The Position Paper 9/6/17

Welcome to The Position Paper! The Position Paper is my series featuring my quick take on a particular topic to help you manage your position. I will often feature one outside article as well that will allow you to dig in deeper if you desire. Read this while you drink your coffee in the morning and start your day off right!

Today’s Position: Financial Position

Featured Article: Here’s The Key To Getting A Good Raise At Time Money

My Take

So, you want a raise, huh? Think you deserve to have your paycheck padded? Think you deserve a bonus for your efforts? Well, let me give you a really complex tip to get paid more at your job. Be good at your job.


Want to track your money for free? I use Personal Capital. Check it out!


 

While not the most earth shattering advice, this tip is timeless. It doesn’t matter what compensation structure is en vogue at the time. It is always financially better in the long run to be a star performer.

Our article today from Time Money not only talks about the monetary value of achievement at work, it also talks about trends within the workforce today. Many workers have come to expect the periodic “raise” purely from just showing up.

For those that really do “only show up,” that is the only raise they will ever see. Rather than giving larger raises to great workers, however, the current trend is to make better use of bonus programs.

Clinical medicine is no stranger to this trend, as many hospital systems are instituting clinical quality bonus systems in line with payers’ increasing focus on quality. Interestingly, this shift in focus has led to a slightly different definition of a “star performer” within the employed physician ranks, but that is a different discussion.

I would highly encourage you to know all the details of any bonus program you participate in so you can maximize your chances of getting every dollar, and don’t forget the different tax treatment of your bonus versus a pay raise so you can plan ahead for your taxes. It’s all about what you keep when it’s all said and done. If you’ve gone through the trouble to be the best, then you might as well get the most you can!

Have a great day!

TheBossMD

Do you like The Position Paper format? Is this someone I should keep doing or trash it? Leave me a comment and let me know!

The Position Paper 8/30/17

Welcome to The Position Paper! The Position Paper is my series featuring my quick take on a particular topic to help you manage your position. I will often feature one outside article as well that will allow you to dig in deeper if you desire. Read this while you drink your coffee in the morning and start your day off right!

Today’s Position: Financial Position

Featured Article: Rules For Riches by Wealthy Doc

My Take

I am a simple man, and I prefer to keep my life simple. Wealthy Doc does a great job in Rules for Riches espousing some simple tips that can lead to great results. The unfortunate reality is that many people don’t do the simple things to get the results they say they want. Do you want to win every free throw contest you enter? Practice them. Every day. Shoot hundreds per day. You’ll get really good at it. Guaranteed.


Want to track your money for free? I use Personal Capital. Check it out!


The same simplicity exists in the financial world, despite how hard we try to make it. You want to accumulate a lot of money? Save it. Don’t blow it. Live a simple life. Don’t do dumb stuff. If everyone could pull that off, then we’d have a lot more wealthy people, physicians included.

In his article, Wealthy Doc outlines some of these simple items that can lead to great results. Educate yourself in an affordable, practical way so you can provide as much value as possible. Make career contingency plans so you always have options. Manage your personal life well by avoiding divorce, raising your kids in an economical way, and maintaining a simply lifestyle.

He, of course, also advises to save early and save often. Only then will you be able to execute a well defined plan of how to grow that money. Perfect asset allocation with five dollars is not going to be very impressive. Perfect asset allocation with five hundred thousand dollars will garner much better results.

The one observation I will add here is that his advice assumes a somewhat traditional career path involving employment. Entrepreneurship is the alternative, which comes with more inherent risk but also potential for higher reward. Last I checked, many of the really wealthy people I know own things, so I would add “Be The Boss” to his list (I had to say it).

Once you grasp these simple items, then you can progress to the higher level stuff. As momma always said,”You gotta walk before you can crawl.” Or something like that…

Have a great day!

TheBossMD

Do you like The Position Paper format? Is this someone I should keep doing or trash it? Leave me a comment and let me know!

The Position Paper 8/23/17

Welcome to The Position Paper! The Position Paper is my series featuring my quick take on a particular topic to help you manage your position. I will often feature one outside article as well that will allow you to dig in deeper if you desire. Read this while you drink your coffee in the morning and start your day off right!

