Achieving a Positive Net Worth in 2 Years with 6 Figures of Debt: Yonas’s Story

Achieving a positive net worth in 2 years with 6 figures of debt

We’ve written extensively about how travel therapy, among other strategic financial choices, has helped put us in an amazing financial position. But we’re not the only therapists who have taken advantage of this career path to achieve financial freedom! Today we’re bringing you a financial success story from a fellow traveling therapist who was able to achieve a positive net worth (assets minus debts) in only 2 years after graduating with his Doctor of Physical Therapy degree! We hope Yonas’s story will further inspire you about the possibilities in your career path as a traveling therapist! Check out his story to learn more:


Achieving a Positive Net Worth in Two Years with Six Figures of Debt: Yonas’s Story

Background

I am a 28-year-old Doctor of Physical Therapy, and I graduated in May of 2018 with six figures of debt. I recently achieved a positive net worth after strategically making simple moves within two years.

I still have student loan debt but have chosen to not rush to pay this debt off, while instead focusing on investing for my future. The amount of assets/money I have is now more than my debts, which equals a positive net worth. I would have never thought I would be this excited to be above water, but here we are today!

How Did I Get Here?

Below I’ll discuss the simple moves I completed to achieve a positive net worth in just two years out of school. These may or may not be easy depending on your goals and situation. Everyone comes from a different starting point, and each person has different goals, life situations, and opportunities.

Personally, I am a first-generation Eritrean. I do not come from a family of wealth. As the son of immigrants, I was instilled with the values of working hard and saving. I never thought about debt or finances until recently. I became interested in how to manage my debt, so I started listening to audiobooks and podcasts on my commutes to work, which is where I learned about most of the tools to help set me up for financial success.

With a bit of research, hustle, and determination, anyone can improve their financial situation.

Here are the 5 steps I used to reach a positive net worth:

  1. Live below your means
  2. Increase income
  3. Automate
  4. Be consistent
  5. Surround yourself with like-minded people

Let’s dive into each one of these steps to see how you can utilize these strategies too.

Live Below Your Means

Spend lavishly on things you love and save immensely on things you do not care about” — quote by author Ramit Sethi, from I Will Teach You To Be Rich

I am pretty low maintenance and do not value many expensive, material things. I do value experiences. I save a good chunk of my paycheck and splurge occasionally on experiences.

For example, during a recent weekend, I went to Yosemite National Park and rented out a cabin with friends. I am living my best life and saving money as well.

I also give credit to my Instant Pot. I am able to cook nearly anything in it. It is great because I can make affordable meals, it makes large portions, and it saves time. As a solo travel therapist, I have lived in places that do not have stovetops or full kitchens, often allowing me to save money on housing costs. Even with these accommodations, I have not had a problem eating well with the Instant Pot. A big “money saver” food is rice as a side. I have eaten over a hundred pounds of rice over the years. My staple dinner is cooked chicken, vegetables, and rice. Yummy for a good price.

This may sound extreme to some, but I am happy with how I am living my life. These are just a couple examples of how I am able to live frugally and put aside a lot in savings. You need to figure out what is your savings comfort level, and make moves accordingly.

Increase Income

Unfortunately, the job market for physical therapists doesn’t always allow for the highest paychecks depending on your setting and location. However, thus far in my career, I have focused on only taking higher-paying jobs in order to improve my financial situation.

I am flexible on setting, location, and am open to moving anywhere in the country. My first job was a permanent job in a large teaching hospital. It was a great learning experience for my first job, but I could not stay there if I wanted to reach my financial goals. I put in my one-month notice and applied for higher-paying travel PT jobs. I have also worked higher paying Per Diem jobs.

In my short two years as a PT so far, I have worked in the ICU, CCU, SNF, ALF, LTC, home health, outpatient, and acute care settings. I have been exposed to many settings from the many travel contracts and PRN jobs I have taken. There is always something new to learn, and if you’re strategic in choosing your positions, you can find high paying jobs while experiencing a variety of settings and learning new skills.

Automate Your Decisions

In order to stay on track financially, I automate my savings, my payments on expenses, and my investments. I automate everything to where I do not have to think about it, thus making it easier to reach my financial goals, be sure not to miss any payments, and having money automatically directed towards savings. This strategy psychologically trains me to not even expect the extra money from my paycheck that is automatically allocated to my bills and my savings accounts.

