1. The Doctor vs. The Plumber

2. How do you become a plumber?
Plumbers start out as apprentices and make around $12-15/hr in Tucson
They work under a licensed plumber for a few years
Eventually you can take your journeyman plumber test
Then you can eventually, through tests and work experience you can obtain the certification of Master Plumber

3. What does it pay to be a plumber?
Averages
Apprentices make $30,000
Journeymen make $60,000
Master plumbers make $100,000
All pay is based on working as an employee of a company

4. How do you become a doctor?
4 years of undergraduate study
4 years of medical school
3 years minimum of residency, depending on specialty

5. Costs to become a doctor
4 years of undergrad average cost is about $20,000 per year
4 years of med school average cost is about $50,000 per year
Median debt for finishing medical school will be roughly $200,000 for people graduating high school in 2019

6. Assumptions
Doctor Spends $20,000 a year on undergrad and $50,000 a year on med school
The doctor doesn’t work during schooling
Plumbers pay steadily increases as they accrue more experience
Both put 50% of their pay to either investments or debt
Doctor’s debt has a 4% interest rate
Investment return assumption is 6%

7. Step 1 - School Age Doctor’s Income Plumber’s Income
Doctor’s Net Worth
Plumber’s Net Worth 18 $0
$31,680
-$20,000
$15,840 19
$36,960
-$40,600
$35,270 20
$42,240
-$61,818
$58,507 21
$47,520
-$83,673
$85,777 22
$58,080
-$137,019
$119,964 23
$60,720
-$192,500
$157,521 24
$63,360
-$250,200
$198,653 25
$66,000
-$310,208
$243,572

8. Step 2 – Residency and Fellowship
Age
Doctor’s Income
Plumber’s Income
Doctor’s Net Worth
Plumber’s Net Worth 26
$55,000
$100,800
-$295,117
$308,586 27
$57,500
$103,824
-$278,171
$379,013 28
$60,000
$106,939
-$259,298
$455,224 29
$62,500
$110,147
-$238,420
$537,610 30
$75,000
$113,451
-$210,457
$626,593 31
$77,500
$116,855
-$180,125
$722,616 32
$80,000
$120,630
-$147,330
$826,153

9. Step 3 – Training is finished
Age
Doctor’s Income
Plumber’s Income
Doctor’s Net Worth
Plumber’s Net Worth 33
$380,000
$123,971
$36,777
$937,708 34
$391,400
$127,690
$233,948
$1,057,815 35
$403,142
$131,521
$449,556
$1,187,045 36
$415,236
$135,467
$684,147
$1,326,001 37
$427,693
$139,531
$939,043
$1,475,326 38
$440,524
$143,717
$1,215,647
$1,635,704 39
$453,740
$148,028
$1,515,456
$1,807,861 40
$467,352
$152,469
$1,840,059
$1,992,567

10. Step 4 – Doctor Pulls Ahead
Age
Doctor’s Income
Plumber’s Income
Doctor’s Net Worth
Plumber’s Net Worth 41
$481,373
$157,043
$2,191,149
$2,190,642 42
$495,814
$161,754
$2,570,525
$2,402,958 43
$510,688
$166,607
$2,980,101
$2,630,439 44
$526,009
$171,605
$3,421,911
$2,874,068 45
$541,789
$176,753
$3,898,121
$3,134,889 46
$558,043
$182,056
$4,411,029
$3,414,010

11. What is left out of this scenario?
50% savings is very high, family, kids, marriage, mortgage, car payments, etc. all make that number very hard to obtain
Lifestyle expenses are not included, doctors will almost always be required to spend more on certain things (car, clothes, etc.)
Tax burden is higher for the doctor than the plumber

12. Things to make the Doctor ‘win’
The doctor in the scenario is in a higher paying specialty
The strategy to pay back the student loans is aggressive
The plumber never started his own company

13. Plumber starts his business
With the knowledge and expertise gained as a master plumber, the plumber starts a business
As a sole proprietorship, they can make upwards of around $250,000 with a plumbing business
As they increase the size of their company and hire workers, each new driver can earn them as much as $100,000 per year
If the plumber starts their business at age 30 and adds one new driver every 5 years, the doctor will never catch the plumber in net worth