Financial Planning for Doctors

Burnout has been in the headlines recently.  First, the World Health Organization (WHO) made burnout an actual medical diagnosis.  Second, another article published around the same time by TIME highlighted research showing how much physician burnout costs the medical field.  Of course, very little of the media put the two pieces together to realize that burnout, which is now an official diagnosis, disproportionately impacts physicians.  Today, I thought I would dive into these recent articles, and describe how we – as physicians – can fight burnout with financial independence.

WHO Burnout Diagnosis

According to the WHO, The diagnosis of burnout in the ICD-11 codes applies specifically to occupation related context, and should not be applied to other portions of our lives.

The diagnosis is stated as follows in the ICD-11,

Burn-out is a syndrome conceptualized as resulting from chronic workplace stress that has not been successfully managed.

They go on to describe the three classic ways that burnout manifests in a burned out individual.

First, they describe the exhaustion.  People who are burned out lose passion for things at work that used to fire them up.  This might look like apathy, or it could also look “lazy” to others who aren’t paying close enough attention.  Either way, exhaustion is a key hallmark of burnout.

Second, they describe the “distance from one’s job,” which is an interesting way to describe Herbert Freudenberg’s original description of depersonalization.  In medicine, this classically presents as doctors who treat their patients like objects rather than living, breathing human beings.

The third and final classic finding of a burned out worker according to the ICD-11 is “reduced professional efficacy”.  Again, I think they have strayed a bit from the original idea, which is that a burned out worker typically feels incompetent at their job.  Even if that is not the case.  Now, that is not to say that burnout hasn’t been shown to impact medical practice, because it certainly does.

Burnout is Costly

The TIME article helps us connect the dots a little better.  Yes, burnout is a problem.  (And apparently it is a “real” problem now that carries a diagnosis).  However, burnout is particularly problematic in the medical field.

We know from other surveys that physician burnout is prevalent.  Approximately 40-50% of all physicians are burned out.  Our rates of burnout are almost twice as high as the general population who work in other fields.

In fact, the research being highlighted in the TIME article estimates that burnout costs the U.S. people $4.6 billion each year.  And they say that this is a conservative estimate.

On an individual doctor level, we know that replacing a physician costs hospitals $250,000 – $1 million to replace a physician.  And we also know that burned out doctors are more likely to seek change and to transition jobs.

Given the numbers above, you would think that the medical community – and the administrators that run this community – would be all over fixing this problem.   It would save them a lot of money, right?  Unfortunately, this is not the case at most hospitals.

As working physicians, we realize that the hospital often won’t love us back.  And they certainly don’t seem particularly interested in proposing systematic solutions to a systematic problem that causes moral injury among our physicians.

Individual Solutions to Systematic Problems

Despite the fact that surveys show that physician burnout is caused by a lack of autonomy, electronic medical records, bureaucracy, and a plethora of other systemic problems… the proposed solutions most of us hear from our hospitals involve individual solutions like praying more, gratefulness mindsets, meditation, yoga, deep breathing, and aroma therapy.

So, here we are…. burned out, morally injured, and often left to fend for ourselves.  Despite the fact that these causes are most often systematic, we must find our own solutions.

What are we to do?

We fight burnout with financial independence.  Financial Independence is our escape hatch to burnout. Here are four ways that financial independence may be the best solution.

1. Finding Our Work-Life Balance

It is my contention that most major causes of burnout can be distilled down into two causes.  The first is a  lack of autonomy to practice medicine how we see fit.  The second cause involves poor work-life balance.

Money has an intrinsic relationship with burnout.  You can either choose the road that makes burnout worse, or you can choose the road less traveled where money can fight burnout.

We can use our financial decisions to work as often (or as little) as we want, if we stay the course with a solid financial plan.  In fact, the majority of physicians can reach financial independence 10-15 years in to their careers.

2.  Financial Independence Creates Courage

We have all had the experience of sitting in a faculty meeting of some kind while we watched people sit silent despite their current misgivings about the system.  Some of this likely comes from the apathy associated with burned out doctors.  However, a lot of it comes from the fact that people are dependent on their paycheck and afraid to speak up.

What if we all lived in a world where people had their financial lives in order?  What if people could actually say what was on their mind without having to worry about lost income or retribution?

In such a world, real change might happen because intelligent, educated, and hard-working physicians would be able to speak their mind about a complicated system that refuses to change.  We have created this road destined for burned out doctors.

We can also change it if we have a critical mass of doctors who have the courage to speak up.  And financial independence can help provide that courage for many who are afraid of losing their livelihood.

3.  Finding Contentment Today

The philosophy of financial independence is built on a few simple ideas.  First, earn a decent income.  Second, live a life within your means by learning to live a life of contentment.  Finally, take the difference between your income and your spending and save what is left.

That second step is absolutely key.  The more contentment we find, the more we realize that we don’t need the expensive house, the fancy cars, and the private schools for our kids that lock us into a life that only an attending physician paycheck could afford.  When we decide to follow Dr. EFI instead of Dr. Jones we realize that we have more than we could ever need.

