Many physicians feel fed up with the burdens of modern medicine and are looking for a way to start fresh in a new career. It's not as easy as one might hope, but there are a number of ways physicians can start over.
I am frequently asked by physicians who have grown tired of their job for a list of non-clinical options they can do. Upon further questioning, what they often really want is something that pays just as well (or better) than clinical medicine, but that is much easier to do. Unfortunately, that can be a very difficult proposition. You see, most jobs pay much less than practicing medicine in any specialty, and most jobs that pay an income similar to that of a practicing physician are at least as hard, risky, and time-consuming. The median physician income is approximately $200,000, and the median household income in the United States is about $52,000 per year, and that often includes two partners working. In fact, only 25% of American households have income over $100,000 and only 6% over $200,000, with half of those between $200,000 and $250,000. The infamous “1%” starts at just $389,000, less than that of many physician households, especially a two-physician household. The bottom line is that almost all jobs pay less than that of a physician practicing clinical medicine. So if you want a job that pays just as well as that of a physician, your choices are very limited.
In some cases, it turns out the physician just doesn’t want to work any more. They want to be financially independent and be living off their investments. The good news is that physicians are generally paid enough that if they can live a middle class lifestyle during their career and in retirement, they can retire completely a decade out of residency. The math looks like this: Make $200,000 per year, pay $50,000 per year in taxes, live on $50,000 per year, and put $100,000 toward retirement. If you earn 5% after-inflation, after 10 years you’ll have a nest egg worth the equivalent of $1.25M in today’s dollars, enough to give you an income of $50,000 a year for the rest of your life. However, I have noticed that very few physicians hate working enough to live on only $50,000 a year for the rest of their lives. Most would rather work at least a little more and spend more. There are real consequences to a very early retirement.
Fix Your Job
The best option for most physicians is simply to fix whatever it is about their job that they do not like. That might mean dropping call, dropping a portion of their clinical practice (like obstetrics for an OB/GYN), cutting back on shifts or hours, or changing jobs to one with a slower pace, a less litigious population, and/or a more supportive administration. Nearly every physician I’ve ever talked to who has cut back their hours by 20-33% raves about how much more they enjoy medicine than they used to. Yes, this approach often comes with a pay cut, but it’s often not all that large on an after-tax basis, and certainly no larger than what they would see transitioning to a non-clinical career.
Perhaps the best pathway out of medicine is becoming an entrepreneur. Unfortunately, there is some risk here. Most small businesses fail, and most small businessmen make less than a physician anyway. However, a physician has a bit of an advantage here. She often has significant capital, which eliminates the main reason small businesses fail—borrowing too much money. She also can ease into the business part-time while maintaining her main, stable job as a physician. Plus, physicians are generally intelligent, personable, reliable, and not afraid of hard work. These traits serve them well as entrepreneurs. It would be impossible to list every possible entrepreneurial pursuit out there, and in fact finding an unserved niche and filling it is part of the fun of entrepreneurship. But the possibilities range from those that often remain “side hustles” like writing, speaking, and consulting, to the relatively competitive field of real estate investing to the design and manufacture of new medical devices.
Non Medical Jobs
Many physicians transition out of medicine completely into a new profession. This often requires another degree or training, such as a JD, an MBA, or a financial advisor certification. Some physicians wish to leave medicine and do something else that pays much less than medical work. These are the classic “encore careers” where you become a chef, a teacher, or a tour guide. This is a similar issue to retiring completely, but the more you have and the less you spend, the more job options that are available to you.
The vast majority of doctors who leave clinical medicine don’t have the interest or skills necessary to be successful as an entrepreneur, nor the money required to move into an “encore career.” They tend to go work for healthcare-related pursuits involving a diverse set of interests such as medical writing, resource utilization, health insurance, medicolegal work, pharma, or managed care. Hospital administration or practice management consulting positions are available to those who have developed non-clinical skills during their career. Coaching other physicians and working in information systems are other possibilities. As you are well aware, the design of most electronic medical record systems suffers from having little input from actual end users, and doctors with IT skills are highly sought after commodities. Health and disability insurance companies need physicians to do reviews. Venture capital companies interested in evaluating and acquiring medical businesses may find your expertise very valuable, especially if you can learn to speak their language. Recruiting physicians for drug trials or locum tenens companies is another option. You can also help write, produce, and present continuing medical education courses. Many of these can be paired with a part-time clinical career as well, which might even make you more valuable as you will still be seen as “one of us” among physicians.
If clinical medicine has become less attractive to you, then consider your alternatives. They include retiring completely, modifying or changing your clinical job, starting a business, leaving medicine for another career, or most likely, using the skills and knowledge you acquired in medicine to pursue a non-clinical medical career.
Dr. Dahle is not an accountant, attorney, insurance agent, or financial advisor. He blogs as The White Coat Investor and is the author of the best-selling The White Coat Investor: A Doctor’s Guide to Personal Finance and Investing.