Menu

Physician Finance Basics

Home Physician Finance Basics Replies Created

Avatar
Message me
You have new message! Physician Finance Basics

Forum Replies Created

  • Avatar Physician Finance Basics 
    Participant
    Status: Physician
    Posts: 37
    Joined: 06/02/2019
    Splash Refinancing Bonus

    Your timing may be a bigger issue than your house budget. In a couple of (or few) years, you can easily spring for that $1M house, if that’s what you still want. Once you finish training and actually start earning, you realize how many competing needs there are for your cash. Also, the realities of the job sink in. You will be in a much better position to decide at that time.

    Blogging and videocasting about the basics of personal finance at http://physicianfinancebasics.com

    in reply to: How much house? #233728 Reply
    Avatar Physician Finance Basics 
    Participant
    Status: Physician
    Posts: 37
    Joined: 06/02/2019

    I really appreciate the feedback so far!!

    There seems to be a general consensus, regarding bond funds, to locate them in tax deferred.. This is interesting to me.  I have seen other sources to suggest doing this strategy as well.

    However, I believe that WCI had a blog that suggested the best approach was to place bonds into taxable brokerage account (as municipals), 100%.  I had a feeling that many would suggest this – but it seems that, on the contrary, many think that placing them into tax protected accounts is more advantageous.

    At the end of the day, it is probably splitting hairs anyway – I do appreciate the input nonetheless!

    Dean

    Click to expand…

    You are correct. If you want to put bonds in taxable (which is fine, if your tax-advantaged space is full or if that’s what you choose to do)- make them municipal bond funds to take advantage of the tax-break (for eg., VG Intermediate Term Tax-exempt Bond Fund). If you are putting your bonds in tax advantaged space, stay away from tax-exempt bonds.

    Blogging and videocasting about the basics of personal finance at http://physicianfinancebasics.com

    in reply to: Asset location advice… #232839 Reply
    Liked by deanyar
    Avatar Physician Finance Basics 
    Participant
    Status: Physician
    Posts: 37
    Joined: 06/02/2019

    -Car loan please. Like WCI says, you cant really call yourself wealthy while still paying off a car note.

    -Beyond that, no one right answer. As long as you’re putting it towards wealth-building (and some towards what brings you happiness), you’re good. Split the difference between front-loading 529s, mortgage payoff and taxable, if you can’t decide on one route.

    Blogging and videocasting about the basics of personal finance at http://physicianfinancebasics.com

    in reply to: Best direction for extra cash #232683 Reply
    Avatar Physician Finance Basics 
    Participant
    Status: Physician
    Posts: 37
    Joined: 06/02/2019
    • Not exactly a financial mistake, but has financial consequences: we always ask how the clients rate their job satisfaction on a scale of 1 to 10. Several times, a low rating is due to not being happy with their specialty, sometimes considering to go back into residency. I have no idea how to remedy this – do any of the physicians here have thoughts? Would some kind of mentoring system help?
    Click to expand…

    It may not be the specialty after all, but how it begins to feel under the physician’s current circumstances…. work environment, colleagues, reimbursement, autonomy. How many times through our schooling did we fall in or out of love with history or math or biology just because of the teacher or the study group…

    Blogging and videocasting about the basics of personal finance at http://physicianfinancebasics.com

    in reply to: Question for advisors: The Norm? #232579 Reply
    Avatar Physician Finance Basics 
    Participant
    Status: Physician
    Posts: 37
    Joined: 06/02/2019

    I have an overall financial (allocation) plan that overall consists of 55% US stocks (small cap tilted), 20% international stocks (which includes 5% emerging markets), 20% fixed/bonds, and 5% REIT (all in index funds of course).

    Click to expand…

    List your mutual funds/ETfs by Tax Efficiency and go from least tax efficient to most efficient as Roth –> Tax Deferred –> Taxable. Once you’ve placed your tax-inefficient holdings, the rest can go wherever there is room.

    Tax Inefficient:

    REITs

    Bond funds

    Moderately Efficient:

    Small caps

    Emerging Market

    Tax Efficient:

    Total Intl

    Total Stock Market

    Muni bonds

    -Small caps may not be very tax efficient but the frequent gyrations do lend themselves to TLH

    -One reason to place TISM in taxable is the Foreign Tax Credit

    Blogging and videocasting about the basics of personal finance at http://physicianfinancebasics.com

    in reply to: Asset location advice… #232575 Reply
    Liked by deanyar
    Avatar Physician Finance Basics 
    Participant
    Status: Physician
    Posts: 37
    Joined: 06/02/2019
    • Contribute lump sum of cash directly from my checking account to the solo 401k. This is where I am confused, how do I elect which portion of my contribution is myself as the “employee” and which part is myself as the “employer”?
    Click to expand…

    If you do not have any other employer sponsored retirement account where you contribute as an employee- you will contribute to your solo k as both employee and employer, like you said. It doesn’t matter how you break up the contribution, as long as you are following the limits. I put in $19k as employEE first. Anything over that amount that I want to contribute, goes in as employER contribution.

