Can You Use Money as a Key to Unlock Your Purpose?

This week on The Long View, physician and an associate medical director at JourneyCare Hospice, Jordan Grumet, joined to discuss his journey with financial independence, life as a doctor, and teachings from his popular Earn & Invest podcast.

Here are a few excerpts from Grumet’s conversation Morningstar’s Christine Benz and Jeff Ptak:

FIRE and Fighting Burnout

Benz: As you were going along in your career as a physician, it sounds like you became acquainted with the financial independence, retire early movement, and you realized that you had the financial resources to retire early, but you didn’t have any sense of how you would spend your time if you kind of separated from your practice in medicine. Can you discuss coming to that realization and what you decided to do about it?

Grumet: You know, as I went further as a physician and felt more and more burned out, I realized that I had to find a way out. I had to find a way to support myself without doing some of this work that was exhausting me. And I started to look around and tried to figure out what my options were. Now, I was incredibly lucky because I was born into a fairly well-off family, and I had two parents who modeled really good financial behavior for me. They always saved a lot more than they spent. They invested in the stock market. They owned real estate. They were entrepreneurs and owned their own businesses. So, I found as I went through medical school and started making money, I made a lot of the same decisions they did, but I didn’t really understand why.

I hit this point where I knew I wanted to leave medicine and I was burning out and I went to my financial advisor at the time and asked, “How much money do I need to retire?” And one of the first questions my financial advisor asked me—this was someone who was actually a very good financial advisor, but in this case, the advice they gave me didn’t necessarily serve me—“Well, how much do you want to spend each year?” And this was something I had never contemplated. Believe it or not, even though I really saved a lot of money and took care of myself financially, I had never budgeted. So, when he asked me how much I wanted to spend each year, I was thinking somewhere around $250,000, $300,000 a year. So, he then used those calculations to do a Monte Carlo simulation and ran me through a bunch of calculators and said, you know what, you’re just nowhere near that.

So, in my mind, I kind of decided, you know, there’s no way I can retire yet. And then, I asked my accountant. I kind of said the same thing. How much do I need to retire? My accountant said, I really think you need about $10 million in the bank, and I was not near $10 million. So, I’d come to this conclusion that this was just something I couldn’t do. I was going to have to find another way to make money or accumulate wealth, because if I really wanted to leave being a physician, I wasn’t at the financial place where I could do that. And then, in 2014, I was writing a medical blog. I’d been writing about medicine and what it felt like to be a doctor, and I had a moderate following. And I got a phone call in the office from a guy named Jim Dahle. He is the writer behind The White Coat Investor. And he had written a book about personal finance and financial independence for people with high incomes like physicians. And he asked me to review it for my blog. And I of course said, “Oh sure, that’s great.” You’re going to give me a free book. I thought it was amazing. He sent me the book and I read it. Probably it took me three or four hours to read through it.

And all of a sudden, I had kind of the vocabulary that explained a lot of my financial behavior, but it also gave me the beginnings of the vocabulary of financial independence, and it was very easy for me to do some back-of-the-napkin calculations and realize, oh, you have enough money technically to stop working, or at least cut down quite a bit, and that wasn’t a realization that I had never had before. And as I tell people, I was exhilarated for all of a few minutes. And then, I had a panic attack, and I got really, really anxious and it took me a while to realize what that panic and anxiety were. It actually even eventually led to a depression for a few months. I had spent all of this time thinking about getting away from medicine. I had worried so much about making money and doing all those things that my parents had taught me to be well financially off. But I hadn’t done much thinking about who I wanted to be or what the real purpose of that money that I was making was going to serve.

So, I kind of knew that I needed it to buy food and clothing and support my children and all of those kinds of things. But we all know that that’s only one small part of living. I had realized that my identity and purpose were not being served anymore by being a physician. Now I had to face the fact that I was going to sever the small thread I still had with my father who died when I was seven years old, but also that I had no idea what my identity and purpose were because I had been so wrapped up in this physician identity for so long that I had never really took the time to figure out what was important to me, what I needed to accomplish, what I want my legacy to eventually be. They’re all questions I never asked, and I was faced with that all in a moment after reading that book. And it took a long time to actually start sorting through those things and realize some of the blooms of financial independence instead of some of the stress, which is what I felt immediately.

Should You Have a Financial Advisor?

Benz: We want to get into that process of discovery, self-discovery, and also in the book [Taking Stock: A Hospice Doctor’s Advice on Financial Independence, Building Wealth, and Living a Regret-Free Life] you talk about how people can engage in this process on their own. But I just had a quick question about the financial advisor engagement. Do you still have a financial advisor? I’m curious.

