Timothy Ulbrich is a pharmacist who had a big goal.
After working with his wife to pay off $200,000 in non-mortgage debt and creating a successful blog at yourfinancialpharmacist.com, Timothy knew that he wanted to share his message about personal finance with more pharmacists.
He started talking to lots of pharmacists and found out that, despite earning a six-figure income, many needed help managing their finances. He consistently heard pharmacists say, “I am living paycheck to paycheck.”
Timothy always says that he is a pharmacist by day and a financial nerd by night. Plus, he has a ton of personal experience with paying off debt and working toward financial freedom.
He could relate to what these pharmacists were feeling.
So, he decided to write a book.
His book, he decided, would be unlike any other personal finance book on the market. It would provide quality personal finance advice tailored specifically to pharmacists.
It would be exactly what pharmacy schools were NOT teaching.
And, it would focus on one of the things that resonated most with the readers of his blog: one of his most successful posts, entitled My Top 10 Financial Mistakes.
By his own admission, Timothy made some mistakes with money.
He wanted to prevent people from making the same mistakes that he did, and he figured that this book would be a great way to do it.
And that’s how the idea for Tim’s new book, Seven Figure Pharmacist, was born.
Setting a Goal
Timothy and his co-author, Tim Church, who is a pharmacist at the West Palm Beach VA, started outlining the book in summer 2016.
He and his co-author tag teamed the project and decided to emphasize the pharmacist perspective by including stories that are relevant to pharmacists.
They finished writing the book in six months (which Timothy said he would not recommend—a year or 18 months would have been much more comfortable considering that has a full-time job as an Associate Professor of Pharmacy Practice and Associate Dean of Workforce Development and Practice Advancement at Northeast Ohio Medical University).
Because of his full-time job, the rigorous writing schedule was tough to stick to at times. But Tim got through it by creating a prioritized list of tasks and staying accountable.
Creating a Buzz
Timothy hired me as a coach to help him through the complex task of writing his book and figuring out the best way to promote it.
Because Timothy and his co-author decided to self-publish the book, they also needed to come up with a marketing and promotion plan.
Ultimately, Timothy and his co-author decided to take a grassroots approach to marketing because it seemed right for their audience and their brand. Eventually, Timothy began to see the power of that approach and began to maximize the tactics that were working well.
Timothy learned how to use social media platforms for optimal marketing, created a website, drove traffic to it, started a blog and booked speaking engagements.
His coaching experience helped him to prioritize more efficiently and to make the best possible decisions—which he believes led to a better end product.
Most importantly, Timothy grew more confident in his product and became more comfortable with selling it.
At first, he didn’t feel comfortable jumping on a Facebook live video and engaging with his audience with little preparation. Now, he is fine with it because he understands that video is more engaging for his target market than reading a blog post.
Also, Timothy understands the true worth of his book.
As part of their review process, Timothy and his co-author created a group of 50 pharmacists to give them feedback on the content, title and promotion plan.
One of Timothy’s former students was a part of that group. After reviewing one of the chapters, she told Timothy that she took a specific action based on what she read.
Timothy said hearing this news provided him with the assurance that the book was truly valuable and achieve its intended purpose, which motivated him to continue with the project when the going got tough.
The Final Product
Timothy and his co-author did a pre-launch in March 2017 and officially released the book on April 17, 2017. They sold more than 700 copies in the first six weeks.
They also went on the road to four Ohio colleges and the Ohio state pharmacy convention to promote the book—which they jokingly called their “Book Launch Tour.”
Timothy said he is hearing great stories about how the book has helped people relieve stress in their lives. He’s even had people tell him that they are taking the book on vacation with them.
As word starts to spread about the book, Timothy and his co-author plan to reach out to pharmacy schools about incorporating the book into their curriculum.
To find out how to order your copy of Timothy’s book, visit www.sevenfigurepharmacist.com. For more personal finance advice for pharmacists, you can also check out Timothy’s blog at yourfinancialpharmacist.com.
Tim and Tim are gracious enough to allow any reader from The Happy PharmD to get 15% off the price of any package. Just use the coupon code BARKER on their page.
Achieving financial freedom is a great goal for any pharmacist to have. If you want to learn more about how you and other pharmacists can create their best life and achieve career satisfaction and financial freedom, check out my website, thehappypharmd.com.
I recently spoke with a pharmacist who wanted out of her retail pharmacy job. Aside from the typical complaints about retail pharmacy, such as bad hours and being poorly treated, she said,
“Everyone knows pharmacist salaries are going down. We are being replaced by machines.”
Her statement struck me for two reasons. First, it was very matter-of-fact. Second, this pharmacist seemed to have accepted that this was the future of pharmacy. Although I disagree with this particular pharmacist’s sentiment about the future of the profession, it did make me wonder whether there is a conspiracy at work in the pharmacy industry.
Before we get started, here’s a disclaimer: The pharmacy conspiracy theory that I am about to present to you has not been validated. It is the simply product of my analysis of industry trends, my personal experience and my knowledge of the pharmacy job marketplace.