In a round about way, this is another tenant of financial independence that helps us fight burnout.  The reason is that it builds two fundamental beliefs that poor gasoline on our FIRE breathing financial independence machine.  The first is that it decreases our spending, because we finally learn how to spend money in ways that actually make us happy. The second reason is that it increases our wealth accumulation rate (i.e. our savings rate).

This then provides the option to continue to work in the current system, to try to change it, or to use the only other “nuclear” option we have left…

4.  Leaving Medicine Behind

While part-time work is often an adequate solution to many physician burnout problems, sometimes it is not enough.  Things might get so bad that doctors will leave altogether.

Altruism (e.g. the desire to help patients) can keep people going for only so long in a system filled with insurance companies, large organizations, and hospitals that do not let doctors take care of patients the way they know they should.

If medicine continues to refuse to change, there will be a mass exodus of excellent physicians in this country. This is the nuclear option that is on the table, but no one likes to talk about.  Regardless, it is a very real problem.

Take Home: Financial Independence Can Fight Burnout

Burnout is not only real, it is costly.  It endangers doctors and therefore, threatens the medical community as a whole.

This is a problem that must be fixed, but if the system continues to propose only individual solutions to something that is a systematic problem, physicians will eventually find a way out of this mess.  Hopefully, financial independence will produce courage and the system will change.

If not, I’m afraid the physician shortage that looms ever larger will only get worse as physicians leave a field that fails to fix a problem that threatens the career and even threatens the life of physicians.

What do you think?  How do you actively fight back against the burnout that threatens your career?  Has financial independence played a part?  Leave a comment below.

TPP

6 thoughts on “4 Ways Financial Independence Fights Burnout”

  1. I know that financial independence has been described as a good way to fight burnout, but it is interesting that for me as I pretty much hit FI there is a part of me that feels like burnout has gotten even worse. In my mind there is a voice saying why are you working doing this if you really don’t need to.

    I am trying to combat this because there are some parts of working that are beneficial (social interaction, mental stimulation etc), but being FI also magnifies the parts you don’t like as well.

    • I actually have an upcoming post about why FIRE isn’t the goal, and one of the reasons I mention is exactly what you are saying. A focus on the future can actually make burnout worse, and so can getting there and realizing that you still aren’t happy.

      Learning the art of contentment is super important. If that doesn’t accompany the journey to FI, you’ll likely always be unhappy

  2. I was in the same position as @xrayvsn a few years ago. “Here I am in a position where I largely do not need the money, yet I am working harder and harder in an increasingly abusive situation.” It was the tipping point into deep burnout.

    I would also comment that financial independence is only a part of the solution. Yes, it gives you the opportunity to walk away, and yes, it also allows you to cut back and absorb less abuse. I also advise either redesigning your job so that there is less abuse, and, if this is not possible, find a new one that is a better workload, cultural, and personality fit.

    The latter step is not easy, and it took me a couple years to swing, but I have done both, and this has seemingly defeated my own burnout demons.

    • 100% agree, Vagabond. Financial independence provides the ultimate option, but many of us (myself included) cannot wait until then to find a way out from the burnout.

      I’ve taken concrete steps to try and help deal with this (asking for 1FTE; asking for shifts that help with work life balance but also require my skill set; saying no to a lot of asks right now).

      Building a job that allows the balance we need is important, and if we can’t do that where we are … Leaving is the only other option

  3. Great article. Of all the reasons you listed, I think item #2 regarding the courage to speak up is the biggest one for me. (I’m not a physician, but I think the principles you listed really apply to any highly-paid professional.)

    I just had a great example of that earlier this week. I recently wrapped up a presentation on the cost / time required to implement a new capability at a factory at my company. When I spoke with the peer with whom I worked on the assessment, he told me that we should start working on it now, ahead of formal management approval of the change – because when management eventually agrees to this change in 3 months, and still wants us to complete the project 9 months *from today* we won’t be behind.

    My response was simple – we say “no.” We said it would take 9 months after approval, and we should stick with that. Sadly, my peer didn’t seem able to process that – the idea of speaking up for the integrity of your own work just wasn’t something he could process.

    This got me thinking – what if more of us were FI? How much less stressful would our lives be if we had the courage to speak out against decisions that directly conflict with reasoned analysis? In fact, how much more predictable would project schedules at work be if management allowed us to follow the schedules we proposed (ie based on facts) vs the whims of management?

    All that said, I have also experienced the things that XRayvsn had listed (ie a general inability to care much about my work after reaching FI), which is disturbing to me as a high achieving professional. Not sure if this is depression or what, but not sure how to address it. Definitely looking forward to your post about it!

    • Glad to hear your perspective! Many of our problems in medicine are not ubique to physicians.

      Financial independence provides many solutions or options. It also provides us the power to stand up and change the system for those coming behind us, which is what excites me most!

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