How much we micromanage our lives is dependent upon our compulsivity and how many goals that we set in life. Medicine is a profession that attracts some of the most goal-driven people I have ever met. There are egos, obsessions, intelligence, and diligence all packaged into one unit. This is simply overwhelming. Fortunately, these habits tend to evolve with age. I’ve seen some of the most incendiary personalities in medicine mellow with time — maybe these doctors have rediscovered their life goals over time.
Our financial priorities evolve over time as well. During two of the years during residency, I opted not to contribute to my Roth IRA account. This amounted to $11,000 of post-tax monies that I spent for living expenses and student loans. These decisions were made during a time in my life where I had some understanding of long-term investing but was preoccupied by a seemingly large negative six-figure student loan debt I had to repay. I used to receive monthly statements on my student loans. Every month these numbers increased as I deferred interest payments. These increasing numbers were psychologically abrasive. I made the decision to reduce my debt to zero, and get my net worth up to zero. If you threw $5,500 in the stock market in 1980, it’d roughly amount to $295,130 in August of 2018! If you left $5,500 of your student loans unpaid at 6.8% for 38 years, you’d only have less than $100,000 built up (there are certain factors like forbearance limits that actually prevent you from dragging out loans this long, however). The right answer at the time probably would have been to contribute to my Roth IRA.
That’s roughly a $200,000 difference for a $5,500 initial investment. For me, it would have been double that for two years of lost investment.
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