Let’s Go Back in Time
You are probably aware that pharmacists are seeing a decrease in salaries and flattening pay over time. However, this wasn’t the prediction for the future of our industry.
In 2000, the Pharmacy Workforce Center released a report stating that there will be a huge demand for pharmacists in 20 years due to rising health care costs and an increase in the aging population. This group tried to read the signs and anticipated that the future demand for pharmacists would far outpace the supply.
Now, a short 17 years later, the supply of pharmacists has exceeded the anticipated demand. This has had multiple effects on the job economy for pharmacists, including:
· Fewer available jobs, especially in urban areas
· Elimination of signing bonuses
· Decreased benefits
· Decreased actual salary/wages
· Decreased offered salary/wages, especially for new graduates
· More part-time jobs such as floater positions, for which reduced benefits are offered
· Flatter salaries over a 10-20 year period
Despite all this, I maintain that pharmacy is still an excellent profession to get into, only if you take control of your career and do not expect to be handed a job. However, our industry is not without its problems. And, although some pharmacists are looking for a way out of the industry, I don’t believe it’s necessary to run for the hills just yet.
Who Benefits From Changes in the Pharmacy Marketplace?
Let’s think for a moment about who is benefiting from these changes in the marketplace. Certainly not the pharmacists, who are seeing lower pay, reduced benefits and flatter salaries during the course of their careers.
It’s the pharmacy executives, business owners and stockholders.
Allow me to explain: Hiring a pharmacist is a big deal because it costs lots of money. If you think about the average salary for a pharmacist plus benefits, you are going to pay well over $140,000 a year in any state in the U.S. If you run a business such as a retail pharmacy chain or a hospital, the easiest way to boost profits is to create systems that help you to eliminate costs—and pharmacists are a HUGE cost.
If you are a pharmacy executive who is responsible for hiring pharmacists, would you prefer to have more applicants or fewer applicants for your new pharmacy jobs? Of course, you want more applicants. The more applicants you have, the more qualified potential employees you can find and the less you can offer to pay. Why? Well, because more people are desperate for the few available jobs you have, especially if your business is located in a choice area.
Before you start making pharmacy executives the enemy, take a moment to sympathize. These people are running large, multi-million-dollar companies and part of their job is to figure out how to make the businesses profitable. And, like the rest of us, pharmacy executives receive rewards if they succeed at their jobs.
So, is it any wonder why pharmacy executives want more pharmacists in the job marketplace?
The Conspiracy Theory
What if pharmacy executives supported (even financed?) the Pharmacy Workforce Center’s 2000 report stating that there will be a huge need for pharmacists in the future? What if there is a bigger reason why pharmacy executives support new pharmacy schools that are popping up all over the country? What if these new pharmacy schools aren’t really intended to meet a demand, but instead to decrease salaries?
Makes sense, doesn’t it?
What we do know to be true is that many pharmacy schools receive funding from retail pharmacy chains.
But no matter what thoughts you have about big pharma, executives and ivory towers, you should remember that this isn’t the end of the world. The pharmacy profession will still exist in the future.
Although the pharmacy model may change, I believe that pharmacists will still have jobs because there always will be a need in the marketplace. No matter how many machines are made to perform some of our technical duties, no machine can take the brain of a pharmacist and help people the way that a human pharmacist can.
What You Can Do
Here’s your call to action: Don’t take this lying down.
Whether or not my conspiracy theory is true, you need to take charge of your career. You should be upset by the fact that salaries and benefits for pharmacists are down and full-time jobs are being turned into multiple part-time positions to keep costs low. Take that emotion and turn it into useful action, rather than spending time complaining about things outside your control.
Don’t be a victim and blindly accept what other people say will happen. Now is the time for you to take back your career and improve your circumstances. Here are a few ideas to help you get started:
· Network, network, network. Go to your next state conference and talk to the big players in your area’s pharmacy industry. Find out if you can help them or volunteer your time. This could lead to a new (better) job.
· Learn a new skill. Acquire a new skill and offer to provide it to other companies. Enjoy working with computers? You never know when a company may need a pharmacist with an information technology background. Have a knack for marketing? Offer to help a pharmacy or health system expand their social media presence.
· Develop skills outside of pharmacy. Fuel your creative energies in your spare time by creating a side hustle that you enjoy. Write a book, build websites, do voice-over acting or try your hand and blogging. In addition to giving you the flexibility to one day leave the pharmacy industry, you can make some extra cash.
· Create value at your job. Make personal and professional development your priority. Create new opportunities for your employer to make money, then ask for a promotion or a raise.
Gone are the days when pharmacists graduate from college, have a great job handed to them and continue to earn easy raises and promotions for their entire career. We live in a new era where pharmacists are having a hard time finding a full-time job.
If you want to maintain your standard of living or generate additional income, you have to take charge of your career, your finances and your future—starting today. Whether you decide to start a side hustle or hope to transition out of the pharmacy profession for good, check out our free PDF, “8 Ways for Pharmacists to Make Extra Cash with No Investment Costs.”
