Let’s say you are a recent anesthesia grad looking for your first job. You interview at a few places and get great offers at the two sites that are top of your list. Even better, they both offer a $50k signing bonus.
You’ve learned a bit about personal finance, want to start building wealth and wonder what your best step is. Should I invest in real estate? Start a brokerage account? Pay down my student loans? How about putting some money down towards a new Rivian?
First, let’s talk about what an incredible position recent anesthesia grads are in – or those looking to change practice environments. Anesthesiologists are in high demand nationwide, and there simply are not enough of us to fill all the open slots.
The result has been higher salaries, more vacation time, signing and relocation bonuses, and better benefits. And I’ve even heard many of my surgical colleagues thank me for our hard work!
With that out of the way, let’s figure out how to start building wealth. If there is one lesson I hope to teach my anesthesia colleagues, it is this. Building wealth had less to do with hitting home runs with all your investments.
Building wealth is about creating habits that constantly run in the background. When you get a bonus, you first think, “Where should I save and invest this money?” instead of looking for a new boat or a bigger house.
Building wealth is about creating and sticking to your investing guidelines – regardless of what the markets are doing or what you overhear in the doctor’s lounge.
Building wealth allows time and your capital to accelerate and compound for you; instead of buying high and selling low, which is far more common.
Returning to our example above, what is the correct answer? Any of the first three options will help you build wealth. You are saving and investing in yourself. You are giving yourself better choices.
To build wealth, you must keep saving and developing that habit. Save and invest in each paycheck.
You can buy investment properties and build a real estate portfolio. That is a well-established route.
You can put money away in your retirement account and your ROTH IRA.
But the most important step is continuing this behavior, month after month, year after year.
Part of what makes bonuses or other windfalls so powerful is they accelerate this process.
Saving $100K yearly for ten years will grow to over $1.5 million. If you saved that $50k signing bonus, you’ll have even more – $1.7 million!
Now don’t think that I’m all saving and no play. If you looked in our garage and saw our toys, or talked with my wife, she’d definitely disabuse you of that notion. Money is meant to support our lives and help us thrive.
My clients will tell you I encourage them to spend money on the areas of their life they value most. Whether that is an amazing family trip to Japan or remodeling the kitchen so they can entertain, money is a tool.
Building wealth is similar to any other keystone habit. It’s a way of life. You are building resilience. You are building and creating better choices for yourself. You are saving for no other reason than to save.
What if each time you got a pay raise, bonus, or other types of money windfalls, you saved 90% and played with 10%? Undoubtedly, this accelerates your path to both financial and time freedom.
What can you do to start working this muscle now? Can you do this with your next tax return? Or from an unexpected bonus at work? Start today!
Reach out here if you want to chat about your current situation.
