Thoughts on 457 plans

[Jcm800]

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I am scared to invest in mine as it is not creditor protected, only transferable to other Institutional 457 plans. And I expect all of healthcare to essentially fold in 15 years. So I don’t find it. I max my 403b and get the max, but have just avoided the 457. Thoughts, oh financial gurus?

 

[DOctorJay]

Not saying I’m a guru but if you’re at all concerned about the health of your hospital and feel it could potentially go bankrupt before you leave then don’t put your money in the 457.


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[paindoc007]

Not saying I’m a guru but if you’re at all concerned about the health of your hospital and feel it could potentially go bankrupt before you leave then don’t put your money in the 457.


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yes, yes, and yes. No way I’d let my hospital have access to my funds, ever.

Once you’ve maxed out your 403 and ira, a good bet to go with is a variable annuity. Avoid fixed annuities. Just do your homework on reputable ones

 

[deleted131481]

I have a 457 but am at a state supported academic center. I agree with DoctorJay's comment.

I'd humbly disagree on any kind of annuity due to fees and complexity. 403 --> backdoor roth (and spouse if you have one) --> 529 --> taxable account

Stick with simple index funds.

 

[Jcm800]

I have a 457 but am at a state supported academic center. I agree with DoctorJay's comment.

I'd humbly disagree on any kind of annuity due to fees and complexity. 403 --> backdoor roth (and spouse if you have one) --> 529 --> taxable account

Stick with simple index funds.

My approach has been I don’t trust the longevity of any hospital system, and therefore have never funded the 457. But I was wondering if I was being too paranoid. I am firm believer in index funds. Primarily the s and p index funds.

 

[paindoc007]

I have a 457 but am at a state supported academic center. I agree with DoctorJay's comment.

I'd humbly disagree on any kind of annuity due to fees and complexity. 403 --> backdoor roth (and spouse if you have one) --> 529 --> taxable account

Stick with simple index funds.

Definitely need to do your homework, can’t blindly sign up for an annuity, or you’ll get crushed w fees and surrender charges. For more experienced investors. To be a simpleton, I agree w the above. Stick with simple index funds, s&p500, and other large cap blue chip stocks.

 

[lonelobo]

I think there are many better options for your investment dollar than an annuity especially if you are under 60 yo.

 

[DOctorJay]

My approach has been I don’t trust the longevity of any hospital system, and therefore have never funded the 457. But I was wondering if I was being too paranoid. I am firm believer in index funds. Primarily the s and p index funds.

are you familiar with JL Collins? I think you'd appreciate his take on investing. He's the author of The Simple Path to Wealth. His website has essentially all the info that's in the book.

Stock Series

If you are wondering whether to dive in, give a couple posts a quick read. You’ll capture the blog’s essence. If after reading those The Stock Series is appealing, you will very likely enjoy it all. If by the same token your reaction is, “This doesn’t feel right for me,” it very likely isn’t...

jlcollinsnh.com

 

[paindoc007]

I think there are many better options for your investment dollar than an annuity especially if you are under 60 yo.

For high income earners? Like what?

 

[deleted131481]

For high income earners? Like what?

Like simple index funds... for both 'simpleton' and experienced investors, high net worth or low net worth. Why would one get a better deal from an insurance company charging several % in fees that takes your money and then invests it vs you investing in an index fund?

Variable Annuity

A variable annuity is a retirement vehicle with one part that is a self-directed investment and another that is fixed. Consider whether it makes sense for you.

www.thebalance.com

 

[paindoc007]

Like simple index funds... for both 'simpleton' and experienced investors, high net worth or low net worth. Why would one get a better deal from an insurance company charging several % in fees that takes your money and then invests it vs you investing in an index fund?

Variable Annuity

A variable annuity is a retirement vehicle with one part that is a self-directed investment and another that is fixed. Consider whether it makes sense for you.

www.thebalance.com

Annuity gets a bad name bc of ppl not doing their homework and getting hammered on fees. I have a great low few annuity for tax deferred growth. Great way to diversify. I also do index funds and other things too. To each his own though

 

[Jcm800]

are you familiar with JL Collins? I think you'd appreciate his take on investing. He's the author of The Simple Path to Wealth. His website has essentially all the info that's in the book.

Stock Series

If you are wondering whether to dive in, give a couple posts a quick read. You’ll capture the blog’s essence. If after reading those The Stock Series is appealing, you will very likely enjoy it all. If by the same token your reaction is, “This doesn’t feel right for me,” it very likely isn’t...

jlcollinsnh.com

will check it out. thanks

 

[Piebaldi]

will check it out. thanks

Sorry to hijack the thread but I was wondering if for those of you that are employed, do you get a yearly cost of living salary increase? i was talking to some attendings and they said they have the same base now as they did years ago.
How is that possible?

 

[Ferrismonk]

Sorry to hijack the thread but I was wondering if for those of you that are employed, do you get a yearly cost of living salary increase? i was talking to some attendings and they said they have the same base now as they did years ago.
How is that possible?

