OMA Insurance has partnered with Common Wealth, the administration and technology partner for the award-winning Advantages Retirement Plan™, to bring you The Financial Checkup, which features top financial questions and retirement stories from your fellow physicians.
Samantha Hill: Financial matters are really just another knowledge database and another skill set, and there's nothing magical or special about it. It's just a lingo that we're not used to.
Speaker 2: Welcome to the financial checkup, a podcast series devoted to improving the financial health and retirement readiness of physicians and their spouses or common law partners. This series is brought to you by the award-winning Advantages Retirement Plan from OMA Insurance.
Preya Singh-Cushnie: Hello, I'm Preya Singh-Cushnie director at OMA Insurance plan sponsor of the award-winning Advantages Retirement Plan for Ontario doctors. This program is the first of its kind group retirement savings plan designed to help physicians, their spouse and common law partners. The purpose of the plan is to help medical students, residents and physicians begin saving for retirement at any stage of their life and career. The retirement talk series is where we invite physicians from across the province to get personal with us on what retirement will look like for them and share how they are preparing for the next phase.
In this episode, I'm very pleased to be welcoming Dr. Samantha Hill cardiac surgeon and immediate past president of the OMA. Welcome Dr. Hill. Thank you so much for joining us today.
Samantha Hill: Thank you so much for inviting me to be here, preya.
Preya Singh-Cushnie: Excellent. It's really a pleasure to have you. And when we look at the whole journey of talking about retirement and just what we're seeing amongst Canadians in many different spaces and practices in their life, we're finding that physicians typically opt to gradually unwind their practice during their income earning activities. Perhaps you might be considering what transition looks like for you and how you'll be spending your time enjoying the next chapter of your life. Today I'm really excited to learn more about you. And before we actually begin, I want to invite you to share just a bit more about who you are, how you got into medicine and what your thoughts are on where you are right now, when it comes to retirement planning.
Samantha Hill: Thanks so much for that. So you would think that most members are sick of hearing from me by now, but a little bit about me. I'm a single mom. I have two kids. I'm a cardiac surgeon in downtown Toronto. And I come from a very middle to lower socioeconomic class upbringing. My parents did the best they could with what they had and we were very privileged, my sister and I to go to a school that took care of us, both culturally and academically, and really set us on good tracks for life thereafter.
But when it comes to financial literacy or planning for a retirement, none of that was dinner table conversation at my house. My house conversation was more about how do you afford milk next week? And so thinking in the future, it's a very different skill set. And I suspect there's actually quite a few of us in medicine who come to medicine without any knowledge of how to manage money or what to do with money. And for a long time, the go to for all of us was MD Financial and of course that's changed recently. But that's really where I began learning about money, learning about what money means and what it doesn't mean, trying to project into the future. And you asked where I am with respect to my retirement planning, I think I'm still at the work hard save money stage.
Preya Singh-Cushnie: Absolutely. That's really interesting to get to know you, just where you've been, how you've been brought up and just your current situation, being a single mom as well, and a professional. And going through this journey of thinking about just what you do next I think, is a commonality that is shared amongst the membership. Because when we did the research to create the Advantages retirement program, we did discover that 47% of physicians between 35 and 49 felt they were only somewhat prepared for retirement. About 51% of them said they were somewhat more confident or that their family will have enough money to retain a comfortable lifestyle post retirement, and 23% of 65 plus don't actually contribute to a retirement savings plan.
So when thinking about your own personal situation and knowing what you've just mentioned, which is just your upbringing and that it wasn't kitchen table talk to learn about finances, what would you say you're doing now to help with educating yourself on retirement and being more prepared?
Samantha Hill: That's a good question. So the first part is just trying to learn more. Money is very intimidating for many of us, accountants are intimidating, actuaries are intimidating. Financial advisors are intimidating. You would think after all our years of professional schooling that we have realized by now that it's just another skillset, but many of us really don't. And we look towards these advisors as if they had a magical lens that foretold the future. So one of the things that I've really learned over the last, let's say 10 years of trying to become more knowledgeable, is that financial matters are really just another knowledge database and another skill set, and there's nothing magical or special about it. It's just a lingo that we're not used to. And we've been able to acquire so much vast quantities of data in whatever our individual specialties are, but I'm absolutely certain we can all learn enough about money, not necessarily to advise others, but to be much more comfortable in these conversations. And so that's one of the first things that I've been doing.
And one of the things that I would really suggest to everyone to do, once you get past that first hump of your first year or two of practice and things start to settle into a little more of a routine, it's a great time to start picking up some books, reading a little bit, exploring various groups online and just informing yourself about all the things you don't know.
