Some of you may consider this post to be somewhat off-topic, but I don’t. The reason I don’t think this post is off-topic is because money is universal. No matter what we do for a living, we all need it to survive. With that being said, let’s take a look at what “pentamillionaires” do that the general public with average income do not, and then let’s apply some of those ideas to medicine and what you can do to approach reaching that seven-figure mark.
Earlier I wrote about working smart in medicine for maximum income generation. The latest article in Smart Money magazine talks about what the millionaires these days are doing, and some of my ideas fall along the lines of those that were successful in generating seven figure net worths. Before we get into the nuts and bolts of the article, let’s take a look at some interesting statistics quoted from the article:
- One million is yesterday’s news. In fact, to reach the top 1% of income earners in the nation, you’ll need to amass a net worth of $5 million.
- The number of people worth $5 million or more has quadrupled since 1997 to more than 930,000.
- 70% of these fortunes are less than 13 years old and the people that have earned them are by and large entrepreneurs. Many of these people accumulated wealth as a byproduct of their passion. This is very important.
- Respondents reported that only 10% of their wealth came through passive investments and only 10% of pentamillionaires inherited their wealth.
OK, there are some interesting tidbits in the above statistics, but what’s most important is that the wealth was actually a byproduct of people doing what they love to begin with. Read that again — the wealth is a byproduct of people doing what they love to begin with.
Another thing to consider is that these people did not make their wealth working a 9-5 (or 6am-6pm for some of our medicine friends). Instead, they all did their own thing through business. Yes, we all know that medicine isn’t the most efficient way to make money but if you’re going to be working in medicine why not make as much money as possible?
But how do you do that? Unless you’re a practice owner you are technically the employee of somebody else. You have a salary, perhaps with bonuses for doing volume. If you choose to stay somebody else’s employee, you’ll have a steady paycheck but I’ll be the first to tell you that you’ll probably never make the top 1% of income earners in the United States.
Let’s take a look at what some of the people did that Smart Money interviewed for the story:
Once you’ve got food in your belly and a big-screen TV, the mere prospect of more Benjamins isn’t enough to get you leaping out of bed at 5 a.m. Rather, rich folks often make their fortunes after they make up their minds to solve a problem or do something better than it’s been done before. When Frank Darras graduated from law school, all he wanted in terms of material wealth was a middle-class life for his wife and kids. But while working as a doctor’s assistant to put himself through school, he developed a burning desire to help the folks he saw struggling with unpaid insurance claims. “It was the David and Goliath aspect that attracted me more than anything,” says the Ontario, Calif., attorney. Once he had his degree, Darras was like a cruise missile aimed at the insurance industry. By 1990 Darras had his first million-dollar year, and today he oversees one of the nation’s largest disability and long-term-care practices. “I never thought I’d make $5 million in two lifetimes,” he says. “I just loved the work.”
So here’s another possibility for all of you medicine people out there — keep your ear to the ground at all times. Find something during your normal day-to-day work routine that you can do better. A perfect example is a surgeon. If you’re doing a procedure with a particular instrument and you know a way it could be done in a safer, more efficient, and/or more cost effective way — start working on developing that. The same idea can be applied across all fields of medicine.
The honest-to-God truth is that you’re not going to want to work the insane hours that you are working now along with the stress when you’re 60 years old. Doing something like this could be your meal ticket out of the rigors of medicine and into something way more lucrative at an early age.
Remember, medicine is business and it’s not a sin to treat it as such.