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Becker’s Healthcare Podcast
Building Financial Freedom to Fight Physician Burnout with Jordan Frey, MD
00:15:59
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- [00:02]
A
This is where healthcare leadership comes together. Becker's 16th annual meeting brings more than 3,500 hospital and health system executives and nearly 800 speakers to Chicago, April 13th through the 16th. This year's event includes keynote conversations with Dallas Cowboys legend Troy Aikman and former President George W. Bush. For the agenda and event details, visit Beckershospitalreview.com and click on the events tab in the upper right. We're looking forward to hosting you in Chicago.
- [00:32]
B
This is Scott Becker with the Becker Healthcare Podcast. We're thrilled today to be joined by a brilliant physician. But more than just being a brilliant physician, we're talking with Dr. Jordan Fry. And Jordan's the founder in the blog, writer and podcaster and author of the Prudent Plastic Surgeon. He's got an absolutely fascinating origin story as to how he developed this, what drove him towards it, and a lot more an incredibly authentic leader. Dr. Fry, can you take a moment to introduce yourself and tell us a little bit about yourself and then the prudent plastic surgeon and how this all evolved?
- [01:14]
C
Yeah, absolutely. Thanks for having me, Scott. So you know a little about myself. Currently, I am a full time practicing reconstructive plastic surgeon. My clinical focus is on breast reconstruction after cancer, specifically microsurgical breast reconstruction and treatment of lymphedema after breast cancer and its treatment. I'm in my six year practice and that's also the age of the prudent plastic surgeon. So I've been doing that for about six years. And how that started was basically because I was, you know, six, seven years ago. I was at the end of my, my training, the long road, going from, you know, a pre med student to someone who is about to finish residency and fellowship. And I was burned out. And that was a surprising realization for me. It was something that I had the symptoms of for a while but hadn't recognized. And when I did and kind of looked back at what were the factors causing it, which there are obviously a bunch. But a huge one for me was a lack of financial well being, which that was not something I even thought of as a component of overall well being before that. But I was in a situation where, yeah, I was about to graduate, I was finally at the end of this long road and everyone was telling me, oh, this is fantastic. Everything is great. You're going to start making all this money. In my head, I was just going like, no, it's, it's not all great. I have half a million dollars of student debt. I have credit card debt.
- [02:52]
B
Stop for a second. Stop for a second. Give us that number of debt again that you came out of residency with. Give us that number, because that's a daunting number.
- [03:01]
C
Yeah. Half a million dollars. A little bit more, actually, because I had taken on debt to pay the full tuition of a private undergrad and private medical school.
- [03:13]
B
That is remarkable. And a lot of money. How much is that? How normal is that to come out of residency with that much debt?
- [03:25]
C
I would say it's slightly more than the average. The average is probably somewhere in the range of like 3 to 400,000 now, based on, you know, the residents that I'm talking to.
- [03:38]
B
Right. And one of our colleagues whose daughter is a pediatrician, just started her first job, and the job offers were private practice, 170, 180,000. The other job offer for a health system job was 220,000. If you come out with 3 to 400,000 in debt, you got to remember that 200,000 in salary is 130,000 after taxes. Those are very hard numbers, aren't they?
- [04:05]
C
Yeah, exactly. It's. There's this even for. For any doctor, there's the public perception of them as extremely high income and, you know, driving a certain car, living in a certain house, etc. But there's. There's definitely a squeeze on doctors nowadays in terms of declining compensation and the increasing cost of, of becoming a doctor in addition to just the rising cost of just about everything these days. So, yeah, it's. It's definitely a big squeeze.
- [04:38]
B
Joe, I didn't mean to take you off track, but the numbers, the 500,000 compared to what my colleague's daughter is making as a starting physician. And I know it's different in different specialties. Some specialties start up really well, some poorly, but those are daunting differences. If you're 3 to 500,000 in debts, making 200,000 a year, go back to your origin story and how you really got started with prudent plastic surgeon.
