Every January I do a post telling you about what has been accomplished here at The White Coat Investor over the last year. In my view, the most important thing this post does is extend a great big thank you to both the readers of this site and to its advertisers. So THANK YOU!

Thank You

Over the last 4 1/2 years I have had the opportunity to directly interact with tens of thousands of readers in person, via email, in the comments section of blog posts, by phone, through my books, and even on other internet forums. I have provided valuable information, helped many of you correct financial mistakes, inspired others to reach their financial goals, and generally changed the financial outcome of your lives by hundreds of thousands or perhaps even millions of dollars. All for free or very close to it. However, you have rewarded me by becoming my biggest fans and literally ambassadors of The White Coat Investor brand. The devotion I see from some of you is very fulfilling and extremely valuable. I do very little marketing for either my book or this site because you guys do it for me in the most valuable way possible-word of mouth. Thank you!

I also want to thank the advertisers for a couple of reasons. The most obvious is that the advertisers keep all of the content (well, except the book) completely free to you. There is no subscription fee for the site or the newsletter. Similar newsletters might charge $200 a year. $200 * 6,406 subscribers = $1.3 Million. While that would be nice, I have no doubt I would have a tiny fraction of 6,406 subscribers if I was charging $200 a year. Doctors, especially those who read financial blogs, don’t like paying for stuff even when maybe they should!

While I don’t make $1.3 Million a year off this site, it has provided a very good income for me and, increasingly, others who work for me. While I have not yet reached financial independence, this site has allowed me to be financially independent of medicine (which makes practicing medicine way more fun by the way.) Other than book revenue, that all comes from the advertisers. So I appreciate you supporting those who support me. Frankly, if I wasn’t making at least some money doing this, I probably would have dropped it three or four years ago. My initial goal was to be making $1,000 a month after 2 years or I would quit. I barely made that.

Growth of the Site

The site now consists of 66 pages, 800 posts, and 25,000 comments (not counting 50 times as much spam comments). We had 3.9 Million page views this year, a 44% increase over last year. 2.1 Million people have come to this site in the last 5 1/2 years.  The RSS feed (the number of people reading any given blog post via email or RSS reader) stands at about 3,175. The newsletter has 6,406 subscribers, almost double what it was a year ago.  It has been a wonderful year by any measure. The most popular pages this year were the Doctor Mortgage Loan page and the New To the Blog page. The most widely read blog post this year was the one I did about Utah’s proposed doctor tax. That was read almost 30,000 times and hopefully had a big effect on that tax NOT passing.

The Scholarship

One of the biggest accomplishments for this last year was the awarding of the WCI Scholarship. The revenue for this scholarship came from website profits, many readers, and a number of website sponsors. While I threw in some very inexpensive advertising in exchange for the sponsors’ contributions (allows them to deduct it) I was amazed at just how excited they were to be involved with this revolutionary effort. In case you missed the winning essay, Landon Woolf was the recipient of the $12,625 award. I consider the scholarship a great way to pay forward the success you all have given to me here. My contribution will increase significantly in 2016.

The Mission

The White Coat Investor, LLC has a three-fold mission:

  1. Help those who wear the white coat (and other high-income professionals) get a fair shake on Wall Street. In essence, I’m trying to give you the financial information you never received during your training.
  2. Feed my entrepreneurial spirit. That is to say, make money for me, my family, and my favorite charities and allow me to create as many jobs as possible.
  3. Connect readers with the “Good Guys” in the financial services industry. While not one of my initial goals for this site, I was increasingly asked for recommendations to the point where it was obvious there was a huge gap to be filled.

Competition

For the last couple of years after I ran this State Of The Blog post I was bombarded with emails from readers asking rather detailed questions about how I got started doing this. Apparently the financial success this site has seen was attracting more attention than I really wanted to and I was spawning my own competition. So, after a while I wised up a bit and told these prospective physician financial bloggers that while blogging is collaborative (people have plenty of time to read all the great content that can be produced), making money on the internet was not. So, to those of you thinking about starting a financial blog, I’ll help you as much as I can to fulfill mission # 1, but I’m not going to email you the list of advertising contacts that I’ve been building for years or a step by step history of how I built this business. It’s not like it’s that hard to figure out who’s advertising on my site, and if you just concentrate on helping as many people as you can, the money will come to you anyway.

Financials 

So, with that caveat out of the way, I still plan to be very transparent about both the financials on this blog and more importantly, the conflicts of interest I have dealt with in the last year. So here’s how we did.

[Update January 2019: I decided to remove the financial reports from the State of the Blog posts for the last three years. You can read the reasoning on the January 2019 post.]

That’s over twice as much as last year, and more than 3 times what my family currently spends outside of taxes, charity, savings, and major purchases. For the first time in this blog’s history, I can envision a scenario where we might make less money next year than we made this year, although my expectation is for continued growth of both readership and income. In fact, I’ve got far more ideas than I have time to implement and what I really need to improve on is figuring out how to maintain (or even improve) quality while spending less of my own time on the various required tasks.