Grumet: I don’t. And actually, I am very pro financial advisor. Some of the people I work most closely with are. The reason I eventually left my financial advisor was I realized that I would never really understand and take control of my money until I had to do it myself, and this is really personal. So, when I was busy being a physician, building a practice, thinking I was too engaged in other things to understand money, I pretty much took everything and put it on someone else’s plate. And my advisor was good. I’ve had multiple advisors in the past. And at least, the last two I had, were excellent. They would update me on a regular basis. They would explain to me exactly why they were doing what they were doing. But the truth of the matter is, I always kind of filed it in the back of my head as this is not something for me to understand. It’s something to hire smart people to understand it for me.

When I realized I was financially independent, I decided to take a step back and take responsibility to understand as much as I can about my finances. And at the time, I really felt that the only way to do that was to do it myself. I can spend many hours finding out most, probably not all, but most of the information I could get from a good financial advisor. But I’ll probably never be as objective as a good financial advisor could be for me, as well as, God forbid, if something were to happen to me, it’s really nice to have a third party or multiple third parties, right? You’re talking about an estate lawyer, an accountant, and a good financial advisor, other third parties who are putting your financial plan together. So, if something were to happen to me, there would be other resources for my wife or my children or my relatives if I was not here to make those decisions. I think having a financial advisor is a very good thing. I think at that time in my life I needed to do it myself.

Is the FIRE Movement Steeped in Fear?

Ptak: You’ve been very much aligned with the FIRE community for much of your career. In the book, you write that you realized that the roots of the FIRE movement are steeped in fear. Can you talk about what you mean by that?

Grumet: The act of writing this book actually in many ways was contradicting some of what I held to be true based on the financial independence, retire early movement. One of those things that I think we do in this movement, and the mistake I certainly made, is we turn money from a tool into a goal. So, instead of thinking about what money can do for us to search deeper for our meaning and purpose and connect us to people we love, sometimes we look at it as a goal unto itself. And the reason that’s bad is it’s just something that we don’t have as much control over sometimes as we’d like to. And if you think about some of the biggest debates in personal finance and specifically, in the FIRE movement, think about all those things we debate. We debate things like safe withdrawal rates, and we talk about sequence of returns. I think what we’re really doing is we’re talking about our fear of running out of money, and a huge part of being in the FIRE movement is that continuous concern about whether I’m going to run out of money or not and how to protect myself from that.

As I got further into why we do what we do with money, and especially after spending time and taking care of people who are dying and talking to them about their regrets and concerns, I really started thinking that maybe we’re concentrating on the wrong things, maybe we need to put money back where it belongs, which is as a tool to allow us to achieve those things that have deep meaning to us as opposed to being a goal unto itself. And I think it comes down to that. We can’t control necessarily everything about our money. Neither you nor I know what’s going to happen over the next 10 years in the equity markets. We just don’t know. A lot of us don’t know even what unexpected expenses are going to happen that we can’t foresee. There’s lots of things that happen, for better or for worse, and I think if we focus too much on that “goal of a financial independence number,” it leads to fear and worry as opposed to the freedom that we really are looking for.

Finding Meaning and Purpose

Benz: One of your passions is helping people determine whether their activities are aligned with what gives them that sense of meaning and purpose. Before we get into that, can you discuss some of the reasons that these two things can get out of whack for us? It seems like the quest for status and financial remuneration would be high on the list. But what else?

Grumet: I think it’s really easy to confuse achievement and wealth with meaning and purpose, and I think we do it often. And part of the reason is I think it’s low-hanging fruit. I think it’s really simple to say I will feel good about life when I get to this job level. Or I will be OK once I reach this net worth. I like to call that low-hanging fruit. They’re easy goals. Maybe not easy to achieve, but at least easy to map out. And we know what to do, right? If you want to make more money, you can work harder, you can get as many promotions as possible, you can side-hustle, you can invest in the stock market. There’s all sorts of things you can do. What’s really hard is to face the fact that time is finite and that we have a limited time on this earth, and there are some goals that really are deeper than those things like money and achievements and those goals we may or may not achieve them, and that scares the heck out of us.

So, I think a lot of us put these easier goals ahead of the other more difficult goals because it feels better and it causes less anxiety, which is OK to some extent, because accumulating wealth and achieving a lot of things, for instance, in the workplace is not bad. But ultimately, one thing I’ve really learned from the dying is when all of a sudden you’re told you only have six months to live, a lot of those low-hanging fruit goals disappear, and you start asking yourself the much deeper questions like what did I want to do with my life, and did I achieve that? I think we’re really scared of facing that until we’re pushed. And I think it’s important that we start thinking about these things way more early in our trajectory. In fact, I would suggest that we should start thinking about meaning and purpose first and then start building our financial goals and structure around that to achieve some of those things.