Today’s Position: Financial Position

Featured Article: The Golden Handcuffs For Doctors-Loan Forgiveness by InvestingDoc

My Take

In today’s Position Paper, InvestingDoc talks about loan forgiveness and the many factors you must consider if you are going to accept an employment contract with loan forgiveness. First, loan forgiveness comes in many flavors. Here are just a few examples:

I have been offered loan forgiveness via employment contract, and InvestingDoc correctly points out that these are often structured as loans. Either the full balance will be due if you don’t stay for the length of the service agreement, or a portion of it will be due depending on how long you stay. There is often interest attached to the balance you must repay.


Want to track your money for free? I use Personal Capital. Check it out!


I recommend actively negotiating that the balance be repaid if needed based on the portion of the service agreement you complete, avoiding interest altogether, or negotiating the lowest interest rate possible on the loan if interest must be included.

InvestingDoc also discusses PSLF, which can be great if you work for a federal agency or 501c(3) non-profit. He correctly states that you need to be prepared to fulfill the full 10 year commitment if you want the tax-free loan forgiveness at the end.

He also discussed the recent paranoia surrounding ending PSLF for physicians. Though it is definitely a possibility that physician access to the program could be limited, I highly doubt the government will end the program for physicians already out of training.

The government’s modus operandi for cost reduction is to limit anyone new from entering a program, not cutting off people already in it. As someone with federal employee experience, I can tell you this is always what happens. Not only is it the most fair thing to do, but it is also the most politically popular thing to do.

Remember docs, if you want that PSLF to stay, vote early and vote often!

Have a great day!

TheBossMD

Do you like The Position Paper format? Is this someone I should keep doing or trash it? Leave me a comment and let me know!

 

The Good, Bad and Ugly of My First Rental Property

Note I am not a CPA, lawyer, or financial advisor. All information below is for informational purposes only. Please consult with a professional prior to making investment decisions.

Real estate is my weakness in the world of investments. My real estate experience started at a young age. My dad owned several units growing up, including a quadriplex and several rental houses. That was back in the day when you could get a 100% loan for a property just walking in off the street. How times have changed!

That experience growing up was invaluable for me. My dad let me ride along on any real estate related trip he took. By the time I reached high school, I had seen all sorts of things. I watched my dad collect rent from someone screaming profanities at him. I watched a tenant get evicted. I’ve even seen a tenant arrested for dealing drugs out of the house!

Most importantly, I watched what a down market and bad partnerships can do to a real estate portfolio. Fortunately, my dad had the means to get through this and has liquidated most of his portfolio now, but I learned invaluable lessons watching.

Many years later now, I have now owned and sold my first rental property. I am currently without any real estate investments as TheBossMD household focuses on student loans, but I plan to get back in the game.

My experience thus far has convinced me that real estate is an excellent asset class but it is just like any other investment or business. You need to understand it to profit. I have added to my real world education with other resources like BiggerPockets and numerous books.

For those of you wondering if this is something you can include in your portfolio as a working physician, I’d like to walk you through the story of my first rental property. I did some really smart things and really dumb things along the way. Hopefully, you can learn from my experience and apply it to your own portfolios.




A Physician Loan

My first renal property was actually my wife and I’s first home. We used a physician loan to buy it. We put nothing down and got a 30 year mortgage at 4.75% (obviously not today’s market). When you add in insurance, taxes, etc, our monthly payment came out around $1150.

After living in the house for 5 years, we decided to move a little closer to family. I had toyed with the idea of renting the house for a few years, but I didn’t realistically think it would work out. Most physician loans stipulate that the home has to be your primary residence.

I decided it couldn’t hurt to ask and called up the bank to see what they would say. My jaw about hit the floor when she said,”We don’t care if you rent your house.” I almost followed up with asking if there was a limit on the number of physician loans they would give me, but I figured that was too aggressive.

Armed with this knowledge, I went to my wife to pitch the idea to her. My idea was simple. The house was located in a good community with strong economic growth. If we could rent the house to good people at a good rate, then we could make a few bucks each month. After a few years, we could decide if we want to keep it long term or sell it, depending on how the market is doing.

Finding a Good Tenant

I then proceeded to make my best decision of this entire process. I determined my criteria for potential tenants and I stuck to them. Here were my criteria below:

  • Monthly income must be 3x monthly rent
  • Solid prior landlord references
  • No criminal history
  • No eviction/foreclosure history
  • Credit score>700
  • Must return communications promptly

I told every applicant up front that those were the criteria. I got a generic paper application and charged an application fee to cover the credit check. A lot of people didn’t make it past the first phone call! I had a few people beg me to bend the rules, but I didn’t budge.

