How financial independence and retiring early (FIRE) can work for physicians

By Jonathan Ford Hughes | Fact-checked by MDLinx staff
Published September 16, 2022

Key Takeaways

  • Financial independence and retiring early (FIRE) is a financial lifestyle concept based on living frugally in order to save more money than usual.

  • If doctors can commit to a more middle-class lifestyle despite their high salary, it can pay big dividends later on.

  • With buy-in from your partner, you can save more now and live the lifestyle of your dreams later on.

Frugal physician seems like an oxymoron on par with simple EMRs, basic brain tumor, or a short staff meeting. Frugality for physicians can be a reality, though, and one that comes with the added benefit of financial freedom. By living the FIRE life (Financial Independence and Retiring early), frugal physicians can get the last laugh.

What is the FIRE Lifestyle?

Living the FIRE life for physicians means having a comfortable middle-class lifestyle and investing/saving 50 percent of your income. Just follow Physician on FIRE’s example. In addition to being a practicing anesthesiologist, PoF guides doctors toward the financial good life.

PoF started working part-time in October 2017 and has a tentative plan to semi-retire next year, focusing exclusively on his website and writing. The advantages to this new career are clear: He can make his own schedule, be his own boss and work from anywhere in the world.

But, living the FIRE life takes some serious commitment and work on behalf of the physician. Frugal doctors, he says, drive modest cars, live in modest homes in neighborhoods that aren’t posh, and don’t buy a lot of frivolous commodities. If that sounds like something you can get behind, here are some thoughts on getting started.

How to ‘chase happiness’ with FIRE

PoF, who is an avid reader of Mr. Money Mustache, realized after diving into the blogger’s content that he could save and invest half of his money while living off the other half after paying off his student loans. He concedes that he and his wife were already frugal when they made these decisions, but the choice is pretty clear when you consider the following:

"Physicians spend a substantial majority of their paycheck chasing happiness. Much of this spending ends up being frivolous when we realize it’s not making us happy."

Physician on FIRE

Think of all of those $25-50 purchases you make. Ask yourself, when was the last time buying something actually made you feel good for more than a few hours or a few days?

Being a frugal physician and avoiding the momentary happiness chase may mean taking on a more minimalistic way of thinking and living. You need to “have a purpose for everything that you own, not allowing clutter to take over your living space and your life. Physical clutter can become mental clutter,” PoF says.

With the average physician salary hovering around the $300,000 mark, you can still live a comfortable middle-class life using the 50/50 model. It’s important to realize that’s middle class, not upper middle class. There’s a key difference, PoF says.

Upper-middle class is more aspirational (luxury car, first-class flights, McMansion). Middle class living is more like the used Honda, coach-flying and comfortable-but-practical house life.

If this is something you can get behind, the FIRE lifestyle may be right for you.

Making a FIRE plan to retire early

If you’re encouraged by PoF’s advice and want to get started, begin here:

“You need buy-in from a partner, if you have one.” You need to talk things over with your partner.

Make sure your financial goals are aligned. This may be difficult depending on the social circles you’re in and the aspirations you have. But before you make any changes, you must make sure you and your partner have the same goals.

“Lead with, ‘what are your goals and dreams,’ not, ‘this is how much money we need to stop spending.’”

Remember, he adds, this change doesn’t need to happen overnight.

A word of caution: One of the pitfalls doctors can’t seem to avoid, PoF says, is “trusting your money to someone else without knowing about their fee structure, motives and incentives.” These factors may not be in alignment with your own ideas.

We get it. You’re busy. But you need to be intellectually engaged with your savings and retirement planning. Horror stories abound about financial advisors who didn’t disclose potential conflicts of interest, only to leave doctors penniless–the opposite of what you’re trying to achieve with the FIRE lifestyle.

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