See Which High-Paid Professionals Will Retire Eating Alpo
People with prestigious, high-paying jobs have the world at their fingertips: Money, security, and the opportunity to travel the world. They can afford status symbols like a beautiful home (or two), luxury cars, and plenty of lavish vacations per year.
But when you have plenty of money and use it to live for today, what will your golden years be like? In a guest post on The White Coat Investor, Dr. Geoff Hubbell said he realized early on he would be eating Alpo in retirement if he decided to squander all of his earnings now on things like expensive real estate in Seattle and a six-figure imperial grand piano.
“I decided to test the waters of living-for-today by trying out some Alpo to see if I could talk myself into a different way of living,” Hubbell wrote in his humorous account, noting that the colorful cans would display nicely through the glass doors of his retirement home’s custom cabinets.
He really did try Alpo. “So is Alpo in retirement really that bad? YES!” he wrote. “This stuff is absolutely terrible. The best way I can describe it is cardboard stroganoff … [I] was originally planning to eat the entire can in order to prove some bizarre point to myself, but I quickly gave up that idea. I was reluctantly forced to conclude that I would have to tell Gulfstream to cancel that order for my G650.”
Coming from a physician, Hubbell’s point was well-taken. Those working in certain high-paid professions are notorious for often living extravagant lifestyles while failing to fund their retirement savings. Here are eight such professions.
- 41% have less than $500,000 in retirement savings
Doctors are above-average earners, even those on the lower end of the pay scale. Base pay for a family practitioner is $189,000. Orthopedic surgeons and cardiologists earn a significantly higher paycheck of over $500,000. However, doctors often fail to build wealth. In a 2013 survey, half of physicians said they are behind where they would like to be in retirement planning. Why aren’t they accumulating savings? Medical school debt, a late start on earnings and savings, and overestimating their ability to manage money have all been cited as reasons.
Next: It’s not all huge windfalls for this profession.
- Price range for 7 years of law school: $150,000 to $400,000
The movies will have you believe that every lawyer sooner or later gets rich off a huge windfall from a successful litigation case. But in reality, there are not always windfalls to be had, and lawyers usually start their careers loaded with student loan debt that takes decades to repay. This debt eats into the $115,000 median annual lawyer’s salary. But lawyers could possibly have it better than doctors. According to The New York Times, while lawyers and doctors are both big spenders, lawyers tend to save more for retirement than doctors do.
Next: The stress of a doctor without the pay
- Average 2016 graduate student loan debt: $261,000
With the median annual salary for dentists at $155,000, this high-paying career seems a good route to spending one’s golden years in comfort. But throw in some hefty student debt, and things look less rosy. The 2016 dental graduating class carried average student loan debt of $261,000. This type of debt will likely be a huge road block to retirement savings. Also, it’s worth noting dentists don’t make quite as much as doctors. “As the general dentist does not make a very high six-figure income few have saved enough to replicate income in retirement,” Kevin Meehan, a certified financial planner, told MarketWatch.
Next: Keeping up with the Joneses is a crushing endeavor.
4. Investment bankers
- Average first-year investment banker salary: $160,000
The average salary of a first-year investment banking associate, including bonuses, is $160,000 per year. For as much as they earn, investment bankers often tend to live expensive lifestyles. “It’s really not that unusual to find Wall Street bankers who are close to declaring themselves bankrupt,” said Gary Goldstein, co-founder of U.S. search firm Whitney Partners. The reasons these professionals are failing to accumulate wealth include the perceived need to keep up with the Joneses. “When you work in banking, you end up surrounded by people who earn a lot of money,” said Erika Shapiro, a former fixed income saleswoman at Goldman, Citi, Credit Suisse and UBS. “Everyone around you has a big mortgage and is sending their children to private schools.”
Next: From millionaire to broke in a few years
5. Former NFL players
- 16% of NFL players file bankruptcy within 12 years of retirement
A career in the NFL may seem like a ticket to riches beyond most people’s wildest dreams, but many an NFL player has gone broke after they retired. The reasons range from pressure to spend money, poor financial education, and being overly optimistic about their longevity as players. A 2009 Sports Illustrated story reported 78% of former NFL players filed bankruptcy or experienced financial stress due to losing their job or getting divorced within two years of leaving the league. Retired NFL players who have filed personal bankruptcy include Warren Sapp, Vince Young, Bernie Kosar, and Luther Elliss.
Next: These professionals don’t have an employer retirement plan.
- 34% of entrepreneurs do not have a retirement plan.
We’ll start this section off by saying not all entrepreneurs are rich. For all their hard work and ingenuity, not all of those who start a business or enterprise turn into the likes of Mark Zuckerberg or Richard Branson. However, breakout success has been achieved by some lucky, brilliant people. Regardless of net worth, many entrepreneurs make the mistake of not saving money, with 34% reportedly not having a retirement plan. In Stages of Retirement Planning for Entrepreneurs, it’s recommended they set up a retirement account and have money automatically transferred to it regularly.
Next: This wildly successful group sometimes ends up penniless.
- Value of Johnny Depp’s one-time fortune: $400 million
It’s hard for most of us to fathom how wildly successful celebrities can find themselves penniless. Yet, it happens, often due to over-spending. Johnny Depp, whose money woes have been in the news, once paid $3 million to fire Hunter S. Thompson’s ashes out of a cannon. His divorce from Amber Heard is said to be pretty expensive as well. Depp is suing his former managers, saying they’re responsible for his money troubles. Other celebs who have wound up bankrupt include 50 Cent, Kim Basinger, Marvin Gaye, Larry King, Gary Coleman, Aaron Carter, David Cassidy, and Toni Braxton.
Next: These professionals are sometimes guaranteed a rich pension.
- Donald Trump’s businesses filed bankruptcy six times.
Some of the country’s prominent politicians have found themselves in the throes of bankruptcy. President Donald Trump’s companies went into reorganization six times – five of them being his New Jersey casino holdings, and one being a hotel in New York. Regardless of his personal wealth and retirement savings, Trump is actually a politician who will not retire eating Alpo. He is guaranteed a presidential pension. For 2013, that amount was $199,700 per year. In addition to Trump, other politicians who have filed bankruptcy include Benedict Arnold, Abraham Lincoln, and George McGovern.
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