Whenever you feel tempted to give in to the belief that your job will be taken by machines in 10 years, remember that there is no replacement for caring human interaction in the pharmacy profession—and that only you can control your future.
Do you remember the moment in pharmacy school when you had to convince yourself that all this effort and energy was earning worth six figures in the future? Remember the moment when you had to cajole yourself to study for another few minutes for that chemo exam by saying to yourself “six years, six figures, six years, six figures …”?
Pharmacy is a wonderful profession for making a living. Yes, we do have our downsides and our problems. But overall, we are paid very well for the work that we do.
There are too many pharmacists who are miserable at their jobs, living paycheck to paycheck and wondering why they made the decision to join this profession. Some feel trapped, like they can’t escape their day job. They can’t even think about taking a day job that would pay them half of their salary—say $60,000—in exchange for a happier life.
I once met a pharmacist who truly did not like what he did on a day-to-day basis (You could say he hated his job). I found out that he had a passion for painting. He loved to paint, not just his own drawings, but also painting houses. Yet he decided that it was better for him to be miserable at his job and earning six figures instead of taking a job he loves that pays less than half of what he currently earns. He would say, "I don't have a choice. I have to do this job."
This kind of lifestyle is something we do not promote at The Happy PharmD. We take a simple approach when it comes to money management. What follows is a philosophy and techniques to use money to create a lifestyle that is fulfilling—call it “lifestyle designing,” if you will. Here are three worldviews that will guide the rest of our discussion:
Minimalism purports that in order to be truly happy, we don’t need to fill our lives with stuff. We don’t need a better home or a better car or the next and newest gadget to fulfill our desires. Minimalism states that you only need the bare essentials to live a fulfilled and happy life; in fact, the less you have, the less distracted you are. And, the more focused you are, the more fulfilling your relationships will be.
Minimalism isn’t just about money. It’s about all of life, including your eating habits, exercising, what kind of car you buy and what kind of job you take.
I was first truly introduced to this approach to life when I read the book, The Life-Changing Magic of Tidying Up, by Marie Kondo. In this book, she talks about how creating a lifestyle in which you are truly decluttered helps you escape from the busyness of life.
A Long-Term Money Perspective
Another definition for wisdom is delayed gratification. If you are a parent or have a young child in your life, think about how that child acts when he or she wants something. Children want everything RIGHT NOW, right? It can’t be later, it can’t be in two minutes—it has to be NOW!
Here is a picture of my daughter crying because I told her I would get her pajamas “in a minute."
Children live in the here and now. They have a hard time conceptualizing the future. As adults, we’re taught this concept primarily through education. We go through education for a majority of our lives to prepare for our career. We are forced into this way of living because it’s what everyone does—and the government mandates it—but really, it’s a long-term perspective.
We are investing time now educating ourselves to achieve a degree, in hopes that it will pay off later. This is the same concept as pharmacy school: The median pharmacy student debt in 2016 is $150,000, and students pay that money (or incur that debt) in order to eventually reap the benefits of the pharmacy profession—and along with that, the salary of a pharmacist.
I take the same approach when I think about how I want to live my life and the investments I want to make. I try to adopt the mindset of long-term thinking when it comes to my money. I think about things like early retirement. I have no desire to work a 40-50 hour work week for the rest of my life in order to “do the things that I want to do” when I am 62. I’d rather live the minimalism lifestyle now so that in the future I can do the things I want to do with the time that I have—we’re not guaranteed life, so I don’t want to hang all my hopes on a retirement that may never come.
In fact, if you’re the kind of pharmacist who hates your job and are still working there every day, why are you suffering now? You don’t have to be a pharmacist for the rest of your life if you hate what you do. You can find a way to escape.
However, if you find yourself with an extravagant lifestyle and living paycheck to paycheck, you will never escape the endless cycle that is your life. You live paycheck to paycheck buying things you don’t need to impress people you probably don’t like—and you’re forced to work at a job that you hate. This is truly a miserable existence, and I want to encourage you to make small changes today to move away from that.
The long-term perspective we have on money is to use the majority of extra income to invest in things such as Roth IRAs, 401(k)s and business ventures so that we can retire early. My wife and I have adopted this mindset and we are aiming to retire by the time I turn 37. Will I actually retire from pharmacy when I turn 37? Probably not. But if I wanted to, I could. If we want to take a two-month sabbatical to Europe, we can. If I want to go part-time as a pharmacist, I can.
This is the lifestyle we want to create—a lifestyle of freedom as opposed to a lifestyle of being trapped.
Debt keeps you trapped. Imagine if all of your debt payments—mortgages, car payments, cell phone payment plans—were gone. How much extra income would you have per month? Take a moment and calculate it.
Now, imagine that you have that money in your hand.
What would you be doing with it? How would you spend that money? Would you save? Would you travel?
Guess what? If you are in debt, the reality is that your debts entrap you. Not only do debts keep you trapped, they fool you into thinking that you are getting a good deal. A $100,000 home at 4 percent interest over 30 years does not cost you $100,000. It actually costs $171,869.51.
