Today we are talking all about bonds and tax-loss harvesting. We get into what some good options for bond substitutes are as well as what are not good options for bond substitutes. We talk about the popular I Bonds and when you should get some or if it is worth sticking with tax-protected stocks in a total bond fund instead. We go over some of the basics of tax-loss harvesting including a step-by-step guide on how to actually do it. We talk about if and when it is worth doing some tax-loss harvesting. We also have some friends of the podcast, Leti and Kenji of Zero to Freedom, on to talk about their course.

 

 

Bond Substitutes 

“Hi Dr. Dahle. This is Tom from California. In the latest edition of A Random Walk Down Wall Street that was published in 2018, given low-interest rates at the time, the author suggests utilizing within their fixed income portfolios, bond substitute funds, particularly the Vanguard dividend growth fund as a mechanism to produce a higher yield of approximately 4% on the fixed income portion of the portfolio. Given the interest rates are now even lower, I'd be interested to hear your thoughts as to the wisdom of using bond substitutes within the fixed income portion of anyone's portfolio. Thank you.”

I think Burton Malkiel is a good guy. I think A Random Walk Down Wall Street was a really important book that really got people thinking about index funds—an important message that has important data in it. I don't agree with everything Burton recommends. For example, he's had some interesting recommendations about emerging market stocks for the last five or 10 years that really haven't panned out. This is another recommendation I really don't agree with. The reason why is that a dividend stock is not a bond. It does not act at all like a bond. What do you expect from bonds? Well, you expect stability, a relatively low amount of return compared to stocks, but stability. When the stock market crashes, you hope your bonds are going to go up.

However, when the stock market crashes, dividend stocks do not go up. They go down in value. Yes, they're paying dividends and the dividend yield may actually increase when the market goes down. However, most of the time when there's a big prolonged market crash it is because the economy is not doing well. And guess what companies do when the economy is not doing well? They cut the dividends. You look at 2008, dozens and dozens of companies cut their dividends. This is not some sort of guaranteed payment. It's a dividend. It comes from the profits of the company.

And so, no, I don't think stocks are an adequate bond substitute. If you want a bond substitute, there are things out there that you can buy. You can buy savings bonds, I bonds, EE bonds. You can put your money in cash. If you work for the federal government, you have access to the TSP. The G fund is a pretty good bond substitute. CDs are a good bond substitute. But stocks? No. Just because they pay a dividend, just because they pay a high dividend, doesn't make them a bond substitute. If you are selling bonds and you're buying dividend stocks or value stocks, you're just taking on more risk. Now, if the market does well, that's going to pay off well for you. If the market does poorly, that's not going to pay off well for you. So no, I don't see dividend stocks as a bond substitute at all. I think that was a stupid idea. You can tell Burton I thought so.

 

I Bonds and the Safe Harbor Rule

“Hi Dr. Dahle. I'm a nephrology fellow, and my wife is a new attending. We want to thank you for all the life-changing advice that your book and website have provided. I have a question about how to maximize I bond purchases while optimizing the safe harbor rule. We're interested in incorporating I bond purchases into our savings plan. I would like to max out each year if possible. That's $10,000 for us individually with a $5,000 purchase at the end of the year using our tax refund. But I'm not quite sure the best way to handle withholdings. On one hand, I can see how it's advantageous to minimize withholdings throughout the year via the safe harbor rule. But on the other hand, I somehow need to pay the IRS an extra $5,000 by December. So, what is the best way to overpay the government? Thank you.”

Good question, Tim. Most of us don't have trouble overpaying the government. The withholding rules generally result in people getting a tax refund. And so, if you're just an employee, if that's your status and you're not regularly getting tax refunds, have more money withheld, claim fewer exemptions and you'll take care of that problem right away. The tricky part is going to be not having so much withheld that you get some massive tax refund back and you end up loaning tons of money to the government at 0% interest all year. Easy to do if you're just an employee.

If you have self-employment income, enough of it that you are having to make quarterly estimated payments, this is not that complicated. You just pay more. You make bigger quarterly estimated payments. Now, the easiest way to do that and make your taxes really easy is to pay them your quarterly estimated payments evenly. So that every quarter is the exact same amount of money. You don't have to do it that way. If you don't do it that way, you have to justify to the IRS that that's the way your income was throughout the year. If you have your regular income, you can make your quarterly estimated payments irregularly, but then you have to match up your income and what you're paid on a tax form at the end of the year.

For me, it's easiest just to pay the same amount every quarter. But if you really wanted to, you could just make that fourth-quarter payment an extra $5,000 and then you'd have an extra $5,000 in there. You paid the government an extra $5,000. Truthfully, anybody can send in a quarterly estimated payment. Every January 15—if you are smart enough that you can nail your withholding, that it's exactly right every year and you don't get any tax refund and you don't have to write a check on April 15—then you can just send in a $5,000 quarterly estimated payment on every January 15. And that would do it. You'd have an extra $5,000 in there. But for most of us, it's more of an estimate and a bit of a guessing game, exactly how much we're going to owe in tax each year. I guess if you screwed up and you didn't get at least a $5,000 refund, you wouldn't be able to buy those I bonds in a given year. But I think the downside of having the IRS sitting on way too much money all year is probably greater than not being able to buy those I bonds.

Incidentally, if your goal is really to buy a lot of I bonds, remember that other entities can also buy $10,000 a year of I bonds. Every trust you have can buy $10,000 worth of I bonds. Every business entity you have, every LLC, can buy I bonds. Some people have gone to the trouble of opening a bunch of little trusts. If you can open it for very little expense just to buy I bonds, you can have a bunch of revocable trusts and they can each have an I bond account, each have a TreasuryDirect account, and buy some I bonds. At a certain point, the hassle probably outweighs the benefit. But if your goal is to really have a significant amount of your money in I bonds, that's one way you can do it.

We actually finally broke down and bought some I bonds. When they're yielding 7%, you've got to go. Basically, no-risk 7% right now. They're pretty attractive. I actually opened some TreasuryDirect accounts last month in December and bought $10,000 for myself and $10,000 for Katie and will buy $10,000 more this month for each of us. And that'll give us $40,000 in I bonds. We're putting some trusts in place and they'll probably have a TreasuryDirect account as well and buy some I bonds with those. But I'm not going crazy trying to get gobs of I bonds in the portfolio. But I put them into my inflation index bond category, which is 10% of our portfolio. And so, the more I bonds I have in there, the fewer TIPS I need. And right now, I bonds are way more attractive than TIPS.

More information here:

I Bonds: Are They Right for You? 

 

I Bonds or Tax-Protected Stocks in a Total Bond Fund? 

“Hey, Jim, and happy new year. A quick question on bonds for you. I have approximately $10,000 that I need to invest currently. And given that bond yields are so low and stocks have done so well this year, I'm assuming that when I rebalance my portfolio, I'm going to find that it's overweighted in stocks. Typically, what I do when I rebalance is move some of my stocks in my tax-protected accounts into bonds in those same accounts and then invest my excess cash into a total market fund in my taxable account. This year, however, I'm intrigued by the post you ran on I bonds. Do you think it'd be better to purchase $10,000 in I bonds this year instead of moving tax-protected stocks into a total bond fund like I currently or usually do? I seem to meet the four criteria for people that this might make sense for. Meaning I have 20% of my portfolio on bonds. I'd love to get some bonds index to the current high inflation state. I do have a taxable account and I'm early in my career and thus not profoundly wealthy. Do you think that the higher inflation-adjusted yield of I bonds makes up for the tax inefficiency of having them in a taxable account? I really appreciate your help on this.”

You're going to like this answer. Yeah. You should buy I bonds. They are the most attractive bonds out there right now. That might change in six months or a year or two years or whatever. But for now, they're clearly the most attractive bonds and they're very tax efficient in a taxable account. They're basically inflation indexed bonds that are designed for a taxable account because you don't pay any taxes on them until you cash them out. The bottom line is, yeah, in your situation, these make a lot of sense. It's a little more hassle. You have one more account you have to manage, but it seems like a perfect match up to me. Obviously, adjust your written financial plan to account for a change like that. But it seems like a smart change to me, at least looking at the current interest rates available on bonds.

 

How to Tax-Loss Harvest

“Hi, Dr. Dahle. This is Diana, pulmonary critical care. I'm calling from the Chicago area. I have a question about tax-loss harvesting. I know you've covered this topic quite a bit. I am new to investing in a taxable account, because we've already exhausted our other investment strategies. I'm wondering how you logistically actually do the tax-loss harvesting? Right now, my gains or dividends are being reinvested. Are people only able to do this if they contribute once or twice per year? How do you keep track of these things if you have a Vanguard taxable account? Literally walk me through the steps of how do I know one, if I need to tax loss harvest, how do I know how to tax loss harvest? I know that might be a broad topic and I apologize for my ignorance on this, but I would love it if you could actually go into the details, because I feel like I am just missing something. Thank you so much for all that you do. Have a great day. Bye.”

These types of walkthroughs, I typically do with blog posts rather than the podcast, but let's see what we can do here. First, log into your Vanguard account. Now, you're looking at all your accounts. The next step is going to be to click on your taxable account. Once that pops up, you'll be able to see that you have some options at the top. There are some links there at the top. One of which is the cost basis. If you click on that, it'll allow you to look at the unrealized gains and losses or the realized gains and losses. Click on the unrealized gains and losses. Now scroll down to your taxable account. You'll find your holdings that are in your taxable account. In my case, I have some iShares total stock market in there from the last time I tax-loss harvested back in March of 2020. On the left below that ticker symbol, you'll see a lot of details. Click on that and it expands. And what I see is that I have one lot there, basically the lot I bought in March of 2020. It is definitely green. It is a green long-term gain that is probably never going to be able to be tax-loss harvested. It's quite a gain since that date. I'm not going to be able to tax-loss harvest that.

