I set up MedCapital in 2015 because as a doctor I made all the mistakes in the book.
The life of a medical student and junior doctor is one of deprivation, so when doctors start earning good money they have a tendency to spend it and delay wealth planning. A small delay in investing leads to a massive difference in the end result.
Doctors are used to working in an environment where there is an exceptional exchange of information, there is no guile, no trickery. Everyone works together to get a good medical outcome. But in the world of financial services doctors are viewed as targets because they are known to have money and be overly trusting and this causes doctors to be particularly susceptible to schemes to make crazy returns, but in reality they lose their money.
Doctors are used to being the best and not failing. They are well above average in terms of raw intelligence and income, and it can be tempting for them to think they can size up investments as quickly as they can take a patient through triage.
Cue me… I didn’t start thinking about investment until five years into my working career, when I did I didn’t want normal returns so I invested in a ridiculous opportunity to make a 100x return on my money, and I did about 30 minutes of due diligence on the business. Needless to say I lost all my money.
So many doctors think they can ‘beat the market’, but generally speaking no one beats the market. Warren Buffet has a bet going with ten of the top hedge funds that they can’t beat the market through actively trading it. They are seven years into the bet and the market is up three times that of the top hedge fund. If they can’t beat the market with their teams of experts and researchers, then what chance do doctors have?
The single most important thing: First, do no harm.
When you combine the fact that doctors earn a lot more than average, and the traits of Impatience, Faith and Confidence, the single most important thing when it comes to their financial health, is the same as the single most important thing in medicine – first, do no harm.
Due to their high income doctors can live a very high quality of life both now and when they retire if they don’t do anything stupid, if they don’t take unnecessary risks, and if they apply a model to systematically and responsibly build their wealth.