In another thread, this came up:
Why would physicians be more prone to poor personal money management than those in other kinds of jobs? Or is it just that, among those with poor personal money management, they have lots of money that attracts the more predatory types in the financial services industry?
Physicians consistently average far better on measures of financial literacy than the general population. In the Medscape investment survey, the most common investments among physicians are mutual funds / ETFs, stocks, real estate, and personal property. Only 14% had annuities and having “exotic investments” besides crypto (12%) was rare.
Physicians as a whole also are successful with their finances, making notable wealth gains on their investments. In the Medscape survey, 2/3 of physicians’ net worth as a whole was contained within retirement accounts and real estate.
I expect the reputation and target from salespersons relates to physicians tending to have high incomes and high wealth, and tending to be more open to financial pitches than certain other high income/wealth occupations, such as ones related to finance. A financial salesperson is far more likely to get a high commission from targeting a physician than from targeting a random person within the general population.
My relatives who are MDs all seem to manage their money just fine. My non-MD relatives manage fine as well, even tho they have less $$$ to work with.
I have plenty of friends who are in the medical profession. I’ve never noticed any difference in how they manage their finances over anyone else.
We are in the med profession. Managing money has never been a problem for us. But, what has been interesting throughout the years:
1.Real estate agents push for the most expensive house you can afford, even though we told how much we were going to spend. We are still in our nice modest house of 25 years. We built our current one for retirement when the kids were little.
2.Advisors come out of no where to want to manage our money. We manage the money quite well on our own.
Not only medical professionals are targeted. As soon as my husband updated his LinkedIn profile to reflect his promotion back in the day, he began getting requests to connect from some random financial advisors. Most were legit people, with a handful of scammers thrown in. These guys use the internet to trawl for individuals who might be a good target. And no, we aren’t interested. And also don’t have megabucks to gamble with. 
I’ll bite.
I feel like this stereotype was definitely true 50-60+ years ago. My father was a physician/surgeon, and they were referred to as, “Dumb doctor deals.” Even among the doctors themselves. Pretty sure he got taken on a couple of risky schemes. He was part of a very large, multi-specialty practice, and I know he wasn’t the only one who got suckered. I can also remember at least one or two times our housekeeper calling from the bank because there weren’t enough funds in my parents’ checking account to cover her check.
My father was not a stupid person, but money management was a skill that he was never taught. More than once I heard him lament that he would have been far better off if basic accounting had been taught to him in medical school instead of Latin. He clearly was also never taught that if it sounds too good to be true, it probably is. He graduated medical school in 1954.
I also think, at least for him, he thought that the money would always continue to roll in. He grew up pretty poor. I think he enjoyed being able to, “show off,” his success since he came from nothing. My parents enjoyed traveling extensively, and my mother had a fondness for jewelry and expensive clothing. So, not necessarily the best saving habits. My mother was completely in the dark on their finances. He earned it, therefore, it was his money. He spoiled her and liked telling her not to worry about what she spent.
I got nothing, except maybe a keeping up with the Joneses mentality, which would lead to buying more car or house than really needed. Though, as this thread shows, that doesn’t apply to all.
Or the high esteem in which doctors are held in society and so they want to appear they understand things that they perhaps don’t and get into unwise investments.
Tbh, again the Goldman Sachs study feels full of opinions and low on facts.
I’m so confused about the purpose of the “study”. To get high earners to invest more?
The guy down the street from me owns an $80,000 truck, multiple four wheelers and a 5th wheel. Forgot about the snowmobiles. Lord knows what else is in their pole barn. I don’t see a study on their dubious choices.
Goldman Sachs published a document summarizing responses to their survey. It doesn’t claim to be a “study”. The quotes in the original post are from the CC thread, not the survey.
I expect the purpose of the GS publishing the survey is to increase revenue for GS. The cost of creating and publishing the survey is a drop in the bucket compared to the $10+ billion per year revenue GS makes from Asset and Wealth Management. If the survey leads to increased new Asset Management clients, the cost to produce the survey and publish results is likely a worthwhile financial investment for GS, particularly clients at the business/employer level, such as new employer retirement management clients. You can see some clues in that the survey summary starts by saying:
The good news is that better planning, personalized advice, stronger portfolio
construction, and retirement income solutions can help…
and ends by saying:
At Goldman Sachs Asset Management, … we remain committed to partnering with employers, advisors, …
with authors listed as: Greg Wilson Head of Retirement, Goldman Sachs Asset Management and Chris Ceder Senior Retirement Strategist, Goldman Sachs Asset Management.
I was responding to the quotes in the first post that weren’t part of the article.
For that I apologize
The guy who owns the fleet of refrigerated trucks owns an $80,000 truck and the doctor across the street owns a $80,000 Luxury SUV.
Neither owns a 10 year old Volkswagen Jetta.
Here is the rural Midwest, I see as many American branded trucks and SUVs that are just as expensive as the Infiniti, Audi, Mercedes Lexus or name a luxury brand that the type of automotive that you drive doesn’t seem to be a indicator of your wealth status.
But I digress. I personally think that there are people who make stupid money decisions in all professions. I don’t think this conversation is for me.
Sorry…that’s a weird article. The family doctor in this family works with a CFP who specializes in doctors. Has been a great help in retirement planning, and helping make big purchase decisions at the right time. This doctor is very careful with their spending anyway.
Many moons ago, I had an old school dentist in Queens which is where I lived when I first graduated from Wharton. When I started working at the aforementioned IB, he always spent the first 15 minutes of every appointment asking me what was hot. There were times when he even took calls from his broker while he was working on me to buy 1,000 shares of something, just like in Boiler Room. A classic example of that era.