is 10K property tax.
Electricity is 1k/yr, water/wastewater/garbage is 1500/yr, internet 1k/yr, Youtube tv 700/yr, iphone with data plan is 2k/yr, car insurance x 2 = 1500/yr, home insurance 2k/yr. gas 500/yr., groceries $3k, gas 2k. = 15k

That leaves me with 35k or $3000/month to live over basic bills.

Sure I can live on 3k/month but early Fire means to retire on your own terms and not retire to live a less comfortable life.

A new roof HVAC would kill a whole years budget not to mention a new decent car.

 

[doctalaughs]

Agree that it's more local than state based. My city is lower than my state as a whole. It was part of my evaluation when I chose where to reside. It's all a choice. You can choose to live in a local closer to 0.5% or as high as 2.5%. You can also choose a $250K, $500K, $1M or $1M+ home. In retirement, you are often going to downsize from the more luxurious family home you might live in before that. I disagree and think there are still going to be a decent amount of okay homes in the $400-500K price point in the near future. I don't suspect in the distant future most retiring EPs will live at this price point mainly due to appreciation, but it's hard to predict and it's still a choice. You can determine how you allocate your budget during retirement. Do you want 20% of your budget going to property taxes or do you want to decrease it to 10% so you can spend more money on other experiences? If you think you want it all, then you are going to have to work harder and longer.

In Emergency Medicine, you can have anything you want, but not everything you want. I think its unrealistic for most EPs to think they are going to Fat FIRE unless they really work for it (extra hours plus side hustles with lean expenditures during working years). By definition you aren't retiring early if you work until 50-60+ to achieve that 10M+ net worth. I also don't think most people really want it all. I think most of us get by very well on less than we think. Chasing after more and more materialism and/or expensive experiences is chasing after never ending shifting goalposts demarcating your level of happiness derived from things money buys.

FWIW and in full disclosure, I'm shooting for balance. I spent more on my home, because I spend a lot of time here, local appreciation has been better than nationally for 20+ years (I think will cool off some) and property taxes are low. I spend little on travel as I did that a lot more when I was younger and don't have the desire to travel as much currently. Most of my travel currently is within the state and to the outdoors (i.e. cheap). I'm guessing I'll leave EM before many with likely more than $2-5M net worth based upon my well paying job and lean living with aggressive saving. However, given my decreased earning years compared to some I doubt I'll hit 10M+. I don't think the extra net worth is worth the trade off of a longer career that I'm no longer as passionate about or by chasing after a lot of side hustles that I don't have interest in.

Of course everything is a choice.

That being said— if the vast majority of the country is on average paying 1-2% or more mandatory non-income tax, and vast swaths of the northeast, the west coast, the mountain west and the south/southeast have a 1m+ housing market to get anything livable + safe — I don’t think it’s realistic to tell a group of well educated professionals (doctors) that they all should expect to move in retirement. I don’t see that trend reversing.

Especially when that often means moving away from family and some of the things they like in major cities.

I always said that living in NYC, San Fran or LA was silly financially for most doctors. Unfortunately- even a “top 25” city in the USA is rapidly becoming an expensive proposition. So unless you plan to live in a rural or small town in 20 years, I suggest a larger nest egg.

2M fire is pretty lean for anyone upper middle class.
5M is probably comfortable.
10M is the sweet spot (for me personally)

 

[Mount Asclepius]

Of course everything is a choice.

That being said— if the vast majority of the country is on average paying 1-2% or more mandatory non-income tax, and vast swaths of the northeast, the west coast, the mountain west and the south/southeast have a 1m+ housing market to get anything livable + safe — I don’t think it’s realistic to tell a group of well educated professionals (doctors) that they all should expect to move in retirement. I don’t see that trend reversing.

Especially when that often means moving away from family and some of the things they like in major cities.

I always said that living in NYC, San Fran or LA was silly financially for most doctors. Unfortunately- even a “top 25” city in the USA is rapidly becoming an expensive proposition. So unless you plan to live in a rural or small town in 20 years, I suggest a larger nest egg.

2M fire is pretty lean for anyone upper middle class.
5M is probably comfortable.
10M is the sweet spot (for me personally)

This has been a good discussion. I think there is more agreement than disagreement amongst most on this topic. There is also perhaps a different flavor coloring your views depending upon whether or not you practice EM versus another specialty.