You're not working at Starbucks anymore. There is no automatic raises, no cost of living adjustments. Only adjustment you'll get as an employed doc is what you negotiate in your contract. If you're independent or work on percent collections, your increase or decrease is based on whatever Medicare and the insurance companies decide. New attendings get the same reimbursement from insurances as those with 40 years experience. You want more money you work harder and bill more CPTs.

Most docs I know get paid less for the same amount of work than they did in the past.

 

[Piebaldi]

You're not working at Starbucks anymore. There is no automatic raises, no cost of living adjustments. Only adjustment you'll get as an employed doc is what you negotiate in your contract. If you're independent or work on percent collections, your increase or decrease is based on whatever Medicare and the insurance companies decide. New attendings get the same reimbursement from insurances as those with 40 years experience. You want more money you work harder and bill more CPTs.

Most docs I know get paid less for the same amount of work than they did in the past.

If docs get paid the same year after year thenthat's a terrible deal - going into medicine is the worst possible decision ever then financially. if someone makes 300k today, and 10 years from now - that's pretty sad.
every industry i know gives cost of living adjustment.

 

[Ferrismonk]

Yep. Now you get it.

Strike out on your own and do cash-only. Then you can give yourself whatever raise you want every year.

 

[Piebaldi]

Yep. Now you get it.

Strike out on your own and do cash-only. Then you can give yourself whatever raise you want every year.

why would anyone work like that? seriously?do you actually think tha'ts a reasonable/acceptable way of doing things?no wonder so many are burnt out and unhappy.

 

[lonelobo]

If docs get paid the same year after year thenthat's a terrible deal - going into medicine is the worst possible decision ever then financially. if someone makes 300k today, and 10 years from now - that's pretty sad.
every industry i know gives cost of living adjustment.

Don't think you are going to get a lot of sympathy from people who make $40,000 and get a COLA of 1.6% a year

 

[Piebaldi]

Do most people who make40k spend 12-15 years of their lives dedicated to becoming a doctor?

Don't think you are going to get a lot of sympathy from people who make $40,000 and get a COLA of 1.6% a year

 

[paindoc007]

why would anyone work like that? seriously?do you actually think tha'ts a reasonable/acceptable way of doing things?no wonder so many are burnt out and unhappy.

No, I don’t get a cost of living increase. As a doctor who is employed by a hospital, mysalary is directory proportional to my production (wrvu). So that can stay the same, go up, or go down. And to be frank, that’s fine with me. The harder I work, the more income I make.

 

[Piebaldi]

No, I don’t get a cost of living increase. As a doctor who is employed by a hospital, mysalary is directory proportional to my production (wrvu). So that can stay the same, go up, or go down. And to be frank, that’s fine with me. The harder I work, the more income I make.

Wow. We are sheep. Most professionals I know get a COL increase and an increase in a bonus. I assume youdon't get a bonus either eh?

 

[paindoc007]

Wow. We are sheep. Most professionals I know get a COL increase and an increase in a bonus. I assume youdon't get a bonus either eh?

Well, if I overproduce my previous year, the difference is given as a “bonus” at year end. But again, it’s tied directly to what wrvu I generate. I’m not a clock in clock out hourly employee. Most physicians aren’t.

 

[Piebaldi]

Well, if I overproduce my previous year, the difference is given as a “bonus” at year end. But again, it’s tied directly to what wrvu I generate. I’m not a clock in clock out hourly employee. Most physicians aren’t.

We are just sheep. What kind of professional doesn't get a cost of livingincrease and/or bonus?Sigh. At one point you can no longer increase RVUs.

 

[lobelsteve]

 

[Piebaldi]

why the facepalm? what about what i'm saying is wrong/incorrect?what's so unreasonable as to get a col increase as well as a bonus yearly

 

[lonelobo]

Maybe when you stop living with your parents we will have more empathy for you

 

[Piebaldi]

Maybe when you stop living with your parents we will have more empathy for you

I do not live with my parents.

 

[DOctorJay]

Piebaldi,

welcome to how medicine in the real world works

when it makes sense for your employer to treat you as a partner they will, when it makes sense to treat you as an employee they will

make sure you don’t sign a noncompete


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[Piebaldi]

Piebaldi,

welcome to how medicine in the real world works

when it makes sense for your employer to treat you as a partner they will, when it makes sense to treat you as an employee they will

make sure you don’t sign a noncompete


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this is simply physicians being sheep honestly. whydou feel it's ok for doctors not to get what every other professional gets? why does it make sense. to make less every year?

 

[lonelobo]

I do not live with my parents.

Oh my bad that was only during your Med school

 

[Piebaldi]

Oh my bad that was only during your Med school

yes i lived w my parents during med school - what's wrong with that? i spent almost nothing, and have 0 med school debt, thank you very much.

 

[drusso]

yes i lived w my parents during med school - what's wrong with that? i spent almost nothing, and have 0 med school debt, thank you very much.

Isn't kind of hard to have romance with your parents in the other room?

 

[Piebaldi]

Isn't kind of hard to have romance with your parents in the other room?

Once I got married (entering 4th year of med school and master's program) I moved out of parents and with husband. No issues with romance,thank you very much.
Not sure how my romantic life has anything to do with anything? Not to mention that I have a great relationship w my parents, and I am completely debt free - as in $0 debt - from undergrad, med school, masters'.

