You Need a Budget

If you’re reading this and your name is Dr. ____, then you have invested a massive amount of your life in learning how to make money. Additionally, you spend considerable amounts of time away from your family, or any other pursuit, to make that money.

If making money were like athletics, you would be on par with an Olympian with the way you’ve trained, prepared, and worked for it. How 

you spend your money is to fitness what diet is to an athlete. As an Olympian, your training must include dialing in your diet— learning about what you eat and how much to eat for maximum performance. It’s imperative that you also invest some time in educating yourself on how best to manage and be in control of that money.

I am not talking about you developing a side hustle as a financial planner (although be my guest – most of us wish we were dentists!); I’m talking about being in control of how much you spend and on what.

Even as an athlete surrounded by coaches and trainers, you still control what you eat!

Why does this matter to you?

In my former life I was a college football player. Our off-season daily training regimen looked like this:

• 1 hour of stretching, running, and plyometrics
• 2 hours of weightlifting
• Daily calories burned? I’ll guess between 5,000-7,500.

Our in-season calorie burn was equally high!

During those years I can still remember that it was almost impossible for me to get full. I would eat like a horse, which would satisfy me for maybe 30 minutes, until I wanted to eat again. I was trying HARD to bulk up and put on weight, but it was impossible.

When I finally stopped expending all those calories playing football, I put on 20 pounds in the first three months of my post-athlete life. I was living in Southern Chile as a missionary and one woman even said to me, “Wow, Elder Williams (my missionary name), you’re getting fat!” (In Chile you never have to wonder about what others think of your weight!)

During your high-earning years, it is easy to get lazy and accustomed to spending a lot, and even more than you think. Unfortunately, even many PFG clients are out of touch with what they truly spend at home and are shocked when we tell them.

The purpose of budgeting is to take and be in control of your money! What you spend and what you spend it on.

The Big Myth about Budgeting

The word “budget” has developed a negative connotation in American vernacular and is synonymous with cheap and crappy. Consider these examples:

• We’re remodeling our bathroom on a budget (i.e. you’re replacing the towel rack and toilet paper roll holder)
• Our next vacation will be on a budget (i.e. we’re either going to visit the in-laws, or camping, probably with the in-laws ☹)
• My daughter is planning her wedding on a budget (i.e. we’re serving cake and ice cream at the local park pavilion, with balloons and a banner that I made, and the photographer will be a group of friends with their iPhones)

It’s true. To most people, budgeting means cheap, crappy, no fun, boring, and low class.

Whatever we call it, what does “to budget” really mean?

“On the cheap” is NOT what I’m talking about!

Let’s instead give it a new name. Let’s call it “Freeing” your money. Or “being in control” of your money. Whatever we call it, budgeting is this:

“Deciding beforehand what you’re going to do with your money, instead of wondering where it went after the fact.”

If you can afford to spend $30,000 per month, and you want to spend $30,000 per month, then go for it! And plan for it in retirement. But don’t think you’re spending $10k while the reality is closer to $25k!

Remember this: freedom (which we all want) is the fruit of discipline. And nowhere is that truer than with how you spend your money!

Why am I writing a post about budgeting to a bunch of high-income doctors?

Simply this: I have learned, after 17 years of working with dentists, that there is no amount of income you can earn that eliminates the need to be in control of your money. To know how much you’re spending, and on what.

Doctors who are clueless about what they spend, and just pull money from their practice every time they overspend, run the high risk of becoming financially unfit, never freeing themselves from the need to keep working.

More importantly, those who spend ignorantly and recklessly run a high risk of running out of money in retirement. After how hard you’ve worked, and how much you’ve earned, that would suck!

What should you do about it?

For the past 15 years I have been using the software YNAB to budget my money. I got off this budgeting software for a few years thinking that I had “earned my way out of that.” Was I wrong! I have since repented and am now back at it being in control of my money.

For this reason, as your friend, I am recommending you download and start using this software: YNAB. There is a small learning curve, but it’s much easier than dental school! And in fact, it’s MUCH easier to manage your money carefully than it is to earn it.

We all want to be free. Discipline in this area will contribute more to your financial freedom than almost any other thing.