By Katherine Vessenes, JD, CFP®

How would you like a peek into what successful doctors are doing with their own finances?

In this week’s episode of More Money Minutes for Doctors, CEO and President Katherine Vessenes, JD, CFP©, sits down with Dr. Nicole Grenier, MD, for another segment of “Quick Financial Tips from Your Colleagues”. Dr. Grenier shares how she balances her work as a dermatologist with her passion for travel while still being successful with her finances.

The following transcript has been edited for clarity and grammar.

Katherine Vessenes: How would you like a peek into what successful doctors are doing with their own finances? Today we’re doing a segment called "Quick Financial Tips from Your Colleagues" and I have a very special guest here today, a beloved client, Dr. Nicky Grenier, dermatologist extraordinaire. Welcome back to More Money Minutes for Doctors. I’m your host, Katherine Vessenes, the CEO and founder of MD Financial Advisors.

K: Now, before we get started, Nicky, our friends at the SEC want me to share a few things. First of all, did I compensate you in any way or give you anything of value to get you to agree to record this educational session?

Dr. Nicole Grenier: Hi, Katherine. Thanks for having me. No, I have not been compensated in any way.

K: I know I did take you out to dinner last year. We had a blast. It was so much fun.

Dr. G: Lovely dinner.

K: Yes, we have to do that again. It was so fun. The SEC wants to make sure that I let our audience know that this is just a public service for clients. You're just trying to give some of your precious time to help other doctors. So, thank you. I really appreciate that.

K: First, tell us a little bit about your background, how you got into dermatology, how many years you’ve been in practice, and anything else you think our audience should know.

Dr. G: Sure. I’m a board-certified dermatologist. I practice chiefly academic medicine. I am the vice chair for our department. I work on the operations for the department. I graduated from my residency here at Brown University about 15 years ago. I also have a side gig. I work at an office out in Nantucket once a month for a little extra income for travel, which is my passion. Anytime I am not working, I am traveling. Usually to some remote location, a far-flung destination. Travel is what I do outside of work. We even have a silly travel website called The Open Rhode, spelled after Rhode Island where we post about our adventures.

K: I love that. I love that website. At one time didn't you call it Champagne Travels or something?

Dr. G: We did. Adventure with a Side of Luxury. But now The Open Rhode for Rhode Island. There are a lot more champagne websites that are a lot more sophisticated than ours.

K: Oh, no, I love that, because we love seeing your vacation pictures! The ones you did in Iceland, I thought were just so lovely.

K: Let's talk about the money tips. Do you have two money tips for younger doctors?

Dr. G: Yes. The first money tip I would encourage younger doctors to think about is to recognize what you don't know. In medicine, we are trained quite a bit, but we often receive zero financial planning or education. And so, recognizing what you don't know. The first thing I did when I got my first paycheck was, I had a financial planner to kind of help me through. I didn't have the foggiest idea what to do with my finances when I finally started making money. So, my first tip would be to recognize your limitations in terms of your financial knowledge and work with a financial advisor early to help come up with a plan for your finances.

K: I think you’re absolutely right about doctors. All of a sudden, their pay goes from fifty or sixty thousand dollars a year to hundreds of thousands of dollars a year. They just don't know what to do, so I think you made a really good choice there.

Dr. G: Which segues into my next tip: start investing early. Like many young doctors, I was a very broke resident. In fact, during one overnight call, we calculated out the dollar amount we were making per hour and it was a very depressing $3 per hour because we were putting in so many hours. So my first paycheck after graduating, it really seemed enormous. There were so many things that I wanted to do with that money. Loans were looming, I needed a new car, but I would say the smartest thing I probably did was to start investing early instead of taking that first big paycheck and doing all kinds of fun things with it. I tried to make a commitment to start investing early.

K: I love that. That's so important because you get years and years of this compound interest. And yes, you can still do fun things with that first check, but I think you're right, taking something off the top first is very, very important. You set aside your savings first, and then you still get to take these fabulous trips. You have a lovely lifestyle and you're saving at the same time.

