030 - How to Generate Wealth and Retire Early As A Physician In Medical Practice- Tips from My Accountant Specializing in Physician Practices

In this episode, Coach JPMD continues his quest to find the most impactful guests to help you decrease your stress and teach you the ins and outs of the business of medicine.  Jolene Loos has been helping physicians with tax preparation and business planning for over three decades.  She brings a unique set of experience after having counseled hundreds of physicians during their careers.  As Coach JPMD’s accountant,  Jolene often gave him advice that he sometimes did not take.  Listen and learn from Jolene and her words of wisdom.  Don’t forget to subscribe and leave a review.  Click on the show notes below to learn more about Jolene Loos and schedule a free consultation call with her.

Visit www.coachjpmd.com/retireearly see how much you need to save to retire early.

Show Notes

Discover how medical graduates, junior doctors, and young physicians can navigate residency training programs, surgical residency, and locum tenens to increase income, enjoy independent practice, decrease stress, achieve financial freedom, and retire early, while maintaining patient satisfaction and exploring physician side gigs to tackle medical school loans.

Transcript

Coach JPMD  0:01  
Do you want to work forever? Is there something that you want to do after you retire? Or are you waiting for mom or dad to leave your money after they pass? Our next guest is my accountant and business consultant for over 20 years, Jolene Loos. And before we get into the episode, I wanted to share a resource or a tool that I wish I had a couple of years ago, that helped, or that could have helped me understand how I could retire early. And then that tool just helps you put in plug in some numbers, how much you make, the rate of return of investments, which I actually think we could probably make about 10% on a return on investment over a 20 year period. I'm not a financial consultant, and I'm not a I'm not a financial guy. So I can't guarantee that of course. But that's a number that I've seen used by some. And you can plug that into the calculator and kind of find out when you can retire. And I can honestly say if you invest consistently over the period of 15 to 20 years, and you're young in your career, you can certainly retire early, just like some of my patients did. So you can find that tool at www.coachjpmd.com/retire early and plug in the numbers and see what you come up with.

Intro  1:19  
Welcome to the practice impossible podcast. We're your host, Jude Pierre M D, also known as Coach JPMD discusses medical practice topics that will guide you through the maze that is the business of medicine, and teach you how to increase profits and help populations live long. Your mission should you choose to accept is to listen and be transformed. Now here's your host, Coach JPMD.

Coach JPMD  1:44  
So Jolene has been my accountant for over 20 years now. And it's unfortunate that I had to it took me about 15 years to figure out that she was usually right about most of the financial advice that she gave me. So today, we have Jolene on the show to teach us things that you guys can do to practice impossible to shortcut the things that I wish I had done several years ago and to hopefully retire early. Or at least give you the path to retire early. But it's up to you. So here we go. So welcome to the practice impossible podcast with your host me Coach JPMD and today we have the privilege and honor of interviewing Jolene Loos, my own CPA and business consultant. Jolene has been my accountant for over 20 years now, I think since I moved to Tampa, and I don't remember when we started. But you know, it is said that the wise seek counsel of many and it's a fool that doesn't take advice. And Jolene has been my wise counsel. And so I want to introduce, I want to let her introduce herself and tell us who she is and her origin story, your background and kind of give us some tips on how we can practice impossible as physicians in this crazy, crazy world that we're living in. So Jolene it's all yours.

Jolene Loos, CPA  3:01  
Well, first you thank you for inviting me to do this. I always love to do these kinds of things. Because I get the most value out of my work. When I feel like I've provided value to some of my clients. And my getting into the CPA world was really very different. I started my college degree at as a fashion merchandising major. And my mom and dad were great in providing for my college education. But I had to work to provide money for my car and entertainment and those kinds of things. And I got a job over Christmas at one of those big box stores. And I started out as a cashier, and I was one of the fortunate people that they decided to keep on after Christmas was over. And they put me up into the accounts receivable and accounts payable department. And I absolutely loved it. I had always really liked math. I was one of those weird people that took calculus classes as an an optional class that I could take. And so I started taking some bookkeeping and accounting classes and realized that I absolutely loved it. And so I changed my major. I got my four year degree from University of South Florida, and then sat for my CPA certificate. I started with a very small firm in Tampa, and I was with them for almost 10 years until they merged with one of the at that point in time international firms. And I always said I didn't want to be with a large firm like that because I was afraid they wouldn't take care of my clients. Like I thought my clients deserve to be taken care of. And I only managed to stay with them for about six months. And I said, Okay, it's right, and had the opportunity to merge my clients that went with me with someone who I actually went to high school with. And he and I were together for about 10 years, and then I was out on my own for a while. And then my current partner and I have been together 21 and a half years which is longer than most marriages. So that's one of the things I like to talk to about with my clients who have partners of, of how you make those relationships last, because what I tell my clients is that when you're married, you love the person that you're with. But when you're in a partnership, there's always a or there always should be a respect, part of that. But there isn't a love part of it. And so making a partnership last, many, many times is a lot more difficult than making a marriage last.

