Financial planners

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BAM!

BAM!

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How many of you use financial services planners? I dont, but am starting to wonder if it might be a good idea.
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My fiancé is a tax accountant so he sees the work of financial planners first hand. According to him, most of them have no idea what they are doing and a lot of them make recommendations that are most advantageous for them, rather than most advantageous for you. So, if you are going to hire a financial planner, find a GOOD tax accountant to review the plan and prepare your taxes on a yearly basis.
 
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Most are pretty expense and deceptive.

It's not that difficult to go buy vanguard funds on your own and read a book and/or blog.

But if you want to pay 1 million dollar plus over the course of your career to give you basic information (maybe misinformation), go for it!
 
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I enlisted the help of a financial planner before WCI was a thing. I have not since fired him. Apparently that makes me this forum's biggest stooge.

I think things are pretty square, but I've been meaning to go through all my accounts to see if I'm getting ripped off. If someone could provide me guidance on how to go about doing that, I'd be much obliged.
 
It's reasonable to do it yourself. It is also reasonable to pay someone who gives you good advice at a fair price. Unfortunately, by the time you can recognize good advice you may no longer need it and a fair price is still pretty expensive.

It is a VERY good idea to get a second opinion, whether from an accountant or from another fee-only advisor.

Wilco- If you want a free second opinion (my favorite price but sometimes you get what you pay for), post your plan or your asset allocation on the WCI forum and people can weigh in on it.
 
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White coat investor

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The 1% fee of most financial advisors costs a ton in term of loss potential compound interest.

Literally could be a million dollar over your career. If you can obtain the same knowledge on your own with little time, then why not?

Not to mention, not all other advice from financial advisors is 'good' advice.
 
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SoCuteMD said:
My fiancé is a tax accountant so he sees the work of financial planners first hand. According to him, most of them have no idea what they are doing and a lot of them make recommendations that are most advantageous for them, rather than most advantageous for you. So, if you are going to hire a financial planner, find a GOOD tax accountant to review the plan and prepare your taxes on a yearly basis.
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I have family who are financial planners.
They say tax accountants who give financial advice have no idea what they are talking about.

Haha
 
gman33 said:
I have family who are financial planners.
They say tax accountants who give financial advice have no idea what they are talking about.

Haha
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I assume that is in the similar vein that my hospital's vascular surgeons and interventional radiologists equally accuse each other of incompetence
 
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Let me weigh in here. My dad is a broker, I have been in the financial services industry and personal investing and money management is something that interests me. I think the need for an advisor depends on how complex your financial picture is.

If all your "real" money is sitting in retirement accounts, its easier. If you need help with tax loss harvesting and other time intensive stuff then maybe an advisor is a good idea.

Also, there are some automated options weathfront betterment etc.

Anyways as I was admonishing a friend of mine about this he really got me thinking. He asked if I could mow my own lawn. I said sure, he knew I had someone do it.
 
Most of these folks are salespeople. Tax loss harvesting is not hard. 1099 side income is not hard. IRAs and brokerage accounts are not hard. Vanguard 3 and 4 fund portfolios are not hard.

I am a self taught do it youselfer, having some exposure previously to FPs but finding they were just trying to sell me things.

It takes a little time. Not a lot. Some books. Some google searching and reading sites like bogleheads and WCI to answer specific questions.

I happen to enjoy it all quite a bit and maybe it sounds horrific to you. But unless you own a business or have some sort of international income stream or overseas bank accounts or perhaps run an illegal cartel or gambling ring you do not need to pay for this stuff. My .02
 
gman33 said:
I have family who are financial planners.
They say tax accountants who give financial advice have no idea what they are talking about.

Haha
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He doesn't give financial planning advice. He gives tax planning advice ;)
 
gman33 said:
I have family who are financial planners.
They say tax accountants who give financial advice have no idea what they are talking about.

Haha
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Unfortunately vice versa is also true. The vast majority of "advisors" give relatively poor advice. So first it's about getting good advice and second, getting it at a fair price.
 
