You read a lot on burnout in Physician land. There was an administrator at my old hospital who had an MBA and went to med school in the Caribbean and got her MD. She didn’t do an internship or a residency and she held no license but she still was used as an in road into the physician community by the hospital. One time there was needed some kind of physician to sign off on some kind of workup in the hospital and I heard her telling her boss the CEO “we’ll just get some physician in the hospital to do it like the Anesthesiologists”, like we were just sitting around on couches waiting to be called to do a H&P on someone. This kind of points out the typical MBA’s perspective as physicians we be grunts. It’s a well known fact most physicians will sell their souls for a free ham sandwich from the drug guy. The MBA’s are jerks but nothing if not masters of manipulation “I’ll give you a quarter to hop on one foot 10x” and so systems develop that are about coercion and doing more with less. Enter the bell curve.
A physicians life is all about this curve. Notice its shape 34% is a big area 13.5% less than half of 34 (40%) of that 2.5% less than 1/10 of 34 and about 1/5 of 13.5. Notice the X axis intervals these are equal. This means for the effort it takes to go from 0 to 1 you get a 34% return. From 1 to 2 a 13.5% return a 200% increase in effort from 0 for 40% more return. 2 to 3 a 300% increase in effort from zero for a mere 10% extra return. It takes a lot of horsepower to get to 300%. This is called diminishing returns. To get into med school you had to walk down the curve and as you descended your effort went up. Then you got into residency and it went up more. Then you became attending and it went up even more. You started getting paid for your effort pretty well but still running at 300% takes it’s toll. The MBA’s would like you to run at 350% so they incentivize you with ham sandwiches and of course you’re a codependent people helping dope and agree to eat the ham. You think the extra effort is linear but in fact it’s Gaussian it is in no way linear. Each of us has his/her natural/mental/physical limit. Each of our families have that as well.
The solution of course is to walk back up the curve, tell the MBA to go pound sand, he’s just a sniveling drunk anyway, and move back toward 200%. How many of our colleagues follow this exact path into perdition and how many retrace back to health, because running at 350% clearly is a distorted way to live.
Another interesting thing happens. If you watch your P’s n Q’s you can save a little along the way and a little turns into enough. At enough your 200% effort might start to look like risk. At some point you’re going to pull the brass ring, so now the question becomes how much risk is too much risk? At some point you realize every day you practice you are adding only a little dab onto your pile (diminishing returns) and that brass ring is looming somewhere out in your future. Pretty soon you decide to hell with it all, enough is enough, time to do something else. You’ve been living a 1 SD lifestyle while making a 2-3 SD wage. You become used to the security a 3 SD wage provides and freak at the idea of living a 1 SD life on 0 wage, substituting your pile for your wage. This again becomes a bell curve problem. One thing to realize you’ve already been living a 1 SD life, so the question really is how much is enough?
Enter the Bell again!
But in this case the numbers start going negative from zero and it becomes a race to understand if portfolio deflation is going to over take all they days of your life. It’s a weird race, the way you win is to die. It too is a Gaussian problem not a linear problem, yet linear solutions are often proposed 4 x25 is essentially a linear solution with a small fudge factor (compounding) built it and a big risk factor (SORR, over deflation and longevity) built in.
Look familiar? For men we are quite likely to die by 99, we’ve been dropping like flies for years. For women however maybe 15% on this chart are still kicking at 99 waiting to die, clearly not a linear problem. Somewhere in this mishmash is parsimony the best result for the least risk. Since planning for yourself necessarily implies planning for your wife, plan accordingly. Marriage, it’s a double bell whammy! DING A LING At least this fleshes out both problems of burnout and retirement deflation risk in terms more akin to reality. Knowing your enemy is critical to success. (A quote frem Sun Tzu or Napoleon or Julius Caesar or one of them jokers.)
Lemme see if I just max out my pre-retirement accounts and invest in low cost index funds……. I CAN QUIT MY JOB AT 30, RIDE MY BIKE, BE JED CLAMPETT AND HANG OUT BY THE CEMENT POND!!! whee doggie It’s shockingly simple, shockingly I tell ya!