The Sunday Best (12/30/2018)

The Sunday Best
The Sunday Best is a collection of articles I’ve curated for your reading pleasure.

Expect most of the writing to be from recent weeks and consistent with the themes presented on this website: investing & taxes, financial independence, early retirement, and physician issues.

 

Presenting, this week’s Sunday Best:

 

Have you listened to the What’s Up Next? podcast with Doc Green & Paul Thompson? They’ve been having roundtable discussions with some of the top personal finance bloggers. I joined them along with Brad Barrett of ChooseFI and Bill from Wealth Well Done for Episode 9: Is College Worth It?

 

As the year winds down, there’s little time to reap tax benefits from charitable giving in 2018. The White Coat Investor recently reminded us of 7 Ways the IRS Supports Your Charitable Desires.

 

Conversely, the IRS can “penalize” you for giving generously to friends and family, but the way this works is often misinterpreted. Miss Bonnie MD is here to set you straight: The Misunderstood Gift Tax.

 

I doubt Carl from 1500 Days understands the gift tax. His grasp on the concept of gifting itself is pathetically weak, resulting in a Reverse Christmas this year.

 

I get where he’s coming from, though. Sometimes, you just don’t want or need much of anything. As Unconventional Sustainability has figured out, joy can come from Learning to Want What We Already Have.

 

In some cases, you may not want what you already have, like when I helped this couple move on from their financial advisor. Lance Cothern at ChooseFI wants to help others who may be in a similar situation. How to Move Money from a Financial Advisor to Vanguard.

 

Some people are not ready or not interested in managing their money completely on their own. The Physician Philosopher recognizes this, penning Do I Need a Financial Advisor? Four Reasons to Use a Financial Advisor.

 

You’ll find that my Recommended Financial Advisors share many of the traits recommended in TPP’s post.

 

Personally, I don’t need a financial advisor, but I will need to find healthcare coverage in 2019. CHM is a leading contender due to its lack of a lifetime benefit cap. Melissa Blevins gives a great overview of the healthcare sharing program in Christian Healthcare Ministries Review.

 

As more docs leave the ranks of the employed to retire early or work for themselves for a change, they’ll need coverage, too. SHM shares some news that’s sad, but true. America’s Physicians: Overworked and Burning Out.

 

From the Reflections of a Millennial Doctor comes a tale that explains a driving force in physician burnout. Time to Face the Truth: Healthcare Workplaces are Toxic.

 

On Christmas Eve, I shared our holiday newsletter along with a collage of “obviously Photoshopped” pictures of me and my family. Merry Christmas from My Family to Yours! Our Fake News Christmas Newsletter.

 

Christmas day, I shared a gift for Fidelity Investors everywhere. To complement by Vanguard TLH guide, I created a Tax Loss Harvesting with Fidelity: A Step by Step Guide.

 

On Thursday, a physician my age shared the complicated decision-making process she recently went through. I Quit Obstetrics at age 43: the “DABDA” Stages of a Major Practice Change.

 

Finally, yesterday’s Saturday Selection from Passive Income MD touched on a sport that we won’t be touching here in Minnesota for many months. What Happened to Doctors and Golf?

 

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Welcome to Mr. Toad’s Wild Ride

 

My family and I spent seven busy and fun days at Disney World a few months back. With my younger son having just reached the all-important 48″ in height, we were able to ride nearly every ride.

There’s at least one ride that I went on as a kid that we did not get to enjoy this time around. Mr. Toad’s Wild Ride. Why not? Because it was decommissioned 20 years ago.

Well, more accurately, it was remodeled. The ride was reworked (Disney would probably say “reimagined”) to feature the more popular and recognizable Winnie the Pooh and friends.* I knew to look for a somewhat hidden framed picture of Mr. Toad handing the deed over to Owl, and I found it. Disney is full of small touches like that; I love it.

Three weeks ago, I started this section off with the heading “The Market is Down. This is Not Abnormal.” I could have just as easily said “this is normal,” but somehow the double negative seemed to get the point across better. Maybe it’s not normal, but not exactly abnormal to have this market volatility.

