Physician Side Gigs to Make You Passive Income

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Passive income was a foreign concept to me just a short time ago. And physician side gigs? Why in the world would a doctor want or need a side gig?

Now, though, I am a huge fan of passive income and side gigs, and I advocate for all physicians to pursue a side gig.

So, what happened? And what are physician side gigs?

Well, let me start out by saying that passive income is really a misnomer. Nothing is completely passive. What you are looking to do as a physician is to weaken the connection between your time and your money. You are used to trading your time for money. As a doctor, if you are not working, you do not make money. However, by creating “passive” income, your money makes more money that you then trade for your time.

And there are a ton of awesome advantages to physician side gigs — for example:

  • Diversify your income so that a decrease in one income stream does not create financial stress
  • Increase your income
  • Pay off your debts faster
  • Utilize tax breaks to your advantage
  • Exercise your entrepreneurial muscles

First, though, let’s quickly discuss what physician side gigs are not.

Side gigs are not endeavors to complicate your life or to take more time away from your family. Most doctors back away from thinking about a side gig because they don’t want to spend more of their time. But, by dismissing side gigs and passive income streams, these doctors do the exact opposite. They spend more time and effort in their doctor job before reaching financial freedom.

The important thing when deciding to pursue a side gig is to establish your long-term goals. My side gigs allow me to practice medicine on my own terms because I want to, not because I have to. They will give me more time with my family and for my personal well-being as they turn into passive income.

Let’s talk about the top five physician side gigs that any full-time working physician (like me) can realistically take advantage of!

1. Equity Investing

This refers to investing in things like stocks and bonds. And of course, I’m talking about passive income investing according to your set asset allocation with at least yearly rebalancing (refresher here).

But in terms of passive income, let’s focus on stocks. Many stocks will pay you dividends — and dividends are passive income. I recommend that you re-invest your dividends. That’s money making more money.

This is a huge advantage of equity and stock investing in addition to the capital gains that your stocks, bonds, and index funds will experience over time (assuming you are investing broadly in the overall market).

2. Passive Real Estate Investing

This is a big category. It’s even bigger than stock investing since there are many ways to invest in real estate successfully:

  • Real Estate Investment Trusts are basically investing in a mutual fund of real estate investments. These are available in nearly every brokerage. Real estate doesn’t correlate with stocks/bonds, so this is a good, passive way to diversify
  • Crowdfunding is basically where a lot of people pool together money to buy properties. The buy-in is usually much lower than with syndications or funds, but generally so is the return
  • Private Funds are investments made in a company or group that specializes in real estate investments. They may specialize in different types of return of real estate investments such as “fix and flip” vs “buy and hold.” You are giving them your money and trusting they will get returns on your money that will be shared with you. There is no guarantee, however
  • Syndications are real estate deals involving a smaller number of investors buying usually single properties. Buy-ins are usually bigger, but so are the potential returns

3. Active Real Estate Investing

Direct investing is my preferred kind of real estate investing. Sure, it’s more active in the beginning but it offers huge returns and advantages when done right.

In this form of real estate investing, you buy a property and rent it out. In basic terms, your tenants then pay your mortgage and additional expenses while the extra money goes in your pocket.

For more detail, here’s my Physician’s Guide to Real Estate Investing.

4. Leveraging Your Medical Knowledge

You can sign up to complete medical surveys. This is a favorite of a lot of people. I know some who have made tens of thousands of dollars a year doing surveys.

Sign up to become an expert witness or medical chart or insurance claim reviewer. You can also become a consultant with industry partners.

And what if none of these appeal to you?

Regardless of whether you plan to take advantage of these physician side gigs, you also need to work on optimizing your medical practice. All too often, we fail to consider strategies to increase our compensation in our day jobs. And this applies to both private and employed physicians.

This includes things like:

  • (Re) negotiating your contract
  • Negotiating reimbursement rates with insurance companies
  • Minimizing costs associated with services like credit card processing
  • Transitioning to locum tenens medical assignments

So is a physician side gig right for you?

My recommendation is to consider your long-term financial goals and your current situation. If you are looking to separate your income from your time and work, then a physician side gig may be right for you.

It can be intimidating to start pursuing one of these endeavors outside of our comfort zone. The important thing to remember, though, is that many other physicians have successfully done the same.

Before I started writing like this, I had never done anything similar. I actually didn’t know that much about personal finance when I started doing this.

But I did identify for myself that I had a passion for helping other doctors improve their financial well-being. I also saw there was a need for a younger voice who is actually going through this financial journey on their own. Additionally, I knew I was a good writer and had fun interacting with people.

So, I put myself in the arena and went for it. It was scary, but I am so happy I did it! And, it has increased my income and pushed me further on my path to financial freedom to boot.

You can do the same!

Disclaimer: The author is not an attorney, accountant, or financial advisor. His expertise is in the field of medicine. Any information in this op-ed and its links should not be considered personalized financial advice.

Jordan Frey, MD, is a plastic surgeon at Erie County Medical Center in Buffalo, New York, and founder of The Prudent Plastic Surgeon.

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