- [05:00]
C
No, 100%. That's such an important point to make. But, yeah, exactly as I was realizing all of this, and I like, yes, my salary is going to increase, but I just realized how much I was going to need to pay to debt service. Everyone was just telling me, again, you need to buy this fancy car, you need to get this fancy house, you need to do all this stuff. And I was like, my income's increasing, but my expenses are increasing even more. And again, all of this was just leading to burnout, especially because I had just given very prime years of my life. To becoming a doctor, where I sacrificed family and friends and a lot of things. So I just felt really bitter towards medicine. And what I ultimately ended up doing was, along with my wife, we just started learning the very basics of personal finance that I had never learned. Things like creating a savings rate, how to invest money wisely, et cetera. Even understanding the concept of financial freedom, this idea that you can work because you want to, not because you have to, which was completely foreign to me. And from that we just started making very simple concerted changes. And this all culminated a few months, you know, after where we just had a one page Microsoft Word document where we laid out a financial plan, very simple, that we would reach financial freedom in 25 years. And that's now become more condensed, but again, just that idea that, hey, I can just follow this simple plan and get there. That allowed me to really rekindle and rediscover what I loved about medicine, what I loved about reconstructive plastic surgery. And I honestly found my burnout improving. And that was what was a huge epiphany for me and Dr. Frank.
- [06:46]
B
Take a moment in that journey and what all the prudent plastic surgeon involves today. Tell us a little bit about the financial journey and how you started writing and blogging about it.
- [06:57]
C
Yeah, so I basically started writing and blogging about it in order to share my story. And what I was looking for was someone who was going through a similar thing to me. And I didn't find that. I found a lot of people who were out of clinical medicine or the liker who had already reached financial freedom. But I just thought, you know what, I'm going to share this as honestly and genuinely as I can and talk about really actionable and simple steps that doctors can take to reach financial freedom. Because I honestly think that is so important for the healthcare profession, for doctors on an individual level in terms of their well being. And so that is what the platform is really about, is sharing those kind of stories and general advice. And what I've done that's worked and that hasn't worked.
- [07:43]
B
And talk about your personal net worth story if you'd like to your financial journey itself.
- [07:48]
C
Yeah, so I started when I first checked my net worth, it was like more negative than negative. $500,000. Today, as we stand now, it's around $2 million, which is not at our goal yet, but certainly is enough that if I wanted to stop working, I could. My wife has been able to transition from she was a college professor to now where she does real estate investments so that's freed up a lot of. And in general, like I said, it just truly has made me a better doctor. Where that is, the plan I have is pretty much on an autopilot. It's not something I have to stress about every day or worry about or check the markets or anything like that. And so I'm just really able to focus on the things I love.
- [08:32]
B
Tell us a little bit about the core parts of that plan. And how important is controlling spending to financial freedom?
- [08:42]
C
Yeah, controlling spending is the number one thing. So if you think about what's like a really simple path to, to wealth at an individual level, it's. You have to create a margin between what you earn and what you spend, and then you have to invest that margin so that your money starts making money. So really the main driver is what you spend. Right. What we earn is going to be in our control, but within a range. And what you spend at every point of your life is always 100% in your control. And yes, that requires some tough decisions at times. But so, yeah, what you spend is the real baseline driver of your wealth. And I think for doctors, a good rule of thumb I always talk about is like, if you have a savings rate of your gross income, so before taxes of 20%, that's a good starting point. Certainly you can accelerate things by going higher. When I started, our savings rate was zero. So we just tried to increase it slowly every month until we, we met our goal, which ultimately was around 30%. So, yeah, that's, that's the main driver.
- [09:51]
B
But so, so starting with that, starting with that. It, it is so hard, of course, to control spending because there's so many just dopamine fixes that come from it. Plus the more if you're a physician or a professional and you're exhausted, then it becomes easy to give into that, those, those decisions. But the things that really can hurt somebody, buying too big a house, getting car crazy. How do you avoid that when, you know, everybody wants the bigger house, the second home, the big car? How do people sort of get business in the mindset to protect themselves and avoid those kinds of things?