Debt traps you and makes you a slave to a monthly payment. And, debt increases over time. What makes me so mad about my college loans is that every month I had to pay $500, and only $240 went toward paying the principal. The rest went toward interest, or, as I like to call it “stupid tax” (because I felt stupid for having to pay it).
Techniques and Strategies
We talked about the philosophies that inform our decision-making. Now let’s talk about the money-saving techniques you can use to live like a resident even after you are done with residency:
1. Low cost of living
When I graduated from high school, and the majority of my classmates said that they wanted to live near the big city. I thought the same thing when I was in high school. I thought I would never move back to my hometown, but that’s exactly what I did.
I received a great offer from a hospital during my residency to live in my hometown with a great salary and benefits. One reason why I chose to live in my hometown was because of the low cost of living. Houses here are extremely cheap, and to get a 2,000-square-foot home for less than $100,000 isn’t unheard of—in fact, it’s common. If you live anywhere near the big city, you’d be hard-pressed to get a two-bedroom, one-bath home for under $100,000.
Cost of living influences what you can do with your buying power. Buying power is the extra income you have to pay off your debts. Another great thing about rural areas is that you might find additional benefits or even higher salaries because few professionals wish to live in these places. I was lucky enough to be offered college loan repayment as part of my current position. I would have never found this had I applied in an urban pharmacy setting.
2. Low expenses
After you start receiving a salary of $115,000 out of nowhere, it can be very tempting to adopt an extravagant lifestyle. After you have all this money, businesses will find ways to allow you to spend it on anything from a nicer home to a nicer car to fancier groceries. Ultimately, we believe that we don’t need those things in order to be happy. What makes us really happy is having the bare essentials and having great friends and family.
When I was a resident, my wife and I figured out that our bare minimum expenses totaled around $1,600 per month. Yes, that includes things like food, rent and insurance. After transitioning from residency to full-time pharmacist, our expenses did increase. We bought a home, which had a higher mortgage payment than our rent, and we also had to start paying off my student loans. After we transitioned, we kept our expenses around $2,500 expenses per month. This allowed us to use about $3,000 per month as our buying power, and we paid off a car loan, my wife’s college loan, my loans, and our house. In fact, we paid off our house 27 years early. Now we have all this extra income to use as we wish because we kept our expenses so low.
3. A cheap house
It pays to buy a cheap home. If I could do this again, I would buy a really cheap duplex and rent out the top. I would do this because it would create extra income for our family over time. The other tenants’ rent would pay for the mortgage, so we literally would be living in a home for free. This is a great strategy for any resident who eventually wants to build multiple streams of income—and multiple streams of income is the way to achieve the freedom lifestyle.
4. Rent, don’t buy (at least at first)
I recommend that most residents and new pharmacists rent. If you don’t know for sure that you are going to stay in an area for at least five years, you shouldn’t buy a home. The hassle, the payments and reselling the home are too much to take on if you aren’t committed to staying in one area for a while. Based on current statistics, people transition from job to job much more quickly than they did once upon a time. There’s no reason for you to settle down and buy a home if you can rent—at least temporarily.
5. No new cars
A new car is one of the worst investments you can make. Why? As soon as you drive the car off the lot, it loses approximately 10 percent of its value, according to CARFAX. Its value significantly depreciates over time and you can’t get that value back. You can save significant amounts of money by getting a quality car with a few years and miles on it.
6. Nix subscription services
Let’s face it. You don’t need Netflix. You don’t need Hulu. You don’t even need Internet, truthfully. People have been living without these things for thousands of years. However, if you are like me and you feel like you have to have Netflix because you love a certain series, join in with other people. Make a family plan so that the cost of these services is cut in half, at least.
7. Low-cost phone
Did you know that with Google’s Project Fi, you can spend about $25 per month for cell phone service? Yes, you read that correctly. One line = $25. Technically, you don’t even need a fancy cell phone. You can get a TracFone and be OK; you just can’t do all the cool things like play Angry Birds or surf the Internet whenever you please.
Habits of the Happy PharmD
Committing to these changes is difficult. I won’t sugarcoat: If you are trying to make these changes overnight, it won’t be easy. It’s like a smoker trying to quit cold turkey. These are a few habits I recommend that you adopt so that you can see the full benefit of these changes over time:
1. Monthly budget meeting
Whether you are single, married or in a relationship, a monthly budget meeting can help you review your expenses and make necessary adjustments as you go along. A monthly budget meeting involves you (and your partner, if applicable) sitting down and going over your expenses and your budget. Although I am not a huge fan of a budget, it’s extremely important for you to know how much you are spending on things each month so you can keep track of your expenditures and hopefully, keep them low. This isn’t a huge commitment and should take about an hour of your time.
One of the best ways to track your expenses without having to create a giant, ugly spreadsheet, is to use my favorite money management tool, Personal Capital. Personal Capital is a free tool that connects you to all of your financial accounts and tracks expenditures that you make.