K: All right, are there two things that you’re doing to make your financial life easier, simpler, or maybe less stressful?

Dr. G: For me, one of the easiest things that I do is I just invest a fixed amount every month. I make enough decisions in my professional life and my day-to-day life that not having to think about what I want to invest that month is just a very simple way to do it. I just commit a fixed amount to invest every month. I think that’s a very good strategy. It keeps it nice and simple.

Dr. G: And the second thing that I would say is I, like many dermatologists, have some compulsive tendencies. So having a team manage the portfolio is very reassuring to me. There’s of course a cost for working with a financial advisor, but for me the cost is far outweighed by not having to worry so much about what the finances are doing on a day-to-day basis. When the news has a doomsday projection about stocks, I don't have to sit there and think about it too much, because I know it’s being taken care of. Particularly during COVID when the market was tanking, if I had been managing things on my own, I would have been a lot more anxious about it than I was knowing I had a team to help take care of it for me.

K: Yes, and I have such mixed feelings when the market’s going down like that. On the one hand, I’m like, "Yay, the market is on sale. Let me scrape up everything I’ve got and start buying more stock." But I also know that some clients are going to be more nervous about that. So, we may have to deal with some nervous clients.

Dr. G: Yeah. And I think for many of us, we don't have a lot of free time. By the time we get home after seeing patients, there’s not a lot of free time left. So, it’s helpful not to have to feel like I have to check that every day. I can glance at it periodically, but it’s not something that I have to work on every single day and worry about.

K: Right, and one piece I would add to the other doctors that are listening to this. You may be listening to this during a time where we are having a market downturn. They can last years sometimes. That is much scarier than the COVID downturn, which only lasted a couple of months. I find it helpful to go through the projections that we do on our financial planning software. We can use our software that does a thousand different "what if" calculations that include a lot of down markets like we may be going through at the time. In other words, it’s showing you what could happen in worst-case scenarios and how even though this time may be bad, you may still be able to meet your desired timeline, depending upon assumptions. Now, I’m hoping that brings us some relief to clients. But you tell me, does that help you when we do that?

Dr. G: Yes, I think so. You very optimistically have me living until about 100 years old, which is very generous and nice. I don't know that that will happen but just knowing that you can see that the money would last depending on how long you end up living is great. And I think the other thing that I like about it is, when I’m having a particular challenging time at work, we can kind of tweak it a little bit to say, "Well, what if I retired just a little bit earlier? Would that still be enough?" Having the model available to play with those projections is very critical. I don't have to have this fixed retirement date in mind. There is some flexibility there and I can see how that would model out.

K: Yes, I know it brings me a sense of comfort when I do my own modeling for myself.

Dr. G: Yes.

K: Because I was thinking recently “what if I retired?” Now, you know me well enough to know that I have no plans to retire at all. You might be retired before I am, actually.

Dr. G: Hopefully!

K: Yes, hopefully. And I thought, "Well, let's just pretend for a minute that I retired today or sold the firm." Heaven forbid, I don't plan on selling it either. What would I do with my own money? I’m a certified financial planner. I’m an attorney. I’ve been doing this stuff for decades. And I realized when I asked myself that question, I would not do this myself. Today it takes me an entire team to produce this. I have the most expensive software out there. I have a whole team that analyzes investments, old opportunities, new opportunities, what have you. I have a whole team that looks at tax laws. And the idea of me doing that all by myself, I was overwhelmed. So, I do use one of the team members for my own financial planning.

K: Now, last question, is there anything that you wish you’d done differently?

Dr. G: I think looking back on it and knowing the power of investing that I understand now that I didn't understand when I was a bit younger, I probably would have started investing a bit earlier. So, despite the occasional volatility of the market, which is scary to look at when you’re young and you don't understand that the reality is over the last 50+ years, returns are 10% or more.1 So it’s really the best place to have your money.