I’m not advocating for people moving specifically for retirement. Most of us move once or more in our lifetimes though. I think it’s important to consider these financial variables when making those choices on where to move. Family/friends, interests and sadly politics (as of late) probably factor in more though.

I also think some folks have different levels of ‘safety’ tolerance. Some zip codes are safer percentage wise, but money and location can’t usually guarantee complete safety.

The small to medium sized cities can be the sweet spot. You aren’t priced out like some of the biggest cities, and yet have amenities that going rural doesn’t provide.

 

[Mount Asclepius]

60k/yr fire. Sure anyone can Fire on 60k. My parents lived on much less raising 5 kids.

But I am sure not going to fire at 60K which would mean selling my house, moving somewhere I do not desire, and essentially living close to poverty.

60K for two retired persons.
400K house in many major Texas (1800 sqft home) is 10K property tax.
Electricity is 1k/yr, water/wastewater/garbage is 1500/yr, internet 1k/yr, Youtube tv 700/yr, iphone with data plan is 2k/yr, car insurance x 2 = 1500/yr, home insurance 2k/yr. gas 500/yr., groceries $3k, gas 2k. = 15k

That leaves me with 35k or $3000/month to live over basic bills.

Sure I can live on 3k/month but early Fire means to retire on your own terms and not retire to live a less comfortable life.

A new roof HVAC would kill a whole years budget not to mention a new decent car.

Kind of illustrates my point. You’ve already covered your basic bills and even some discretionary items with over half left over in your scenario. That’s okay. I think we’ll just have to agree to disagree on how much we’d prefer to have or spend.

 

[cyanide12345678]

I always said that living in NYC, San Fran or LA was silly financially for most doctors. Unfortunately- even a “top 25” city in the USA is rapidly becoming an expensive proposition. So unless you plan to live in a rural or small town in 20 years, I suggest a larger nest egg.

Plenty of large "top 25" cities with reasonable housing, safety, school districts - Indianapolis, columbus, cleveland, houston, San antonio, charlotte, jacksonville - There are options out there. I personally live in a top rated suburb of one of these cities that has been named as one of the top cities in the US by multiple magazines several years now. Every school is rated either 9 or 10 by great schools - elementary, intermediate, and high schools, literally there isn't a single school rated 8 or lower by greatschools. Can still build a brand new 5000 sqft home for ~ 600k with 1% property tax. Cost of living is about average. Crime is non existent essentially.

So yeah...because of decisions I made out of residency in choosing a relatively lower cost of living area, I think a 2.5M nest egg is more than enough if I actually wanted to call it quits in 4 or so years. I probably won't since I'm not even 3 years out, but it's nice not having that financial stress and not having any "need" to work.

 

[HoosierdaddyO]

Imagine if physicians had pensions… what a pipe dream that would be lol. Literally 2 million dollar nest egg right there, waiting for you at the ripe age of 57 lol!!! In addition to all your other savings and IRAs and 4-0-whatever’s!!!

 

[WilcoWorld]

I have a spouse that works, live in a low cost of living place. I have been out two years, own my house outright (I know this is financially not best move but I have developed a pathological hate of debt) and have about 300k in retirement, 50 liquid between my wife and myself. If my wife didn’t work I’d be in the same place in 1-2 years, though med school debt would have more interest before I could have removed it.

With optimal investment I’d still have a home loan and would have more like 600k in the market. Maybe even 800 if I consolidated my student loans and refinanced rather than paying them off, though would be offset by 200k debt. Between returns and ongoing investment we could easily have 2-3 million at the current rate of spending without any of this optimization.

How much you can get very much depends on where you live, how you live, and who you married.

And how you've divorced

 

[Splenda88]

I stayed at a reasonable hotel in Atlanta last month. $175/night. Let's say 3 nights for a big tournament. Used 3/4 of a tank of gas to get there, so 1.5 tanks just in interstate travel and let's say another .5 in travel around the city. I have an SUV so a tank is 20 gallons at $4 per gallon. Food for a family at non-fast food runs at least $50 per meal. We'll be generous and say only 3 meals.

That's $965 right there.