I go down to my next holding. This one is the iShares total international stock ETF. I tax-loss harvested into that, again, in March 2020. I've got two lots there. I think I accidentally bought it later that year as well, but I have gains there. It's green. It's not red. If you look at it there, you'll see that there's a short-term capital gain or loss period and a long-term capital gain or loss period. Either way, when there is a loss, it's red; when there's a gain, it's green. Nothing to tax-loss harvest there for me. I go to my next holding. I've got some Vanguard small-cap value ETF. Okay, here we look at this and I've got six lots of this particular holding. The first two I have long-term capital gains on, the next three I have short-term capital gains on, and the last one I have a short-term capital loss on. I am currently $3,700 underwater.

Here is a candidate for tax-loss harvesting. If I wanted to tax-loss harvest this, I could. What would I do now? I would go in and put an order to sell this ETF. A sell order. I would sell all the shares I have of it there. It looks like I've got almost a thousand shares of it there with a slight loss. I could sell that. And then I'd turn around two minutes later and buy another small-cap value ETF, maybe the iShare small-cap value ETF or that sort of a fund. And then I would've booked that loss, that $3,700 loss I've got there. And I would be able to use that on my taxes. Remember, you can use up to $3,000 a year against your ordinary income and an unlimited amount against your capital gains.

The next one I look at, I've got some Vanguard XUS, small-cap ETF. I've got seven tax losses there, five of them have gains or four of them have long-term gains. One has a short-term gain and then two of them have a slight loss. That would be an option if I wanted to tax-loss harvest those as well. If I look at my total stock market ETF, I've got a bunch of tax lots there. I've got nine tax lots, six of them have long-term gains. Three of them have short-term gains. Nothing to tax-loss harvest there. I've actually got a slight loss on a bunch of my Vanguard intermediate-term tax-exempt funds. This is a muni bond fund. And I've got about five lots there with slight losses on them. They're not big losses, probably not really going to tax-loss harvest those. And I look at my last holding here. My total international stock market from Vanguard. I've got a whole bunch of tax lots here. I've got five with long-term gains, three with short-term gains, and three with short-term losses. The largest one there, I've probably got about $20,000 worth of losses there. So, I should think about tax-loss harvesting this. I could claim a $20,000 loss if I did this. And all I would do is I would sell VXUS. Two minutes later, I would buy IXUS, the iShares total international stock market ETF. And I would have booked that $20,000 loss.

I hope that's helpful in how you do that. Now, the bigger question is whether it's worth bothering. I've got hundreds of thousands of dollars of losses right now that I booked back in March 2020. And so, I'm not going to be able to deduct that against ordinary income. The only uses I'm going to have for that down the road is against capital gains. Maybe if I sell a bunch of stocks to live off of or if I end up selling the White Coat Investor. In that sort of a thing, I could use those losses to offset those gains. And so, more losses may be more useful for me, but it's not like your first $3,000 a year, which are really useful losses. And I'd be a lot more aggressive about harvesting these losses, if it was going to make a difference in my current tax bill. But that $20,000 loss in the Vanguard international stock index ETF is probably big enough for me to go after and harvest that. So maybe I'll get that done later this week.

All right. I hope that's helpful to you and explains the process. It does make it easier. You'll have fewer tax lots if you don't reinvest your dividends and capital gain distributions. I don't do that. All mine go into the money market fund, and then I pull them together with the other money I'm going to invest the next month. Whether it comes from the White Coat Investor, whether it comes from practicing medicine, whether it comes from another investment, I pull all that money together and I invest that the next month all into one lump sum of one of the assets, whatever's lagging most in the portfolio. In one month, I might put it all into the total international fund. The next month, I might put it all into the total stock market fund. Next month, I might put it all into small value. Whatever, just to keep the number of tax lots down.

Then, of course, if you've been listening for a while, you know what I tend to do with tax lots with a lot of appreciation. I use them for my charitable donations. And so that helps limit how many tax lots I'm managing. It helps me flush these capital gains out of the portfolio. And overall, I end up coming out ahead tax-wise than if I was giving cash instead of these shares. I hope that's helpful. I hope that walkthrough was beneficial.

More information here:

A Step-by-Step Tax-Loss Harvesting Guide

Is Tax-Loss Harvesting Worth It?

 

Tax-Loss Harvesting — When Is It Worth It? 

“At what percent drop in the market do you consider it worth your time to tax-loss harvest? Five percent, 10%, 20%? I'm sure it's different for every person, or do you do it based on a certain dollar number that your total losses have reached? Also, for someone who automatically invests every two weeks into VTSAX and VTIAX—that's total stock market and total international stock market—you can imagine at the downturn of a market, you would have quite a few transactions to make. For example, I have a loss of $50-$80 on each of my cost basis purchases for VTIAX. But altogether, they're almost a thousand dollars. Do you just exchange every single one of the VTIAX for its similar fund? Does Vanguard allow you to make all those tax-loss harvesting transactions in one day greater than 20?”

Basically, the dollar amount is really what I pay attention to. Percentage matters only if it's a significant dollar amount. For example, let's say you have a tax lot that was only $1,000. And it drops 5%. That's $50. For $50, I'm not going to tax loss harvest something. I just don't care. When I didn't have any tax losses, I was probably willing to tax loss something that was just a few hundred dollars, but now I'm not even willing to do tax-loss harvesting for a few thousand dollars. If it's not getting up at least into the $10,000, $20,000, $30,000, $40,000, $50,000 range, I'm not going to bother tax-loss harvesting. And the reason why is because you get 95% of your tax losses in a big nasty bear market. In reality, you get most of the bang for your buck out of doing this once every three or four or five years. You just go back in that big, nasty bear market and you sell your last four or five tax lots of every asset class. And you get all kinds of tax losses and then those carry you forward. Any tax loss you don't use in a given year is carried forward into the next year.

As you acquire more of these tax losses, then you probably are less and less and less likely to do more tax-loss harvesting. It's just a diminishing return thing. But is there a certain amount where you should do it? Well, when it's worth your time and hassle to save a few bucks on your taxes. But if we're just talking about the $3,000 a year that you can put against your ordinary income, that might save you $1,000 in taxes. How much time do you want to put in to save $1,000 in taxes? Not that much time. After that point, it's really just about offsetting capital gains that you might have from any sort of transactions you might need to make.

Is it still worth it? Yeah, it's still worth it, but it's not as worth it as that first $3,000 is. And some people don't like to tax-loss harvest at all, and I can hardly blame them. It's not worth that much money. And I get this question all the time. People are like, “I've been reinvesting my dividends, my capital gains. I have the same investments inside a retirement account. My IRA in particular, as I have in my taxable account, I'm going to get wash sales. How do I manage all this?” Well, the truth is tax-loss harvesting and automatic investing do not go together very well. You need a pretty manual process to take advantage of tax-loss harvesting. There's a lot of benefit to having an automated investing process. It's good behaviorally. It's good for your time. It maximizes your time in the market. There's a lot of things to be said for it. So, it's not crazy to not tax-loss harvest at all and just put everything on autopilot and not worry about it. That's not a crazy thing to do, but if you want to get that additional benefit from tax-loss harvesting, particularly if you do what I do and combine it with donating appreciated shares to charity, I think it's pretty powerful. I take all the gains. I donate them to charity. I book all the losses, and I've accumulated quite a bit of tax losses over the course of my investing career that I expect at some point I'll be able to use.

 

457 Plans 

“Hello, Dr. Dahle. I'm a family medicine physician from Pittsburgh. My husband and I are thankful for all you do. We are so close to celebrating our first million of net worth and having our student loans behind us. My husband and I are both hospital-employed physicians maxing out our 401(k)s yearly, backdoor Roth IRAs. My husband is maxing out his hospital's 457 plan and HSA.

My question is about my hospital's 457 plan. I've listened to prior podcasts about 457 plans, and my hospital 457 option seems like a good one. The only issue is that the plan documents say that the contribution percent that I would choose will not be effective in 2022 until the paycheck after my eligible wages exceed the annual limit as established by the IRS, which is $305,000 in 2022. The documents state that deferral will only begin after I exceed this dollar limit. I think last year was about $250,000. As a family medicine doctor, I am not making over $305,000 per year, even though my hospital says I am eligible for the 457 plan. Does this mean that I am not eligible for a 457 plan based upon these IRS limitations due to my salary? And is it typical for deferrals for this 457 plan to begin after you max out your 401(k) and make over the salary limit?

I'm trying to figure out if this is typical for a 457 plan, which means I would never be eligible to use one. Any information on this would be appreciated. Thank you.”

This is news to me. I've never had somebody ask me this question or bring a plan to me that had that requirement. If it's a requirement, there's not a lot of people that know about it. What I think is in order here is a trip into HR. And I would just ask them, “Can I put money in the 457? If so, how can I do it?” And if they let you do it, I'd put it in there. If they say, no, you can't do it because our plan is weird, we've written it such that you can't put anything in there unless you're making over $305,000, then I guess you're out of luck.

But the truth is all over the country there are academic docs who have 403(b)s and 457(b)s and 401(a)s. And many of them are not making that much money. Many of them are making less than $300,000. So, the fact that I've never heard of this before tells me that either your plan's very unique or that this isn't actually an IRS requirement.

If somebody else has more information on this that they've heard about this being an IRS requirement, shoot me an email, [email protected] I'd like to hear a little bit more about it, but this is the first time I've had anybody come up with that concern.

More information here:

What Is a 457 Retirement Plan?