After listening to a lot of rambling phone calls and getting stood up for showings several times, I finally struck gold with a young professional moving to the area. She had a great job, solid references, and returned any email or call immediately.

Undercharging Rent

I celebrated finding my excellent tenant by promptly doing something stupid. The home commanded a rent of $1500-$1550 easily. I was so excited that I had found a trustworthy tenant that I got talked into undercharging her. We settled on a lease for $1350 a month. Yep, you read that right. I left at least $200 per month on the table. Like I said, stupid.

I also compounded my mistake by not raising the rent after the initial one year lease expired. I actually renewed at the same rate and did an eighteen month lease the second time! The only upside was that I minimized my vacancy and turnover costs.

Managing the Property

Given that I only had one property, I elected to manage it myself. This decision also got a lot easier when I left too much money on the table with my lease to pay for property management! I think it’s excellent experience for anyone that wants to really get involved in real estate to manage a rental yourself. No one cares more than you about your property, and experience is the best teacher for what good property management looks like.

Due to my excellent tenant choice, I received minimal phone calls for the entire time my tenant occupied the property. She even asked if she could do some things herself, like paint a few rooms to better match her furniture. Sure, no problem!

Another mistake I made, however, was trusting too much and not doing periodic inspections. I was lucky because my tenant never caused any major damage to my property, but in retrospect, I would have done inspections every six months to make sure everything was on the up and up.

If I had, then I would have noticed that the carpet was wearing out. I could have avoided rushing to replace it right when I was trying to sell the house later. In the future, I’ll be checking in more.




Deciding To Sell

As we passed the two year mark of being a landlord, I began to ponder what my end game was. Interest rates had dropped by then, and I had a decision to make. Do I try to see if someone will refinance at a lower rate to keep the property long term, or do I sell the property? I ultimately chose to sell for two reasons.

First, Mrs. BossMD and I decided to focus on paying off our student loans. It might have been the better financial move to keep the property, but we wanted the student loans off our plates and out of our lives.

Second, by selling before the three year rental mark, we could avoid some of the associated capital gains via the section 121 exclusion. Section 121 of the IRS code states that you can exclude capital gains from the sale of any primary residence as long as you resided in it for two out of the past five years. Single folks can exclude up to $250,000 of gains while married couples can exclude up to $500,000. Not a bad deal. There is some fine print associated with exactly how much capital gains you can avoid, so your tax professional will be helpful here.

Note, the section 121 exclusion does not prevent you from depreciation recapture, which you will still have to pay. For those that don’t know, depreciation is this wonderful real estate tax perk, where you can write off a portion of the purchase price of the asset every year for a certain amount of years (27.5 years for homes). This a large part of what makes real estate income tax advantaged. Depreciation often wipes out a large chunk of the income on your taxes.

Depreciation recapture is the process where the IRS “recaptures” some of that benefit when you sell the home at a gain (i.e sell it for anything higher than the current adjusted cost basis). In general, the depreciation is recaptured at your marginal tax rate, i.e if you’re in the 33% bracket, then it will be taxed at 33%. This is probably where you need a tax professional to assist you again. Best to figure out exactly what you will be paying Uncle Sam before you decide to sell.

Missing A Tax Opportunity

One opportunity that I missed was to do a 1031 exchange. A 1031 exchange is named for Section 1031 of the IRS code which allows for property owners to do a “like-kind” exchange of their property for another of equal or greater value. There are a few other rules surrounding this, but in general, you can avoid taxes on the sale of your property through this mechanism if you stay within the parameters of the code.

I could have potentially traded up from my house to a quadriplex with higher value, while avoiding the tax man for now. Stupid! I didn’t consider this at all when making my hold vs. sell decision. I had several tax friends later say I should have considered it, but it was too late by then.

This is something I’ll definitely consider in the future and also why I’ll involve my accountant much earlier in my sell vs. hold decision process.

Takeaways

Given the whole experience, I have to say I was pleased with my first rental property. I made a nice chunk of change, had minimal stress, and learned some good lessons. I plan to dip my toes in the water again once Mrs. BossMD and I reach our student loan goals and agree to diversify our portfolio a bit more.