$175/night in Atlanta is low IMO. I am wary of any hotel (especially the ones in big cities) that is less than $250/night. When I was a broke person (aka medical student or resident), $175/night was a lot but now as an attending, I look for hotels that are 4.5+ stars.

 

[Splenda88]

FWIW and in full disclosure, I'm shooting for balance. I spent more on my home, because I spend a lot of time here, local appreciation has been better than nationally for 20+ years (I think will cool off some) and property taxes are low. I spend little on travel as I did that a lot more when I was younger and don't have the desire to travel as much currently. Most of my travel currently is within the state and to the outdoors (i.e. cheap). I'm guessing I'll leave EM before many with likely more than $2-5M net worth based upon my well paying job and lean living with aggressive saving. However, given my decreased earning years compared to some I doubt I'll hit 10M+. I don't think the extra net worth is worth the trade off of a longer career that I'm no longer as passionate about or by chasing after a lot of side hustles that I don't have interest in.

That is kind of big range. 2M vs. 5M in retirement is 2 completely differently lifestyle where one has to fly coach while the other (5M) can fly business class with no worries.

 

[Splenda88]

Plenty of large "top 25" cities with reasonable housing, safety, school districts - Indianapolis, columbus, cleveland, houston, San antonio, charlotte, jacksonville - There are options out there. I personally live in a top rated suburb of one of these cities that has been named as one of the top cities in the US by multiple magazines several years now. Every school is rated either 9 or 10 by great schools - elementary, intermediate, and high schools, literally there isn't a single school rated 8 or lower by greatschools. Can still build a brand new 5000 sqft home for ~ 600k with 1% property tax. Cost of living is about average. Crime is non existent essentially.

So yeah...because of decisions I made out of residency in choosing a relatively lower cost of living area, I think a 2.5M nest egg is more than enough if I actually wanted to call it quits in 4 or so years. I probably won't since I'm not even 3 years out, but it's nice not having that financial stress and not having any "need" to work.

I agree with your overall point. But why would a middle class family of 4 (typical US family) need anything > 2500 sqft home?

I just don't understand the middle class family obsession with big homes in the US. We (4 of us) live in <1700 sqft home right now and I think it's enough space for a family of 4.

 

[VA Hopeful Dr]

$175/night in Atlanta is low IMO. I am wary of any hotel (especially the ones in big cities) that is less than $250/night. When I was a broke person (aka medical student or resident), $175/night was a lot but now as an attending, I look for hotels that are 4.5+ stars.

Embassy Suites Centennial Park with AAA discount.

 

[VA Hopeful Dr]

Imagine if physicians had pensions… what a pipe dream that would be lol. Literally 2 million dollar nest egg right there, waiting for you at the ripe age of 57 lol!!! In addition to all your other savings and IRAs and 4-0-whatever’s!!!

Some of us do

 

[WilcoWorld]

Some of us do

I have a pension, but it's not like it's free money. I pay into the pension plan instead of paying into a 401k. I also save in other "long-term buckets" and I like the diversity this gives me - one fund is backed by the market, the other is backed by my state.

 

[VA Hopeful Dr]

I have a pension, but it's not like it's free money. I pay into the pension plan instead of paying into a 401k. I also save in other "long-term buckets" and I like the diversity this gives me - one fund is backed by the market, the other is backed by my state.

I do the same

 

[emergentmd]

Some of us do

Kudos to you and everyone that is able to obtain something that literally will kill any private business.

But any doctor can create their own pension with the excess income you make from not working for the government.

I would think you can make 100k more in the private EM sector than the VA. Take that 70K post tax $$ yearly, put it in real estate or even a high yield mutual fund.

70kx20 yrs is 1.4M which will we worth 4M in 20 yrs.

4M in real estate should produce 200K in yearly cash flow.
4M in high yield mutual fund at 4% dividends will produce 160K.

You can always create your own pension. "forced pensions" in lieu of market pay just guarantees you will not completely screw up retirement similar to what the NFL tries to do with people making millions a year but end up broke.

 

[WilcoWorld]

Kudos to you and everyone that is able to obtain something that literally will kill any private business.

But any doctor can create their own pension with the excess income you make from not working for the government.

I would think you can make 100k more in the private EM sector than the VA. Take that 70K post tax $$ yearly, put it in real estate or even a high yield mutual fund.