2. Continue the hustle
Residency felt like I was extending school another year for significantly lower pay—I still had to hustle, complete extra projects, work late and live on a tight budget. What I recommend is not adjusting to your new pharmacy salary. I see a lot of people who finish residency adjust to “normal” life and stop pushing themselves.
One of the best ways to become a minimalist and apply that long-term approach to money is to continue the hustle by going above and beyond your job and creating an extra revenue stream through real estate, consulting or another side business. You can use this extra income to save for the extra things you want in life (or pay off debt, I paid off $50K in 2015 using this strategy). By hustling outside of your job, you create a drive and energy for you to push. I found that whenever I didn’t have a hustle—something on the side that I was working on—I found myself getting lazy at home and at work.
By following these tips and strategies to live like a resident, you can set yourself on a path to happiness and fulfillment. I know this sounds difficult, and you will definitely have some bumps in the road. But whenever the going gets tough, just imagine how great it will feel when you find personal and financial freedom.
Timothy Ulbrich is a good friend of mine. He’s also the guy behind yourfinancialpharmacist.com and author of a new book, Seven Figure Pharmacist. I have known Tim for two years and we have had lots of discussions about financial freedom and pharmacy. He’s taken a few minutes out of his busy schedule to chat with me about his journey to financial freedom and how his new book can help other pharmacists achieve their financial goals.
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Alex: Could you tell us a bit about who you are and what you do?
Timothy: I always say that I am pharmacist by day and a financial nerd by night. My background and training is in pharmacy. I graduated from Ohio Northern University, did residency training at Ohio State and worked in academia for about seven years.
Like many pharmacists coming out of school, I had a bunch of debt—and my wife decided to marry me despite it all. All through high school, I had no debt. Then I went through six years of pharmacy school and residency training, got married and when I looked up, I had $200,000 of non-mortgage debt.
Unfortunately, this is normal. My wife and I thought we had everything under control. We didn’t think it was “stupid” debt because we weren’t buying anything extravagant. But in 2012, the humbling moment came when we realized that we were making a six-figure income, but we were broke.
After that realization, my wife and I thought, “There’s got to be a better way of doing this.” What was so frustrating was that despite our hopes and dreams for what we could do with a six-figure income, we were not in a position to achieve any of them. We were unable to move to a larger home, go on vacation or give to people in need. We really had very little flexibility and almost no freedom.
So, we got serious about paying the debt, setting goals and working on it together. In the fall of 2015, about three years later, we hit the “submit” button on the last payment of our $200,000 of non-mortgage debt.
As a reminder of that moment, I saved the screenshot of that zero-dollar balance after I hit the “submit” button. After making that last payment, the feeling of living paycheck to paycheck was gone and we found financial freedom that we didn’t have before. Yes, it was hard, but it was so worth it—and I am fired up about sharing our journey and helping other pharmacists achieve their financial goals.
Alex: I know that you are a teacher and that you enjoy talking about personal finance.
What was the impetus for starting your website, www.yourfinancialpharmacist.com?
Timothy: Right around the time that I hit the “submit” button on that last debt payment, I started talking to a lot of other pharmacists and students. Personal finance has always been an area of interest and a passion of mine, and as I talked to more people, I consistently heard the message, “I feel like I am living paycheck to paycheck despite making a six-figure income.” That’s exactly what I felt, and I found out that many people who were making great income were struggling financially day-to-day.
These pharmacists had common financial questions and were struggling because they had great income, but lacked financial freedom. I also heard pharmacists say, “I’m really not pleased with my job and I want to do something else, but I can’t because I have $200,000 of debt,” or “I’d love the flexibility to go part time, stay home with my kids or save for retirement, but I can’t because I have all this debt on my back.”
I reached out to about 100 of my close friends and peers and told them that I was thinking about writing once a week or so about personal finance and sharing stories of successes and failures, and the reaction was unbelievable. People said, “We need this. We want more of this.” I started writing and sharing some of the good financial things that I’ve done and some of the stupid financial things that I’ve done and got feedback from people saying, “We never learned that during pharmacy school, and I wish we would have,” and “Having a peer perspective from a pharmacist really resonated.” I started the website in October 2015, and it’s been an incredible journey since then.
Alex: You said you’ve done a lot of stupid financial things … your words, not mine. What is one of the least intelligent financial decisions you’ve made as a pharmacist?
Timothy: I’m so glad you asked that question! I first wrote an article about this in 2016 called “My Top 10 Financial Mistakes.” After writing the article, I remember having a little voice of pride inside of me before I hit “submit” that said, “Do you really want to share all the stupid things you’ve done with money?”
As it turns out, that article resonated with readers far more than anything else I’ve done. And that’s what we need to do more of—share more examples of our mistakes so we can learn from each other.
At the end of the day, we all know that personal finance is behavioral. We can have all the knowledge in the world, but we know that personal finance is emotional.
One mistake that sticks out—and that my wife and I are feeling right now—is buying a house without a 20 percent down payment. We bought a house with only a 3 percent down payment and had to pay Private Mortgage Insurance (PMI). Because of our small down payment, it took forever to build equity and we are still feeling the pain.