 

Should Residents Carry Less Car Insurance Coverage?

“Hi. I'm Mohamed. I'm an internal medicine resident. I used all your products as my go-to for taking ownership of my finances. Thank you very much for all that you do. I had a question about car insurance. After listening to your episode, I decided to look at my own policy, and I've maxed out my bodily injury coverage. And after thinking about it, it almost feels like I'm protecting against wealth that I don't really have to lose since my net worth is like negative $200,000 with student loans and my only assets are really retirement-protected accounts.

I was wondering if you could talk about how insurance should be approached for trainees and residents who don't have wealth to begin with. Can we opt for a more basic or standard coverage? And then when our net worth does look like it approaches where it's flipped and begins to accelerate when we get our full attending jobs, if it makes sense to then switch to our umbrella policy or a higher coverage.”

Great question. The truth of the matter is I think attendings are more likely to carry more liability insurance than residents are. And late-career attendings are more likely to carry more than early-career attendings. That's probably natural. You have more to protect. But the truth is your liability is about the same. You can injure somebody just as much as a resident as you can as a late-career attending. And it's not just the assets you have currently that you can lose in a lawsuit. You can have your earnings basically seized, future earnings. Now in most states, it's limited to a certain percentage, maybe 15% until you've paid whatever the judgment is. But if you get a $2 million judgment against you for running over somebody with your car or for a malpractice above policy limit situation or something like that, then that's something they can hang over your head. Now, can you go and declare bankruptcy to get out of it? I suppose, but I'd rather buy a little bit of insurance than ever have to declare bankruptcy.

The other benefit of having insurance is when you hurt somebody, you can actually help them. Sometimes, we hurt people. It's our fault, our bad. Luckily, I have this great insurance policy that can help take care of people. That's another benefit of having insurance. It's not just about protecting your stuff. It's also being able to compensate somebody that you hurt. So, I think it's worthwhile getting reasonable insurance. Would I fault a resident for maybe not having quite as much as an attending? Well, of course not. A lot of times, a resident has as much need for disability insurance or as much need for life insurance as an attending does, but they don't buy as much because they just can't afford it.

If you're looking to save a little bit of money, then maybe you hold off on getting the umbrella policy until you come out of training. That's not crazy. What I wouldn't do though, is I wouldn't go around with just a $50,000 auto liability policy, just because you've got a bunch of debt and your only assets are in your Roth IRA. I think that's folly. There are way too many cars out there driving around that are worth more than $50,000. And that doesn't include the value of the occupants inside the cars. At a minimum, I would increase your auto liability coverage to several hundred thousand, even if you don't get the umbrella policy on top of it.

More information here:

How Much Car Insurance Do I Need?

Umbrella Insurance for Physicians

 

Wash Sale Rule for Donated Shares 

“Hi, Jim, thanks for all you do. My question regards the wash rule and how it applies to donating appreciated shares of stock. If I give X number of shares to a charity and then go buy the same number of shares that day, did I just violate the wash rule or did I just legally step up my basis? Thanks.”

This is pretty awesome. There is no wash sale when it comes to donating shares to charity. You absolutely can donate appreciated shares and buy back the same shares that day, the next day, etc. There's no reason you can't do that. Feel free and go ahead. It's interesting, one of the other places in tax-loss was with cryptocurrency. People were able to tax-loss harvest their cryptocurrency, and go back and buy the exact same cryptocurrency. But they're making some law changes that are going to prevent that. In fact, I think that's one of the other things that was in the bill that didn't pass at the end of 2021. But I would expect that one to be back soon. If you need to tax loss harvest your cryptocurrency, I'd get right on that.

But that was another big gaping loophole in the tax law. Frankly, this is another one. You can donate them and buy them back the very next day. I do that all the time. I'm donating shares every year to my DAF that I then use for my charitable contributions. And I don't wait at all before I buy the shares right back. More often, what I find is I'm actually donating something else that I tax-loss harvested into. Like right now, my donations have been the iShares total international stock market fund that I tax-loss harvested into back in March of 2020. I'm donating those, and I'm buying back the Vanguard ETF because I prefer the Vanguard one very slightly. I guess I'm not doing wash sales right now, but there would be nothing wrong with it if I decided to.

 

Disability Insurance Early in Your Career 

I got an email recently that I thought would be useful for our listeners to hear.

“Because of this diagnosis, I'm likely to need my disability insurance early in my career. I'm in my third year of post-training doing relatively well, all things considered, but I see the writing on the wall.”

There's a lesson there. You can get something bad even as a resident, even as a young attending. You are not invincible. The time to buy disability insurance is as soon as you start making money. When you're an intern, buy that policy. You might be like this doc and develop something during your training that is going to keep you from being able to buy disability insurance as an attending. That's why you need to buy it as an intern and get the future purchase option. Even if you develop something during your training, you can increase that coverage when you become an attending without having to prove your insurability.

Now, the reason for the email, I'll go on with. He says,

“The claim policy for an accident injury seems very black and white, but claiming for a chronic illness seems much more of a grey area. I'd love to hear a podcast or read a guest post from a physician who's gone through the claim process. I heard you say many times that disability insurance is relatively likely to be used. So, hopefully there are enough out there who've gone through this process. If you could find a few who wouldn't mind anonymously sharing their story. Of course, this is self-serving for me given my situation, but I think it would make for an interesting podcast. And I'm sure there are others in a similar situation out there who would greatly benefit from this. I'm extremely fortunate to have found WCI and listened to your advice early in my training and secured disability insurance before my diagnosis. And for that, I am extremely grateful.”

Well, you're welcome. It's my pleasure. But I agree that this would be a really interesting podcast. If you are a doc out there who has been through the claim process for a chronic illness, for the disability insurance claim process, I'd like to hear your story. And if you can write in [email protected], maybe we can get somebody on the podcast and talk a little bit more about that. I know we've had some attorneys on and insurance agents on in the past, but it would be fun to hear about it from the doctor's perspective.

More information here:

Physician Disability Insurance

 

Zero to Freedom with Leti and Kenji

We have a couple of special guests here on the White Coat Investor podcast. Welcome back to Leti and Kenji, the founders of the Zero to Freedom Cash-Flowing rentals course. They're going to be reopening their course here in a little bit. You can get more information about that at whitecoatinvestor.com/rental. But before we get into the details of your course, I want to hear about what you've been doing with your freedom lately. Tell us what you're up to now.

“We're actually in Costa Rica, which has been amazing. Kenji and I decided to be digital nomads back in August of 2021. So we've been traveling around the United States and now, actually, we're moving to Puerto Rico. So, we've been busy.”

And are you totally out of medicine now, taking a break from it? Part-time, where are you at with medicine?

“Technically, we are both moonlighters and we're hospitalists, but I don't know, actually. I think we're kind of undecided right this moment. We're maintaining our board certification. We have appointments at a hospital. We have contracts to be moonlighters, but we haven't picked up a shift since October of 2021.”

Awesome. Well, congratulations on your freedom. Let's talk a little bit about direct real estate investing. Now, there are lots of people out there that are interested in real estate, but they're not interested in putting in a lot of time or effort. They're far more interested in publicly-traded REITs, private REITs, private funds, syndications, etc. Make the case for being a direct real estate investor.

“Number one is cash flow. And the amount of money you can make, in general, in real estate that you own. When you are buying REITs or when you're even investing in a syndication, the syndicator is taking part of that return. When you control your own properties and you buy your own properties, you really get to make the cash flow. Plus, you have the mortgage paydown. Plus, then you can do something called forced depreciation, where you increase the value of the property by increasing income or decreasing expenses and all that money ends up in your pocket. And so, returns can be astronomical. You can literally force hundreds of thousands of dollars of appreciation in even a year. So, I think that's the number one.

Just to clarify, not everybody who's going to invest actively is going to do well. I really think you need to know how to combine all the benefits into a package and then take advantage of everything. What Leti was talking about was there's cash flow. That's only one component. It's actually not even the biggest. The biggest one is when you can force appreciation and that's like buying a property that you flip. You've seen those shows, where you take a property that's beat up and then you sell it for a significant profit. Well, you're doing that with a rental property where you're raising the value of that property significantly.

And then on top of that, if you can combine some type of tax benefit, either with a long-term rental, you can do something called real estate professional status. With a short-term rental, there's something called a short-term rental tax loophole, where you can take paper losses and use that to shelter your income and reduce your tax burden. If you can combine all those factors together and do it really well and you know how to do it well, then you can do very well. You can be on the other side of those syndications that you're investing in, when you're doing 2X equity multiple, you can do 10X or more. And you have control. You can choose what property to buy, when to sell. That control for me, I trust myself to be able to make money. That control element means that I'm relying on myself, not others.”

And how do you deal with the 3am toilet calls? The infamous calls that everybody's worried about?

“We don't. We have property managers for that. The truth is some of our students do actually self-manage. They will self-manage the long-term rentals, and there is actually software where you cannot get that 3 am toilet call if you want to, or you can choose to do it. And then we have a lot of students who do self-manage the short-term rentals, at least for a portion of time, to get those tax benefits. And so, they would get their 3am toilet calls, in that case. But most of us do not, most of us do not self-manage.”

Speaking of your students, how many students have you had? You've been doing this for a couple of years or more now. How many students have you had through your course?

“We've had over 3,000 students come through our course, and it's been pretty amazing. That's actually our Zero to Freedom course. We also have a short-term rental course we recently launched. We have 400 students there. Well over 3,000 people, mostly doctors, who have joined us. It's been really great.”

And can you share a success story or two that your students have had?