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EctopicFetus said:
Anyways as I was admonishing a friend of mine about this he really got me thinking. He asked if I could mow my own lawn. I said sure, he knew I had someone do it.
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Do you pay $30K a year to get your lawn mowed? Lots of docs are paying that to have their finances managed. At the typical price at which most financial advice is offered ($5-30K a year) I feel like I can "mow my own lawn."
 
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EctopicFetus said:
Let me weigh in here. My dad is a broker, I have been in the financial services industry and personal investing and money management is something that interests me. I think the need for an advisor depends on how complex your financial picture is.

If all your "real" money is sitting in retirement accounts, its easier. If you need help with tax loss harvesting and other time intensive stuff then maybe an advisor is a good idea.

Also, there are some automated options weathfront betterment etc.

Anyways as I was admonishing a friend of mine about this he really got me thinking. He asked if I could mow my own lawn. I said sure, he knew I had someone do it.
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Sure but it is cheap to pay someone to mow your lawn with little risk potential.
 
The White Coat Investor said:
Do you pay $30K a year to get your lawn mowed? Lots of docs are paying that to have their finances managed. At the typical price at which most financial advice is offered ($5-30K a year) I feel like I can "mow my own lawn."
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Easy fix. Just get the guy that mows your lawn to also do your finances.
 
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BAM! said:
How many of you use financial services planners? I dont, but am starting to wonder if it might be a good idea.
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Step 1: Pay off all high interest (eg credit card, >10% ARP)
2) Max out 401k
3) Get good accountant
4) : Learn how to dollar cost average. Invest a certain amount in Vanguard, or Fidelity or TD ameritrade fund for S&P500 & total bond market fund. Invest monthly. Kick back and watch the suckers try to outsmart Wallstreet, which does it for a living.
5) REad this book: Physicians GUide to investing. I'm sure Whitecoat's book is good too--has solid advice.
6) Don't get further investing advice from a medical wall. Doc's are terrible with money.

If you have problem with 4-6, then find planner who charges per session, rather than one who doesn't charge but you have to buy stocks through him/her. Trust me on that one.
 
EctopicFetus said:
He asked if I could mow my own lawn. I said sure, he knew I had someone do it.
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You wouldn't pay a physician $150/hr to mow your lawn so why would you mow it yourself? Similarly, a financial advisor might make more sense. Or it might be paying $30k/year to have someone do a mediocre job cleaning your floor when you could have just bought a Roomba...
 
Doctor4Life1769 said:
It's a platform to invest. A roboinvestor. Is it worth it is my Q
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I have been a betterment customer for about 1 year.

Pros:
-all automated for your goals (auto-rebalances, changes risk tolerance as goal approaches, spreads deposits equally over everything, etc.)
-mostly low cost index funds (vanguard)
-tax minimizing tools (free tax loss harvesting, minimizes taxes when your withdrawal, etc.)
-no fee to deposit or withdrawal
-lower fee than financial advisor (0.15% fee for accounts over 100K)

Cons:
-you still need to do reading and overall planning on our own (it's a tool, not a person)
-at it's core it has fees for vanguard funds I could buy on my own
-hard to tell if their fees will remain stable for a long time

Overall it's leagues better than a financial advisor in my opinion. It doesn't try to sell me crap I don't need and has a much lower fee. However, you could probably do everything it is doing on your own with a little more research and a fair amount of time.
 
sum dude said:
Tax avoidance is more important for doctors than investing. Make market rate, don't be greedy, save your money. I promise you will not beat indexes over 30 years, unless you have a rockstar manager who is charging >1.5% and prob. wants $1M buy-in.

But don't listen to me--listen to the Michael Jordan of investing: http://www.ft.com/cms/s/0/946ade3c-f235-11e4-892a-00144feab7de.html#slide0
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Yep....


investment.png
 
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EctopicFetus said:
Let me weigh in here. My dad is a broker, I have been in the financial services industry and personal investing and money management is something that interests me. I think the need for an advisor depends on how complex your financial picture is.