Here are my takeaways from the experience:

Good

  • Quality tenants reduce headaches
  • Desirable properties in good locations attract good tenants
  • Tax advantaged income
  • Average physician should have multiple financing options

Bad

  • Long term leases can be good…until they’re bad
  • Don’t forget about trading up
  • Consult professionals when needed so you don’t miss opportunities

Ugly

  • Don’t cheat yourself out of rent!

Overall, I think maintaining a real estate portfolio is a great way to build wealth as a physician, and it’s definitely possible for a working physician. If I scale to more properties in the future, then I’ll definitely expand my team so I can remove myself from the day to day. Here’s hoping I can convince Mrs. BossMD to get started soon!

Do you have a good real estate story? What was your first rental property like? Tell me about it in the comments!

Four Financial Tips For New Attending Physicians

So, you’re a new attending now, huh? The big money is rolling in. Your pager doesn’t go off as much at ridiculous hours of the night. Life is good. Life is going to be even better when we take our newfound riches and buy a Mercedes, right? Wrong.

Like other professionals that come into big paydays very quickly (professional athletes, lawyers, etc), physicians are highly prone to making very rash decisions with their money right out of the gate.

Nothing will set you up for misery more than tieing up your hard earned cash in petty things. New attendings tend to think they are invincible now that their paychecks have changed.

Your dream job you have now is perfect, right? No way it will go south and become awful. What if your job is actually terrible? What if you are ready to jump off a bridge six months in? It happens a lot, and the person that was smart with their money and can afford to make a change is in a much better position than the person driving the Benz.

So with that, I’d like to offer some free advice to the new attending crowd. Some of these tips I followed personally. Some I didn’t, and I have learned from the school of hard knocks. Heed my warnings so you can be in the best position possible.

Like any good boss, I don’t do all of the work myself, especially in the personal finance arena. There are a myriad of excellent blogs devoted to physician personal finance. Where applicable, I have linked to them so you can benefit from their wisdom.

Don’t Spend Differently

On the day you get your first attending paycheck, you should celebrate by eating out…at Subway. My first tip is don’t change your spending habits at all. If you bring your lunch to work every day, then keep bringing it. If you have a push mower to cut your lawn, then keep pushing (OK, maybe you can go self propelled here).

My point is don’t let your expenses grow with your new paycheck. When your expenses change with your paycheck, I call that living paycheck to paycheck. When your expenses are low and your paycheck is big, you are headed towards financial independence.

The temptation is so great in this arena that I propose literally hiding your money from yourself. Figure out how much you need to continue living your residency lifestyle. Keep that much in your checking account. Take the rest and put it in a separate account. Savings account, checking account, whatever. If your HR department lets you deposit your paycheck in multiple accounts, then do it that way. There is a bunch of free budgeting software out there that can help you keep track of your money across all your accounts. Pick one and use it. I use Personal Capital.

The White Coat Investor has many excellent articles about maintaining your residency lifestyle to grow wealthy. I recommend you check them out. Personally, I fell into this trap and then cut back my lifestyle after discovering my mistake. Don’t copy my screw-ups. Do it right from the beginning.


Want to track your money for free? I use Personal Capital. Check it out!


Physician Finance Max Out Your Retirement Accounts

Do you want to retire one day? Do you want to become financially independent so you can just do the work you want to do? Both goals involve saving and investing money, so start doing it. The best way to save and grow your money in a tax deferred way is through your retirement accounts (401K, 403b, SEP-IRA etc).

If you’re making the average new attending salary in almost any specialty, then you can afford to max these out. The current maximum for those under age 55 in 2017 is $18,000 per year of employee contributions to a 401K. Divide that up by the number of paychecks you get per year and contribute that amount every paycheck.

There are multiple free resources available regarding the technicalities of retirement accounts and the different selections you need to make. For those already familiar with the numbers and terminology, I’ll say to set up your asset allocation with low cost index funds so you can reap the benefits of your contributions and your employer match. For those that have no idea what that sentence means, then read the following articles:

1. Index funds

2. Asset allocation

3. 401k basics

Clean Up Your Student Loans

If you’re like me, you came out of medical school with six figure student loans. You need to clean that mess up, pronto. You probably don’t have the free cash to pay all of those bad boys off immediately, so you need a plan.