Conflicts of Interest

I have always been very big on disclosing my financial conflicts of interest on this site. I’m sure you have noticed the statement at the beginning of every guest post I’ve run and perhaps even the disclosure page that links to another page about my financial conflicts of interest (which now that I look at it probably needs a little updating.) The only way to avoid conflicts of interest around here is to simply do all this for free. Not only am I not willing to do that, but my wife isn’t willing to let me do it either, so we’ll all have to simply settle for sufficient disclosure to allow you to properly evaluate the information found here.

This year, rather than a long list indicating all the companies I have a financial conflict of interest with, I’d like to talk about some of the specific dilemmas I have faced in the last year with regard to these conflicts of interest. For the typical reader, this post gets much less interesting from here on down, so don’t say I didn’t warn you.

# 1 Accepting New Advertisers

Most of the ads you see on the site are private firms who have contacted me and asked to advertise here. Approximately half of those who contact me are turned down as I felt the missions of their companies were simply incompatible with that of The White Coat Investor, LLC. These include a lot of companies who want to lend you money, firms that want to help you invest in currency, options, or other investments that I did not feel comfortable recommending to you, commissioned salesmen masquerading as financial advisors, and a lot of financial advisors who I didn’t think could provide readers with great advice at a fair price. Sometimes I had a problem with the advice, and sometimes I had a problem with the price. However, my incentive is to always accept new advertisers. By turning them down, I’m turning down revenue. But I felt that revenue came at too high of a price- that is, I felt I would lose my most valuable commodity- your trust.

# 2 Doctor Mortgage Loans

One of the most profitable pages on this site lists firms that would like to sell you a doctor mortgage (i.e. <20% down with no PMI.) However, long-term readers know that I never used a doctor mortgage. I simply saved up for a 20% down payment and got a conventional mortgage. So how can I possibly justify listing all these doctor mortgage firms? Well, my justification is two-fold: First, most doctors are better off either paying down student loans or maxing out retirement accounts rather than saving up a downpayment (although I wish they’d live like a resident long enough to do all three at once). Second, you’re all buying instead of renting anyway no matter how often I tell you not to do so until you’re in a stable attending position. So I might as well get you in touch with the folks who can actually close your loan and give you the best rates available for what you’ve decided you’re going to do.

# 3 Recommended Financial Advisors

The page on this site that has caused me the most heartburn over the last year or two is the Recommended Advisor page. As you may recall, I wrote earlier this year about how there is no perfect advisor. Long-term readers know I don’t have a financial advisor, mostly because financial advice is very expensive and I don’t see sufficient value in that relationship for the price I would have to pay. However, it is very obvious to me that the vast majority of physicians (although a smaller percentage of readers of this site) would benefit from having a reasonably priced competent financial advisor. And I am asked for recommendations all the time. Thus, the purpose of the “Recommendations” page. However, the conflict I faced this year was who to list on that page. When I initially made that page 5 years ago, I simply listed a handful of low-cost, index fund-based asset managers I was aware of without ever contacting those firms, much less receiving advertising dollars from them.

Over the years, I have had an increasing number of firms contact me in order to be listed there. It was getting to the point where I didn’t have as much time as I needed to create content because I was spending so much time reading ADV2s, reviewing websites, and communicating via email with potential advertisers. I knew I wasn’t going to list firms that I felt gave bad advice or charged too high of a price. That was an easy decision. What was a hard decision for me, however, was whether or not to remove firms from that list that I thought were good but which were not paying me. In the end, I decided to remove the non-paying firms as I felt it wasn’t fair to those who were paying, and besides, many of those advisors already had as much business as they could handle without shunting clients to their less experienced associates.  Also, in order to decrease the amount of time I was spending evaluating firms, I made a standardized application that I plan to include with each listing so potential clients can see what I think is important for an advisor and see how a given advisor stacks up in those respects.

High above the City of Rocks, Idaho

High above the City of Rocks, Idaho

# 4 No Personal Loans

I had one potential advertiser that wanted to make personal loans to doctors. I turned them down initially. They were very persistent and in the end, I acknowledged that many doctors and dentists required a business loan to open their practice. That was a service they also offered (and with pretty good terms) so I eventually relented and allowed them to advertise. But I had to send their banner back for a revision or two simply because it also mentioned their personal loan product!

# 5 Advisor Lawsuit

One of the advisors that advertises with me is in the midst of a lawsuit with a former client. I spent a long time thinking about whether I should be referring readers to an advisor in that situation, even if I refer patients to doctors being sued all the time. After speaking with both the advisor and the plaintiff’s attorney, I was convinced that not only was the lawsuit probably unwarranted, but that it was unfair to have it discussed on the site where privacy laws and ethical constraints prevented the advisor from responding. I also held comments related to the lawsuit until the suit is complete (at which point I plan to do a post discussing the lessons learned for both clients and advisors, as the only winners in a lawsuit situation are the attorneys.) The advisor also demonstrated some major changes the firm had made to prevent this sort of thing from occurring again. I still felt comfortable referring readers to the firm, but I also made sure that every single reader I referred was aware of both the lawsuit (which, like most suits, will be tied up in the courts for years) and my conflict of interest with the referral.