“It's incredible what physicians and doctors will do when they're given the tools. Our people really impress us. We've had students who are literally telling us that this year they're going to be at $500,000 in cash flow, which is remarkable. That's far faster than we were able to do this ourselves. We have a student who did an incredible thing where they built up $1.4 million in losses in one year. And so, that sheltered $1.4 million in income and actually went, he did this in 2020, and it went back and sheltered income from like five years before. That was pretty incredible. Then we have a lot of students who have gone out and gotten six figures in income within 18 months in cash flow. Of course, that's not taking into account the net worth growth with the forced depreciation. It's also not taking into account the tax savings, as well.

I think anybody who jumps in, especially if they do something like a short-term rental, if you do enough long-term rentals, you can, like I said, claim that status called real estate professional right out of the gate. A lot of them are in their first year of investing, sheltering a significant amount of money. Of course, there are several cases where we have students who have blown past the tax savings and are doing tremendous things with both cash flow and forced depreciation. But I would say a lot of them are taking advantage of that tax savings right off the bat. We call it a quick win. You get a quick win right out of the gate, shelter your income, get a nice tax refund, and then use that to reinvest. So, it's a nice kind of way to kind of kickstart your real estate investing, and a lot of our students are doing that.”

Now, more than just a course in information, when they take this, they're also joining a community. Tell us about the community and its benefits.

“I think community is one of the most valuable things that anyone could have. When we started investing in real estate, we didn't actually have that. I think that's part of the reason that it took us so long to get to where we are comparatively to how our students are doing. When you are looking at a deal, if you have the ability to ask other experienced investors—some of whom are investing in the same market as you and actually have contractors and have the resources there who they've tried out—it's incredible because now you're getting multiple heads to look at a deal and make sure that you've thought of every blind spot possible. But then you also have people sharing their resources and helping you be more successful because now you have the contractors that are proven in the market.

Then it's, of course, about inspiration and lifting each other up and supporting each other when we go through tough times, because not everything is bright and cheery. Always, there's going to be challenges in investing in real estate. Just having that community that you know has your back and is thinking the same way and lifting you up is so powerful for people. I think people who go through the course, it's not about the videos, it's not about the Q&As with us. The community is a really, really big part of it. That's why people love it, and that's why people stay, actually, after our course. People stay with us for over two years on our membership side. It's been really great. People love that community and support each other. It helps you avoid mistakes and also can really propel your success, as well.”

All right, let's hear about the deets. We know we can go to whitecoatinvestor.com/rental and sign up and get more information about it. But tell us about the course, when it's open to sign up, how long it lasts, how much it costs, how we can pay for it, give us all the details.

“It's called Zero to Freedom through Cash-Flowing Rentals, and it is open for sale from January 31-February 9. We open it twice a year right now, and people start right away. If you buy the course, right away you start to get the pre-course and you can start doing work. Actually, we are having a Facebook challenge before where people can do some pre-work as well. Then the course itself lasts seven weeks. Starting on February 11 is the first module release. During those seven weeks, what you have is a community in the Facebook community. We have actually five coaches who we pay to be answering Facebook questions and doing open office hours now. You have that ability to bring your specific questions into the open office hours.

During those seven weeks, we do live Q&As as well. You could get your vendors, you get your agents, people start putting in offers. They even start buying properties during that time. The goal of the course is to take you from knowing nothing about real estate to being confident to buy your first property. We truly have people that do close on properties during the course because they get the tools, they get the team, they get the community and they just take action just because they're incredible people.”

OK. How can they pay for it? Is it all at once? Is it over time? What's the cost of the course?

“We have one payment option, and it is $3,199.”

Is there any sort of guarantee, any sort of money back or trial period that they should know about?

“Absolutely. You have until 21 days after the release of module one. Basically, you have the opportunity, go through the pre-course and module one, two, and part of module three, before you can decide. If it's not the right fit for you at that point, it's a money-back guarantee.”

Awesome. Try it before you buy it. And certainly 100% guarantee. Wonderful opportunity there, Zero to Freedom through Cash-Flowing Rentals. You can find that information again at whitecoatinvestor.com/rental. Leti and Kenji, thanks again for being on the podcast.

 

PearsonRavitz are disability and life insurance advisors founded by and for physicians. At PearsonRavitz, they help you as a doctor safeguard your most valuable asset, your income, so you can protect the most important people in your life, your family. PearsonRavitz makes human connections before they make quotes. Go to pearsonravitz.com today to schedule your consultation with an advisor.

 

Survey

We want to make sure we are serving you as best we can, so we have created a survey to kick off the new year. We want to understand who our readers are and what they want from WCI. We will be entering everyone who fills out the short survey into a drawing for 20 WCI T-shirts and a free WCI course. Please spend a few minutes helping us serve you better by completing our new survey!

 

WCICON 2022

Time is almost up to register for The Physician Wellness and Financial Literacy Conference. The conference is in Phoenix on February 9-12, 2022. We will, of course, have incredible speakers and presentations on financial literacy but will also have a big focus on the wellness side of the event. There will be fantastic speakers, presentations, and activities to help revitalize you after what has been a difficult few years for everyone. If you cannot attend the in-person event, we are also offering a virtual component. You can register for the virtual conference until the last day of the live event. Get your tickets today!

 

Milestones to Millionaire

#50 – Orthopedic Surgeon Pays Off All of His Debt in 6 years

This story demonstrates just what can be done with income. This doctor grabbed the bull by the horns, opened his own practice, and became very successful. Have you thought about opening your own practice? Have you thought about geographical arbitrage? This is what it can look like. Surgeons are needed in medium and small towns across America. You will be doing a great service and giving yourself a tailwind in your financial life.

Sponsor: CrowdStreet 

 

Quote of the Day

Our quote of the day today comes from a Boglehead who goes by the handle Eagle 33. This person said,

“You have optimized your asset allocation when you spend half your time wishing you had more equities and the other half of your time wishing you had more bonds.”

 

Full Transcript

Transcription – WCI – 247
Intro:
This is the White Coat Investor Podcast where we help those who wear the white coat get a fair shake on Wall Street. We've been helping doctors and other high-income professionals stop doing dumb things with their money since 2011. Here's your host, Dr. Jim Dahle.

Dr. Jim Dahle:
This is White Coat Investor podcast number 247 – Bonds and Tax Loss Harvesting.

Dr. Jim Dahle:
PearsonRavitz are disability and life insurance advisors founded by and for physicians. This White Coat Investor recommended agency grew out of One MD's experience with a career-changing on-the-job injury. Today, PearsonRavitz service a medical community in all 50 states.

Dr. Jim Dahle:
At PearsonRavitz they help you as a doctor safeguard your most valuable asset, your income, so you can protect the most important people in your life, your family. PearsonRavitz makes human connections before they make quotes. Go to pearsonravitz.com today to schedule your consultation with a PearsonRavitz advisor.

Dr. Jim Dahle:
Welcome back to the podcast. We're recording this on January 3rd. I think it doesn't run until the end of the month, the 27th, I believe. Hopefully nothing we say today will be out of date by then. Sometimes things change quickly in the field of finance, but most of the time we talk about evergreen stuff, it's going to be timeless for quite a while.

Dr. Jim Dahle:
Let's take our first question today off the SpeakPipe. Somebody asking about bond substitutes. Thanks for this question, Tom. Let's take a listen.

Tom:
Hi Dr. Dahle. This is Tom from California. In the latest edition of “A Random Walk Down Wall Street” that was published in 2018, given low-interest rates at the time, the author suggests utilizing within their fixed income portfolios, bond substitute funds, particularly the Vanguard dividend growth fund as a mechanism to produce a higher yield of approximately 4% on the fixed income portion of the portfolio.

Tom:
Given the interest rates are now even lower, I'd be interested to hear your thoughts as to the wisdom of using bond substitutes within the fixed income portion of anyone's portfolio. Thank you.

Dr. Jim Dahle
Well, I think Burton Malkiel is a good guy. I think “A Random Walk Down Wall Street” was a really important book that really got people thinking about index funds. An important message has important data in it.

Dr. Jim Dahle
I don't agree with everything Burton recommends. For example, he's had some interesting recommendations about emerging market stocks for the last five or 10 years that really haven't panned out.

Dr. Jim Dahle
This is another recommendation I really don't agree with. The reason why is that a dividend stock is not a bond. It does not act at all like a bond. What do you expect from bonds? Well, you expect stability, a relatively low amount of return compared to stocks, but stability. When the stock market crashes, you hope your bonds are going to go up.

Dr. Jim Dahle
However, when the stock market crashes, dividend stocks do not go up, they go down in value. Yes, they're paying dividends and the dividend yield may actually increase when the market goes down. However, most of the time when there's a big prolonged market crash is because the economy's not doing well.

Dr. Jim Dahle
And guess what companies do when the economy's not doing well? They cut the dividends. You look at 2008, dozens and dozens of companies cut their dividends. This is not some sort of guaranteed payment. It's a dividend. It comes from the profits of the company.

Dr. Jim Dahle
And so, no, I don't think stocks are an adequate bond substitute. If you want a bond substitute, there are things out there that you can buy. You can buy savings bonds. I bonds, EE bonds. You can put your money in cash. That's a bond substitute. If you work for the federal government, you have access to the TSP. The G fund is a pretty good bond substitute. CDs are a good bond substitute. But stocks? No. Just because they pay a dividend, just because they pay a high dividend, doesn't make them a bond substitute.

Dr. Jim Dahle
If you are selling bonds and you're buying dividend stocks or value stocks, you're just taking on more risk. Now, if the market does well, that's going to pay off well for you. If the market does poorly, that's not going to pay off well for you. So no, I don't see dividend stocks as a bond substitute at all. I think that was a stupid idea. So, you can tell Burton I thought so.

