This is the third post in a series on common mistakes I have seen medical residents and other professionals make just out of training, mistakes with long-term, often severe, consequences. The first post-training mistake I covered was the debt trap. The second was with employment agreements. In this post I’ll cover the third arena where mistakes are commonly made—anchoring or putting down roots too soon out of training.
I get it. You have delayed gratification for many years and perhaps you’re tired of apartment living. Now that you have finished your training you want to move to that city or place where you’ve always wanted to live. You want to buy your place, plop down roots right away, and get on with your career and life.
So, you pick up and move and buy the big house, now that you have an income to match. You believe it will be bliss…Only it isn’t.
After a few months or years with your head down working, one day you look up and realize you hate where you live. Or, you’ve come to despise the place where you work. Your natural inclination maybe to pick up and move but you can’t. At least you feel you can’t because you’re tied to a large anchor.
The anchors holding you in place can come in various forms but typically the largest and most common anchor is a home mortgage. A property bought can also be sold but not usually overnight.
The wrong time of the year, too many marketable houses for sale, or a rise in interest rates can present as barriers to a quick sell. A turn in the local or national economy can catch people upside-down with mortgage debt making a house much more difficult to liquidate. The time from listing to ‘sold’ can become a real factor if you’re miserable and desiring a significant change in your circumstances.
If you find yourself living in an undesirable location, or if you find yourself burned out from a toxic work environment, it is better to be nimble. For this reason, I recommend renting a house or an apartment initially. I would not recommend buying a house until you know for sure you have made the right decision in terms of the neighborhood, city, and state where you have chosen to live and work.
Your skills remain highly portable if you’re not anchored down. They will go wherever you go. If you have made the wrong choice when it comes to a job or a particular work environment, anchoring will limit your options in the near-term. Renting will serve as kind of a decision buffer. It will provide physical and financial margin to determine if you have chosen the right location, job, or position for you and/or your family.
Renting will also allow you time to save a down payment for the house of your dreams when you find it or design it, or give you time to eliminate student loan or consumer debt. Freedom from debt, by avoiding the debt trap, will make you the nimblest of all and provide you the most options.
Once you’ve rented long enough to experience all of the facets of living and working in a particular area, once you have found just the right neighborhood or schools, once you feel connected with people around you and the colleagues you work with, and once you can rest assured you’ve made the right decision on your locale and work, then and only then should you consider buying a house, taking on a mortgage, and putting down those roots.
Prudent advice is good only if heeded. If you are approaching the end of your education or training, delay gratification for just a bit longer and remain nimble. Doing so will save you time and big money in the long run and lower your frustration factors in the short-run.