If all your "real" money is sitting in retirement accounts, its easier. If you need help with tax loss harvesting and other time intensive stuff then maybe an advisor is a good idea.

Also, there are some automated options weathfront betterment etc.

Anyways as I was admonishing a friend of mine about this he really got me thinking. He asked if I could mow my own lawn. I said sure, he knew I had someone do it.
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When it comes to deciding whom to hire and when, you should ask not only can you do something, but at what cost when compared with your time.

I can manage all of my accounts in less than 10 hours per year. If I go into primary care, that time will be worth approximately $1,250 if I'd worked instead at $125/hr. Therefore, any advisor that costs me over $1,250 per year is resulting in a net loss of income versus managing things myself.

Now let's look at lawns. If I've got a lawn that takes me half an hour to mow, and I'm mowing it once a week for 36 weeks a year, that comes to 18 hours of work, at a total opportunity cost of $2,250. If I can find a guy to mow my lawn for $35 an hour, that lawn mowing service will cost me a total of $630, for a net savings of $1,620/year. Above a certain income, there are things that are stupid to do yourself (unless you enjoy them) because the opportunity cost is too great.
 
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Mad Jack said:
When it comes to deciding whom to hire and when, you should ask not only can you do something, but at what cost when compared with your time.

I can manage all of my accounts in less than 10 hours per year. If I go into primary care, that time will be worth approximately $1,250 if I'd worked instead at $125/hr. Therefore, any advisor that costs me over $1,250 per year is resulting in a net loss of income versus managing things myself.

Now let's look at lawns. If I've got a lawn that takes me half an hour to mow, and I'm mowing it once a week for 36 weeks a year, that comes to 18 hours of work, at a total opportunity cost of $2,250. If I can find a guy to mow my lawn for $35 an hour, that lawn mowing service will cost me a total of $630, for a net savings of $1,620/year. Above a certain income, there are things that are stupid to do yourself (unless you enjoy them) because the opportunity cost is too great.
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Don't forget to add in taxes and the additional liability. At a 48%+ marginal tax rate, saving money pays surprisingly well!
 
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Mad Jack said:
When it comes to deciding whom to hire and when, you should ask not only can you do something, but at what cost when compared with your time.

I can manage all of my accounts in less than 10 hours per year. If I go into primary care, that time will be worth approximately $1,250 if I'd worked instead at $125/hr. Therefore, any advisor that costs me over $1,250 per year is resulting in a net loss of income versus managing things myself.

Now let's look at lawns. If I've got a lawn that takes me half an hour to mow, and I'm mowing it once a week for 36 weeks a year, that comes to 18 hours of work, at a total opportunity cost of $2,250. If I can find a guy to mow my lawn for $35 an hour, that lawn mowing service will cost me a total of $630, for a net savings of $1,620/year. Above a certain income, there are things that are stupid to do yourself (unless you enjoy them) because the opportunity cost is too great.
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This only works under the assumption that you are going to work with all of your additional free time, which is generally not the case. Most people will keep their standard shift load and eat cheesy poofs on their couch while someone mows their lawn each week. Some may do it though.
 
goodoldalky said:
This only works under the assumption that you are going to work with all of your additional free time, which is generally not the case. Most people will keep their standard shift load and eat cheesy poofs on their couch while someone mows their lawn each week. Some may do it though.
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It isn't how one should look at everything, but it is how one should look at tasks that they view as work. You can pay off the guy mowing your lawn by putting in an extra 10 minutes of work a week, basically by seeing one extra patient, which means the effort involved is essentially not worth your time, as you could pay the guy off by working one extra 6 hour shift per year to never have to worry about your lawn. You may choose to enjoy your cheesy poofs, but when it comes to finances, the savvy amongst us aren't lazy cheesy poof eaters- we break things down analytically, to find the best way to deal with something from a financial perspective. If you can hire a maid and a lawn care guy, and all you'll have to do is pick up two extra weekend shifts for the entire year to not impact your bottom line while simultaneously freeing up well over a work week's worth of time, why not?