This topic is very intricate, and there are a myriad of blogs and entire websites devoted solely to this topic. In a nutshell, here are the items you need to address:

1. Loan pay off vs. Loan forgiveness

2. Find any applicable loan assistance programs

3. Find the lowest interest rate

4. Variable vs. fixed interest rate

5. Identify the best loan term

For quick links that can give you great information on making these decisions, check out the following:

1. Student Loan Hero Guide for Doctors

2. Physician on FIRE Student Loan Resource Page

3. White Coat Investor

Public service loan forgiveness (PSLF) is the most popular loan forgiveness program. This applies to anyone working for a 501 (c) non profit or federal/state government. It is fantastic program that will allow your entire remaining loan balance to be forgiven tax free after 120 on-time, qualifying payments. This article gives you more in depth details regarding this.

Folks choosing PSLF should realize that your entire strategy changes if you are going this route. If you choose PSLF, then your entire focus should be on making your payments as low as possible. That way, you pay the smallest amount possible and maximize the amount that is forgiven. Pay close attention to what a qualifying payment is so you don’t wonder outside the bounds of the program in your search for the lowest payment.

Lastly, the subject of loan assistance programs is not well covered in the physician student loan world, in my opinion. You can negotiate with your new employer to write a check for your student loans for each year you’re employed with them. I have seen amounts ranging from $25,000/year to $50,000/year. You can also make sure they throw in enough to cover the taxes on that check.

Several government agencies also offer loan assistance above PSLF. The Department of Veterans Affairs will pay you up to $120,000 over five years through the Education Debt Reduction Program in some cases to work for them, just as an example. Don’t ignore these types of possibilities.



Physician Financial EducationEducate Yourself

There are enough resources available for physicians to be very successful with your finances without having to pay exorbitant fees to someone else. I have linked to several above, but here are links for the main sites of a few that will get you on your way.

1. White Coat Investor

2. Physician on Fire

3. Passive Income MD

4. Wall Street Physician

5. Rockstar Finance

If you follow my Twitter account as well, you will see me mentioning any new resources I find.

If you still want personal guidance after looking at these resources, then I recommend getting professional help in the form of a fee only financial planner. Fee only planners are financial professionals that will give you personal financial advice for a flat fee.

I mention this particular type of financial advisor specifically because they are the most likely to give you unbiased advice. Just like doctors that get paid by Pfizer are more likely to recommend drugs made by Pfizer, financial advisors paid by a certain services are more likely to recommend those services. You don’t want the services they get paid to recommend. You want the best ones. The National Association of Personal Financial Advisors is a great place to start looking for a fee only financial advisor.

So there you have it, my four financial tips for new attendings. Hopefully it prevents you from falling into some of the traps I fell into. I enjoy talking about money now that I’m starting to be responsible, and my life is always better when my financial ducks are in a row. I hope my tips help you do the same!

For those of you further down the line in attending world, leave a comment with your best advice for the younger crowd or maybe a personal story of something you did or did not do well financially. I’d love to share others’ experience in addition to my own. 

If any bloggers want to guest post on a physician personal finance topic, then shoot me an email or message me on Twitter.

Financial Independence Retire Never (FIRN)

I follow a lot of the FIRE (Financial Independence Retire Early) crowd both on their blogs and on social media. I find a lot of good advice there and many of the things I have read have positively shaped my personal finances today. 

For those motivated to do so, I take no issue with physicians working hard to achieve early retirement. In my view, you put up the money to pay for your schooling so it is your life to manage as you wish. If that means retiring at thirty-five and living in Tahiti, then God bless you and post pictures when you’re on the beach.

I suspect, however, that there are many folks like me that have a really hard time with the idea of working hard for some specified amount of time and then walking away forever. I’m willing to bet that many physicians, in general, share my uneasiness with this idea.

I will readily admit that I have a borderline pathological obsession with being active. I like to have my hand in several different pies at once and wasted time is truly my enemy. This even spills over into my vacation time. I will never be the guy that is able to sit on a beach for five straight days and watch the tide go in and out. Trust me, I would drive my wife crazy.

I am also blessed to say that I enjoy what I do on a daily basis, and despite the satisfaction I get when I stick that wedge within 3 feet, I would truly have less fun in my life if I just played golf every day. 

So with that in my mind, I would like to officially dub my version of financial independence as FIRN or Financial Independence Retire Never. I have no intention of accumulating wealth for the purpose of not working. I have every intention to attain financial independence to attain maximal flexibility to do the work I want to do.

