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Avoiding the Financial Arrival Fallacy for Doctors

Arrival fallacies are real. And as physicians, we tend to experience more than the average individual. However, we usually don’t think about one big one – the financial arrival fallacy. Unfortunately, I’ve seen a bunch of doctors fall victim to this.

So, let’s talk about it right in the open rather than keep it bottled up. The same as everything I do here, the goal is to help clear the stigma of money in medicine. Because the whole reason I started this blog was that I realized, to my surprise, that I actually became a better doctor when I started thinking about money after my financial comeback…

Let’s start at the beginning.

What is an arrival fallacy?

I was unfamiliar with this term until a few years ago. However, I immediately understood it once someone gave me an example. Because I had experienced arrival fallacies over and over in my life.

financial arrival fallacy

With that in mind, I’ll start with an attempted definition and follow that up with some examples that will probably be even more effective.

An arrival fallacy describes the experience of expecting some massive positive change in your life upon reaching a milestone, only to find the expected fulfillment, joy, or reward absent.

That’s my definition. But now let’s try some examples…

“When I finally graduate college and get into medical school, everything will be good…”

“Once I finish medical school and match into my residency of choice, things will get better…”

“Finally, I’m going to be an attending and start making money, then I’ll be happy…”

These are all set ups for an arrival fallacy

Because physicians have a ton of well-defined milestones on their journey to becoming physicians, we are particularly prone to setting ourselves up for and experiencing arrival fallacies.

I thought all of the above things. And things did not magically get better or I did not magically get happier afterwards. Because that is not how things work. Especially when you are placing the importance on just the extrinsic goal of accomplishing that milestone. Instead, we often reach the goal or milestone and are disappointed. Because we find that our imagined promised land is no where in sight.

In my case…

The arrival fallacy straw that broke my back was the one I built up around finishing training and becoming an attending.

Everyone, including family, friends, colleagues, and myself initially, were telling me that things were finally going to be “great.” I was finishing training after this long road and would finally be a full-blown surgeon. I was going to start making real money. It was the good life ahead!

The problem, however, was that I didn’t really feel this way. Internally, I started shouting back,

“No, it’s not all good! I’m >$500,000 in debt with student loans and credit cards. I have no savings and no investments. I don’t even know how to do those things. Plus, I have a young family. And yes, my income will increase but everyone is just telling me that my expenses will too. It’s not all good!”

And finally I recognized what my errors were. I had always looked at these goals externally. My intrinsic reason for reaching them remained ill-defined. I also always assumed that reaching some goal magically brought something with it. But in reality, nothing is just going to happen. You have to make it happen!

Anyway, that’s a long backstory into how arrival fallacies work. But we are talking about…

The financial arrival fallacy

The financial arrival fallacy can be tricky. And it seems to happen in two types of physicians in my experience:

  • The first kind are very well-intentioned. They may even read this blog and their goal is to reach financial freedom. This arrival fallacy can really sneak up on them…
  • The second kind is usually – and I tried to think of a nicer way to put this – but the kind of doctors who gives doctors a bad name. And perpetuate the taboo that doctors shouldn’t think about money. Because these doctors are just trying to stack their bills and pad their net worth. These are a minority, but the financial arrival fallacy hits them maybe the hardest.

Regardless, the financial arrival fallacy occurs when a doctor sets a goal to reach a certain net worth or create a certain amount of cash flow, then reaches that goal and finds themselves no happier, fulfilled, or less burned out.

For instance, the first type of doctor mentioned above may feel burned out. So they do their homework, figure out what their retirement nest egg needs to be to reach financial freedom, reaches that goal using these saving and investing strategies. However, when they reach their goal, they remained unfulfilled and burned out.

And the second type of doctor may just keep working hard to reach a certain level of wealth that they deem as appropriate. But then they reach it. And they find that nothing changed. There is no magical enlightenment awaiting them. So they keep working more and more. Trying to find what is missing.

This isn’t the answer either…

How to avoid the financial arrival fallacy

The answer is really the same as how to avoid any arrival fallacy. And the answer is that you need to establish your big why!

You need to know your absolute reason for seeking financial well-being and independence. This seems on its face like such a simple and kind of ridiculous question. Of course we want to have our finances in order. Of course we want to be financially independent. Isn’t that reason enough?

The problem with this logic, in my opinion, is that one day you will reach your goals. You’ll become financial well and likely independent.

And then what?