I can't convince you to value your time at what it is worth, however. Only you can tell yourself your time is worthwhile.
 
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Mad Jack said:
It isn't how one should look at everything, but it is how one should look at tasks that they view as work. You can pay off the guy mowing your lawn by putting in an extra 10 minutes of work a week, basically by seeing one extra patient, which means the effort involved is essentially not worth your time, as you could pay the guy off by working one extra 6 hour shift per year to never have to worry about your lawn. You may choose to enjoy your cheesy poofs, but when it comes to finances, the savvy amongst us aren't lazy cheesy poof eaters- we break things down analytically, to find the best way to deal with something from a financial perspective. If you can hire a maid and a lawn care guy, and all you'll have to do is pick up two extra weekend shifts for the entire year to not impact your bottom line while simultaneously freeing up well over a work week's worth of time, why not?

I can't convince you to value your time at what it is worth, however. Only you can tell yourself your time is worthwhile.
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You sound like the person who says they financed their new car instead of paying cash due to the "opportunity cost of money", arguing that they will invest the $400 a month and obtain better returns on the money. Which can in theory be true, except that literally no one ever does this.

If you actually do these things, then of course the logic is sound. But the majority of people do not.
 
goodoldalky said:
You sound like the person who says they financed their new car instead of paying cash due to the "opportunity cost of money", arguing that they will invest the $400 a month and obtain better returns on the money. Which can in theory be true, except that literally no one ever does this.

If you actually do these things, then of course the logic is sound. But the majority of people do not.
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Op asked a finance question though- you're going to end up with a more financially disciplined crowd answering financial questions. You can take or leave the advice, that's on you. And regardless of whether you work more to make up for certain expenses, the time/value equation still holds true in regard to what you should find a valuable use of your free time, as your free time is worth far more than the average individual since you could be making far more money during it, and the amount you'd have to spend to protect that free time is a far smaller fragment of your overall income.

Regardless, doing your finances yourself both saves you substantial amounts of money in the short term and makes you far more money in the long term if you use low-fee mutual funds and ETFs. Financial advisors are generally all-around poor decisions.

Estate planners, on the other hand, can be a lifesaver for those that depend on you. That's one financial service I wouldn't knock if you have a substantial net worth.
 
I do not use a financial adviser.

I get phone calls a couple times a month from advisers offering their services (have turned them down but they keep calling).

Have read their brochures but honestly don't see what I'm missing. It's basic math and quick internet research. I doubt any adviser would make a better return to cost ratio than a simple ETF porfolio, certainly not using high-cost funds and 1% AUM.

I also mow my own lawn and change the oil/brakes/timing-belt/general maintenance/etc on my car/motorcycles. Why? Because I don't trust someone else to do it and it's way easier/quicker for me to just do it myself rather than having to get someone to drive me to a shop, wait around, be car-less for a day, etc.
 
e30ftw said:
I do not use a financial adviser.

I get phone calls a couple times a month from advisers offering their services (have turned them down but they keep calling).

Have read their brochures but honestly don't see what I'm missing. It's basic math and quick internet research. I doubt any adviser would make a better return to cost ratio than a simple ETF porfolio, certainly not using high-cost funds and 1% AUM.

I also mow my own lawn and change the oil/brakes/timing-belt/general maintenance/etc on my car/motorcycles. Why? Because I don't trust someone else to do it and it's way easier/quicker for me to just do it myself rather than having to get someone to drive me to a shop, wait around, be car-less for a day, etc.
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Clearly you don't drive a fancy car!

I only say that because some of my co-res have fancy BMers, Benzs, Audis and they inform me that when they get their cars checked out, they are offered a nice rental in return.
 