70kx20 yrs is 1.4M which will we worth 4M in 20 yrs.

4M in real estate should produce 200K in yearly cash flow.
4M in high yield mutual fund at 4% dividends will produce 160K.

You can always create your own pension. "forced pensions" in lieu of market pay just guarantees you will not completely screw up retirement similar to what the NFL tries to do with people making millions a year but end up broke.

Agree for the most part. One point, my pension isn't forced. I had the option to either enter the pension plan or go into the employer-matched retirement savings plan (market-based). Both have their advantages. So, I suppose I am obligated by my employer to save for retirement, but I'm not forced to do it through the pension.

 

[VA Hopeful Dr]

Kudos to you and everyone that is able to obtain something that literally will kill any private business.

But any doctor can create their own pension with the excess income you make from not working for the government.

I would think you can make 100k more in the private EM sector than the VA. Take that 70K post tax $$ yearly, put it in real estate or even a high yield mutual fund.

70kx20 yrs is 1.4M which will we worth 4M in 20 yrs.

4M in real estate should produce 200K in yearly cash flow.
4M in high yield mutual fund at 4% dividends will produce 160K.

You can always create your own pension. "forced pensions" in lieu of market pay just guarantees you will not completely screw up retirement similar to what the NFL tries to do with people making millions a year but end up broke.

Mine is weird. Technically I work for a county hospital but the retirement plan is the only thing that's government related anymore. I make well above market for my specialty (FM).

Usually you can choose either pension or 401k with match. The exception is if you have ever been enrolled in the state retirement plan with a previous job. I did some moonlighting at a state psych hospital in residency and was put into the state system at that time so I didn't have a choice with the current job. I can (and do) still contribute to the 401k I just don't get a match.

 

[NITRAS]

Mine is weird. Technically I work for a county hospital but the retirement plan is the only thing that's government related anymore. I make well above market for my specialty (FM).

Usually you can choose either pension or 401k with match. The exception is if you have ever been enrolled in the state retirement plan with a previous job. I did some moonlighting at a state psych hospital in residency and was put into the state system at that time so I didn't have a choice with the current job. I can (and do) still contribute to the 401k I just don't get a match.

Interesting. Is it basically the same money, just it goes into he state pension rather than a 401k match?

 

[WilcoWorld]

Interesting. Is it basically the same money, just it goes into he state pension rather than a 401k match?

Yes, the main difference is that pension pay out is guaranteed as a % of your top earning years. On the one hand, you don't have to worry about the stock market with pension. On the other hand, if the market does well it will out pace your pension.

 

[VA Hopeful Dr]

Yes, the main difference is that pension pay out is guaranteed as a % of your top earning years. On the one hand, you don't have to worry about the stock market with pension. On the other hand, if the market does well it will out pace your pension.

Pretty much. However, SC has an interesting additional benefit. I can take a slightly lower yearly payout (20% or so) but when I die my spouse gets that same amount for the rest of her life. Or, I can take a slightly lower payout (12% or so) and then when I die my kids split 50% of the payout for the rest of their lives. I ran the numbers earlier, if I'm lazy and max out at 250k highest earnings and take the children option I'll end up getting around 8.5k/month while I live and then when I die each of my 2 kids will get 4.25k monthly for the rest of their lives. There's a slight inflation adjustment for me but that stops when it gets to my kids.

My mother was a teacher and took the second option for my sister and I. When she dies, we'll each get about $1000/month for the rest of our lives.

 

[thegenius]

Disagree. I've lived on ~$50K/year in residency and walked away with pretty decent savings. Never felt like I was living paycheck to paycheck. It's a lot of money to many people. You also don't pay an effective tax rate of 20% on 60K. Either way, you could live on 4K/month. I think @dadaddadaBATMAN said it well above. We are just talking past each other at this point. I'm fine with a glass of wine at sunset (plus luckily get to enjoy much more), while others feel like they 'need' fancy first class international trips every other month and couldn't possibly retire on less than 10M. I think this just further embodies the entitled 'rich' doctor stereotype.

How many kids do you have?

 

[Mount Asclepius]

How many kids do you have?

Now that's an idea. I didn't think about putting my kids to work for me to try to make ends meet and escape the pit.