In hindsight, one more year of saving, one more year of waiting and one more year of being patient would have given us 20 percent down and would have allowed us to have a lot more flexibility five years down the road. Not being patient, reacting quickly and wanting to get into a home worked out, but it was harder than it had to be—and we took a risk that we didn’t have to take.
Luckily, we bought our home after 2008, so the housing market had already crashed. If we would have bought out home pre-2008 before the market crashed, I probably would have been underwater on my mortgage. That’s just not intelligent because it decreases your financial security and flexibility.
If I had to pick one more bad decision, it be waiting to buy life insurance. There was a point in time when I was married with two kids and had no life insurance in place. With a single income in the household (my wife stays at home with my three children), that was crazy. When I tell that story, people look at me like, “Really?” But there are a lot of pharmacists who don’t have life insurance or disability insurance, but they should. And, there are a lot of pharmacists who are being sold bad policies, and I can intervene because of that mistake I made. If I can help 30 or 50 or 100 people to get those important policies to protect their income, making my mistake was so worth it.
Alex: I’m glad you have that attitude. You have a new book that just came out called Seven Figure Pharmacist. I love the title and I have to admit that the seven-figure pharmacist sounds far-fetched because most pharmacists make six-figures. Seven-figures seems impossible. Tell me a bit more about why you wanted to write this book and why you chose that title.
Timothy: I want to acknowledge my co-author, Tim Church, who is a pharmacist at the West Palm Beach VA. We really tag-teamed this project, and I think one of the things that really comes through in this book is the pharmacist perspective and the stories that are relevant to pharmacists. Really, there isn’t anything else out there like that.
It’s funny that you bring up the “seven-figure” in the title, because we spent about a month debating it. We started off with, “The Million-Dollar Pharmacist” and we found that pharmacists, for whatever reason, have a negative connotation about the idea of being a millionaire.
I talk a lot about the fact that it’s not about becoming rich; it’s about building wealth so you can take care of your family, give to others and be responsible. When I talk about being a seven-figure pharmacist, I’m not talking about being wealthy for the sake of being wealthy. My goal is to help you get out of debt, build a cushion to protect your income, maximize wealth and help the next generation.
If you look at the book’s subtitle, it’s “How to Maximize Your Income, Eliminate Debt, and Create Wealth.” That’s what this is all about.
We started the book with a net worth calculation. I did this with my students in the fall, and I thought they were going to fall off their chair when they found out their net worth. You need to know what your current position is before you can get where you are trying to go, and what that net worth calculation does is help you to figure out where you are today, how your debt factors in and where to you need to go in order to move forward.
The book has three chapters related to investing and building wealth. Without question, every pharmacist with adequate planning should be a multimillionaire. It’s not even debatable. If you look at the math of what a pharmacist makes, as long as you responsibly get out of debt, responsibly save each month, minimize your expenses and maximize your income, being a multimillionaire should be a reality. If you want to retire at a reasonable age, not only should it be a reality, but it HAS to be a reality.
One of the things we do in the book is go through a nest-egg calculation for your personal situation that looks at how much money you need to save to retire or reach financial independence. What most people realize is that they need several million dollars to reach that place. That’s the premise of Seven Figure Pharmacist: Get out of debt, build, protect and maximize your income and create wealth.
Alex: You’ve been working on this book for a long time. Writing a book is not easy in the first place, and the type of book you’re writing is not always fun to write. I know that at times you felt frustrated and overwhelmed. What drove you to write the book, even when you felt like giving up?
Timothy: What really motivated and inspired me as I talked to more than 1,000 pharmacists in the last year and a half is how much of a pain point this is for people. I know how much financial trouble hurts and how much their finances impact their career satisfaction, home life and peace of mind. I wanted to create an A-to-Z resource for pharmacists to help them get an idea of where they should be heading. I wanted it to be light, fun and relatable for a pharmacist. Knowing that there was nothing out there to meet that need gave me increased motivation.
For me, at the end of the day, this book is about helping people change their financial future—that’s what gets me fired up. When I speak with someone or they email me and say, “Because I read this, I did this and now my husband and I are working on a budget, we bought life insurance, and we have a plan to pay off my debt. If I can motivate a pharmacist to do any one of those things, it’s a win.
That’s what it’s all about: People improving their financial future. That’s what motivated me to get up at 4:30 and 5 a.m. and to keep writing. That’s what motivated me to keep going even though I have three young kids.
My co-author, Tim Church, was incredible. He helped to keep me accountable by saying, “Hey, we’re almost there” and providing a different perspective. We also had a team of 50 pharmacists who were helping us to write this, and we were getting feedback saying, “Because I read this chapter, I just did this.” When you are a third of the way through writing a book and you read that, it gets you fired up enough to keep going. You’re right … It was hard. It was difficult.
Two weeks ago when I finished writing, I said that I am not sure I would do it again. Now that I’ve forgotten some of the struggles, I’m ready to go again.
Alex: I know that you sent the book off to the publisher and you’re done with the writing process. Is there anything you would have done differently as you wrote the book?