# 6 Order Listed

In several places on the website, multiple firms that offer the same service are listed. It is obvious that the higher a firm is placed on a list, the more business they are likely to receive. So my dilemma is whether I should list firms by how much they pay me or by some other criteria. These firms ask me what the criteria are and offer more money to be listed higher. In the end, most of the time we decided to list them by how profitable they were to us. This tends to come into effect with affiliate advertising relationships, such as the student loan refinancing companies that advertise here. In one place on the site, I list them by how much they pay me if you refinance through them. However, as you’ll soon see when the forum goes live, in another place I decided to list them in a different order-by how much they pay you if you refinance through them. Dilemmas dilemmas.

# 7 Content Dilemmas

I receive 10-15 offers a week to run “sponsored posts.” That is, a company gives me a payment and I run a post about them that either they write or I write. I have always turned these down. (Although I’m considering running 3 or 4 of them from established advertisers in association with the scholarship fundraising drive next summer- with all of that revenue going toward the scholarship fund.) However, aside from that rather easily avoided conflict of interest, I run into other content-related dilemmas all the time. For example, advertisers always want me to write more about their pet subject- insurance, financial advisors, student loan refinancing, mortgages etc. A bigger dilemma for me occurs with affiliate advertisers (meaning I only get paid if you open an account or refinance a loan with the firm)- the more I write about it, the more money I am likely to make. Consider student loan refinancing- it’s a win for the company, a win for you, a win for me, and even a win for the taxpayer (who gets his money back to lend to someone else.) So, while my incentive is to write about it twice a week, I’m really only writing about it a handful of times a year and usually only when there is something new.

The site redesign had a number of purposes, one of which was to provide a more uniform experience to first time readers. However, one of my other goals with the site design was to make sure new readers all had the opportunity to see the most profitable pages on the site. The prominent Featured Posts space on the “fancy” homepage showcases some of the most profitable posts on the site.

Speaking of student loan refinancing, three years ago nobody was doing it. Then there were only a handful of firms. Over the last year more and more firms have come into the market. When I hear of a new one, I approach them and try to set up an advertising deal with them. It seems like a no-brainer to me for them to advertise here, especially with an affiliate deal. I mean, they don’t have to pay me a thing if they don’t get any business from the site. However, this Fall and Winter I’ve been trying to bring on a new firm. Like many of these guys, they’re a small bank and so the idea of an affiliate advertising relationship is a bit new to them. My dilemma was how long do I wait to tell you about this option (or do I tell you at all) if they keep dragging their feet? Thus far, I haven’t run a post about them (but have allowed readers to discuss them in the comments section) with the thought that “Who’s going to buy the cow when you get the milk for free?” Hopefully, they’ll come on board as an advertiser soon and eliminate my dilemma.

Another student-loan refinancing dilemma came with institution of the new government REPAYE program. The rumor and then eventual implementation of this program kept some student loan refinancers from allowing residents to refinance their loans. (Remember with REPAYE your effective interest rate is lowered during residency, possibly even lower than the rate you can get by refinancing.) So my dilemma was how long do I wait to tell you, dear reader, that it is possible you would be better off going into the government REPAYE program (which pays me nothing) rather than refinancing your student loans (which pays me a lot more than nothing) in July of your intern year? In this case, I decided I needed to let you know about this earlier rather than later, and ran the post 3+ weeks before REPAYE went into effect, about the time it seemed to me that the rumors were likely to actually become reality. I have no idea how much money that has already cost me, or will cost me over the years. The worst part about it is that REPAYE makes the decision so much more complicated. There are still lots of people who would be better off refinancing early in residency, but it’s a lot harder to figure out if you’re one of them!

Conclusion

Once more, thank you very much for being a dedicated WCI reader and/or advertiser. I hope this disclosure and lengthy discussion of my financial conflicts of interest increases your trust in what you are reading here. (Although I suspect I just decreased your trust in everything else you’ve ever read on the web.) The internet is truly The Wild West of entrepreneurship where anything goes if you can get away with it and if your moral code allows it. But as you can see, I had plenty of income BEFORE I ever started this site and don’t have a need to sell you out in order to get a little more. Knowing I’m going to have to reveal my conflicts of interest to you each year helps guide me in doing the right thing throughout the year.

Questions? Did you find that discussion of my conflicts of interest even remotely interesting or was it as boring as it sounded to me when I re-read it? Any suggestions for dealing with my ethical dilemmas? Comment below!