Mad Jack said:
It isn't how one should look at everything, but it is how one should look at tasks that they view as work. You can pay off the guy mowing your lawn by putting in an extra 10 minutes of work a week, basically by seeing one extra patient, which means the effort involved is essentially not worth your time, as you could pay the guy off by working one extra 6 hour shift per year to never have to worry about your lawn. You may choose to enjoy your cheesy poofs, but when it comes to finances, the savvy amongst us aren't lazy cheesy poof eaters- we break things down analytically, to find the best way to deal with something from a financial perspective. If you can hire a maid and a lawn care guy, and all you'll have to do is pick up two extra weekend shifts for the entire year to not impact your bottom line while simultaneously freeing up well over a work week's worth of time, why not?

I can't convince you to value your time at what it is worth, however. Only you can tell yourself your time is worthwhile.
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I can't remember which book I'd read, but it's underlying message resonates with your message.
 
Doctor4Life1769 said:
Clearly you don't drive a fancy car!

I only say that because some of my co-res have fancy BMers, Benzs, Audis and they inform me that when they get their cars checked out, they are offered a nice rental in return.
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Your co-residents drive BMWs, Benz's and Audi's? That's insane. Also makes me feel a little less guilty about paying for the Honda with leather, lol.
 
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TimesNewRoman said:
Your co-residents drive BMWs, Benz's and Audi's? That's insane. Also makes me feel a little less guilty about paying for the Honda with leather, lol.
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Some.

Ya I'm happy with my Toyota

Fancy cars aren't assets, they're liabilities.

I'm interested in some of yalls take on leasing cars. I don't do this and generally everything I've read shows it's a waste, but I see plenty of physicians and lawyers, business folks doing this.
 
Doctor4Life1769 said:
Some.

Ya I'm happy with my Toyota

Fancy cars aren't assets, they're liabilities.

I'm interested in some of yalls take on leasing cars. I don't do this and generally everything I've read shows it's a waste, but I see plenty of physicians and lawyers, business folks doing this.
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There are plenty of MDs and JDs with $200k+/y salary but low net worths because of terrible choices, I just don't get it. Just save your money, it's not that hard. I'm more debt averse than most (thanks, Dave Ramsey), so I'm more focused on paying off student loans than saving for retirement. We're still maxing my wife's matched retirement, but every penny beyond that goes to paying off student loans. I've paid off nearly 80k while in residency. Although I know I'm not saving for retirement yet, I figure if my wife and I can put 40% of our net (plus nearly all of my extra moonlighting money) to student loans, 20% of a much higher salary directly to a 401K shouldn't be that hard.

I think it was WCI that recently said "stop leasing cars, that's what poor people do."

Seriously, any time I hear an attending giving me financial advice, I nod and smile then remember to do exactly the opposite. Whether it is people telling me the benefits or an ARM mortgage, letting my student loans ride so I can invest, lease a car, using a "great" financial advisor, etc.

Keep it simple. Marry a frugal spouse and stay married. Keep your fixed expenses low. Be compulsive about paying off your student loans. Have an emergency fund. Pay cash for everything but your home. Get a fixed rate mortgage (preferably 15y). Don't be house poor or car poor. Max retirements and put them on auto-deduct.

http://www.nbc.com/saturday-night-live/video/dont-buy-stuff/n12020
 
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TimesNewRoman said:
There are plenty of MDs and JDs with $200k+/y salary but low net worths because of terrible choices, I just don't get it. Just save your money, it's not that hard. I'm more debt averse than most (thanks, Dave Ramsey), so I'm more focused on paying off student loans than saving for retirement. We're still maxing my wife's matched retirement, but every penny beyond that goes to paying off student loans. I've paid off nearly 80k while in residency. Although I know I'm not saving for retirement yet, I figure if my wife and I can put 40% of our net (plus nearly all of my extra moonlighting money) to student loans, 20% of a much higher salary directly to a 401K shouldn't be that hard.