Timothy: The one section that really gave us some heartburn was helping people navigate choosing a financial advisor. It’s at the very end of the book, and the reason we wanted to spend so much time on it is because it’s a question I get all the time. What should I be looking for in an advisor? Do I need one? How do they get paid? Without going into too much detail, the financial services industry is extremely complicated, the regulation is all over the place, there is little regulation around the term “financial advisor” and to be honest, there are a whole lot of pharmacists who just aren’t getting good advice. We felt it was so important that we went through seven or eight versions of that chapter.
If I were to do it all over again, I would have started writing that chapter earlier. Just to give you a quick idea of how the book is structured, we broke it up into six “prescriptions”:
The book is 350 pages and includes lots of great stories and examples. We also included references to scholarships for students, and I think people are going to get a lot of value out of it.
Alex: Some pharmacists have been in the career for some time and are close to retirement age, and I know that some of them feel like they haven’t used their income very well. What advice do you have for the pharmacist who feels like it’s too late for them?
Timothy: I get a lot of questions from people who have been pharmacists for 20 or 30 years who are still struggling with student loans or other debt and feeling the pressure of retirement. My advice is that you will never be successful if you try to attack all of your financial problems at once.
If you are looking at debt, lack of an emergency fund, paying off your house, paying for your kids’ college tuition, you will become overwhelmed. My wife and I realized when we first started this process that we were trying to do six or seven things at once and weren’t doing any of them well. We said, “We’ve got to do one of these things and go all in and do it well to get momentum.”
Get the small wins and build off of that. That’s the advice I have for people who are 25, 35, or 55. You’ve got to get a small win and map out a stepwise approach to attack your finances—and you’ve got to pick one thing to focus on. You can’t do it all at once.
Maybe your one thing is paying off a small loan, building an emergency fund, getting a life insurance policy, maxing out a Roth IRA or taking advantage of an employer 401(k) match. If you try to do all of these things at once, you are going to get frustrated, it won’t work and you will feel like you aren’t making progress. Finding one thing—and one person to keep you accountable such as a peer, a spouse, a financial coach or an advisor—can help you build momentum.
If you ready to learn more about becoming a Seven Figure Pharmacist, visit http://www.sevenfigurepharmacist.com, where you can purchase the book and different “therapy packages” based on where you are on your financial journey and what you are ready to do. If you use the coupon code BARKER, you will receive 15 percent off your purchase and access to a private Facebook group that connects you with a community of pharmacists who are working on their finances together. Whether you are seasoned saver or a personal finance neophyte, this book will provide you with the financial knowledge required to help you make the most of your pharmacist income.
Once again, it’s time for my updated Pharmacy Salary Guide.
Before we dive into 2017, let’s look at the pharmacy salary information from 2016. In 2016, full-time pharmacists made anywhere from $84,000 to $134,000 per year, with the average annual salary coming in around $108,000, depending on the data source consulted. Both the high and low end of the salary range decreased by about $6,000 when compared to 2015.
Staff pharmacists at retail and mail order pharmacies were the lowest paid in 2016, earning an average wage of $58.35 and $56.83 per hour, respectively. Aside from team managers, nuclear pharmacists were the highest paid, earning an average wage of $66.31 per hour. Nearly 42 percent of pharmacists reported earning between $61 and $70 per hour in 2016.
For our 2017 Pharmacist Salary Guide, we consulted a number of sources to try to give you a well-rounded picture of pharmacy salaries in the U.S., including Payscale.com, Drug Channels, Drug Topics, PharmacyWeek, U.S. Department of Labor Bureau of Labor Statistics, U.S. News & World Report and The American Association of Colleges of Pharmacy. The good news is that, no matter which source we consulted, a pharmacist is still considered to be a respected, stable job that provides above-average income.
According to the results of a PayScale.com survey, pharmacists’ annual salaries were between $83,000 and $135,000. The median annual salary is $110,000, with higher-paying jobs typically offering potential bonuses and profit-sharing amounting to an additional $10,000 per year.
Just as in 2016, the factors that influence a pharmacist’s salary in 2017 include (in order of most influence):
According to PayScale.com, experience does not seem to play a large role in salary calculations:
Although there is a significant increase in average annual earnings after the first five years on the job, average annual income tapers off as pharmacists become more experienced. And, the average salary in each of these experience ranges increased by $1,000 to $2,000 when compared to 2016.
Each year, PharmacyWeek teams with Mercer to conduct a national compensation survey of pharmacists. In 2016, pharmacists reported earning an average hourly wage of $61.67, representing an increase of 79 cents when compared to the average reported hourly wage in 2015. However, the pay rate varies depending on a pharmacist’s job title, setting and specialty area.
Here is the breakdown of average hourly pay for different job titles in the pharmacy industry, as reflected in PharmacyWeek’s 2016 survey:
|Job Title||Hourly Pay Rate||+/- From 2015|
|Staff pharmacist – mail order||$58.57||$1.74|
|Staff pharmacist – satellite||$61.06||$0.49|
|Staff pharmacist – retail||$60.18||$1.83|
|Staff pharmacist – hospital||$61.98||$1.23|
According to this survey, hourly wages increased for all types of pharmacists. Retail pharmacists saw the highest wage increase, at $1.83 per hour.
