Opportunity Costs & Why Lifestyle Specialties Are So Popular
The amount of money that you earn in life depends on managing your opportunity costs. In principle, this is somewhat simple: Focus your time where returns are the greatest.
Choosing a medical specialty is difficult for many students, since there are numerous factors that come into play.
First you’ll need to evaluate your commitments: How long is the residency? How much time do I have to work each week? What’s the call schedule like?
It’s also important to try and get an idea of your returns for completing residency: What’s the average salary? How much vacation time do I get? Are there bonuses for patient, case, or specimen volume?
Let’s step out of the residency realm for a bit. Did you know that you could earn $1 Million by not watching TV?
A recent study found that it would take $1 million for someone to be willing to give up TV for the rest of their lives. People rarely consider the cost of watching TV, and when they do, they usually focus on the cost of their monthly cable bill. The truth is that there are a wide variety of costs associated directly and indirectly with having a TV.
The costs associated with watching TV go far beyond the cost of the television and cable. Additions such as pay-per-view, DVD players, gaming consoles, entertainment cabinets, movie rentals, and games help to run up the bill.
More importantly are the opportunity costs associated with not watching TV and the hidden costs of commercials.
Another cost often overlooked when considering the price of watching TV is the opportunities forfeited when you choose viewing over something else. Assuming that your time is worth at least the minimum wage of $5.85 per hour, your opportunity cost is $737 a month if you view the average amount of TV.
In 2005, Nielsen Media Research reported that the average person watched approximately 4.5 hours of TV a day, or 31.5 hours a week. At $200 in extra spending for each hour watched, that means that the average person spends an extra $6,300 a year due to TV commercials that they wouldn’t have spent if they didn’t watch TV.
You Need To Measure The Opportunity Costs For Medical Training
This case study on TV looks at costs many people have never thought of. You need to take the same approach when selecting a specialty in medicine.
It basically boils down to this: Where can you make the most amount of money with equal time and monetary commitments?
Here are some things to consider:
- Are increased costs associated with a “prestigious” residency or medical school worth it in the long run?
- Will you dilute your time value of money with more hours worked on the job?
- If you plan to go into private practice, is it really necessary to train at an academic center?
- Could you do something now that surpasses your future earning potential as a physician?
- Is a 5-year residency financially sound when you could potentially match those earnings in a three or four year specialty?
Lifestyle specialties are so popular because either the commitments, returns, or both are favorable. Similarly, the opportunity cost of not choosing a lifestyle specialty is extremely high.
Honestly, why work 60 hour weeks for $120,000 per year if you can work the same amount of time and pull in $300,000?
It’s something to think about.
I wanted to comment on the last sentence of your post:
“Honestly, why work 60 hour weeks for $120,000 per year if you can work the same amount of time and pull in $300,000?”
Here are some reasons that helped me make that decision:
I love peds, and I’d be perfectly miserable doing anything else. Overall, I’ve found I hate most of the medicine that goes on inside the hospital. The extra 180K that I would make as say, an EM attending or even a busy IM attending, just is so not worth it to me to deal with all the crap those docs put up with. Give me a screaming kid and a overbearing mother any day over a 300 pound COPDer with foot ulcers and CHF. I made the choice to earn less money but be able to work with patients who don’t create their own problems.
Lazy,
Very good point. You should absolutely do what makes you happy.
My point, which isn’t very clear in the above post, is to find the most bang for your time spent at work — all else being equal, that is.
I think I’m leaning towards surgically related stuff. I really liked anatomy. I though phys was ok but not great (and when they started talking about lab values and what’s high or low and what that means I wanted to stab someone.) I don’t really mind working long hours; what I think I’d hate is having no control (like general surgery call.)
I’ve basically ruled out General Surg, neurosurg, ortho because those fields seem like they attract the, to quote Full Metal Jacket, “The phony tough and the crazy brave” type. Emphasis on the “phony tough.” I know some older surgeons and they’ve told me not to go into general. They’ve recommended plastics and ophtho. What do you think of those two?
Optho is part of the EROAD group, so I would assume it’s a good lifestyle. The lifestyle is good in plastics (pay especially) once you get done, but it’s a long road to finish training.
You could, however, do nothing but cash-only breast implants in a big city and make crazy coin.
=)
Crazy coin!
Plastics is nice, but it’s an incredibly competitive field. Consider that there were 85 spots this year for an integrated plastics residency, and 90-some spots for a PRS fellowship from General Surgery.
Even after you come out of residency for PRS, opening up a practice would be extremely tough considering that LA/Miami are ridiculously saturated as far as the cosmetic surgery market. On top of that, one would have to be exceptionally shrewd for a doctor to be able to manage the finance of the practice.
fuck plastics. why do that lowly shit when you can be a cosmetic dermatologist, working half the hours and making the same dough, getting even more pussy and saying…”I got into the toughest residency ever”……if you wanna be a straight baller go for derm…..not some pansy plastics or neurosurg shit.
you get my point? why make 1 mil a yr if you have no time to spend it……in derm you can actually go to the bahamas every 2 months and get hunnies in your Benz Convertible instead of whackin off at home after 12 hour plastic surgery days
You sound so stupid gdizzle it amazes me. Never the less, plastic surgery just sounds really appealing to me having to utilize very precise stitching, eye balling, etc to change people for the better.
Gdizzle:
Plastics is the toughest residency to get into, not derm(both are crazy hard to get into, though). The average scores are higher in plastics, and there are less than 1/3 the spots than derm. Even though plastics is the hardest to get into, derm offers a much sweeter life during(lowest residency hours) and after residency if cosmetics, MOHS, or dermpath is a large portion of your practice.
I once met a plastic surgeon who thought that a totally nasal bridge (very obvious on the x-ray and clinically) was not broken….
After reading Gdizzle’s post, atleast I can take comfort in the fact that he/she probably won’t ever become a doctor.