Net worth

[Iamnew2]

What is a reasonable net worth of a PM&R doc at career end?

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[runfastnow]

Not sure where I found this but a reasonably simple equation:
MD Net Worth = (Salary x Years in Practice x 0.3) - 200,000

Perhaps more complicated but more controllable way via financial calculator (* Finance Calculator) to estimate at career end:
PMT = 15% average annual take home salary (or your current saving rate), insert as negative number
PER = # years left of your career
INT = 6% (or current annualized investment return)
PV = current retirement account(s) value, insert as negative value
FV = variable the calculator will solve
Add your FV to whatever other assets you might have, and want to include, such as home(s), share value in ASC, etc.

 

[sloh]

3-4 million in investable assets

 

[DMBandFan86]

Net worth is what? Assets - Liabilities. So you want to know how much cash + assets to have to retire? I agree it is probably greater than 3 million, but extremely variable person to person. Definitely would want your assets paid off.

I mainly look at what my retirement income will be. How much I will have each month vs how much I will need. Net worth doesn't necessarily reflect that.



On a side note, (and I may be the only one) but I have been in various retirement plans since 2007 and don't have a 6% return rate on my investments. Thats regardless if I do the investments myself or hire someone to do it. I pretty much see myself as an investment looser, based on everything that was promised with compounded interest. However, currently satisfied with a defined benefits pension plan if I stay with my current job.

 

[Iamnew2]

Net worth is what? Assets - Liabilities. So you want to know how much cash + assets to have to retire? I agree it is probably greater than 3 million, but extremely variable person to person. Definitely would want your assets paid off.

I mainly look at what my retirement income will be. How much I will have each month vs how much I will need. Net worth doesn't necessarily reflect that.

I think you said somewhere else you make about 800 k per year. So you probably only need to work 10 years to achieve a target net worth. Doesn't mean you necessarily have a good retirement plan when you become eligible.


On a side note, (and I may be the only one) but I have been in various retirement plans since 2007 and don't have a 6% return rate on my investments. Thats regardless if I do the investments myself or hire someone to do it. I pretty much see myself as an investment looser, based on everything that was promised with compounded interest. However, currently satisfied with a defined benefits pension plan if I stay with my current job.

I won't be making that kind of money in upcoming position, but still a reasonable wage. I don't have a pension, I do have investments, a reasonable saved amount, paid off house, car, and no med student loan/masters/undergrad loan. Can I ask how you get the pension? I wasn't aware that groups gave pensions outside of the VA or Kaiser.

 

[runfastnow]

Pensions are a dying breed rare to see outside of government/VA jobs. Being a high earner as a physician you have tremendous potential to create whatever net worth you desire within the confines with the time value of money.

FV = PV(1+r)^t

 

[DMBandFan86]

I won't be making that kind of money in upcoming position, but still a reasonable wage. I don't have a pension, I do have investments, a reasonable saved amount, paid off house, car, and no med student loan/masters/undergrad loan. Can I ask how you get the pension? I wasn't aware that groups gave pensions outside of the VA or Kaiser.

Some state employers and public universities still offer DB pension plans. The accounting and admin costs are very high so people don’t offer much anymore. But, a 3 million pension at retirement would technically be a net worth of zero until you use it.

If net worth for PMR was 3M in 2018 then likely would want more like 3.5-3.6M now.

 

[j4pac]

I won't be making that kind of money in upcoming position, but still a reasonable wage. I don't have a pension, I do have investments, a reasonable saved amount, paid off house, car, and no med student loan/masters/undergrad loan. Can I ask how you get the pension? I wasn't aware that groups gave pensions outside of the VA or Kaiser.

Mayo

 

[Iamnew2]

http://www.rimed.org/rimedicaljournal/2018/10/2018-10-50-cont-eltorai.pdf

This is a nice publication that has a breakdown of most specialities including hourly wages and net worth at retirement. According to this PM&R docs come in at around 3 mil at retirement.

haha PGY-30! I am not sure how many PM&R docs only make $250k these days.