Pharmacists on the West Coast of the U.S. earn the most, making an average of $68.97 per hour, or $143,500 per year. Pharmacists in the Northeastern U.S. earn the least, at $57.28 per hour, or $119,100 per year.
In California, pharmacists earn the highest wage in the United States, pulling in an average of $71.17 per hour, or $148,000 per year. Pharmacists in Puerto Rico are the lowest paid, earning an average of $51.19 per hour, or $106,500 per year. Here is a breakdown of pharmacists’ average annual and hourly salaries by state:
|State||Average Annual Salary||Average Hourly Salary|
|North Dakota||Data not available||Data not available|
Hospital/healthcare system pharmacists are the highest paid, at an average of $129,100 per year, or $62.07 per hour. Supermarket pharmacists make an average of $126,200 per year ($60.66 per hour); mass merchandiser pharmacists make an average of $121,700 per year ($58.49 per hour); and chain drug store pharmacists earn an average of $126,600 per year ($60.84 per hour). Mail-order pharmacists are the lowest paid, at an average of $120,500 per year, or $57.94 per hour.
Drug Channels, which bases their statistics on the U.S. Department of Labor Bureau of Labor Statistics’ (BLS) Occupational Employment Statistics from 2015, reported the average gross salary for retail, mail and specialty pharmacists as $119,517, representing an extremely modest increase from the 2014 average salary of $119,400. Here is a chart showing total U.S. employment and average salary by dispensing format:
|Dispensing Format||Total Employment||Average Annual Salary|
|Chain and independent drugstores||128,030||$119,600|
|Mass merchant pharmacies||26,790||$122,860|
When compared to 2014, the number of pharmacists employed at mail order pharmacies increased by 21.7 percent despite a slight decrease in the average annual salary. Although the salaries of pharmacists employed by mass merchants remained the highest, employment in that sector fell by 8.5 percent.
The 2017 Drug Topics survey, which was conducted in 2016, found that the 3,085 surveyed pharmacists are mostly satisfied with their jobs, but are experiencing an increase in job-related stress.
In 2016, 45.4 percent of pharmacists reported earning between $120,000 and $140,000. Just as in 2015, most pharmacists (41.7 percent) earn between $61 and $70 per hour. This chart shows a breakdown of pharmacists’ hourly wages in 2016:
|Hourly Wage||Percentage of Respondents|
|$40 or less||3.3|
|$71 or more||6.0|
Approximately 86 percent of respondents reported working full time, 9.9 percent reported working part-time and 1.9 percent reported being unemployed. Pharmacists also reported that, although raises are modest, salaries are growing:
This chart shows a breakdown of pharmacist annual raises by percentage in 2016:
|Amount of Raise By Percentage||Percentage of Respondents|
More than 25 percent of pharmacists earn between $120,001 and $130,000. This chart shows: Breakdown of pharmacists’ annual salaries in 2016
|Pharmacist Annual Earnings||Percentage of Respondents|
|$70,000 or less||1.6|
|$150,000 or more||11.2|
A majority of pharmacists (57.7 percent) reported working between 40 and 44 hours per week, and 29.6 percent reported working 39 hours or fewer per week. Only 6.2 percent of pharmacists reported that they saw a decrease in their stress level at work; 63.4 percent said that they saw an increase.
Approximately 67 percent of pharmacists said they are not considering a job change within the next 12 months. However, of the 32.9 percent who are considering a job change, 67.4 percent said they are dissatisfied with their current job.
In its 2015 report, the U.S. Department of Labor Bureau of Labor Statistics (BLS) reported that there are 295,620 pharmacy jobs in the United States, down slightly from 297,100 in 2014. BLS reports that the median pay for pharmacists is $119,270 per year, or $57.34 per hour—also down from 2014’s average salary of $120,950 per year and $58.15 per hour.
In 2015, the most recent year for which data is available, U.S. News & World Report ranked “Pharmacist” as No. 20 on its list of best-paying jobs, down from No. 18 in 2014. The publication reported that the median salary was $121,500 per year, or $58.41 per hour.
According to the publication, the best-paid pharmacists are employed by scientific research and development companies and work in the metropolitan areas of Santa Cruz, CA; Victoria, Texas; and Laredo, Texas.
The average salary for full-time pharmacy professors in 2016-17 was $166,600.
If you’ve made it this far, you’ve probably figured out that pharmacy salary data varies depending on which source you consult. But, it is safe to say that pharmacists across the United States have seen modest increases in their salaries this year with fairly flat employment rates—except for large employment increases in mail order pharmacy sector.
Not much has changed when it comes to salary variations by location. Pharmacists in California are still the top-earning in the country due to the higher cost of living. Nuclear pharmacists remain the highest paid and hospital/healthcare systems remain the highest-paying job setting.
Whether you are considering relocating for a new job or are looking for fodder to negotiate a raise, I hope that this information proves to be useful to you.