Coach JPMD  6:19  
Well, a lot of people say that you shouldn't have been you shouldn't have partners and businesses, because sometimes it's hard for that, for you to see that partner is working as hard as you are maybe not working as or working more harder than you are. And so to find that balance and in partner, so this can be tough. How did you find that balance and your partner? And do you guys share the workload? Or do you guys? How do you manage your client base does he have his own clients where she has her own clients, or...

Jolene Loos, CPA  6:48  
We both have always maintained our own client base, shared space, we've shared team members. But the biggest thing that's made it work is the fact that we have religiously had meetings starting out when we first joined together, the meetings were once a week almost. And then as the practice evolved, we found that it didn't need to be that often. And once a month worked. But the biggest, the biggest thing we did was that neither of us were ever afraid to discuss something that was bothering us. So the little grains of sand never got to convert into mole hills, or then ultimately mountains, it's always so much easier to resolve something when it first becomes an issue with you than it is when it's best or then you've made it into something that probably isn't as serious as it really should be.

Coach JPMD  7:55  
And so because you share space, because you do a lot of computer work, I guess, does that give you more time to to have that time to communicate? Because I think what we find in the physician world is a physician may be running at the hospitals, and they may be going back and forth from different locations, but they never have time to meet. Do you find that it's important to set those times to meet regularly? Or do you guys meet spontaneously? Or how do you set your meetings?

Jolene Loos, CPA  8:24  
We definitely had some spontaneous meetings because we were you know, right down the hall from each other. But we always had confirmed meetings on our calendars. And I want to go back to something you said that doctors can't find time to meet. And I would say doctors don't make time to meet. Because we all have the same 24 hours a day available to us seven days a week, 52 weeks a year. But each of us has to prioritize what's most important to us, and make sure that those things that are most important to us actually get on calendars.

Coach JPMD  9:11  
Yeah, and I think it's kind of speaks to one of the topics I wanted to address with you. And that is the research that Dave Ramsey and his team did on the top five earners. That earned a million dollars in their lifetime and physicians are not and one of them engineers are there, CPAs are there, teachers were surprisingly there that list, management, people in management I guess, and attorneys, but physicians are absent in that list. Or are on that list. Why do you think that is?

Jolene Loos, CPA  9:42  
And this might make some of your physician clients mad at me.

Coach JPMD  9:47  
That's okay.

Jolene Loos, CPA  9:49  
I've worked with hundreds of physicians over the years, the practice I first started with that was the main category of businesses that we worked with. And at the time that the firm merged, we were dealing with, I want to say 750 physicians and or physician groups. And...

Coach JPMD  10:15  
Sorry, 750 physicians that were your clients?!

Jolene Loos, CPA  10:20  
That were the firm's clients? Yes.

Coach JPMD  10:22  
That sounds like a lot for an accounting firm. What percentage of that was of your total book of business? 50%? 10%?

Jolene Loos, CPA  10:30  
Oh, no. It was close to 90% of the book of business that the firm was doing. And there were 50 people in the firm. So it wasn't like I personally, was handling those 750 clients. We each CPA within the practice had a book of business that they were working with, and they were specifically responsible for everything relating to those clients.

Coach JPMD  10:57  
And that was in the first firm that you worked with? Right?

Jolene Loos, CPA  11:00  
Correct. 

Coach JPMD  11:01  
So over the span of how many how many years? Have you been in practice? 20?

Jolene Loos, CPA  11:07  
I started working with that firm in 1976. Okay, I was with them until 1985.

Coach JPMD  11:15  
So a long, long time. So the quite why reason why I'm asking that question is because that means that you probably have seen a ton of physicians, as as clients. 

Jolene Loos, CPA  11:28  
I have.

Coach JPMD  11:28  
Would you say that that's majority of your business, because I'm not sure if I knew this.

Jolene Loos, CPA  11:33  
And when I first left, it was definitely the majority of my business over the years. Right now, my physician book of business in my practice, is around 50%.