FIRN

It’s really hard to find a FIRN image

The Four Principles of FIRN

Practically, many of the principles employed by the FIRE crowd are the exact same ones I employ, mostly because the basic principles of FIRE or FIRN are time honored tenets of wealth creation.  Here are my four basic principles:

Minimize expenses-I am not part of the extreme frugality crowd, but if you can do this then more power to you. The basic math dictates that the less you spend, the more you keep. This is especially important for physicians that find themselves in the upper tax brackets. Working to earn more money at a 35% federal tax rate can be downright demoralizing at times. Cutting out your $1000/month shopping budget is a tax free way to give yourself a big raise without having to pony up to Uncle Sam.

Eliminate Debt-I shouldn’t have to tell any physicians about the weight of student loan debt. Carrying six figure student loan debt definitely decreases your financial and professional flexibility and locks you in to having to pursue jobs that pay large salaries, regardless of whether you enjoy it or not. Unloading that burden can really improve your FIRN opportunities.

Use Compound Interest-There is no greater magic than watching money compound year over year. If you are earning an average physician wage, then your retirement accounts should be maxed out (401k, 403b, IRA, whatever it is). You should also take advantage of any other compound interest opportunities you may have. I will discuss more of these opportunities in future posts and link you to some great resources for getting the compound interest ball rolling.

Diversify Your Income-You might earn a fantastic wage as a physician, but your nest egg is at risk if that is your only source of income. Hospitals and physician practices are not immune to closure. You should work to diversify your income streams so that losing one will never be the end of you. Some do this by additional medical work on the side like expert witness work, chart reviews, locus work, or telemedicine. Others do things totally outside of medicine that they are passionate about. Take stock of whatever skills you have and see if you can apply them to set up an additional income stream.


Want to track your money for free? I use Personal Capital. Check it out!


The Freedom of FIRN

In my mind, a key principle of physician FIRN is that you always intend to do something, not necessarily medicine. Personally, I very well may decide to move on from clinical medicine one day. I have no idea what my professional future holds in this regard. I might even decide to cut back my work schedule one day. However, I can fairly confidently say that I will always be doing something that likely brings in a paycheck of some kind as long as I am physically and mentally able. 

What this really comes down to at the end of the day is what you enjoy. To some people, work of any kind is simply a means to an end. For others, work is part of what makes life enjoyable. It’s all about what makes you tick and what your passion is. For me, a life solely based in leisure would be unfulfilling. As my About Me page says, I am the guy that would probably train to join the Senior PGA tour if I ever devoted my life solely to my hobbies.

Ironically, I think a lot of the FIRE crowd actually falls into FIRN if we are being strict about the definition. Most of the blogs I read and people I come across are still very much working and bringing in paychecks (sometimes really big ones), even though that have “retired” from their day job. Maybe they will prove me wrong one day and totally pull the plug on working, but many of them look like they have the same itch to keep moving that I do.

FIRN Investing

The choice of FIRN vs FIRE has real implications when it comes to applying the art of compound interest. For investors of all stripes, there is often distinction made between returns that come in the form of value you receive now versus value you receive later. For real estate, this is cash flow versus appreciation. For stocks, this is dividends versus equity.

For the individual pursuing true FIRE status, investment activities would most logically be geared towards the immediate income side of the equation. The FIRN investor, on the other hand, can gear activities more towards total return. Assuming that a FIRN investor has already undergone some basic income diversification, then he can afford to engage in activities that may pay out nothing now but will be the most profitable in the long run.

A practical example would be Berkshire Hathaway stock. Berkshire Hathaway has paid out a dividend exactly one time in its entire history. This stock is much less valuable to an individual pursuing FIRE, but could be much more attractive to an individual pursuing FIRN. No dividends are no problem for the FIRN person. They can afford to play the long game and just watch the equity grow as the company’s value goes up. In reality, most physicians probably should have their money in index funds and not be buying individual stocks, but we’ll leave that for another day

At the end of the day, I’m not making value judgements about either philosophy. Everyone needs to decide what their goals are and then act accordingly. If you really do want to live life from your beach hut, then I wish no tropical storms on your paradise.

Both philosophies will eventually lead to financial independence, which is really the core goal you should be striving for. If a person that has achieved FIRE sits down to dinner with a person that has achieved FIRN, then I’m pretty sure they’ll both be happy with their lot in life and have a lot more in common than different. The FIRE person may have to wait for the FIRN person to get off work, but hey, retirement is just a big waiting game for life’s last big event anyway, right?