Dr. G: While it would have been challenging for me to invest money when I was a broke resident, I think even if I put a little bit aside then, that would have been better for me. But more powerfully than that, as a young attending, I could have put away a little bit more each month. I was really anxious to pay off student loans. You have this massive amount of money that’s kind of beating down on you, and you feel like you have to work to pay that off. But looking back on it, that interest rate was maybe 3%. It probably would have been a smarter choice to put a little bit more money toward investing and less into paying off my loans. That money would be more powerful in the long run in terms of compounding the investment versus just trying to pay off those loans because it made me feel better.

K: Yeah. I think you hit upon something very important. It's like the emotions versus the numbers. And I think you came through that pretty quickly. We have had some doctors that absolutely would not consider saving anything until they had those student loans paid off. That was horrible, because that may take them five or ten years and they’ve lost all that time for the compounded interest. I would like to get residents investing maybe only $200 a month. It’s something that keeps them going and teaches them to live below their means. That way they can always be saving something.

Dr. G: Yeah. It’s to the point I made earlier. You just don't understand that as a resident. We don't receive any financial education like that. Unless you come from a family of financial advisors or have a little bit more knowledge of that, I think it’s not something that you think of when you’re working so hard and making so little money. It’s just not the first thing that you would think to spend your money on, but it really is probably the smartest thing you could spend your money on.

K: I totally agree. And you’re really too tired and exhausted, as you said. Is there anything else you wish you’d done differently?

Dr. G: I think that's the main thing. Other than that, we do a pretty good job of not spending a lot on extravagant things. We do save most of our money for travel because that’s what I feel is the most valuable use of my money.

Dr. G: I do think spending a little below your means, if you can early, and putting that money toward investment is important. And I think that’s where my husband and I have really done a good job. We do a lot of things independently for ourselves so we can save a bit of money there.

K: As I recall, you're doing some remodeling on your house to save some money.

Dr. G: Yes, we did all of our own remodeling. We live on a huge acreage and so we do all of our own landscaping and yard work. We’re probably at the point where we could get someone to help us with it, but we still do that on our own. Then we take a little bit more luxurious vacation later in the year as a reward.

K: All I can say is bless you. That is something that I would not tackle, but I’m glad you're enjoying it.

K: Well, Nicky, thank you so much for taking the time to join us today. To wrap up: start early, educate yourself, maybe work with somebody that can help you, and live under your means. What would you add to that?

Dr. G: I think that's really it. I think get help, because you probably don't have the knowledge when you’re younger to make a plan that’s going to work for you in the future. That's really been the most helpful for me.

K: Awesome. Thank you so much. So doctors, I’m hoping you found this helpful. If you did, we would be honored if you would forward this on to your colleagues. And if you have any other further questions or there's something you’d like us to cover in a future episode, you can always reach out to us at info@mdfinancialadvisors.com. And of course, don't forget to like, subscribe, and follow us on social media. That really does help us get higher up in the rankings so the message can get across to more doctors. Finally, only you can take care of yourself, plan, protect, and prosper.

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Katherine Vessenes, JD, CFP®, is the founder and CEO of MD Financial Advisors who serve 600 doctors from Hawaii to New York. An experienced Financial Advisor, Attorney, Certified Financial Planner®, author and speaker, she is devoted to bringing ethical advice to physicians and dentists. She can be reached at Katherine@mdfinancialadvisors.com.

1. Historical market returns can be found at https://tradethatswing.com/average-historical-stock-market-returns-for-sp-500-5-year-up-to-150-year-averages/?srsltid=AfmBOopuE44brunCbGV8oeN2sGUPx8c-4vlDqo2_-Xa3I3viDlXjTbVy

These statements are from a current client and may not be representative of the experience of other clients and do not guarantee future performance or success; no cash compensation was exchanged for this recognition. MD Financial is not aware of any material conflicts of interest between this client and the firm.

Financial planning projections are hypothetical, based on assumptions, do not reflect actual investment results, and are not guarantees of future outcomes. Individual results will vary.

Additional information, including management fees and expenses, is provided on our Form ADV Part 2 available upon request or at the SEC’s Investment Adviser Public Disclosure website, here. Past performance is not a guarantee of future results.