Coach JPMD  11:46  
So a lot is so before we get into, I know you want to answer that question, but so what do you do for the physicians? So you have a lot of physicians in the group? Or in the practice? What are the main services that you provide for them?

Jolene Loos, CPA  12:05  
Well, we are a full service CPA firm. So we do all of the regular boring kinds of things that physicians need. So we complete financial statements for them, if they have their own practice and need financial statements prepared. If they are part of a group, we will review it with them and look at how their bonuses are calculated, and make sure that everything is handled properly. And then we either file or we file both business tax returns for them, or, and or their personal returns. Okay, one of the things that we do that's a little bit different, and Jude, you've been part of this for many years is I won't take a new business client on unless they are willing to do something that we call a year end planning meeting. And the reason to do the year end planning meeting is because of the fact that if we don't meet until it's time to do your tax returns, if there was something that we could have done to help save you money, that time period has passed. And you can't ever go back and and re coupe that time period. But we look at not only where you were for the prior year, but we talk about things of what's coming up for you in the next year. And can we project what your income might be? Are there going to be significant changes in your life from this last year to the next year? For a lot of my clients, because I've been doing this so long, it's a discussion about how many more years do you want to work? And are you in a position where you can afford to retire? And sometimes that answer to are you in a position to be able to afford to retire? That that answer is yes. But what I find with a lot of my physician clients is that a lot of them don't have any life outside of what they do for work. They haven't taken the time to develop hobbies or have things that they enjoy doing. And so for a lot of physician clients I've seen retirement is difficult. Some of them have gone into teaching. Some of them have decided to do some locum work, but for I would say it's easily 25 to 30% of them. They haven't been happy in retirement

Coach JPMD  15:00  
That's not good for me to hear, because I find myself really active in wanting to do and learn more and more things. So what is driving that? What do you think is driving physicians to not explore other things? Is it fear? Is it maybe lack of income or inability to retire? Like you were saying, or, like what's driving that?

Jolene Loos, CPA  15:18  
I think it could be a combination of all of those things, Jude, I think a lot of times the lack of income is changeable. Because I have, my philosophy has always been to live below my means. I drive my cars, I take really good care of them. When I drive them until like, like, the car I'm driving right now has 56,000 miles on it, and would have a lot more on it if it wasn't for COVID. But I haven't put much mileage on it. They think they need to live in a house that's of the same calibre of the other physicians that they're surrounded with. And almost always take on, in my opinion, too much debt to live up to their peers, is instead saying, where how many years do I really want to work? What is my earning potential over those years that I want to work? And then what do I need to save on a monthly annual basis to get to the place that I want to be when I want to retire? I have so many physician clients who do not max out their 401 K plans that live that are working with groups. And and when I asked them why the answer is normally, well, I'm putting in enough so that they max so that they're matching the maximum amount that the entity will match. And my comment on that is there's a couple of things with physicians. Number one, I'm a huge retirement proponent, as you know. And that's because of the fact a couple of things. Retirement Plan, monies are not subject to creditors. So if for any reason you ever were subjected to a malpractice case, those are monies that the PI attorney can't get to. And secondly, because that money is growing tax deferred, and especially for my younger clients who have so many years to grow that money, even though it's not saving taxes for them now, I'm recommending that at least 50% of that, if it's available, go into Roth deferrals instead of ordinary deferrals.

Coach JPMD  18:02  
But you said it's not tax preferred, or...

Jolene Loos, CPA  18:04  
You know, the Roth...

Coach JPMD  18:06  
The Roth is not..  

Jolene Loos, CPA  18:08  
Yes. 

Coach JPMD  18:08  
Okay. But the regular 401k is tax, tax deductible, whatever.

Jolene Loos, CPA  18:13  
Correct, it reduces your income that you have to report on your personal return.

Coach JPMD  18:17  
Yeah. So I think what what it sounds like you're saying is that there's a stubbornness in our profession, to doing whatever we want to do. Like I was stubborn. And I will admit, I did not listen to wise counsel, 10 years ago, 15 years ago. So I'm now having to catch up on that 401 K and all of my retirement stuff. So what would be the one thing that you think physicians are not doing or doing that are not getting them on that top five list of millionaires?

Jolene Loos, CPA  18:46  
My first comment would be that in most, or a lot of instances, they're living above their means. And they're living for today, instead of living for their future.