If you haven’t sorted out the why of doing this, the end can actually seem pretty hollow. Sure, you’re financially set, but what do you do now that you no longer have to chase this carrot?

In my eyes, money (without the why) truly doesn’t buy happiness.

Don’t get me wrong. This is a problem that a lot of people wouldn’t mind having. But it’s important to remember that the goal of financial well-being is to enhance your life, your happiness, and your overall personal well-being.

For this to happen, we have to align our financial goals with our life goals

In her excellent book Grit, Angela Duckworth identifies passion and purpose as two components of grit, a personality trait that is common (even more so than intelligence) in high achievers.

When we identify and feed our passions and know our purpose, we are more likely to persevere and follow through with our aligned goals.

Therefore, I strongly believe that figuring out our why (aka our passion(s) and purpose) is the first step toward sustainably working on our financial well-being.

Let me lay out the steps:

  1. Think about and establish your why
  2. Align your financial goals to your why
  3. Develop your plan to reaching those financial goals
  4. Pursue your financial goals

It seems straight forward enough, but most people don’t do these steps in that order.

Most people start with step #4

If they are unsuccessful, they fall back onto limiting beliefs like “The odds are just stacked up against me” or “It’s not fair” and they stop trying.

If they are successful, more likely than not, the seeming end point is met with a profound lack of purpose. Either of these scenarios leads to unhappiness in my mind. 

However, by starting with step #1, we begin realizing that money for money’s sake is not what we are after. We are after other things that can come with financial well-being. Things like absence of finance-related stress, work on our terms, more time with family and friends, more travelling, etc. The list goes on and on.

But a common theme emerges

It seems that most people are looking to buy time with their money. And this makes absolute sense. Time is a completely limited resource while money is not.

Trading money for time is a winning trade; trading time for money is a losing one. That’s why we need to think of our time value as physicians

Back to the main point though, everyone’s why will be different and it is the hardest step for sure, but doing it first will step you off on the right foot to financial freedom.

Further, when you have an all-important why in your back pocket, when you come up to those road blocks in your journey, you will have a reason to persevere and push through without stopping or getting off track. All to often, without a why, people get off track or just give up. It’s easy to think “Wait a second, this is hard. What is the point of doing this?” That question doesn’t even come to mind if you have a why because, that’s the answer right there!

It took a very long time for me to establish my why

It actually began when I was figuring out the type of job that I wanted after my plastic surgery training. I found it incredibly difficult to decide among the options that I had and the reason was that I wasn’t exactly sure what I wanted my life to look and be like. Because of this, I didn’t know which option would give me the best opportunity to build that life. Once I figured that why out, the decision was pretty straight-forward.

For me, I am seeking financial well-being to buy more time.

I love what I do and have no intentions of stopping soon (heck…I’ve barely got started). But I do want to work on my own terms. Doing something because I am choosing to do it feels very different to me and most people than doing something because I have to.

I want more time with my family and friends. My wife and I have not done much travelling due to time limitations from our educations and training. We want to make that up. I want to focus more time on hobbies of mine, such as this blog, that have been neglected during my training when my sole focus was (intentionally) on becoming the best surgeon that I could.

Also, I want to conserve the time and mental energy that I otherwise would spend worrying about my finances. I know what I certainly do not want – I do not want to be idle. I need to have continued purpose as I easily become restless and bored. My why helps ensure that won’t happen.

Lastly, why’s can change all the time

That’s absolutely ok.

We may find new passions that uncover a new purpose. As long as we recalibrate and keep our eyes on the real prize – our why and not money – then we still have our goals aligned and are improving our well-being, both in a financial and overall sense.

It is easy to lose sight of why we are pursuing the things that we are pursuing. It’s easier to keep our head down and keep going rather than to look up and realize we are not where we want to be.

But to get there, to our why, we have to take this first step of looking up. The rest will follow!

And, if you are looking for a single, straightforward, actionable resource to help guide you to financial well-being and freedom, please check out my best-selling book, Money Matters in Medicine!

What do you think? Have you experienced an arrival fallacy? How about the financial arrival fallacy? How do you combat it? Let me know in the comments below!

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    Jordan Frey MD, a plastic surgeon in Buffalo, NY, is one of the fastest-growing physician finance bloggers in the world. See how he went from financially clueless to increasing his net worth by $1M in 1 year and how you can do the same! Feel free to send Jordan a message at [email protected].

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