But apart from learning, the biggest thing that I think I do that sets me up for a reasonable retirement, is really about how much I spend. And so early on someone said to me, just keep spending, like you're still a student. And those were probably the best words of advice I've ever gotten. There are so many people who even in residency start to accumulate debt, or in their first couple years at a practice spend their entire income. Because let's face it's been 10 hard years or so, getting to that point. We all want a little bit of a party, we feel like we deserve whatever the fancy sports car speedboat, whatever it is, but the money that you save at the beginning of your career is worth so much more than the money you save at the end of your career that even taking an extra two or three years to put away as much as you can, and really stockpile that money, I think makes a big difference when you're in your forties and looking forward. And I suspect it'll make an even bigger difference when I'm in my fifties and looking forward.
Preya Singh-Cushnie: That is so interesting. I mean going from self-educating, reading, taking the time to grow your knowledge, to really powerful what you just said there, Dr. Hill. Spend as if you were still a student. I think that's really interesting. And it is a concept that is challenging when you do start to see the loans that you're able to qualify for from the different financial institutions. And then of course, when you do get into practice, the income stream starts to make you tempted to buy that fancy item. So it's really interesting and I love that perspective.
So when you think about yourself, again in terms of retirement, what would you say is your biggest worry when you retire?
Samantha Hill: Is it fair to say I'm not actually worried about it?
Preya Singh-Cushnie: Absolutely. That's fantastic. I actually like that. And why aren't you worried about it?
Samantha Hill: I'm not worried about it, because I feel like I've done my due diligence. I have insurance policies in place in case I can't work. I look forward to being able to continue to generate income at a very similar level to what I'm currently generating for at least another decade. And my biggest spending, my biggest expense is really around my kids' school. And so hopefully by the time I am ready to retire, my house should be paid off, my kids should be out of, depending on me for school, I paid my way through university and while I'd love to help them, I'm sure they can do the same. And so I look forward to the sense that all of the work that I've done has set myself and my children up for an empowered future where money is important, but it's not the be all and end all.
And we can focus on being good citizens of the world and contributing to our cultures, our environments, our communities, and really the bigger problems at hand in front of us, like the climate crisis or equity issues. There's just so many more important things out there to worry about than money, that if I, as a physician who has to be in the top 10% of earners in Ontario, can't get there it would be really disappointing.
And so I'm not terribly worried, but a large part of that really is based on lifestyle. I don't own a car. I don't own a boat. I didn't buy a big house with lots of acres in Thorn Hill or whatever the other fancy places are. I live basic. I live in a way that is in keeping with my values. I don't need all of the fancy things and I don't think that they will make me particularly happy. I'd rather save my money to spend on trips to international places to see other cultures when COVID is over. And so in some ways, I guess COVID has helped me save some money.
When I look towards retirement, I also don't think I'm going to need that much money in my retirement, because in essence, you want to maintain the same lifestyle that you're currently living. And the amount I spend from year to year from what I've been led to believe is far less than some of my colleagues. And so if I continue living a very similar lifestyle, I don't need that much money put aside.
Preya Singh-Cushnie: That is so interesting. And it's really, down to the core, it really is about your lifestyle and the choices you make and sort of the value system that you have when it comes to money as well. And you definitely have a value system that's been as much as the awareness of how you were raised and having that transcendent to how you are treating money and the value of it when it comes to your own income spend and lifestyle right now.
It's actually showing very true that somewhere down the line, which leads to be to my next question. While there might have been not kitchen table talk, there was somehow someone in your life that may have inspired you to have this sort of value system. Can you share a little bit more with me on any advice that you've had along the way that's helped you to reinforce what you're currently doing so that you do have that sound retirement?
Samantha Hill: Sure. So I mean, a lot of my values obviously come from my parents and my immediate family. And the idea of not needing to keep up with the Jones's is very much something I acquired as a young child and just really not being overly concerned with what other people do or don't have as far as reflecting what I do or don't want, because you never know their whole story and everything is only a glimpse into someone else's life. And so maybe they have, I don't know, some fancy house that you covet, but the truth is they haven't paid it off and they're in debt for it or something like that. You never know the whole story.
And so just that not comparing yourself to others has been really important. And it's been challenged a few times as I got older and saw things around me, but you make it long enough and you start to realize that some of those stories that look happy ever after aren't so happy ever after, and I focus inwards. I focus on me. I focus on my family and what I can do that is consistent with that. So that's part of it.