Dr. Jim Dahle
Hey, if you haven't done our survey yet, make sure you do our survey. We're going to keep this going through January 31st. We're basically trying to use your feedback to serve you better. That's all it is. It's just a few questions. It'll take you a few minutes. Ask you about you, ask you about what you like and don't like about the White Coat Investor. That's it. It's just a survey.

Dr. Jim Dahle
whitecoatinvestor.com/survey. We're going to bribe you to do it. We're given away 20 t-shirts and one online course, our CFE Las Vegas online course. And it's a drawing among all those who take the survey to win those prizes. So, please enter and hopefully you can win a prize.

Dr. Jim Dahle
All right. Our next question comes from Tim. This one's about I bonds.

Tim:
Hi Dr. Dahle. I'm a nephrology fellow, and my wife is a new attending. We want to thank you for all the life-changing advice that your book and website have provided. I have a question about how to maximize I bond purchases while optimizing the safe harbor rule.

Tim:
We're interested in incorporating I bond purchases into our savings plan. I would like to max out each year if possible. That's $10,000 for us individually with a $5,000 purchase at the end of the year using our tax refund.

Tim:
But I'm not quite sure the best way to handle withholdings. On one hand, I can see how it's advantageous to minimize withholdings throughout the year via the safe harbor rule. But on the other hand, I somehow need to pay the IRS an extra $5,000 by December. So, what is the best way to overpay the government? Thank you.

Dr. Jim Dahle:
Good question, Tim. Most of us don't have trouble overpaying the government. The withholding rules generally result in people getting a tax refund. And so, if you're just an employee, if that's your status and you're not regularly getting tax refunds, withhold less money or have more money withheld rather, claim fewer exemptions and you'll take care of that problem right away.

Dr. Jim Dahle:
The tricky part is going to be not having so much withheld that you get some massive tax refund back and you end up loaning tons of money to the government at 0% interest all year. Easy to do if you're just an employee.

Dr. Jim Dahle:
If you have self-employment income enough of it that you are having to make quarterly estimated payments, again, this is not that complicated. You just pay more. You make bigger quarterly estimated payments. Now the easiest way to do that and make your taxes really easy is to pay them your quarterly estimated payments evenly. So that every quarter is the exact same amount of money.

Dr. Jim Dahle:
You don't have to do it that way. If you don't do it that way, you got to justify to the IRS that that's the way your income was throughout the year. If you have your regular income, you can make your quarterly estimated payments irregularly, but then you got to match up your income and what you're paid on a tax form at the end of the year.

Dr. Jim Dahle:
For me, it's easiest just to pay the same amount every quarter. But if you really wanted to, you could just make that fourth-quarter payment, an extra $5,000 and then you'd have an extra $5,000 grand in there. You paid the government an extra $5,000 grand.

Dr. Jim Dahle:
Truthfully, anybody can send in a quarterly estimated payment. Every January 15th, if you are smart enough that you can nail your withholding, that it's exactly right every year and you don't get any tax refund and you don't have to write a check on April 15th, then you can just send in a $5,000 quarterly estimated payment on every January 15th. And that would do it. You'd have an extra $5,000 grand in there.

Dr. Jim Dahle:
But for most of us, it's more of an estimate and a bit of a guessing game, exactly how much we're going to owe in tax each year. I guess if you screwed up and you didn't get at least a $5,000 refund, you wouldn't be able to buy those I bonds in a given year. But I think the downside of having the IRS sitting on way too much money all year is probably greater than not being able to buy those I bonds.

Dr. Jim Dahle:
Incidentally, if your goal is really to buy a lot of I bonds, remember that other entities can also buy $10,000 a year of I bonds. Every trust you have can buy $10,000 worth of I bonds. Every business entity you have, every LLC can buy I bonds. And so, some people have gone to the trouble of opening a bunch of little trusts. If you can open it for very little expense just to buy I bonds, you can have a bunch of revocable trusts and they can each have an I bond account, each have a treasury direct account, and buy some I bonds. At a certain point, the hassle probably outweighs the benefit. But if your goal is to really have a significant amount of your money in I bonds, that's one way you can do it.

Dr. Jim Dahle:
We actually finally broke down and bought some I bonds. When they're yielding 7%, you've got to go, geez. Basically, no-risk 7% right now. They're pretty attractive. And so, I actually opened some treasury direct accounts last month in December and bought $10,000 for myself and $10,000 for Katie and will buy $10,000 more this month for each of us. And that'll give us $40,000 in I bonds.

Dr. Jim Dahle:
We're putting some trust in place and they'll probably have a treasury direct account as well and buy some I bonds with those. But I'm not going crazy trying to get gobs of I bonds in the portfolio. But I put them into my inflation index bond category, which is 10% of our portfolio. And so, the more I bonds I have in there, the fewer TIPS I need. And right now, I bonds are way more attractive than TIPS.

Dr. Jim Dahle:
All right. Another question on bonds, let's take a listen to this one on the Speak Pipe.

Speaker:
Hey, Jim, and happy new year. A quick question on bonds for you. I have approximately $10,000 that I need to invest currently. And given that bond yields are so low and stocks have done so well this year, I'm assuming that when I rebalance my portfolio, I'm going to find that it's overweighted in stocks.

Speaker:
And typically, what I do when I rebalance is move some of my stocks in my tax-protected accounts into bonds in those same accounts and then invest my excess cash into a total market fund in my taxable account. This year, however, I'm intrigued by the post you ran on I bonds. Do you think it'd be better to purchase $10,000 in I bonds this year instead of moving tax-protected stocks into a total bond fund like I currently or usually do? I seem to meet the four criteria for people that this might make sense for. Meaning I have 20% of my portfolio on bonds.

Speaker:
I'd love to get some bonds index to the current high inflation state. I do have a taxable account and I'm early in my career and thus not profoundly wealthy. Do you think that the higher inflation-adjusted yield of I bonds makes up for the tax inefficiency of having them in a taxable account? I really appreciate your help on this.

Dr. Jim Dahle:
Oh, you're going to like this answer. Yeah. You should buy I bonds. They are the most attractive bonds out there right now. That might change in six months, might change in a year or two years or whatever. But for now, they're clearly the most attractive bonds and they're very tax efficient in a taxable account. They're basically inflation index bonds that are designed for a taxable account because you don't pay any taxes on them until you cash them out.

Dr. Jim Dahle:
They're very tax-efficient, both I bonds and EE savings bonds. They're all very tax efficient. You don't pay taxes on them until you cash them out or until 30 years, whichever comes first. But the bottom line is yeah, in your situation, these make a lot of sense. It's a little more hassle. You got one more account you got to manage, you got to manage a treasury direct account now, but $10,000, what you want to put in there, you can put $10,000 a year in I bonds, it seems like a perfect match up to me.

Dr. Jim Dahle:
Yeah, go for it. Obviously, adjust your written financial plan to account for a change like that. But it seems like a smart change to me, at least looking at the current interest rates available on bonds.

Dr. Jim Dahle:
Our quote of the day today comes from a Boglehead who goes by the handle Eagle 33. This person said, “You have optimized your asset allocation when you spend half your time wishing you had more equities and the other half of your time wishing you had more bonds.”

Dr. Jim Dahle:
And I think that's the truth. If you are constantly wishing you had more money in stocks, you probably need more aggressive asset allocation. If you find yourself in a bear market wishing you had more bonds, you probably need a less aggressive asset allocation.

Dr. Jim Dahle:
Basically, what you're weighing is the fear of loss from having too much money in risky assets with the fear of missing out on returns, from not having more risky and higher returning assets. And where you can balance those two fears, that's where you set your asset allocation. That's where you set your stock to bond ratio or your risky asset to less risky asset ratio.

Dr. Jim Dahle:
All right. We have a couple of special guests here on the White Coat Investor podcast. Welcome back to Leti and Kenji, the founders of the Zero to Freedom Cash-Flowing rentals course. Welcome back to the podcast.

Leti:
Thanks, Jim. We're excited to be here.

Dr. Jim Dahle:
Yeah, they're going to be reopening their course here in a little bit. You can get more information about that at whitecoatinvestor.com/rental. But before we get into the details of your course, I want to hear about what you've been doing with your freedom lately. Tell us what you're up to now.

Leti:
Yeah. We're actually in Costa Rica, which has been amazing. Kenji and I decided to be digital nomads back in August of 2021. So we've been traveling around the United States and now, actually, we're moving to Puerto Rico. So, we've been busy.

Dr. Jim Dahle:
And are you totally out of medicine now, taking a break from it? Part-time, where are you at with medicine?

Leti:
Technically, we are both moonlighters and we're hospitalists, but I don't know, actually. I think we're kind of undecided right this moment.

Kenji:
Yeah, we're maintaining our board certification. We have appointments at a hospital. We have contracts to be moonlighters, but we haven't picked up a shift since October of 2021.

Dr. Jim Dahle:
Awesome. Well, congratulations on your freedom. Let's talk a little bit about direct real estate investing. Now, there's lots of people out there that are interested in real estate, but they're not interested in putting in a lot of time or effort. They're far more interested in publicly-traded REITs, private REITs, private funds, syndications, etc. Make the case for being a direct real estate investor.

Leti:
Number one is cash flow. And the amount of money you can make in general, in real estate that you own. When you are buying REITs or when you're even investing in a syndication, the syndicator is taking part of that return. When you control your own properties and you buy your own properties, you really get to make the cash flow, plus you have the mortgage paydown, plus then you can do something called forced depreciation, where you increase the value of the property by increasing income or decreasing expenses and all that money ends up in your pocket. And so, returns can be astronomical. You can literally force hundreds of thousands of dollars of appreciation in even a year. And so, I think that's the number one.