- [10:31]
C
My biggest thing with spending is, is spending intentionally. So you're exactly right. Usually when people spend, you know, we do it for, for the dopamine hit. We buy something, we get that don't mean hit. Eventually that starts wearing off. And the joy we're getting from the purchase we made weans as well. And, you know, you go and make another purchase and that's a recipe for overspending in contrast, what we have to do is sort of, when we spend, bring two questions into the, the forefront of our mind. The, the conscious thinking part of our mind is whether you're buying something that's a dollar or a million dollars, can I make this purchase and still reach my financial goals? Okay, Usually the answer to that is going to be yes, more or less. But the second question we have to ask is, okay, is the purchase I'm making, is the joy that I'm going to get from it greater than or equal to the price tag? And that's a very, like, subjective question, but it's one we don't actually think about very often. If the answer is yes, then you should get it. If the answer is no, then you shouldn't. And the example I always give is, for the years in my practice, I drove a $4,000 used Toyota that I bought. And the reason is that I'm not a car person. I don't derive a lot of joy from cars. I just need something get me from point A to point B. In contrast, we bought certainly a doctor house. Like, still to this day, our biggest monthly expense is our mortgage. But that gives us a lot of joy. We were going from New York City, where we lived in a small apartment with two kids, slept on an air mattress. We wanted a place with a yard, enough rooms and a lot of stuff. So. But it fits within our financial plan. So I always tell people who accuse me of being overly frugal, you know, I'm not saying don't spend the money. I'm just saying spend it intentionally. We have to think about how we're spending it if we're ever going to manage our expenses and build that savings rate and get to financial freedom.
- [12:29]
B
No. And I love that. And so keeping spending in control, putting away 20% of your gross income. So if you make 300,000, you're putting 60,000 a year, you're trying to live on the other 180 that you have, which is the 300 minus the 40% in taxes and put 60 away. And whatever the number is, whatever that number is, I love that. So a couple pillars, 20% of income away. If you could do more, more. And obviously, the more you make, the easier it can be to put more away, but the harder it can be to control spending. Control your spending. And then how do you think about investing? Is it. How do you balance investing between index funds, individual stocks, safe, safe investments? How do you think about that?
- [13:13]
C
Yeah, I, again, I'm like a very, you know, I live by the kiss principle of keep it simple. So what. What I did when I became an attending and was like, okay, it's time to start building this wealth, was I created that savings rate. It was about 30%. And I said, all right, I need to reduce my liabilities. I need to build my assets. The two assets I see that seem to work really well are stocks, bonds, and then real estate. So I took a third of my savings rate, and I used that to pay off debt. Student loans, et cetera, credit card debt first, then student loans. I took a third of it and invested primarily in my retirement accounts at that time in stocks and bonds. I am just invest using index funds. I don't have any individual stock holdings. I, since I'm young, I have a pretty aggressive asset allocation. It's 90 stocks, 10% bonds. But I took 30% and invested in that. And then I took 30% and invested directly in real estate. So I use that money to save up on a down payment. We bought a duplex using that money. That duplex cash flowed. We used the cash flow from that to save up for another property. Now we have nine properties. That cash flow. So that's kind of how I created the building blocks.
- [14:39]
B
Fantastic. I. I love that. And so how can people. I love your newsletter. I. I now signed up for it since I got to visit with you a couple weeks ago. I love it. Can you tell people how to find more about the prudent plastic surgeon? I just absolutely love what you do. If you don't mind telling more people and. And what Jordan does, what Dr. Fry does. It's helpful whether you're a hospital executive, whether you're an entrepreneur, whoever you are. The advice is mindful and useful for all of us. Dr. Fry, how can people learn more about you and the prudent plastic surgeon?
- [15:09]
C
Yeah, thank you. The easiest way is probably if you go to prudentplasticsurgeon.com and from there, that's kind of the hub. And you can sign up for the newsletter and see everything that we're doing. And then if anyone wants to reach me directly, my email is jordan jo r d a n@prudentplasticsurgeon.com and I respond to all the emails and stuff. So, yeah, that's probably the best way to reach me.
- [15:32]
B
Thank you so much, Dr. Fry. I love what you do. I'm a huge fan. You know, I'm whatever amount older than you and following some of these principles, I love it. And just fantastic. Thank you so much for taking the time with us on the Becker's Healthcare podcast today. And congratulations on your journey and, and sharing your journey with so many people.
- [15:54]
C
Thank you so much for having me, Scott.