 

[DOctorJay]

this is simply physicians being sheep honestly. whydou feel it's ok for doctors not to get what every other professional gets? why does it make sense. to make less every year?

Where did I say I feel this is ok?


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[Piebaldi]

Where did I say I feel this is ok?


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Well you are telling me "welcome to medicine." most professional jobs get COL increases and bonuses yearly. why would we not expect bonuses and col yearly after countless years of hard work? granted during my first job i didnt even discuss col increases as i assumed this was a given, and then went into fellowship, but next job i will most definitely be discussing this.

 

[DOctorJay]

Go ahead and negotiate that into your contract. I bet you end up with a lower base salary for it.

Do you think we get increases in our wRVU values each year or Medicare increases the rate of what we get for each procedure each year? Where do you expect this cost of living increase to come from?

By the way lawyers do not have noncompetes from what I understand.


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[deleted131481]

Piebaldi,

I don't understand why you keep asking the same question over and over. The answer was given multiple times. If you're not happy with your situation, you can negotiate your own contract, choose another job, or start your own practice.

I'm not aware of any non-physician profession that routinely pulls in 300-400k with steady COLA not heavily influenced by incentives / bonus.

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[Piebaldi]

Go ahead and negotiate that into your contract. I bet you end up with a lower base salary for it.

Do you think we get increases in our wRVU values each year or Medicare increases the rate of what we get for each procedure each year? Where do you expect this cost of living increase to come from?

By the way lawyers do not have noncompetes from what I understand.


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I don't understand the question regarding the medicare issue - the cost of living increase should come from the employer - for employed physicians.
do u not know/think that every other professional industry pays a higher salary - for the same job- every year since every year things get more expensive?
how does it make sense if u get a salary of say 350k today, that 10 years from now you are still at 350? when ur avg professional making 150k 10 years from now is making 250k or whatever?

 

[Laryngospasm]

In theory over time the cola would come from increase in pay per rvu. However that doesn’t seem to be the case for a multitude of reasons.

 

[Piebaldi]

In theory over time the cola would come from increase in pay per rvu. However that doesn’t seem to be the case for a multitude of reasons.

So essentially the salary base taht you get upon signing a contract will be the base you end up with upon leaving the job.

 

[Laryngospasm]

It’s typically a percentage of average rvu based salary so 50% of mgma would in theory go up over time as would pay per rvu.

 

[Piebaldi]

It’s typically a percentage of average rvu based salary so 50% of mgma would in theory go up over time as would pay per rvu.

Do medicare/insurance rates go up over time ? clearly i hav elimited knowledge on this, but don't rates frequently get decimated every so often?

 

[lobelsteve]

I do not live with my parents.

I do.

 

[Laryngospasm]

Thats whole other existential question as cost cutting in medicine has focused on reducing pay for the people who actually do the work including doctors and nurses while ignoring the other 90% of expenditures that go to pharma, equipment, hospital, imaging etc. the fact that a spine surgery costs 150k while the surgeon makes a couple thousand seems to sum it up. This is due to the powerful lobbies that the companies, hospitals, and equipment companies have as well as the corrupt nature of our society. Good luck..

 

[lonelobo]

I do.

Pick up your socks already

 

[Piebaldi]

I do.

what about mrs lobelsteve? since someone else inquired about my romantic life when i lived with my parents during med school, i'm going to ask the same - don't the lobelsteve parents put a cramp on your love life? lol.
my apologies in advance for asking!

 

[Jcm800]

Oh my bad that was only during your Med school

Bro, that is being harsh... leave him or her alone about living with their parents. Chastise instead for hijacking my thread

 

[Piebaldi]

Bro, that is being harsh... leave him or her alone about living with their parents. Chastise instead for hijacking my thread

I did say i was sorry for hijacking the thread didn't I? See I tend to apologize in advance!

 

[Ferrismonk]

The only way an employer can give a COLA allowance is to make more money off of you that you're "salary". Employers don't have an endless pot of money either. The lineworker at Ford makes the company many multiples of his/her salary, thus a COLA for seniority reasonable. Medicine is more true to "real life" where you eat what you kill. The base pay is higher because of that.

 

[au bon pain]

Regarding the 457 question, if it's from a governmental organization than it's probably worth it. If it's from a non-governmental employer then you should check the employer's credit rating. If their Moody's rating begins with an A, the plan offers decent distribution options, and you are OK with a little bit of risk, then it may be worth partaking in it.

this is simply physicians being sheep honestly. whydou feel it's ok for doctors not to get what every other professional gets? why does it make sense. to make less every year?

I agree that physicians are sheep in many ways. Not getting a COLA isn't one of them. You cannot get blood from a stone. If you really wanted to put some energy into some things that would actually change the playing field that keeps physician wages relatively stagnant you could start by lobby with your congressman to 1) reform the Stark laws 2) raise the bar on minimum required insurance payments each year 3) create a law requiring every physician to be able to see the yearly sum total of charges billed in their name by their employer. There are many more ways to appropriately increase physician pay, but those would be a good start. Or you could go cash only and have a much higher chance of success.