We already spoke about the idea to spend like a student for a few years. That was very early. Another piece of advice I got very early on was differentiating between good debt and bad debt. And so what I mean by that is if you take out a loan to buy something like a house, that's going to increase in value or should increase in value, there's no fortune teller, but that is considered good debt because that's money that although you're paying for it's working for you. Whereas if you take out a loan to buy a Louis Viton purse, the chances are that-
Preya Singh-Cushnie: Which every woman wants.
Samantha Hill: The chances are that purse isn't actually increasing in value. And maybe I'm speaking out of turn here, because I've never owned one, maybe they do. But that kind of idea, that there are lots of things that people buy that decrease in value even the second you walk out of the store or off the parking lot with them. And so taking out a loan for those kinds of things is just throwing away money. You wait until you can afford it unless it's a need. And so that was another piece of good advice.
And then the last couple pieces of I good advice, some of which I took and some of which I didn't, but were around your home life. So we talked about how a lot of your financial setting is really about your lifestyle and the idea of don't get divorced or get a prenup before you get married, is something that's very unsexy. Can I say that on radio? It's very unsexy to talk about when you're in your 18, 20 year old phase and your head of her heels for someone. But it's really good advice for everyone. A respectful relationship between two people should be able to talk about money in the future. And if you can't have that conversation, maybe that's a red flag right there.
Preya Singh-Cushnie: Very, very, very important. Definitely. It's tough conversations, but it's absolutely necessary. You'll learn as well if you share the same values with your future partner as well when it comes to money, because that also creates a bit of a disparity, is when you have different opinions as a couple, when it comes to how you save. So great advice there. When you think about yourself and other young female physicians who are in their early practice years, what advice would you give them when it comes to saving?
Samantha Hill: That's a hard one. Practically, I would say if you're planning to have kids try and clump them closer together, so your childcare costs are combined as opposed to extended over multiple years. Consider the whole public versus private school thing. Our public school system here is excellent, but maybe it affects where you buy or where you decide to live when your kids are younger, those kinds of questions. But really I think if I was going to give one piece of overarching advice to young women beginning their career, is that the only limits that exist are the ones that you set for yourself. And that's true in your career. It's true in academia, it's true in your financial life.
So take some time early on, figure out what's important to you, what you value. What at the end of the day is going to matter and what is going to be gravy or icing cake or whatever. It's just, if you figure out your values early, you can live in a consistent fashion with them. And that ultimately brings you to a place of profound contentment that you can't buy, even with millions of dollars in your retirement saving plan.
Preya Singh-Cushnie: Wow. That's very powerful. Thank you for sharing that. I'm actually going to take that advice myself, because that is so powerful. What are you most looking forward to would you retire?
Samantha Hill: So I have a daydream that at some point there will be a house outside of a city with a couple of acres of land, with either a greenhouse or some kind of hobby farm, animals, place where my kids and my grandkids will want to come and visit, a place where I can grow old and live out the rest of my life in an ecologically, environmentally sustainable fashion, really connected to water and trees and greenery around me. And I haven't found it yet, but I think I'm on the right path. And I look forward to figuring out where this place is and what it looks like in its entirety.
Preya Singh-Cushnie: You just painted a beautiful picture. And I do hope that you find that beautiful place because sounds peaceful. And it's what you deserve, especially when you work so hard as a physician for majority of your life. So I hope you find that picturesque house in that environment, because it just really does sound beautiful. As we are getting close to wrapping up Dr. Hill, are there any last comments that you have for our audience? Any last words?
Samantha Hill: I would just say that if you're in the same place that I was, and you don't know a lot about money, to go out and start getting yourself informed, it's never too early to start. We developed the Advantages retirement plan at the OMA as you are well aware Preya, but it's a good place to start. It's been vetted by some people who know a lot more than I do about money and it's an excellent foundational setting. And the more you learn and the more you read, the less scary this will all become. So go out, start the process and you'll be amazed where you can wind up in 10 years.
Preya Singh-Cushnie: Thank you so much for your time today, Dr. Hill. It was an absolute pleasure speaking to you, getting to learn more about you and your advice, sharing it with the rest of our listeners today. For everyone listening, thank you so much for listening to the financial checkup. As Dr. Hill said, if you are an Ontario physician, please check out the Advantages retirement plan at OMEinsurance.com/retire or email us at email@example.com for more tips, education, to help you on your path to retirement readiness. Thanks everyone.
Speaker 2: The financial checkup series is producing collaboration with OMA Insurance and Commonwealth, the administration and technology partner for the Advantages retirement plan.