    Blogging and videocasting about the basics of personal finance at http://physicianfinancebasics.com

    in reply to: Opening a Solo 401k – logistics #232236 Reply
    Avatar Physician Finance Basics 
    Participant
    Status: Physician
    Posts: 37
    Joined: 06/02/2019

     I have been doing that since my teens and it takes less than 5 mins.

    Click to expand…

    I think that’s key… if it’s a habit you acquired when young, it is no big deal at all (like many other tedious jobs in life). If you grew up in India, it was the way to go, that’s what everyone did. The buttons, after all, were the weakest link in an apparel. And it has stood you in good stead all your life.

    Blogging and videocasting about the basics of personal finance at http://physicianfinancebasics.com

    in reply to: Making Do #231501 Reply
    Liked by Kamban
    Avatar Physician Finance Basics 
    Participant
    Status: Physician
    Posts: 37
    Joined: 06/02/2019

    If simply looking for a high yield savings account, any reason not to take advantage of this? Would it screw up taxable investing tax loss harvesting?

    https://www.businessinsider.com/wealthfront-high-yield-savings-return-growth-calculation-2019-7

    Click to expand…

    No reason. Not connected with the investing account. Keep in mind though the interest rate may fall if fed keeps cutting rates.

    Blogging and videocasting about the basics of personal finance at http://physicianfinancebasics.com

    in reply to: The SEC and Wealthfront #231499 Reply
    Avatar Physician Finance Basics 
    Participant
    Status: Physician
    Posts: 37
    Joined: 06/02/2019

    $5 on $25 gift card. no brainer. literal free money.

    Done! Thanks for the info

    Blogging and videocasting about the basics of personal finance at http://physicianfinancebasics.com

    in reply to: Amazon Prime! #230999 Reply
    Liked by Peds
    Avatar Physician Finance Basics 
    Participant
    Status: Physician
    Posts: 37
    Joined: 06/02/2019

    I agree 100%. Just had such a VIP for an “emergent” MRI of the spine here today (just the 3rd in 3 months) which to obtain “overnight” we bent over backwards x3. Local VIP with lung cancer but the poor oncologist can barely treat his inoperable cancer because his concierge PCP has consulted everybody and their brother and they are all doing  the maximum possible (orthopod is getting ready to kypho his metastatic thoracic vertebral body pathological fracture, pulmonologist gives steroids which prohibit part of the immuno/chemotherapy he should have gotten, PCP orders CT scans every other week which prompt a change in direction). None of the involved follows the usual order of events – all in an attempt to facilitate and accelerate treatment but it is working not in favor of consistent treatment.

    Click to expand…

    this is so sad

    Blogging and videocasting about the basics of personal finance at http://physicianfinancebasics.com

    in reply to: VIP syndrome, treating colleagues, staff etc. #230996 Reply
    Liked by Zaphod, Anne, ENT Doc
    Avatar Physician Finance Basics 
    Participant
    Status: Physician
    Posts: 37
    Joined: 06/02/2019

    I opened that Solo 401k with just my SS# as I was told that would be ok.

    Click to expand…

    Are you doing business with your SSN (sole proprietor) or with an EIN (SP/LLC)? I would imagine you would use the same.

    Can i just write a personal check from our checking account to TD Ameritrade with the Solo 401k account number on it and be good?

    If you have a business account, transfer the money from there to keep things clean. If you don’t, can use a personal account. Why a check? I do Electronic funds transfer for everything of this nature.

    I plan to remove the 7.65% SE tax and about 3/4 of my average annual expenses to be safe and contribute again once I know my final taxable earning for 2019.

    You can contribute on any schedule, if you are not paying trading fees: biweekly, monthly, q3/6 months. Use an online calculator to calculate contribution amount. I find the Oblivious Investor Solo 401k calculator pretty accurate. It is better to undershoot that overshoot. Remember, contributon deadline for 2019 is all the way upto Apr 15, 2020- so you can make up any shortfall.

