Medical School Didn’t Teach You About Money, But We Will

Introduction

As a physician, you’ve dedicated years to mastering the complexities of human health, yet many of us emerge from medical school with little understanding of personal finance. This gap in education can lead to financial missteps that undermine the hard work we’ve put into our careers. Fortunately, there are resources available to help bridge this gap. One such resource is the Financial Boot Camp, a FREE 12-week email course designed to empower you to take control of your finances, invest wisely, and accelerate your journey toward financial independence.

A Personal Journey

I’m Dr. Edgar Remotti, a 33-year-old interventional pain medicine fellow at BIDMC-Harvard. As I prepare to graduate and embark on a promising career, I reflect on my financial journey, which began with a simple question from an attending physician: “What’s a Roth?” At that moment, I realized that despite being among the highest-earning professionals, many physicians lack a basic understanding of personal finance.

Fast forward a few years, and I’ve become known as “the money guy” among my peers. My experiences, from being a guest on the WCI Milestones to Millionaire podcast to participating in the ASA ADVANCE Emerging Leaders Program, have fueled my passion for financial literacy. My partner and I, both physicians, have managed to accumulate over $750,000 in net worth within the first few years of our careers. This article aims to share the mindset and strategies that have guided us on this journey.

A Frugal Start: The Foundation of Wealth Building

My financial philosophy is rooted in my upbringing. My parents, both physicians, taught me the importance of living within my means and valuing every dollar. However, it wasn’t until I began my medical training that I truly understood how small, intentional choices could significantly impact my financial future.

In medicine, we learn to avoid “anchoring” in clinical decision-making. In behavioral economics, anchoring refers to using a reference point for decision-making. For me, that reference point was the hospital-provided free meal. By relying on these meals, I saved thousands over the years.

I extended this principle to other areas of my life: living in a modest apartment, avoiding unnecessary subscriptions, and using public transportation. These choices were not sacrifices; they were investments in my future. Every dollar saved was a dollar that could be redirected toward building wealth.

Turning Savings into Investments

While saving is essential, it’s equally important to put your money to work. This realization hit me during residency when we saved enough to open a taxable brokerage account. Initially, the idea of investing felt daunting, largely due to “loss aversion”—the fear of losing money often outweighs the potential for gains.

However, avoiding the stock market posed a greater risk. We opted for simplicity by building a portfolio of low-cost index funds, which allowed us to benefit from market growth without the complexities and high fees of actively managed investments. By treating our investment accounts as untouchable, we avoided the temptation to cash out during market fluctuations.

Thanks to compound interest and a bit of luck, our portfolio grew significantly. By the end of residency, we had accumulated hundreds of thousands of dollars in investments—not due to extraordinary financial skills, but through consistency and discipline.

Education and Behavioral Awareness

Financial growth is not just about saving and investing; it’s also about continuous learning. I immersed myself in books like The Millionaire Next Door and A Random Walk Down Wall Street, followed financial blogs, and listened to podcasts. These resources helped me recognize and overcome cognitive biases that lead to poor financial decisions.

As I became comfortable with traditional investments, I sought to diversify into real estate. Initially unfamiliar with this niche, I quickly grew passionate about it. Real estate offered a tangible way to build wealth beyond the stock market. I educated myself through books, networking with seasoned investors, and attending seminars.

Our first property purchase became a turning point, teaching me invaluable lessons about financing and cash flow. Real estate complemented our traditional portfolio, providing diversification and passive income opportunities.

Delayed Gratification: The Key to Long-Term Success

Physicians are well-acquainted with delayed gratification, having spent years in training. Applying this principle to personal finance felt natural. While many colleagues upgraded their lifestyles with increased income, we resisted that urge. Instead, we focused on aggressively paying off student loans and maximizing investment contributions.

Behavioral economics teaches that humans often prioritize short-term rewards over long-term benefits. By being mindful of this tendency, we built habits that will serve us for a lifetime.

The Value of Spending: Life Beyond Numbers

While saving and investing are crucial, it’s essential to remember that money is a tool, not the ultimate goal. Life is short, and experiences often hold more value than a growing bank account. I realized that depriving myself of cherished moments with family for the sake of cash was counterproductive.

I’ve learned to spend intentionally on experiences—traveling, enjoying meals with friends, and pursuing hobbies. This isn’t a failure of discipline; it’s a recognition of what truly matters. Behavioral economics highlights that material possessions often lead to temporary satisfaction, while meaningful experiences create lasting joy.

The Invisible Hand

Behavioral economics isn’t just an academic concept; it’s a practical toolkit for navigating financial decisions. The principles I’ve discussed can help anyone build wealth. Understanding the invisible forces that drive our decisions allows us to channel them toward achieving our financial goals.

For me, these principles culminated in a strategy that enabled me to graduate from training debt-free and with a robust financial portfolio.

Final Thoughts

Financial success isn’t about luck or extraordinary income; it’s about making consistent, informed decisions. My journey from free resident meals to a portfolio worth over $750,000 exemplifies this principle.

As I embark on the next chapter of my career, I feel empowered by the financial security I’ve built and the knowledge that independence is within reach. I hope other physicians can learn from my experience, leveraging behavioral economics to create a future of financial freedom.

Remember, wealth is a means to an end, not the end itself. Spend thoughtfully, invest in experiences, and cherish the relationships that bring meaning to your life. The most valuable currency isn’t money—it’s time, memories, and deep connections. Don’t lose sight of this as you navigate your financial journey.

So, the next time you’re handed a free meal, think of it not just as a perk of the job, but as the potential start of something much bigger. Good luck!