I think it was WCI that recently said "stop leasing cars, that's what poor people do."

Seriously, any time I hear an attending giving me financial advice, I nod and smile then remember to do exactly the opposite. Whether it is people telling me the benefits or an ARM mortgage, letting my student loans ride so I can invest, lease a car, using a "great" financial advisor, etc.

Keep it simple. Marry a frugal spouse and stay married. Keep your fixed expenses low. Be compulsive about paying off your student loans. Have an emergency fund. Pay cash for everything but your home. Get a fixed rate mortgage (preferably 15y). Don't be house poor or car poor. Max retirements and put them on auto-deduct.

http://www.nbc.com/saturday-night-live/video/dont-buy-stuff/n12020
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I agree.
People always want the nicest cars, the latest iPhone, the latest Apple Watch or cool gadget out there.
I already have a few classmates who recently signed with practices who have now bought a house. I think I'm the only one who is staying in my 1 bed/1bath apartment after residency. I was asked if I needed a real estate agent or if I wanted information on their housing area to buy and I told them I wasn't going to buy and it certainly had them caught off guard.

I haven't been as aggressive with paying down my loans - I have been more focused on saving, creating an emergency fund of 12 months, putting some money into the Roth. I am confident that I can pay off my loans in 5 years or less. I'm single and don't plan to get married anytime soon. No kids and no plans to have one any time soon. I did get a financial advisor for my own disability insurance and that's it. I've recently been moonlighting for the extra source of income to put into savings/emergency account/Roth.
 
I've used financial planners and never been very impressed. Vanguard or Fidelity mutual funds are not that complicated and they have plenty of managed account options that are low cost and fairly hands off and painless.

I think balance is key. It's difficult to justify living a sybaritic lifestyle fresh out of residency. That being said... most of us sacrificed over a decade of our lives for advanced learning and self sacrifice to get to this point. We above all specialties should be the most in tune with our own mortality. After living like a resident for a few years after residency, I then finally decided to just enjoy life...within reason. I have no idea when my number might be up or God might call me home. Most of us all know at least one physician or colleague who has died unexpectedly and at a relatively young age. I honestly have a hard time picturing myself in my 80s and am convinced something terrible will happen to me well before I reach that point. That being said, I save, I pay down debt aggressively but I've decided not to save much for retirement until I pay off my high interest loans (at which point I'll dump an equal amount to retirement). I bought a nice house and I'll fully admit that it's too big for me. You know what though? I like it and it makes me happy. I have a nice watch and I have a nice car. I also like having some of the latest gadgets. I've started going on more vacations and like to splurge for a nice trip at least 3 times a year. I don't think that's financial suicide and I consider that just part of trying to live and enjoy life. Hell, I'm in my 40s now and if I lived in a 1 bedroom apartment saving every dime I earn and working as many hours as I could to pay down X or save for Y, I'd have a heart attack in 5 years. Just enjoy your life. Enjoy your relationships and loved ones. Work on your personal life, but don't punish yourself and lose out on some of the most valuable years of your life in the name of maximum financial gain. There's no reason to have a warped sense of guilt when you decide to enjoy some of the benefits from all those years of sacrifice and hard work. You've earned it.
 
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My dad considers it a hobby, and my sister has a MBA and is in corporate finance. I do my own taxes, but I have a guy I can run things by if I need to. (As in, would it be better to get an energy credit with new windows, or max out a 457 if I had an extra $15K... Survey says... hell, just do both. And I did.) But mostly, it is becoming a hobby for me too. A hobby where I put money in and leave it the hell alone, mostly.

I love index funds. Especially the Admiral class at Vanguard. Opened my individual 401K this year, and will have my student loans paid off soon. Oh, so soon. It's killing me... just... want... them... gone! (15K to go, but have that pesky estimated tax payment coming up, so I am restraining myself.) At that point, will only have a mortgage, as well as 1 on a rental, which will sell in the next 2 years for a tidy profit (staying within the 2 of 5 years primary residence clause.)

