Debt Free Doc Interview 1

Debt Free Doc Interview 1 - F

Here’s our latest interview with a debt free doctor (or soon to be). These stories allow us to continue to learn from those who are free of debt or currently on the path to do so.

If you’d like to be considered for an interview, email me jeff(at)debtfreedr.com and we can talk about specifics.

Be sure to read all the way to the end and either leave your questions or comments.

My questions are in bold italics and his responses follow in black.

Let’s get started…


How old are you?

We are 34 years old.

Do you have kids/family?

Yes, 2 children, ages 2 and 1.

What area of the country do you practice in?

Rural Wisconsin



How much student loan debt did you have?

I had 115k in student loan debt and my wife had about 80k of student loan debt. We also cash flowed her graduate school which was about 25k. I was fortunate in that I did have help with tuition. The majority of my classmates graduated with about 250k in student loan debt. This was in 2010.

How much other debt did you have?

In 2010, my wife had a car loan of about 5k. In the years after 2010 , we had mortgage debt. Our first house (2012 was purchased at 182k, mortgage of 162k), That house was sold in 2014 due to change in job. We then purchased our second home in 2014 for 255k with a mortgage of 210k. That house was then sold in 2018 and our current home was purchased for 229k with a mortgage of 110k. In the meantime, we had purchased 2 new vehicles (2013, 2015) with car loans of 20k and 32k respectively. We had also purchased a boat(2015) for 8.5k which was also on loan.

Is your house paid off? If not, is it on a 15 or 30 year mortgage?

Our house will be paid off at the end of the month. We lost money each time we sold our homes, however, what equity we did have was rolled into the next home. Our first home was on a 5/1 ARM and the following two homes were both placed on 15 year mortgages.

What was the defining moment that made you decide to tackle your debt?

Stumbled upon Dave Ramsey and his show in 2015, shortly after purchasing a boat and new vehicle. He made me rethink some of the financial decisions we had been making in general. It was at this point that the decision was made to become debt free.

I had decreased my student loan burden substantially as, I qualified for state based loan repayment (50k for 3 year service commitment). After the state based repayment was satisfied, I applied for the NHSC loan forgiveness program ( 50k for 2 year commitment). I also took an additional year of forgiveness beyond the 2 year commitment (20k for 1 year commitment).

We placed an estimated 20k in after tax money at my student loans. I made the decision to pay ahead on my student loans as opposed to paying down principal, because I thought I might be in public health for some time. This proved to be a good decision, as the government payed most of my student loans and allowed us to focus on paying other debts.

What type of plan did you use to pay off your debts?

We used Dave Ramsey’s debt snowball. Psychologically, it was fantastic. We were able to quickly payoff the boat and cars and use those payments to speed paying off wife’s student loan debt.

Did you make any mistakes or hit any snags along the way?

After 2015 we were generally pretty disciplined about saving. Biggest mistakes prior to that were home purchases. It would have made more financial sense to rent, especially on our first home. Thus far, we have lost money on each of our home purchases.

How long did it take you to become debt free?

8 years since graduation, 3 years since being deliberate about paying it off.



What is your profession?

I am a dentist and my wife is a nurse practitioner. I am a salaried employee. I do not have my own practice.

What is your salary?

I did a residency after dental school. Paid about 50k during residency. After residency made 125k for 2 years. Switched positions after which salary has increased each subsequent year. 165k to 210k to 245k to 270k. After year 2 of current job, I am vested into my work pension plan which adds about 26k per year into retirement funds. My wife’s salary (2013 and beyond as we were not married prior to that) was as follows: 40k, 55k, 55k, 80k, 90k. My wife worked part time 2013-15 while completing NP. Bump in salary was noted after graduation from NP school.

What does your work life balance look like?

I work 5 days a week and my wife works 4 days a week. She went to 4 days after our first child was born (2016). I plan on working 4.5 days per week next year which should improve work life balance.

Do you have any sources of income besides your career?

At this point, we do not.



What is your annual spending?

I would estimate our annual spending equates to 90-95k per year. Child care has increased annual spending substantially. We should see a decrease in annual spending next year of about 15k due to mortgage payoff.

What are the main categories this breaks into?

Mortgage 15k, Taxes 4k, Childcare 24k, day to day living, vacations, etc, 50k

Do you have a budget?

No, not at this point. We don’t see a need as we can save 50 percent of our income and do not feel deprived in any way.

What percentage of your gross income do you save and how has that changed over time?

Today, I’d estimate it at about 50 percent. Obviously, it has increased over the years as our debt has decreased and our income was increased. Childcare has offset some of the income increases the last number of years.

What do you secretly love spending money on?

I enjoy woodworking, so I spend money on that. Otherwise, we enjoy travel when we can. Try and get a couple of vacations a year. My wife loves coffee and restaurants.



What is your investing philosophy?

We use Paul Merriman’s Ultimate buy and hold portfolio (aggressive). We are 100 percent invested in stocks. I do view the paid off home as more bond like, however.

What’s been your overall return?

Market has done well over the last number of years. I’d say 10 to 12 percent per year.

What is your current net worth?

Including home, 875k. Subtract 230k without home.

Do you have a target net worth you are trying to attain?

I’d be very comfortable at 2.5 million. At that point, I know I could maintain existing lifestyle with no reliance on current job.

What are the main assets that make up your net worth?

  • House 230k
  • Taxable investments 150k
  • 529 plans for children 25k
  • Retirement accounts 470k



When do you plan on retiring?

Difficult to say at this point. I’d like to have the freedom to do so by 40 or so.

What are your retirement plans?

I’d like to do more woodworking, possibly create business revolving around this. I also enjoy biking.



What advice do you have for Debt Free Dr. Readers on how to become debt free?

Spend less than you make and substantially so if possible. Possessions will not make you happier, nor will an expensive home. If you are able, live in a low cost of living area, so much the better.

How did you learn about finances?

Father helped me along when younger. More recently, certainly Dave Ramsey has been an inspiration, as has the FIRE movement.

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