Kenji:
Yeah. Just add to that, and to clarify, not everybody who's going to invest actively is going to do well. I really think you need to know how to combine all the benefits into a package and then take advantage of everything.

Kenji:
What Leti was talking about was there's cash flow. That's only one component. It's actually not even the biggest. The biggest one is when you can force appreciation and that's like buying a property that you flip. You've seen those shows, where you take a property that's beat up and then they sell it for a significant profit. Well, you're doing that with a rental property where you're raising the value of that property significantly.

Kenji:
And then on top of that, if you can combine some type of tax benefit, either with a long-term rental, you can do something called real estate professional status. With a short-term rental, there's something called a short-term rental tax loophole, where you can take paper losses and use that to shelter your income and reduce your tax burden. And if you can combine all those factors together and do it really well and you know how to do it well, then you can do very well. And you can be on the other side of those syndications that you're investing in, when you're doing 2X equity multiple, you can do 10X or more.

Leti:
And you have control. You can choose what property to buy, when to sell. And that control for me, I trust myself to be able to make money. And that control element means that I'm relying on myself, not others.

Dr. Jim Dahle:
And how do you deal with the 3:00 AM toilet calls? The infamous calls that everybody's worried about?

Leti:
We don't. We have property managers for that. The truth is some of our students do actually self-manage. So they will self-managed our long-term rentals, and there is actually software where you cannot get that 3:00 AM toilet call, if you want to, or you can choose to do it. And then we have a lot of students who do self-manage our short-term rentals, at least for a portion of time to get those tax benefits. And so, they would get their 3:00 AM toilet calls, in that case. But most of us do not, most of us do not self-manage.

Dr. Jim Dahle:
Yeah. I talk to those who self-manage and most of them tell me what, “You know what? The 3:00 AM toilet calls are a myth anyway, we get very few calls after hours.”

Leti:
That's true.

Dr. Jim Dahle:
Speaking of your students, how many students have you had? You've been doing this for a couple of years or more now. How many students have you had through your course?

Kenji:
Yeah, we've had over 3,000 students come through our course, and it's been pretty amazing. That's actually our Zero to Freedom course. We also have a short-term rental course we recently launched. We have 400 students there. Well over 3,000 people. Mostly doctors who have joined us. And so, it's been really great.

Dr. Jim Dahle:
And can you share a success story or two that your students have had?

Leti:
It's incredible what physicians and doctors will do when they're given the tools. Our people really impress us. We've had students who are literally telling us that this year they're going to be at $500,000 in cash flow, which is remarkable. That's far faster than we were able to do this ourselves.

Leti:
We have a student who did an incredible thing where built up $1.4 million in losses in one year. And so, that sheltered $1.4 million in income and actually went, he did this in 2020, and it went back and sheltered income from like five years before. That was pretty incredible.

Leti:
And then we have a lot of students who have gone out and gotten six figures in income within 18 months in cash flow. And of course, that's not taking into account the net worth growth with the forced depreciation. And it's also not taking into account the tax savings as well.

Kenji:
Yeah, I think anybody who jumps in, especially if they do something like a short-term rental, if you do enough long-term rentals, you can, like I said, claim that status called real estate professional right out of the gate. A lot of them are in their first year of investing sheltering a significant amount of money. And of course, there are several cases where we have students who have blown past the tax savings and are doing tremendous things with both cash flow and forced depreciation.

Kenji:
But I would say a lot of them are taking advantage of that tax savings right off the bat. We call it a quick win. You get a quick win right out of the gate, shelter your income, get a nice tax refund, and then use that to reinvest. And so, it's a nice kind of way to kind of kickstart your real estate investing. And a lot of our students are doing that.

Dr. Jim Dahle:
Now, more than just a course in information, when they take this, they're also joining a community. Tell us about the community and its benefits.

Leti:
I think community is one of the most valuable things that anyone could have. When we started investing in real estate, we didn't actually have that. And I think that's part of the reason that it took us so long to get to where we are comparatively to how our students are doing.

Leti:
When you are looking at a deal, if you have the ability to ask other experienced investors, some of whom are investing in the same market as you and actually have contractors and have the resources there who they've tried out. It's incredible because now you're getting multiple heads to look at a deal and make sure that you've thought of every blind spot possible, but then you also have people sharing their resources and helping you be more successful because now you have the contractors that's proven in the market.

Leti:
And then it's of course about inspiration and lifting each other up and supporting each other when we go through tough times, because not everything is bright and cheery, always, there's going to be challenges in investing in real estate. And so, just having that community that you know has your back and is thinking the same way and lifting you up is so powerful for people.

Kenji:
Yeah. I think people who go through the course it's not about the videos, it's not about the Q&As with us. It is a community, as a really, really big part of it. That's why people love it, and that's why people stay actually, after our course. People stay with us for over two years on our membership side. And so it's been really great. People love that community and support each other. Like Leti said, it helps you avoid mistakes and also can really propel your success as well.

Dr. Jim Dahle:
All right, let's hear about the deets. We know we can go to whitecoatinvestor.com/rental and sign up and get more information about it. But tell us about the course, when it's open to sign up, how long it lasts, how much it costs, how we can pay for it, give us all the details.

Leti:
It's called Zero to Freedom through Cash-Flowing Rentals, and launch is from January 31st through February 9th is when it's open for sale. We open it twice a year right now, and people start right away. If you buy the course, right away you start to get the pre-course and you can start doing work. And actually, we are having a Facebook challenge before where people can do some pre-work as well.

Leti:
And then the course itself lasts seven weeks. Starting on February 11th is the first module release. And during those seven weeks, what you have is a community in the Facebook community. We have actually five coaches who we pay to be answering Facebook questions and doing open office hours now. You have that ability to bring your specific questions into the open office hours.

Leti:
And during those seven weeks, we do live Q&As as well. You could get your vendors, you get your agents, people start putting in offers. They even start buying properties during that time.

Leti:
The goal of the course is to take you from knowing nothing about real estate to being confident to buy your first property. And we truly have people that do close on properties during the course because they get the tools, they get the team, they get the community and they just take action just because they're incredible people.

Dr. Jim Dahle:
Okay. How can they pay for it? Is it all at once? Is it over time? What's the cost of the course?

Leti:
We have one payment option and it is $3,199.

Dr. Jim Dahle:
Okay. And you take cards, I assume, since it's an online course?

Leti:
Of course.

Dr. Jim Dahle:
whitecoatinvestor.com/rental. You can get that information there. You can learn more about it there as well. Is there any sort of guarantee, any sort of money back or trial period that they should know about?

Leti:
Absolutely. You have until 21 days after the release of module one. Basically, you have the opportunity, go through the pre-course and module one, two, and part of module three, before you can decide. If it's not the right fit for you at that point, it's a money-back guarantee.

Dr. Jim Dahle:
Awesome. Try it before you buy it. And certainly 100% guarantee. Wonderful opportunity there, Zero to Freedom through Cash-Flowing Rentals. You can find that information again at whitecoatinvestor.com/rental. Leti and Kenji, thanks again for being on the podcast.

Leti:
Thank you, Jim, for inviting us.

Kenji:
Thank you.

Dr. Jim Dahle:
All right. Let's take a question from Diana. This one's on tax-loss harvesting.

Diana:
Hi, Dr. Dahle. This is Diana, pulmonary critical care. I'm calling from the Chicago area. I have a question about tax-loss harvesting. I know you've covered this topic quite a bit. I am new to investing in a taxable account, because we've already exhausted our other investment strategies.

Diana:
I'm wondering how you logistically actually do the tax-loss harvesting? Right now, my gains or dividends are being reinvested. Are people only able to do this if they contribute once or twice per year? How do you keep track of these things if you have a Vanguard taxable account?

Diana:
Literally walk me through the steps of how do I know one, if I need to tax loss harvest, how do I know how to tax loss harvest? I know that might be a broad topic and I apologize for my ignorance on this, but I would love it if you could actually go into the details, because I feel like I am just missing something. Thank you so much for all that you do. Have a great day. Bye.

Dr. Jim Dahle:
All right. These types of walkthroughs I typically do with blog posts rather than the podcast, but let's see what we can do here. First, log into your Vanguard account. Now, you're looking at all your accounts. The next step is going to be click on your taxable account. And once that pops up, you'll be able to see that you have some options at the top.

Dr. Jim Dahle:
There's some links there at the top. One of which is the cost basis. If you click on that, it'll allow you to look at the unrealized gains and losses or the realized gains and losses. Click on the unrealized gains and losses.

Dr. Jim Dahle:
Now scroll down to your taxable account. You'll find your holdings that are in your taxable account. In my case, I've got some iShares total stock market in there from the last time I taxed lost harvested back in March of 2020.

Dr. Jim Dahle:
On the left below that ticker symbol, you'll see lot of details. Click on that and it expands. And what I see is that I have one lot there, basically the lot I bought in March of 2020. It is definitely green. It is a green long-term gain that is probably never going to be able to be tax loss harvested. It's quite a gain since that date. And so I'm not going to be able to tax loss harvesting that.

Dr. Jim Dahle:
I go down to my next holding. This one is the iShares total international stock ETF. I tax loss harvested into that, again, in March, 2020. I've got two lots there. I think I accidentally bought it later that year as well, but I have gains there. It's green. It's not red. If you look at it there, you'll see that there's a short-term capital gain or loss period and a long-term capital gain or loss period. Either way when there is a loss, it's red, when there's a gain, it's green. Nothing to tax loss harvest there for me.