Coach JPMD  19:00  
And then what I see is what I see in our older colleagues is that they did that. But then now they're in the process of trying to retire and they, they realize that they can't, so they're having to work longer hours or having to, to do things that are outside of medicine to supplement their income, which then takes their focus away from medicine. That's their, their main bread and butter. So I thank you for that insight. Because I think, coming from you and knowing that you've seen so many physician clients, I think it's helps our audience understand what they can do today to practice impossible to get that that monies or those monies that they they need to retire. So what what are three things that you think physicians should do right after residency, while they're joining a group or hospital with their finances? 

Jolene Loos, CPA  19:48  
The number one thing they should do is that the, as soon as they possibly are eligible for the 401 K plan, they should enroll in the 401 K plan. The second thing is that they regretfully in today's market, most young doctors coming out of residency have some kind of student loan debt that they have to pay off. So they should find a qualified financial planner. And they should put a plan in place that will allow them to get their debt paid off, and to know where their finances need to be. And then the third thing would be, and it kind of melds in with two because they go hand in hand. But you've worked really hard. And you probably like a brand new car. But a nice brand new car doesn't have to be an 800 to $1,500 a month car payment. There are other nice cars out there that still drive nice to look nice. And so the third thing is, don't feel that you have to hold yourself up to what you see other colleagues doing.

Coach JPMD  21:11  
Yep. And so I've heard a saying said, they want you want to be like the Joneses. But most people don't realize that the Joneses are broke. So it's no need to chase those Joneses because it's, it's important to have those three things in order. And I say, and I think I, I probably would put two before one, because I think if you develop a good financial plan, I think you can pay off your student loan debt within three to five years of residency. And I can show people how to do that as well. But for sure, I love those three suggestions. So give me an example of a physician you feel because we've kind of been kind of doom and gloom here with physicians. But give me an example of a physician that's just crushing it, that's just practicing impossible that you said, Wow, this guy's really doing well. I wish that all my clients were like this doctor, what would be the characteristic of that doctor?

Jolene Loos, CPA  22:03  
I'm fortunate that I can say I have numerous positions that fall into that category. Because I have beat into their heads that they have to do personal financial planning, they have to have a plan in place. One of my ones that may be is is one of my favorite because he was he was one of my physicians, he was actually my OBGYN. And he was with the first practice I worked with. And the the partner in charge didn't want me to work with him. Because of the fact that he he was my physician, too. And the client came and said, If I can't work with Jolene, I'm not staying with the firm. And so the partner in charge came to me and I said, it doesn't bother me. And we put a plan in place for him. And he's been retired now 15 or 20 years, he regretfully had to retire, he hurt his back and didn't have the option to continue working. But because of all of the planning that he's done, literally, he and his wife can do anything that they would consider wanting to do. And they will not run out of money before they leave the face of the earth. And will be leaving their children and grandchildren a nice legacy, even though one of their children is a doctor out in California, and he's doing very well on his own. And he's already started the saving philosophy, and their other son is in management and actually works for Robert Half who finds accountants to place in CPA firms. And he also has done really well in saving, too. So he's one of my, he's my favorite success story. But I am fortunate that I have numerous other clients that fall in that category.

And so with changing healthcare reform and things changing with reimbursement and and doctors just getting into more debt coming out of residency and medical school, where do you see healthcare going in the next 20 years?

Jude, you do know that I'm fortunate that I've worked with a lot of physicians that do risk management. And so I was very fortunate that I had a client that got involved in that when I knew nothing at all about it. And at the time, it was JSA who now has moved, merged through different companies. But I literally spent hours at JSA offices, learning how to read the reports and what they meant and, and what did my client need to do differently to not only be a physician, but be a business person. Because regretfully, you don't have time to take business classes when you're going through residency and and getting your degrees. And most physicians that I see come out as physicians, but most of them come out as a really bad business people. And medicine. It didn't used to be that way. When I started practicing, almost any physician could make an extraordinarily good amount of monies in their practice. That's not the case. In today's market, the physicians that I see that are going into practice, now, they have to run their businesses like a business, they have to be aware of how they're practicing medicine, and making sure that they're doing making smart decisions in how they're running the book of business that they're responsible for.