What Will You Regret?

Ptak: What are some of the key questions that we should ask ourselves on that process of self-discovery? You talk about thinking through purpose, identity, and connections. Can you talk about those one by one why each is so important and how to get to the bottom of thinking about each of them?

Grumet: Certainly. So, purpose is a difficult question, and many people struggle with how do I find my purpose, and this is where working with the dying has really opened my eyes. It’s interesting. When you really sit down with the dying and start talking to them about their lives, at some point, most people say, I really regret that I never had the energy, courage, or time to dot-dot-dot. Whatever comes after those dots, in my opinion, is your purpose. And so, I think we as young people need to start asking that question much, much earlier before we’re on our deathbeds. In hospice, we do something called a life review, and it’s doctors, nurses, chaplain, social workers, and we sit down with our patients. We not only try to deal with physically what’s happening to them as they get nearer and nearer to death, but we try to emotionally help them look back at their life and take stock of what happened. And it’s a whole process of asking a series of leading questions where you delve into what they accomplished, what they didn’t accomplish, what they wished they had tried, what relationships were important in their life, what they still feel like they need to accomplish before they die. I think that’s something we should all be doing on a regular basis if we want to start understanding what our purpose is, and specifically, that one question, what would I regret not having the energy, courage, or time to do. We got to start thinking about those things now.

The thing about purpose is, it can be something like saving the whales or fighting climate change. It can be something very worldly and important. But it also can be something just personal to you. Like I want to be a black belt in karate. Purpose can be a lifelong thing, or it can be something that keeps you busy for a year or two and then you move on to something else. The key is to start working on those things that have deep meaning to you now as opposed to putting them off. So, I think that’s how we kind of focus on purpose is by running through that thought of experiment of how we would feel if we were told that we had a set amount of time to live, and then we had to decide how to get those things done we wanted to.

Identity is interesting in the sense that it’s a much deeper sense of who you are and what you’re about. A good exercise to try to figure out or start working on your identity is to ask yourself the question, “I am?” over and over again. I’ll use myself as an example. When I started doing this exercise, I said. “I am,” and the first thing that comes to mind is a doctor, right? So, a lot of times we talk about the things we do for a living. After asking myself that question a few more times, you start saying, I am a husband, a child, a father. So, you start talking about your relationships, which is also important, but a lot of those are more descriptive terms. As you go further, you might say I am, and start mentioning achievements or awards, things like that. But ultimately, after doing this long enough, you get to those deeper answers of what you are and what’s important to you. So, for me, after asking myself this question over and over again, I eventually came to I am a communicator. I’m a podcaster. I’m a writer. I’m a public speaker. These things actually described more of who I am than some of those other things, which were just more vague and general descriptors. And again, this is something that doesn’t happen overnight. It’s something you have to ask yourself regularly. You might even have to ask other people how they perceive you and how they see you. But it’s an exercise to do on a regular basis and start thinking of what’s important to you after we let go of some of those surface things and how do you see yourself.

And last but not least, once you start working through purpose and identity, connection flows very easily from there. My example is, for so long I identified myself on the outside as a physician, but I didn’t really feel like that on the inside. So, that left me feeling in a sense almost shame. I remember that I would go to parties and meet a bunch of people I didn’t know, and I would try to sneak away before we got to the point where they asked me what we do for a living, because I didn’t feel connected to that identity. And then, I didn’t really connect to other people who had that identity. So, I grew up in hospitals and physician lounges and nursing homes and offices, but I never really made a lot of doctor friends because I didn’t feel connected to those people. When I really finally came down to this idea that instead of being a doctor what I really connected to was communicating, public speaking, podcasting, writing, I ended up going to conferences and places where people did these things, and I felt immediate kinship because we had the same interests, and so, in a sense, I felt like I found my people.

So, in the book, there are series of exercises that go into purpose, identity, and connections. But the idea is, we have to start searching for these answers now and they’re not easy. So, I realized I was financially independent in 2014. It probably took me a good three or four years to get a hold of who I wanted to be and who I thought I was to then start changing my life such that I was spending a lot less time doing these physician activities that weren’t fulfilling me and doing a lot more of those other activities that really related to my purpose, identity, and connections, which now take up a majority of my time.