Dr. Jim Dahle:
I go to my next holding. I've got some Vanguard small-cap value ETF. Okay, here we look at this and I've got six lots of this particular holding. The first two I have long-term capital gains on, the next three I have short-term capital gains on, and the last one I have a short-term capital loss on. I am currently $3,700 underwater.

Dr. Jim Dahle:
Here is a candidate for tax-loss harvesting. If I wanted to tax loss harvest this, I could. What would I do now? I would go in and put an order to sell this ETF. A sell order. I would sell all the shares I have of it there. It looks like I've got almost a thousand shares of it there with a slight loss.

Dr. Jim Dahle:
So, I could sell that. And then I'd turn around two minutes later and buy another small-cap value ETF, maybe the iShare small-cap value ETF or that sort of a fund. And then I would've booked that loss, that $3,700 loss I've got there. And I would be able to use that on my taxes. Remember, you can use up to $3,000 a year against your ordinary income and an unlimited amount against your capital gains. And so, that's an option.

Dr. Jim Dahle:
The next one I look at, I've got some Vanguard XUS, small-cap ETF. I've got seven tax losses there, five of them have gains or four of them have long term gains. One has a short-term gain and then two of them have a slight loss. That would be an option if I wanted tax loss harvest those as well.

Dr. Jim Dahle:
If I look at my total stock market ETF, I've got a bunch of tax lots there. I've got nine tax lots, six of them have long-term gains. Three of them have short-term gains. Nothing to tax loss harvest there.

Dr. Jim Dahle:
I've actually got a slight loss on a bunch of my Vanguard intermediate-term tax-exempt fund. This is a muni bond fund. And I've got about five lots there with slight losses on them. They're not big losses, probably not really going to tax loss harvest those.

Dr. Jim Dahle:
And I look at my last holding here. My total international stock market from Vanguard. I've got a whole bunch of tax lots here. I've got five with long-term gains, three with short-term gains, and three with short-term losses. The largest one there, I've probably got about $20,000 worth of losses there. So, that's to think about tax-loss harvesting. I could claim a $20,000 loss if I did this. And all I would do is I would sell VXUS. Two minutes later I would buy IXUS, the iShares total international stock market ETF. And I would have booked that $20,000 loss.

Dr. Jim Dahle:
I hope that's helpful in how you do that. Now, the bigger question is whether it's worth bothering. I've got hundreds of thousands of dollars of losses right now that I booked back in March 2020. And so, I'm not going to be able to deduct that against ordinary income. The only uses I'm going to have for that down the road is against capital gains. Maybe if I sell a bunch of stocks to live off of, or if I end up selling the White Coat Investor.

Dr. Jim Dahle:
In that sort of a thing, I could use those losses to offset those gains. And so, more losses may be more useful for me, but it's not like your first $3,000 a year, which are really of useful losses. And I'd be a lot more aggressive about harvesting these losses, if it was going to make a difference in my current tax bill. But that $20,000 loss in the Vanguard international stock index ETF is probably big enough for me to go after and harvest that. So maybe I'll get that done later this week.

Dr. Jim Dahle:
All right. I hope that's helpful to you and explains the process. It does make it easier. You'll have fewer tax lots if you don't reinvest your dividends and capital gain distributions. I don't do that. All mine go into the money market fund, and then I pull them together with the other money I'm going to invest the next month, whether it comes from the White Coat Investor, whether it comes from practicing medicine, whether it comes from another investment, I pull all that money together and I invest that the next month all into one lump sum of one of the assets whatever's lagging most in the portfolio.

Dr. Jim Dahle:
In one month, I might put it all into the total international fund. The next month I might put it all into the total stock market fund. Next month I might put it all into small value. Whatever, just to keep the number of tax lots down.

Dr. Jim Dahle:
And then of course, if you've been listening for a while, you know what I tend to do with tax lots with a lot of appreciation. I use them for my charitable donations. And so that helps limit how many tax lots I'm managing. It helps me flush these capital gains out of the portfolio. And overall, I end up coming out ahead tax-wise than if I was giving cash instead of these shares. I hope that's helpful. I hope that walkthrough was beneficial.

Dr. Jim Dahle:
Our next question comes from my email box and is related somewhat to the last one.

Dr. Jim Dahle:
“At what percent drop in the market do you consider it worth your time to tax loss harvest? 5%, 10%, 20%? I'm sure it's different for every person, or do you do it based on a certain dollar number that your total losses have reached?

Dr. Jim Dahle:
Also, for someone who automatically invests every two weeks into VTSAX and VTIAX, that's total stock market and total international stock market, you can imagine at the downturn of a market, you would have quite a few transactions to make. For example, I have a loss of $50 to $80 on each of my cost basis purchases for VTIAX. But altogether, they're almost a thousand dollars. Do you just exchange every single one of the VTIAX for its similar fund? Does Vanguard allow you to make all those tax-loss harvesting transactions in one day greater than 20?”

Dr. Jim Dahle:
Yeah, basically the dollar amount is really what I pay attention to. Percentage matters in so much only if it's a significant dollar amount. For example, let's say you have a tax lot that was only a thousand dollars. And it drops 5%. That's $50. For $50, I'm not going to tax loss harvest something. I just don't care.

Dr. Jim Dahle:
When I didn't have any tax losses, I was probably willing to tax loss something that was just a few hundred dollars, but now I'm not even willing to do tax loss harvesting for a few thousand dollars. If it's not getting up at least into the $10,000 – $20,000 – $30,000 – $40,000 – $50,000 range, I'm not going to bother tax-loss harvesting.

Dr. Jim Dahle:
And the reason why is because you get 95% of your tax losses in a big nasty bear market. In reality, you get most of the bang for your buck out of doing this once every three or four or five years. You just go back in that big, nasty bear market and you sell your last four or five tax lots of every asset class. And you get all kinds of tax losses and then those carry you forward. Any tax loss you don't lose in a given year is carried forward into the next year.

Dr. Jim Dahle:
As you acquire more of these tax losses, then you probably are less and less and less likely to do more tax loss harvesting. It's just a diminishing return thing. But is there a certain amount where you should do it? Well, when it's worth your time and hassle to save a few bucks on your taxes.

Dr. Jim Dahle:
But if we're just talking about the $3,000 a year that you can put against your ordinary income, that might save you $1,000 in taxes. How much time do you want to put in to save a thousand dollars in taxes? Not that much time. It's worth putting some time in, but not that much time. After that point, it's really just about offsetting capital gains that you might have from any sort of transactions you might need to make.

Dr. Jim Dahle:
Is it still worth it? Yeah, it's still worth it, but it's not as worth it as that first $3,000 is. And some people don't like to tax loss harvest at all, and I can hardly blame them. It's not worth that much money. And I get this question all the time. People are like “I've been reinvesting my dividends, my capital gains. I have the same investments inside a retirement account. My IRA in particular, as I have in my taxable account, I'm going to get wash sales. How do I manage all this?”

Dr. Jim Dahle:
Well, the truth is tax loss harvesting, and automatic investing do not go together very well. You need a pretty manual process to take advantage of tax loss harvesting. And there's a lot of benefit to having an automated investing process. It's good behaviorally. It's good for your time. It maximizes your time in the market. There's a lot of things to be said for it.

Dr. Jim Dahle:
So, it's not crazy to not tax loss harvest at all and just put everything on autopilot and not worry about it. That's not a crazy thing to do, but if you want to get that additional benefit from tax loss harvesting, particularly if you do what I do and combine it with donating appreciated shares to charity, I think it's pretty powerful.

Dr. Jim Dahle:
I take all the gains. I donate them to charity. I book all the losses and I've accumulated quite a bit of tax losses over the course of my investing career that I expect at some point I'll be able to use. I hope that's helpful.

Dr. Jim Dahle:
All right, let's take our next question. This one's about 457 plans from Molly.

Molly:
Hello, Dr. Dahle. I'm a family medicine physician from Pittsburgh. My husband and I are thankful for all you do. We are so close to celebrating our first million of net worth and having our student loans behind us. My husband and I are both hospital-employed physicians maxing out our 401(k)s yearly backdoor Roth IRAs. My husband is maxing out his hospital's 457 plan and HSA.

Molly:
My question is about my hospital's 457 plan. I've listened to prior podcasts about 457 plans and my hospital 457 option seems like a good one. The only issue is that the plan documents say that the contribution percent that I would choose will not be effective in 2022 until the paycheck after my eligible wages exceed the annual limit as established by the IRS, which is $305,000 in 2022. The documents state that deferral will only begin after I exceed this dollar limit. I think last year was about $250,000.

Molly:
As a family medicine doctor, I am not making over $305,000 per year, even though my hospital says I am eligible for the 457 plan. Does this mean that I am not eligible for a 457 plan based upon these IRS limitations due to my salary? And is it typical for deferrals for this 457 plan to begin after you max out your 401(k) and makeover the salary limit?

Molly:
I'm trying to figure out if this is typical for a 457 plan, which means I would never be eligible to use one. Any information on this would be appreciated. Thank you.

Dr. Jim Dahle:
This is news to me. I've never had somebody ask me this question or bring a plan to me that had that requirement. If it's a requirement, there's not a lot of people that know about it. What I think is an order here is a trip into HR. And I would just ask them, “Can I put money in the 457? If so, how can I do it?” And if they let you do it, I'd put it in there. If they say, no, you can't do it because our plan is weird, we've written it such that you can't put anything in there unless you're making over $305,000, then I guess you're out of luck.

Dr. Jim Dahle:
But the truth is all over the country, there are academic docs who have 403(b)s and 457(b)s and 401(a)s. And many of them are not making that much money. Many of them are making less than $300,000. These are academic docs. And so, the fact that I've never heard of this before tells me that either your plan's very unique or that this isn't actually an IRS requirement.

