The $7 Million 7 Years Wealth System

Good plan, Scott! Where does paying off your student loans fit in with your choices for the $3500-5000 you’re going to start investing in January 09? Will those be allowed to trickle along due to their low interest rate? How were you able to find the $3500-5000 (or make it available)? Was this thru applying Making Money 101 (paying off another debt) or through working a sideline or another investment that is part of your Making Money 201? Inquiring minds want to do it, too! 🙂

Thanks Diane, I have elected to continue paying only the minimums on my student loan because I consolidated them to one fixed payment at 2.8% interest 2 1/2 years ago and due to everything I’ve learned while being one of the 7 MIT, I see this debt the same as a mortgage. The interest rate, like the mortgage on my home is so far below what I can achieve investing in real-estate, businesses and stocks that I wouldn’t dream of using precious capital to pay them off early.

As far as finding the extra cash per month to invest, it was more of a matter of increasing income through increasing clinic ownership and keeping lifestyle relatively low. I’m very fortunate that the 10 years of sacrifice in college work and 4 degrees enabled me to earn a terrific income as a doctor(I think of those 10 years as an “investment” that I made in my future earnings much the same way a regular investor does) and I insist my family and I give every dollar a name every month so we live on significantly less than we could and this is what ‘frees’ up the investing money.

However, even if our household income was 1/3rd of what it is now, we would simply live on even less(ie, we would have a $750.00 mortgage, instead of a $2,400.00 one, etc…across the board on all expenses,)pay off bad high-interest consumer debt, then stay away from consumer debt, and use this money that would otherwise be sent to visa, mastercard, discover card, etc..to fund investments. In other words, same method, just using smaller amounts of cash but still getting to the same destination.

One of the lesson’s I’ve learned about money so far is it’s not about how much money you make, it’s about how well you manage the money you make….which will eventually lead to you having MORE money to manage.

Hope this helps.

15% Stocks” if u lucky, I rather Real-Estate together with Stocks and Small Businesses ….yeah baby!!!

@ Diane – I’m glad that SOMEBODY pays attention to what I’m saying 🙂

@ Scott – Your post goes some way to answering Josh’s question (that he sent me) about whether to go for an MBA or not … no doubt it’s a great investment; but, on it’s own, it wouldn’t have got you to your Number/Date. However, the Making Money 101 lessons that you learned – and, the ‘investing income’ that you are accruing – in the process of acquiring these degrees then using them, just might!

@ MoneyMonk – You said it, Baby!

Sounds like a good plan Scott. Seems to me like your taking the train. A determined, steady mode of transportation.

@Scott – you made good choices along the way, unfortunately I think many people have already gone outside their means and are now faced with debt and very little (if any!) extra money each month. Did you not have any private education loans? My private education loans have much higher interest rates than 2.8% (and you can’t consolidate those with federal, unfortunately). Bummer. But yay for you- looks like things are all falling into place for you!

@ Moneymonk – That’s pretty much what I meant with my plan; real-estate together with stocks and small businesses. Didn’t really put any credence in my post to the order, but you get the point.

@ Adrian – Yeah, I would seriously look at the “big picture” of the MBA first before pursuing if it were me; Would the degree provide enough ‘seed money’ to fund your investment vehicle of choice to get you to your required NUMBER by your required DATE? That’s the question I would have to answer for myself.

@ Josh – Thanks Josh. Although I plan to open up a couple more clinics, which will be like dropping a couple of twin turbos in this train, lol.

@ Debbie – Been there, done that too. I was waaay over 2ook in the negative when I started out(and that doesn’t include a mortgage!). Yep, your heard that one correctly. When I was finishing up my last semester of school, we had 2 cars that totaled 40k of debt, over 20k in credit card debt, 2 personal loans of 10k each, my wife’s 11k student loan, owed our first born to a couple of banks, etc.. and our household income TOTALED about 35k. If there was a way to be stupid with money, unfortunately I did it! But what valuable lessons I learned that are worth far more money than the debt I paid off….As Dave Ramsey put it, we got on beans and rice, rice and beans and started hacking away. As we began to manage our money better and started stacking the debts with the debt avalanche, something strange began to happen, the money coming in kept going up, and not just my income. My wife kept getting raises and nearly doubled her income while I was raising my income, so the same principles work for anyone I think.

As far as the private loans, no, Sallie Mae funded all the graduate work and I did an enlistment in the Army out of high school that gave me the Army college fund to take care of all my undergrad work. Growing up in trailer parks, I didn’t see much of a chance in paying for college at the time unless I enlisted, lol.

@Scott, I am more inspired by what you just shared in that last comment than anything else I’ve done or read here. Thank you!!

(Oh.. that’s not to say I haven’t been inspired thus far, just that this has been very enlightening to me- just wanted to clarify because after posting I thought someone might take that the wrong way!)

@ Debbie – we have ‘thick skins’ here … have to 😉

@ Debbie – Your welcome Debbie. Trust me, just keep your focus and you will achieve your goals!

@ Scott – My niece and her husband are recent MDs who both got residencies in Chicago at about what you quoted: $35k apiece. My sister went up there this fall to take care of their baby because they can’t afford a babysitter. I was shocked at what a newly-minted MD is paid (and expected to do), but I understand it’s a bit like learning how to make “better decisions faster” by having to learn how to do them while sleeping on your feet…eventually they are second nature and require almost no thought.

Yeah, it’s definitely a shocker, but they’ll be doing well before you know it. Maybe you can teach them what you are learning here and get them off on the right foot when they do begin making high incomes so they’ll put it to good use for themselves 🙂