    Blogging and videocasting about the basics of personal finance at http://physicianfinancebasics.com

    Avatar Physician Finance Basics 
    Participant
    Status: Physician
    Posts: 37
    Joined: 06/02/2019

    Are you jealous when a Medicaid patient comes in with a better version of the iPhone than you have?

    Click to expand…

    I went in to the ER at the hospital I work with my daughter for her fractured forearm. My phone was out of charge. And no one had a charger for the iphone 4. They’d moved on to 7, I believe, at the time. The nurse asked, “what happened, doc?” (as in, what are you still doing with a 4?)

    Blogging and videocasting about the basics of personal finance at http://physicianfinancebasics.com

    in reply to: Mr. Jones' truck #230664 Reply
    Avatar Physician Finance Basics 
    Participant
    Status: Physician
    Posts: 37
    Joined: 06/02/2019

     Would it cost him much to have the office set up a 401k? I don’t know. I was funding a self SEP IRA for the last 19 years so the 401k world is foreign to me.

    Click to expand…

    Yes, there are costs to establishing a small group 401k/Profit sharing. It’s not as simple as opening a Solo 401k at your favorite brokerage. The practice would need to hire a small group retirement advisor. The savings are not just for the employees but also for the practice owners. That is what we see in our small group, being owners… the tax benefit far outweighs the cost of contributing to employees and maintaining the plan. Depends on practice demographics, though. Talking to an ERISA advisor will give you an illustration of cost/benefit- practice owner can then take the decision.

    Blogging and videocasting about the basics of personal finance at http://physicianfinancebasics.com

    in reply to: And there goes the Stretch IRA?? #230527 Reply
    Liked by Tim
    Avatar Physician Finance Basics 
    Participant
    Status: Physician
    Posts: 37
    Joined: 06/02/2019

    Thanks for all your advise. I did not purchase or sell any stock in the last 6-8 years and almost all of the stocks in my current portfolio have been purchased around the 2010-2011 time frame. I do have a nack for not selling and turning winners in to losers as I don’t follow the market closely to the point there were times I did not log in to my brokerage account for a year and only logged to get the tax statement.

    Click to expand…

    You are just a busy physician- most docs around me are this way. Hence the utility of index funds. Set and forget.

    I will be selling both losers and winners in the next few days but should I leave it in cash until there is a mini correction or move it to index funds immediately understanding the market is at all time high?

    I’d recommend put it all in. Unless your risk tolerance can’t take it and you will pull out in a bad correction. In that case, put it in bits over a pre-determined period of time- better than panic selling.

    We can potentially buy a smaller stand alone property in the 2M range for just the practice or have a bigger property to be owner occupied while renting the rest of the space.

    Click to expand…

    I wonder how much of a headache it will be to find and manage commercial tenants. Being landlord for residential properties is hard enough. Especially with your busy practice (has to be… >$1M in income is a lot of hours). A smaller place enough with enough room for your own practice to grow and thrive may be easier financially and otherwise. JMHO

    We are planning on funding their 529 10-15K each year. We are considering funding another $15K each in some sort of an investment account for them but I like them not to have control of that account until they turn 25 atleast. I dont know if there is a vehicle like that.

    Click to expand…

    With the 529, you are the account holder and retain control. With a UTMA account, they are the owner and attain control at 18 yo.

    Blogging and videocasting about the basics of personal finance at http://physicianfinancebasics.com

    in reply to: Guidance #230482 Reply
    Liked by Peds
    Avatar Physician Finance Basics 
    Participant
    Status: Physician
    Posts: 37
    Joined: 06/02/2019

    It’s wonderful you’ve taken the first steps towards righting the course! And congratulations on the income.

    1) You can put the $15k each in their 529s. You can put in more, too, if you want- since 529s can be front-loaded for 5 yrs. If you don’t want to do that, you can open a UTMA account for each of them.
    2) Would you consider starting your investing career in commercial RE at a lower price point? You had mentioned in your first post that you are thinking in the $5M range. There is a steep learning curve to RE investing and smaller projects may cause less expensive mistakes.
    3) One safe bet is to start with the recommendations on this website. Or ask on the thread.
    4) Wise. Ask away, that’s what this forum is for!
    5) Not a bad idea. Cut your losses and move on. Many of us have done that many times over :)… Your losses will bring down your tax bill this yr too. Figure out your desired asset allocation first and go for it! With financial discipline and that great income, you’ll do awesome with a 3 fund portfolio. BTW, re: “evidently I suck at picking stocks”, you’re the norm, not the exception.

     

    Blogging and videocasting about the basics of personal finance at http://physicianfinancebasics.com

    in reply to: Guidance #230438 Reply
Notifications Mark all as read  |  Clear