So no, I don't have a financial planner, per se.
 
Car lease may work in your favor. Visit leasehacker if your lease to cost ratio is greater then 10 yrs and you wouldn't keep the car that long anyways it may make sense

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Groove said:
I think balance is key. It's difficult to justify living a sybaritic lifestyle fresh out of residency. That being said... most of us sacrificed over a decade of our lives for advanced learning and self sacrifice to get to this point. We above all specialties should be the most in tune with our own mortality. After living like a resident for a few years after residency, I then finally decided to just enjoy life...within reason. I have no idea when my number might be up or God might call me home. Most of us all know at least one physician or colleague who has died unexpectedly and at a relatively young age. I honestly have a hard time picturing myself in my 80s and am convinced something terrible will happen to me well before I reach that point. That being said, I save, I pay down debt aggressively but I've decided not to save much for retirement until I pay off my high interest loans (at which point I'll dump an equal amount to retirement). I bought a nice house and I'll fully admit that it's too big for me. You know what though? I like it and it makes me happy. I have a nice watch and I have a nice car. I also like having some of the latest gadgets. I've started going on more vacations and like to splurge for a nice trip at least 3 times a year. I don't think that's financial suicide and I consider that just part of trying to live and enjoy life. Hell, I'm in my 40s now and if I lived in a 1 bedroom apartment saving every dime I earn and working as many hours as I could to pay down X or save for Y, I'd have a heart attack in 5 years. Just enjoy your life. Enjoy your relationships and loved ones. Work on your personal life, but don't punish yourself and lose out on some of the most valuable years of your life in the name of maximum financial gain. There's no reason to have a warped sense of guilt when you decide to enjoy some of the benefits from all those years of sacrifice and hard work. You've earned it.

Kind of a tangent, but back on topic... I've used financial planners and never been very impressed. Vanguard or Fidelity mutual funds are not that complicated and they have plenty of managed account options that are low cost and fairly hands off and painless.
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Amen! I will be aggressive with loan repayment and retirement saving, but I am going to have fun with my money now while I am young instead of dying with millions of dollars. When I'm 80 I'll probably only need a couple of grand a month to pay for the nursing home and buy treats for the grandkids. I'll be damned if I went through all of this training to drive a piece of crap car or live in a studio apartment. Use your money to do fun things while you can enjoy it, but do it responsibly.
 
TimesNewRoman said:
There are plenty of MDs and JDs with $200k+/y salary but low net worths because of terrible choices, I just don't get it. Just save your money, it's not that hard. I'm more debt averse than most (thanks, Dave Ramsey), so I'm more focused on paying off student loans than saving for retirement. We're still maxing my wife's matched retirement, but every penny beyond that goes to paying off student loans. I've paid off nearly 80k while in residency. Although I know I'm not saving for retirement yet, I figure if my wife and I can put 40% of our net (plus nearly all of my extra moonlighting money) to student loans, 20% of a much higher salary directly to a 401K shouldn't be that hard.

I think it was WCI that recently said "stop leasing cars, that's what poor people do."

Seriously, any time I hear an attending giving me financial advice, I nod and smile then remember to do exactly the opposite. Whether it is people telling me the benefits or an ARM mortgage, letting my student loans ride so I can invest, lease a car, using a "great" financial advisor, etc.

Keep it simple. Marry a frugal spouse and stay married. Keep your fixed expenses low. Be compulsive about paying off your student loans. Have an emergency fund. Pay cash for everything but your home. Get a fixed rate mortgage (preferably 15y). Don't be house poor or car poor. Max retirements and put them on auto-deduct.

http://www.nbc.com/saturday-night-live/video/dont-buy-stuff/n12020
Click to expand...

The beautiful thing about your approach is that no one can argue it isn't going to work. It is. I'm pretty impressed with paying off $80K in residency. I don't know that I made much more than $80K in residency. I think the salary was $34K the year I applied.
 
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