Excerpt From Chapter 1

Developing a Productive Relationship with Money

"Doctors don't know %#& about money! I know, I'm one of 'em!" said the 55-year-old internist sitting across from me at a business luncheon. I smiled as he said, "We also don't know anything about business and managing people. They don't teach it to us in medical school; we have to make a lot of mistakes to learn. Why don't you write this stuff in your book to help keep us from screwing up?!" My hope is that this guide will do much more than keep the reader from "screwing up" but that it will allow you to relax and enjoy life, confident that your finances are on solid footing.

We work to produce income, and presumably because we enjoy it. We trade time for money, and although time is limited, money is not. We can work and work to pile up money or things, but because our time is finite, first we should be good stewards of that. If we can manage our time, the rest will fall into place. Money's only role in your life should be to support your and your family's goals, commitments, and intentions and to support priorities consistent with your values. Your work should help to support your life, and ideally, you find work fulfilling.

Work can be separate from your monetary goals. Talk with Doctors Without Borders (www.doctorswithoutborders.com) physicians or research doctors earning one third what they could earn if they said "yes" to the group practice that gently hints they could use another partner. Balancing a wonderful work environment with a wonderful pay environment is one of the trade-offs many make in their careers.

For any physician, getting rich fast is as easy as working extra shifts, working where you can earn the most, living simply and, of course, saving and investing. The key is to have a life that is rich in joy, good relationships, security, and fulfillment and that allows you to relax, knowing you are moving toward your financial goals while comfortably balancing your current needs.

Tension comes from finding and trying to maintain a balance between current and long-term goals. The key is to be aware of the trade-offs you make and to get buy-in from those who are affected by those decisions, including partners, spouses, children, parents, lovers, and so on. Balance is the key; great tension can come if your spouse is trying to fit a nice second car into the budget while you want to pay off the student loans as fast as possible, start funding a 529 plan for your first child, or simply slow down. We all make choices, and we as individuals have control of the choices we make. We only have so much time; how we use it is up to us.

Your Money's Financial Future: A Mission Statement

After tests, boards, residencies, fellowships, and finally, landing a good job, a young physician should sit back, relax, and say, "What do I really want my life to look like over the next 50 years?" This "life visioning" can be daunting, but it is the most important step in the financial planning process. Add a spouse, parental expectations, children, and other responsibilities to this life vision and you can get caught up in an "I think I'll read charts or go play tennis" avoidance technique.

A financial vision statement does not have to be written down, but it is helpful to do so. A vision statement will help develop a mission statement and goals that are beneficial when creating your financial plan. The "My Way/Our Way Life Plan: Budgeting Time and Money" on page 000 is a flowchart to help you see the complexity and importance of first understanding what you want before you get to the easy part of financial planning. If you do not know where you want to be or what you are willing to give to get there, you will be prone to use your assets and income inefficiently—chasing cure-all programs or drifting along without financial direction.

The following desires are easy to place in a vision statement:

As you think about what you want your life to look like, your "vision" ideas will coalesce into a tangible philosophy based upon your intentions, values, commitments, and desires. Following are some sample attributes:

Personal: Health, happiness, fulfillment, contentment, ability to express love through a committed relationship, honest friendships, family, children.
Family: Raise responsible, happy, healthy children in an education culture; be in a marital relationship built on trust, love, and commitment; be married to someone who takes care of the home, the children, and me; be married to someone I can talk to, who accepts my love as I wish to express it, who wants to grow together, and who is a good listener and communicator.
Lifestyle: Be where I/we can swim, walk, hike, boat, play tennis, golf, allow the dogs to run, have horses; be near our church, family, friends, work, great restaurants, museums, university, good airport, great schools; be in a safe environment; travel, do mission work, volunteer, have time for spiritual practice.
Possessions: Car, boat, ship; home with great views, home in woods, home in city; home with swimming pool, tennis courts, near health club; home has a great soaking tub in master bath, well-equipped kitchen, game room, entertainment room; second home, cottage, travel, an island, retirement plan account, investment accounts, real estate in this or another country; separate investment account set aside so I/we can take a year off to live in another country; house for parents or in-law apartment or cottage at your home; art collection, antique collection; farm, jewelry; ability to give to charities, religious organizations, help people.

Later chapters educate you in this visioning process and take you on a ride down life-cycle lane, helping you to see your life over many years. Life planning works best if you have a long view. A long-view plan allows you to be patient with yourself and those around you and live in the moment, confident that things are moving ahead as you wish.

The ultimate goal of all these chapters is what I call "financial ease," in which your finances are arranged to support you comprehensively, comfortably, and easily. So when your child needs college money, you can just write out the check; when retirement comes, you can just turn on the income; when health issues hit you, insurance or the cash falls into place and you can count on getting well without worrying about income security or bills.