The most common question an investing novice will ask a financial advisor or experienced investor is, “What should I invest in?” While it seems a simple question, it is an attempt at shortcutting an involved process. Following the process leads to a good outcome. Shortcutting it is likely to lead to investing disaster. The process is as follows:
WCI has created rock-solid philosophies around investing since beginning the site in 2011; here’s a summary of those principles.
Many investors, including a sizeable majority of doctors, do not have the interest, knowledge, or discipline to successfully design their own investing plan or manage their own investments. While a person intelligent enough to get into medical school can develop the ability to successfully manage their own investments, they still need to develop enough interest in doing so to be successful. Like with medicine, a commitment to at least a low level of life-long learning is required. In addition, you will need to do some upfront learning that consists of reading, at a minimum, a handful of good investing books.
In addition to some relatively easily acquired knowledge, you will also need to develop the discipline to stay the course with your plan, particularly in bear markets. Throughout his life, the late Jack Bogle, founder of mutual fund giant Vanguard, called “stay the course” the most important investment wisdom he could pass on. Selling low during market downturns, especially if done repeatedly or in the critical few years before or after retirement, can be a financial catastrophe just as serious as a divorce or an early career disability.
If you are concerned you lack the required knowledge, the interest in obtaining it, and/or the discipline to properly manage a portfolio over decades, you would be wise to hire the services of an advisor who offers good advice at a fair price. Many people who call themselves “financial advisors” are really just commissioned salespeople in disguise. They may specialize in selling insurance products, like whole life insurance or annuities, or perhaps investment products such as private REITs or loaded mutual funds. That is not the advisor you want. You want a “fee-only” advisor.
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Many beginning investors feel overwhelmed and don’t know where to start when trying to design and implement their investment portfolio. They feel so helpless with this task that, in retrospect, always seems so easy that they run to a financial advisor for assistance. Unfortunately, some writers suggest as many as 93% of financial advisors are simply salespeople, and, so, many of these naive investors don't get started off on the right foot.
DIY investing can be overwhelming, but you’ve got this. An important principle to remember when designing and implementing your investment portfolio is “Don't Take Shortcuts.” This may seem very basic, but it is frequently skipped, leading to numerous problems down the line in the process of portfolio design.
The process is simple, but it is critical that you take it in order.
Taking things one step at a time, you'll be prepared to design and implement a simple, yet sophisticated investment portfolio yourself—or at least gain the skills and knowledge necessary to know when an advisor is “selling you down the river.”
Most doctors and high-income professionals aren’t financial hobbyists. If given the choice, many would rather outsource all their financial chores to an advisor who would take care of everything for them for a reasonable price. The problem: many advisors charge too much for good advice, or they put you in assets that you don’t want or need. Either way, high-income professionals leave a lot of money on the table and go through life with a sense of unease that they are doing something wrong with their finances.
If that’s true for you, the Fire Your Financial Advisor courses is just what you need. You won’t have to wade through dozens of books, scroll through hundreds of blog posts on dozens of blogs, or check in daily with online forums to try to gain a financial education. For one-tenth the price and half the time of hiring a professional financial planner, this course will take you from feeling anxious to having a written financial plan you can follow the rest of your investing career.
No more feeling clueless about personal finance and investing. No more wasting time and money on stuff that isn’t making you happier. Let’s get rid of your debt and start building wealth to eliminate financial stress from your life. It’s time for you to become the “rich doctor” that your family, friends, and patients already think you are. Then, you can focus on what you really care about—your family, your patients, and making the world a better place than you found it.
Developing a written financial plan is an essential task for anyone interested in being financially successful. This will require you to determine your goals, measure your savings rate, assess the tax-advantaged accounts available to you, select investments, and minimize your investing costs.
The main goals to think about when developing a financial plan are:
If you want to use an advisor temporarily or for your entire life, there is no reason to feel guilty about it—just make sure you are getting good advice at a fair price. We have a list of vetted, recommended firms that offer good advice at a fair price.
There are four main methods of paying for financial advice, and some advisors use two, three, or even all four methods. They are:
Medical school may not have taught you about money, but we will.
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