Coach JPMD  26:26  
And you mentioned risk contracts and JSA. And the JSA was a huge managed care organization, they ran mainly capitated medicine or capitated payment arrangements for primary care physicians and, and that's where I think it's going and I think you're spot on because it's about managing patient populations. So whether you're in managed care, capitated managed care, fee for service, these insurance companies are coming down and providing value based care, that is really focused on managing the patient population with their diabetes care, their mammograms or colonoscopy making sure things are done, and reimbursing physicians who are doing those things more than those that are not. And I think, to some extent, they're actually probably cancelling physicians who are not doing the right thing as well. So you run the risk if you don't understand managed care. And if you don't understand risk management or population management, then you may not have a job in that in that area. So you're spot on there.

Jolene Loos, CPA  27:21  
Or if you don't, and you're with a group, you find yourself going in the hole of what you thought you were going to be able to make with that group. And that's why it's so important to make sure if you're in that kind of a group, that you understand what the reports that hopefully you're getting, and if you're not getting them, then you need to get them. Because those reports can show a massive amount for physician of the things you're doing right, and the things you're not doing.

Coach JPMD  27:57  
And a shameless plug for the llama course as well, because we teach physicians in the course how to read practice reports, both profit and loss and managed care reports that, you know, you don't have to be an expert, you don't have to be a CPA, but being able to manipulate an Excel spreadsheet, or see a report in a simple, simple manner can definitely save, save you tons of headaches and really take take your patient population under your control because you're ultimately responsible for those patients. So thank you for that.

Jolene Loos, CPA  28:30  
Absolutely. Absolutely.

Coach JPMD  28:32  
What do you do for fun? Because it can't just be CPA and business.

Jolene Loos, CPA  28:37  
It's not. My husband retired a year and a half ago. And miraculously, we haven't killed each other even though we've both been home because I've been working remotely during COVID and he's been here. We really love travelling and are luckily starting to be able to do that. We both golf. I actually believe it or not, but this is how well my partner and I have believed in running whatever you do as a business. I golfed done a charity tournament yesterday, so even have to be at my office to tie out 1040 extension.

Coach JPMD  29:22  
Oh, that's right. Yesterday was April 18.

Jolene Loos, CPA  29:26  
And we had the extension because IRS was closed on the 15th for Good Friday. And so the extension date moved to Monday.

Coach JPMD  29:36  
And you're on the new doing charity event playing golf. That's wonderful.

Jolene Loos, CPA  29:41  
And and I love to read. I absolutely love to cook and I have a really cute little puppy dog that is a COVID dog. I got him in the middle of COVID and so he gets to take me outside and do walks and playtime so those are my main hobbies.

Coach JPMD  30:01  
Cool. It's so, so great to have this conversation with you. It's been 20 years in the making, I guess. And hopefully I'll be like that OBGYN in the next couple of years, after I've listened to you beat me up. 

Jolene Loos, CPA  30:17  
You're moving in the right direction. 

Coach JPMD  30:19  
That's right. That's right. So as long as you're moving forward, so how can how can our audience find you if they're interested in having them help you or having you help them with their, their finances?

Jolene Loos, CPA  30:30  
Well, we are still definitely looking for new clients. And I do offer a free short initial consultation. And I the easiest way to schedule that is I have a Calendly link. I think Jude had said he'd get that information out to you, that will give you access to my calendar to schedule a short meeting. And then, you know, just to just that meeting to find out a little bit more about you, because our firm does want to work with people that we really believe we can help. And I believe we can help everybody. But there are people who really don't want help. And so those are clients that we really aren't suited to work with.

Coach JPMD  31:25  
I think our audience is the practice impossible audience and we know that they are they want to do what is different than their colleagues and I am 100% confident that my audience will definitely engage in that link. If they need to speak to someone if they don't have an accountant. I strongly recommend that our audience does this because Jolene is such a great resource and has helped me in so many different ways, not just in the business, but also in some personal issues as well. So I will share those that link in the show notes. And we'll have a landing page and we'll make sure that we get them your information, Jolene. Thank you.

Jolene Loos, CPA  32:05  
I want to kind of touch on that a little bit. Because because of how closely I do work with my clients, because we're working with finances, you learn so many things about people, and they learn to trust you, as Jude mentions with things that are more personal related than, than business related. And I've had multiple clients that have asked me, Are you sure you don't have a psychology degree too? And I think it's just because of the fact of listening to my clients and caring about my clients.

Coach JPMD  32:47  
And I can attest to that for sure. It's really about the relationship and relationships that you develop over time and with like I said at the beginning with wise counsel, and you have been such a wise, Counsellor for me and our family. So really appreciate what you've done for us jelly. Thank you so much, and we'll see you soon.

Jolene Loos, CPA  33:08  
Thanks, Jude.