I am currently saving about 60-70 percent of my paycheck. As part of my savings, I maximize my Roth IRA retirement account. I invest in the same fund every month and plan to do so for as long as I can. This money will benefit me in retirement, and some of it can hopefully be passed down to my future kids or beneficiaries one day. Outside of my retirement contributions, I currently do not invest in any additional brokerage accounts, as I want to hold money to invest in real estate for now. This is a personal decision to diversify my savings.

Remain Consistent

It is important to have an end goal and motivation to stay consistent. What’s the point of making money if you do not have any intrinsic motivation?

I hope to one day be financially free, allowing me the freedom to work because I want to, not because I have to. I also love volunteering and would love to have more free time for this.

Surround Yourself with Like-Minded People

It’s important to hang out with finance rock stars or like-minded people. You are the average of the 5 people you hang out with most (~Jim Rohn). Since the pandemic currently makes it tough to hang out with anyone in person, I try to listen to people who not only talk the talk, but also walk the walk in the finance world. I do so via audiobooks or podcasts, so I can internalize their mindset on money which helps me in my own life. Everyone has an opinion, and it is best to listen to people who have a track record of success. Growing up, I was the kid who never read a book unless if it was for school; however, I am currently on track to read/listen to at least 24 books this year because of the valuable content I have gained.

During the first few months of my first PT job, I had the mindset to pay off my loans ASAP and put the majority of my paycheck toward loans for peace of mind. There is nothing wrong with this, and it’s a great strategy for many people. However, after listening to many podcasts and books, I have changed my mindset and prefer to use the money toward investments and not rush to pay off my loans. I would rather pay myself first and set myself up for a positive financial future, than rush to pay back my student loans at this time.

Future Goals

I am unsure of what the future holds for me. I am currently saving a chunk of my paycheck in a high yield savings account and maximizing my Roth IRA retirement account. I know that in the future I do plan to invest in real estate. I would like to live in a unit, and rent out the others. Hopefully, I can buy property at least once a year and see where the investment goes from there.

Recommended Resources

Below are a couple of life-changing books that changed my mindset on finances. I would recommend checking these out if you’re looking to get into a better financial situation!

  • Rich Dad Poor Dad by Robert Kiyosaki
  • I Will Teach You to be Rich by Ramit Sethi

A resource I wish would’ve been available to me as a beginning travel therapist is “Rate My Therapy Company” Facebook group. I created this community to fill a need of therapists not knowing what kinds of companies they would be signing contracts with. This group allows therapists to rate companies and provide valuable information on factors like pay, setting type, and company culture.

I love talking about my story, so if you have further questions about it, you can email me or send me a Facebook message—I am an open book.

Best of luck to you as you pursue your own path to financial freedom!


Yonas Tekeste is a travel physical therapist originally from Chicago, Illinois. He graduated with his DPT degree in May of 2018. He is currently taking a month-long break from travel contracts to spend more time with family in Illinois. He enjoys listening to podcasts, playing sports, hiking, and attending social events in his free time. The best way to contact Yonas is through Facebook or email at Yonastekeste@gmail.com


We would like to thank Yonas for sharing his story with us! Please feel free to contact Yonas to learn more about his financial strategies. You can also contact us if you have more questions about starting a career in travel therapy to help set yourself up for a better financial future, as we and many other traveling therapists have done!

Travel Therapy: The Path to Financial Freedom

Travel PT: The path to financial freedom

Jared wrote an article in 2019 for Covalent Careers (New Grad Physical Therapy) website, which provides resources for PT, OT, and SLP. The title of the article is “Travel PT: The Path to Financial Freedom,” and Jared discusses how he has used Travel PT as a means to improve his financial future.

You can read the full article below to learn more!


Increasing Student Debt

With tuition prices continuing to increase each year, it’s no surprise that the amount of student debt that therapists are graduating with continues to rise as well. I talk to students and new grads every day through my site that are upset about the logistics involved with paying off six-figure student loan debt, while also doing their best to build a life after grad school. Some services, such as Fitbux, offer assistance with determining a plan to handle this debt as a new grad. Fitbux is a wonderful resource for developing the most optimal plan for getting to the zero debt finish line, and having a plan is a vital part of the process. But besides having a sound financial plan, another vital aspect is optimizing income. There are many ways to increase your income when coming out of school, including working multiple jobs or opening your own cash-based practice, but in my opinion, the easiest (and most fun) path to financial freedom is pursuing travel therapy contracts.

