Less than 20% of doctors are Millionaires ?

[TexDoc]

Trending on Bogleheads.  New Millionaire Next Door coming out in 2018.  Discussion has spiraled into the fact that there are more millionaire teachers than doctors.  https://www.bogleheads.org/forum/viewtopic.php?f=2&t=254081&newpost=4027930

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This back and forth made me curious, so I did some research. Please bear with me " width="15" height="15" /> The National Center for Education Statistics estimates there are 3.6 million teachers in the US. A 2016 census of licensed physicians (https://www.fsmb.org/globalassets/advoc ... census.pdf) estimates there are about 953,000 physicians in the US. As of 2016 there were about 1.3 million attorneys in the US (https://www.denniswpottslaw.com/united- ... rneys-map/). The research from Spectrum Group estimates there are 8.6 million households in the US worth $1 million or more. The survey says 12% are teachers, 2% are physicians, and 2% are attorneys. Using those numbers:

Teachers: 12% times 8.6 million = 984000 teacher millionaires / 3.6 million total teachers in USA = 27 percent

Doctors: 2% times 8.6 million = 164000 doctor millionaires / 953k total doctors in USA = 17 percent

Attorneys: 2% times 8.6 million = 164000 attorney millionaires / 1.3 million total attorneys in USA = 12.4 percent

Thus, about 27% of all teachers are in millionaire households. Meanwhile, 17 percent of physicians are in millionaire households while only 12 percent of attorneys are in millionaire households.

 

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Do you think it's accurate that less than 1/5 of doctors are millionaires?

 

[Kamban]

Teachers cover a wide spectrum from lowly paid school teachers in the South to highly paid ones in NY to college professors in Ivy league schools. How you break it down is important.

Also, quite a few physicians in academics are more likely to play a role as teachers and administrators than have anything to do with a patient.

[Hatton]

I also think you have to break it down by age.  I think the % of millionaire docs is decreased because of student loans and mortgage debt.  Pretty easy these days to be a millionaire by 40.  Most docs should be multi-millionaires in the 50s.  The only way I could believe that only 17% of docs are millionaires is if they are including med students and residents.

[Bmac]

It seems like fuzzy math to conflate households with a percentage of occupations. Also, what percentage of doctors are residents or within a few years out of residency and may still have large student loans?

[hightower]

Agree with Kamban, there's a broad spectrum of what defines a teacher.

Maybe many of them married well?  If it says they are "in millionaire households" does that include teachers that married a dentist or a wall street banker, etc?

I guess it could be true.  We all know how badly physicians behave when it comes to managing their own finances.  The question is how many are there that are behaving badly vs following a "WCI financial lifestyle."  I don't think anyone knows that number, but I would guess the vast majority are still pretty bad.  So 20% millionaires might be accurate.

[MnSaver]

I would think the number is higher, but having grown up in a medical household it doesn't surprise me. Two observations: "I can always make more" and "I deserve it because of all the sacrifices I made during training" were attitudes I observed not only at home but in that community in general. Not bad things, but certainly don't help engender early wealth accumulation.

Mortgage debt and education debt are the killers: mathematically, it's really difficult to "catch-up" in your late 40's and 50's.

Would be fascinating to do the same study and include value of defined benefit pensions. Teachers, Police, Fire, etc would all be labeled as millionaires.

 

[VagabondMD]

According to the 2018 Medscape survey, 41% of docs have a net worth greater than $1M. That number seems more realistic and accurate.

That said, teachers start earlier, have longer careers, pay less in tax in peak earnings years than docs, and often have generous pensions. They can retire in their 50’s with full pensions and get another job or do tutoring , which can be very lucrative.

[ajm184]

Couple points:

a. I have a slightly differing number of millionaires (9.98 Mio) (source: https://spectrem.com/Content/press-release-new-spectrem-group-market-insights-report-reveals-significant-growth-in-US-household-wealth-in-2017.aspx)

b. I would tend to add the millionaire 'buckets' together as the denominator.

c.  Not willing to actually pay $50 for the report, but I think Fox is willing to spring for our collective wisdom!

[G]

I think the data in these studies are always suspect: 1) self-reporting bias (think Lake Wobegon), and 2) who are they interviewing (I've never told anybody except my wife my NW).

Although my NW is increasing exponentially, I wasn't a millionaire (I just checked) for my first 11 years as an MD.  I wasn't collecting data, but my self-reported guess is that I didn't get to broke til 7 years out

[MPMD]

this to me is kind of like the stat that 50% of marriages end in divorce.

sample is so broad and heterogeneous that it's hard to draw conclusions. includes Britney Spears' third Vegas wedding and also the [insert fundamentalist religion here] couple for whom divorce isn't really an option even they both desperately want it.

[G]

ajm184 wrote:

Couple points:

a. I have a slightly differing number of millionaires (9.98 Mio) (source: https://spectrem.com/Content/press-release-new-spectrem-group-market-insights-report-reveals-significant-growth-in-US-household-wealth-in-2017.aspx)

b. I would tend to add the millionaire ‘buckets’ together as the denominator.

c.  Not willing to actually pay $50 for the report, but I think Fox is willing to spring for our collective wisdom!

Click to expand...

Ha, referencing Side Hustle's "climb" thread...I guess the next goal is to bust out of the UHNW category from $5-25MM.

I wonder if folks will still be worried about health insurance at the >$25MM category!!!

[childay]

Vagabond MD wrote:

According to the 2018 Medscape survey, 41% of docs have a net worth greater than $1M. That number seems more realistic and accurate

Click to expand...

Even that is pretty low!

[Raddoc123]

MnSaver wrote:

I would think the number is higher, but having grown up in a medical household it doesn’t surprise me. Two observations: “I can always make more” and “I deserve it because of all the sacrifices I made during training” were attitudes I observed not only at home but in that community in general. Not bad things, but certainly don’t help engender early wealth accumulation.

Mortgage debt and education debt are the killers: mathematically, it’s really difficult to “catch-up” in your late 40’s and 50’s.

Would be fascinating to do the same study and include value of defined benefit pensions. Teachers, Police, Fire, etc would all be labeled as millionaires.

 

Click to expand...

Next generation of govt. pension holders may get a percentage of what they’re promised given the rampant underfunding.

[Raddoc123]

Vagabond MD wrote:

According to the 2018 Medscape survey, 41% of docs have a net worth greater than $1M. That number seems more realistic and accurate.

That said, teachers start earlier, have longer careers, pay less in tax in peak earnings years than docs, and often have generous pensions. They can retire in their 50’s with full pensions and get another job or do tutoring , which can be very lucrative.

Click to expand...

Most doctors are in lower paying specialties like primary care.  Give them a 7-10 year later start and a 6 figure educational debt and they may never catch up to the municipal worker with a pension and health care benefits at retirement.   While the doctor is burned out and doing calls in his 50s, the municipal worker may have already retired comfortably.  This isn’t even considering how many doctors  live at or beyond their means.

[q-school]

what's a millionaire household?

the present value of a pension for teachers who are eligible probably makes them millionaires once they vest, if that is included.

is home included in the net worth of a millionaire household?

I echo hatton1.  age stratification for physicians is probably extremely important.  even so, 17% is shockingly low.  even accounting for reckless spendthrifts and divorce.