Dr. Jim Dahle:
If somebody else has more information on this that they've heard about this being an IRS requirement, shoot me an email, [email protected] I'd like to hear a little bit more about it, but this is the first time I've had anybody come up with that concern.

Dr. Jim Dahle:
Thanks so much for what you do by the way. A lot of you are family practice docs, you're internal medicine docs, you're pediatricians. You don't necessarily get paid as much as some of the high-flying specialties out there, but you may be working just as hard and dealing with the pandemic from the front lines. So, if no one said thanks for what you do today, let me be the first.

Dr. Jim Dahle:
Let's take another question here. This one is from Mohamed about car insurance.

Mohamed:
Hi. I'm Mohamed. I'm an internal medicine resident. I used all your products as my go-to for taking ownership of my finances. Thank you very much for all that you do. I had a question about car insurance.

Mohamed:
After listening to your episode, I decided to look at my own policy and I've maxed out my bodily injury coverage. And after thinking about it almost feels like I'm protecting against wealth that I don't really have to lose since my net worth is like negative $200,000 with student loans and my only assets are really retirement-protected accounts.

Mohamed:
I was wondering if you could talk about how insurance should be approached for trainees and residents who don't have wealth to begin with. Can we opt for a more basic or standard coverage? And then when our net worth does look like it approaches it's flipped and begins to accelerate when we get our full attending jobs, if it makes sense to then switch to our umbrella policy or a higher coverage.

Dr. Jim Dahle:
Great question. The truth of the matter is I think attendings are more likely to carry more liability insurance than residents are. And late-career attendings are more likely to carry more than early-career attendings. That's probably natural. You got more to protect.

Dr. Jim Dahle:
But the truth is your liability is about the same. You can injure somebody just as much as a resident, as you can as a late-career attending. And it's not just the assets you have currently that you can lose in a lawsuit. You can have your earnings basically seized, future earnings.

Dr. Jim Dahle:
Now in most states, it's limited to a certain percentage, maybe 15% until you've paid whatever the judgment is. But if you get a $2 million judgment against you for running over somebody with your car or for a malpractice above policy limit situation or something like that, then that's something they can hang over your head. Now, can you go and declare bankruptcy to get out of it? I suppose, but I'd rather buy a little bit of insurance than ever have to declare bankruptcy.

Dr. Jim Dahle:
The other benefit of having insurance is when you hurt somebody, you can actually help them. Sometimes we hurt people. It's our fault, our bad. I like to take care of you. Luckily, I have this great insurance policy that can do that. That's another benefit of having insurance. It's not just about protecting your stuff. It's also being able to compensate somebody that you hurt.

Dr. Jim Dahle:
So, I think it's worthwhile getting reasonable insurance. Would I fault a resident for maybe not having quite as much as attending? Well, of course not. A lot of times a resident has as much need for disability insurance or as much need for life insurance as an attending does, but they don't buy as much because they just can't afford it.

Dr. Jim Dahle:
If you're looking to save a little bit of money, then maybe you hold off on getting the umbrella policy until you come out of training. That's not crazy. What I wouldn't do though, is I wouldn't go around with just a $50,000 auto liability policy, just because you got a bunch of debt and your only assets are in your Roth IRA. I think that's foley. There are way too many cars out there driving around that are worth more than $50,000. And that doesn't include the value of the occupants inside the cars.

Dr. Jim Dahle:
At a minimum I would increase your auto liability coverage to several hundred thousand. Even if you don't get the umbrella policy on top of it. I hope that's helpful in making your insurance decisions.

Dr. Jim Dahle:
I got an email today that I think is worth sharing. So, let me read this. I think some of you will be able to relate to this and be instructed by this experience.

Dr. Jim Dahle:
The email reads, “I'm a procedural subspecialist and was diagnosed with a chronic illness during my fellowship. Thankfully as a WCI blog reader from way back, I secured high-quality disability insurance during my intern year from one of the White Coat Investors sponsors well before my diagnosis.

Dr. Jim Dahle:
Because of this diagnosis, I'm likely to need my disability insurance early in my career. I'm in my third year of post-training doing relatively well, all things considered, but I see the writing on the wall.”

Dr. Jim Dahle:
There's a lesson there. You can get something bad even as a resident, even as a young attending. You are not invincible. The time to buy disability insurance is as soon as you start making money. When you're an intern, buy that policy. You might be like this doc and develop something during your training that is going to keep you from being able to buy disability insurance as an attending. That's why you need to buy it as an intern and get the future purchase option. Even if you develop something during your training, you can increase that coverage when you become an attending without having to prove your insurability.

Dr. Jim Dahle:
Now, the reason for the email, I'll go on with. He says, “The claim policy for an accident injury seems very black and white, but claiming for a chronic illness seems much more of a grey area. I'd love to hear a podcast or read a guest post from a physician who's gone through the claim process. I heard you say many times that disability insurance is relatively likely to be used. So, hopefully there are enough out there who've gone through this process. If you could find a few who wouldn't mind anonymously share their story.

Dr. Jim Dahle:
Of course, this is self-serving for me given my situation, but I think it would make for an interesting podcast. And I'm sure there are others in a similar situation out there who would greatly benefit from this. I'm extremely fortunate to have found WCI and listened to your advice early in my training and secured disability insurance before my diagnosis. And for that, I am extremely grateful.”

Dr. Jim Dahle:
Well, you're welcome. It's my pleasure. But I agree that this would be a really interesting podcast. If you are a doc out there who has been through the claim process for a chronic illness for the disability insurance claim process, I'd like to hear your story. And if you can write in [email protected], maybe we can get somebody on the podcast and talk a little bit more about that. I know we've had some attorneys on and insurance agents on in the past, but it would be fun to hear about it from the doctor's perspective.

Dr. Jim Dahle:
All right. Let's take another question on the wash sale rule for donated shares, which I'm not sure that rule exists, but let's listen to the question and see what they're really asking.

Speaker 2:
Hi, Jim, thanks for all you do. My question regards the wash rule and how it applies to donated appreciated shares of stock. If I give X number of shares to a charity and then go buy the same number of shares that day, did I just violate the wash rule, or did I just legally step up my basis? Thanks.

Dr. Jim Dahle:
This is pretty awesome. There is no wash sale when it comes to donating shares to charity. You absolutely can donate appreciated shares, and buy back the same shares that day, the next day, etc. There's no reason you can't do that. Feel free and go ahead.

Dr. Jim Dahle:
It's interesting, one of the other places in tax loss was with cryptocurrency. People were able to tax loss harvest their cryptocurrency, and go back and buy the exact same cryptocurrency. But they're making some law changes that are going to prevent that. In fact, I think that's one of the other things that was in the bill that didn't pass at the end of 2021. But I would expect that one to be back soon. If you need to tax loss harvest your cryptocurrency, I'd get right on that.

Dr. Jim Dahle:
But that was another big gaping loophole in the tax law. And frankly, this is another one. You can donate them, and buy them back the very next day. And so, I do that all the time. I'm donating shares every year to my DAF that I then use for my charitable contributions. And I don't wait at all before I buy the shares right back.

Dr. Jim Dahle:
More often what I find is I'm actually donating something else that I tax loss harvested into. Like right now, my donations have been the iShares total international stock market fund that I tax loss harvested into back in March of 2020. And so, I'm donating those and I'm buying back the Vanguard ETF because I prefer the Vanguard one very slightly. I guess I'm not doing wash sales right now, but there would be nothing wrong with it if I decided to. So, I hope that's helpful.

Dr. Jim Dahle:
PearsonRavitz are disability and life insurance advisors founded by and for physicians. This White Coat Investor recommended agency grew out of OneMD's experience with a career-changing on-the-job injury. Today PearsonRavitz serves the medical community in all 50 states.

Dr. Jim Dahle:
At PearsonRavitz, they help you as a doctor safeguard your most valuable asset, your income so you can protect the most important people in your life, your family. PearsonRavitz makes human connections before they make quotes. Go to pearsonravitz.com today to schedule your consultation with a PearsonRavitz advisor.

Dr. Jim Dahle:
Don't forget, you can still sign up for the conference. We're going to have a great time. I hope you're coming. If you're not, you can still come virtually. It's February 9th through 12th. You can sign up at whitecoatinvestor.com/wcicon22. So, get on that. You can register right up to the last day of the conference if you want. And because what you get as part of that registration is all that content indefinitely, you don't miss anything, even if you sign up the last day. Go ahead and do that if you like.

Dr. Jim Dahle:
Thanks to those who are telling their friends about the podcast and leaving five-star reviews. Our most recent one comes from a pulmonary critical care fellow who said, “Life-changing. I've learned so much from WCI. I have the confidence now to manage my own finances, pay down my debt and invest. I have the insurance protections I know I need, and I've given myself permission to leave the ones I knew were always unnecessary. I sleep better at night knowing I have the right financial plan in place for my family. Thank you for making my journal to financial literacy both easy and entertaining. Five stars.”

Dr. Jim Dahle:
Thank you so much for that. We always appreciate getting praised publicly, just like you do. And of course, any criticism you have, we appreciate getting it privately, just like you do. If there's something you'd like to see changed about the podcast, or anything we do at WCI, please send me an email, [email protected] But if you got praise for us, give us a good review, a nice five-star review. Thank you so much.

Dr. Jim Dahle:
Keep your head up, your shoulders back. You've got this and we can help. See you next time on the White Coat Investor podcast.

Disclaimer:
My dad, your host, Dr. Dahle, is a practicing emergency physician, blogger, author, and podcaster. He’s not a licensed accountant, attorney, or financial advisor. So, this podcast is for your entertainment and information only, and should not be considered official personalized financial advice.