Financial Power of Travel PT

I began my travel therapy career directly out of school as a new grad three years ago, and this decision has provided me an immense amount of financial flexibility as well as an exciting lifestyle! As a new grad travel therapist, I was able to make twice as much starting out as some of my classmates taking permanent positions. The extra money earned from travel contracts, combined with keeping my expenses low while traveling around the country, led to me being able to save over $100,000 in 1.5 years after graduation. With this amount of savings, my student loans could have been completely eliminated during that time. Keep reading to find out what I did instead.

Flexibility in Student Loan Repayment

In addition to earning extra income, an often overlooked benefit of travel therapy is that it gives you more flexibility with the inevitable student loan payments. Many travelers choose to aggressively pay off their loans in the first couple of years out of school, like I could have done, which puts them in a great financial position. Others choose to go on the standard 10-year repayment plan while saving the additional money earned for other endeavors such as a downpayment on a home or for personal and family expenses. More may take a completely different route, like I’ve done, which is to choose an income-driven repayment option. With this option, I pay the minimum required each month on my income-driven repayment plan, while investing all leftover money each month into more profitable assets. I believe this is the best option since a big benefit of being a traveler is the tax-free stipend involved with maintaining a tax home and taking travel assignments. The stipends, in essence, increase your total yearly compensation while not increasing your taxable income, and therefore increasing your Adjusted Gross Income (AGI), which is what is used to determine your monthly income driven payment.

This already low payment can be reduced even further if the traveler is taking advantage of investing money in their traditional retirement account options, which also reduce your AGI. I have talked to fellow travelers who have been able to achieve a $0 monthly student loan payment this way. Currently under the REPAYE plan (one of the income-driven repayment options) half of each month’s accrued interest is forgiven, and this is a very powerful thing for someone with a high student loan balance and a very low (or $0) monthly payment. With this plan, the “effective interest rate” is basically cut in half, meaning that if your average interest rate is 6%, interest is now only accruing at around 3% each month. Therefore, if you are investing the extra money that you’re saving in retirement and taxable accounts with smart allocation, your returns from the stock market will almost certainly exceed the student loan interest rate over the long term.

Financial Freedom Equals Lifestyle Freedom

Having a low monthly student loan payment, combined with invested money earning consistent returns in the form of dividends and appreciation, is a recipe for financial and lifestyle freedom. In my first three years out of school working hard as a traveling therapist and investing heavily, I now have the financial stability and security to pursue other interests in addition to working as a PT. For me, this is expressed as working only three months per year for the foreseeable future, while spending the other nine months traveling both internationally and domestically. Travel therapy and generally managing my personal finances have certainly been the keystone in achieving this “semi-retirement” so early in my career. You can check out CovalentCareers Resources’s Ultimate Guide to Personal Finance for some extra tips! However, for others, it could be expressed in a variety of ways, whether that’s having more time to spend with their family by working part-time or PRN, being able to take more vacation time intermittently, or being able to retire earlier than traditional “retirement age.”

Travel PT: The Path to Financial Freedom

Travel therapy is a powerful way for new grad physical therapists to make significant progress toward paying down debt and getting on the path to financial freedom in a short amount of time. This independence can be used to reduce stress and potential burnout by working fewer hours per week or fewer weeks per year, which I have been able to take advantage of while going this route. Having a lower taxable income as a travel therapist also allows for flexibility with how you choose to pay off your student debt, which can lead to further financial freedom early in your career. This can be infinitely valuable depending on your situation. Traveling as a new grad physical therapist isn’t for everyone, but I believe that for the majority it can be a viable option with proper planning and professional growth prior to graduation.

You can check out the original published article at:  https://covalentcareers.com/resources/travel-pt-path-financial-freedom/

A big thanks to Covalent Careers for featuring Jared on their site!

If you have questions about getting started on your career in travel therapy, please send us a message and we will be happy to help you along the way!