Physicians are among the least productive occupational groups in transforming their incomes into wealth. Keep this in mind when you read the following case study.
Mr. Arrow, who has a degree in pharmacy, is employed by a large pharmaceutical company. Part of his job description is to interface with physicians and surgeons. Unlike many others who call upon physicians, Mr. Arrow usually does not have to wait very long in their waiting room. Why do so many of his physician clients have a keen interest in speaking with him ahead of others? It is because he provides them with more than information about his core pharmaceutical offerings. Before I reveal what these auxiliary services are, let me give you some more information about Mr. Arrow’s background.
He and his wife are ardent savers and investors. Their stated philosophy:
. . . be productive . . . save some of our rewards for that productivity for the times when we will be less productive.
The couple’s household net worth is more than three times the expectation given Mr. Arrow’s age and income. He is 61, and their annual income is $160,000. Mr. Arrow attributes his low consumption lifestyle to being raised by a frugal Scottish father. But Mr. Arrow is also a voracious reader of books on money and investing. In the process of his learning, he transformed his wife from an income statement affluent type into a member of the balance sheet affluent group. She was Mr. Arrow’s first student in his informal “building wealth class” but not his last.
By becoming well educated in the ways and means of the millionaire next door, Mr. Arrow has benefited in two ways. First, he was able to build a considerable domestic nest egg. Second, because he acts as a mentor sharing his considerable financial knowledge with his physicians, they respond to him in a positive manner.
A physician will invite me into his office and ask me to shut the door behind me. That is always a sign that he/she is going to ask for financial advice. Nine times out of ten it is debt that is dragging them down. They didn’t realize their school loans would be so difficult to repay or they bought too much house or too much car because they thought that is what doctors do. Recently, a specialist about my age thought he could retire with about $800,000. I’m sure you can imagine how long his retirement lasted.
2 thoughts on “Millionaire Mentors His Clients”
That’s really interesting because I find the same thing happens in my friends who are doctors and dentists (I am not one). They get into a lot of debt for their school or their businesses and then can’t figure out why they’re not getting ahead, yet they drive flashy cars and live in big houses.
In the end, it’s all the same, no matter what income you make — save what you have, and spend within reason.
I myself am not in the extremes. I do save what I make (~$200K by the age of 28 and then I took a sabbatical of sorts for 2 years to travel), but I also spend and enjoy it because I want to, yet it’s all within reason.
Doctors I respect don’t let drug salesmen in the door. They do their own reading on pharmaceuticals and know how to interpret studies. Do you think the salesman is going to mention numbers needed to treat (if they’re high), or that the medicine doesn’t work much better than a placebo (if that’s the case), doesn’t work much better than cheaper off-patent drugs, etc.?