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That being said, it feels like we’ve reverted from the happy calmness that is The Many Adventures of Winnie the Pooh back to Mr. Toad’s Wild Ride. Of course, I plan to ride it out, tax loss harvesting and perhaps rebalancing if things get too out-of-whack.

Remember you haven’t actually lost money unless you are selling. Yes, your net worth is lower, but unless this time is different than the last 100+ years, the market will eventually recover. I don’t know if it will take three weeks, three months, or three years, but I have no doubt the most recent “top” this fall wasn’t actually “the top.”

Meanwhile, I saw about 6 years of anticipated spending disappear from our balance sheet over the course of a few months, and on the day after Christmas, we got a whole year back and then some.

The volatility doesn’t mean much to me, but I haven’t yet experienced what it’s like to be living off this portfolio; I’m still working and earning an income. I’d be interested to hear from recent retirees in the comments. How does it feel?

 

*On a somewhat related note, have you seen Christopher Robin yet? We loved it, and are now re-reading A.A. Milne’s The Complete Tales of Winnie-The-Pooh to our boys.

 

I Resolve To…

 

Follow through with my plan to retire early from medicine in 2019.

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I also plan to finally print out and fill out my “In Case of Emergency” binder.

In a couple days, I’ll publish a post of 10 or 11 motivating New Year’s Resolutions you can make to improve your financial picture. I’ll see you then!

 

A Recommended Financial Advisor

 

I’m proud to present another top-notch firm on my short list of recommended financial advisors. We have only included firms which have the lowest fee structures (i.e. flat fee, hourly rate, no AUM fees) to help lower your costs and help you reach early FI.

 

CMG Financial Consulting

CMG Financial Consulting Application

Clint Gossage CFA, CFP®, CPA, has been married to a Surgical Oncologist for the past 15 years and has experienced first-hand the ups and downs over the journey from undergrad to attending. After helping friends in medical school, residency and fellowship with their finances, he left a high-paying job, managing the investments at a multi-billion dollar family office, to start CMG Financial Consulting. He helps physicians and medical professionals to get out of student loan debt, save money, invest in tax efficient strategies, manage and protect their assets and give them back their most scarce resource…time. Schedule an appointment today.

Fees:

One-Time Services:
Student Loan Review – $250
Financial Plan – $1,000 – $3,000

Ongoing Financial Planning:
Financial Planning – $200/month

Financial Planning, Investment Management & Tax:
Early Investors: (Up to $500,000 of Assets Under Management): $350/month
Foundation Builders: ( Up to $1,000,000 of Assets Under Management ): $675/month
Financially Independent> (Over $1,000,000 of Assets Under Management): $1,000/month
Resident/Fellow – 50% discount on all plans

Contact Info:
22816 N 79th Pl
Scottsdale, AZ 85255 
(480) 695-8004
[email protected]

 


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Have an Happy New Year!

-Physician on FIRE

9 comments

  • Disneyland has Mr. Toads wild ride and it is quite fun. No rebramding out West. Happy New Year. My 2 month sabbatical comes to an end Wednesday but it has been quite nice.

    • No kidding? I haven’t been to Disneyland since I was a kid. But I’m pretty sure I did take that wild ride back then.

      And we’ve been on a different sort of wild ride lately. Sorry to hear your sabbatical’s over, but I’ll bet it was a nice time. Hope you’re getting settled in down in TN.

      Cheers!
      -PoF

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  • Thanks for the shout out, POF.

    And completely agree about the market turmoil. More and more I learn to just ignore it, but I do imagine that gets tougher to do as we near retirement and become dependent on drawing down from that number.

    Looking forward to your financial related new year’s resolutions!

    TPP

  • December was indeed a wild and rocky ride for my portfolio. Even though I had previously experienced larger drops, just the sheer magnitude of money at play now makes the amount quite staggering (approaching my first two attending years of salary).

    I know I am spot on with my risk tolerance assessment as even now have not been tempted to switch my investing philosophy and will stay the course

  • Hey PoF, weighing in as a recent retiree on market volatility, per request. A bit unnerving, but I’m calmed by having my Bucket Strategy firmly in place before my retirement. I won’t be selling any of my stocks for 5 years at the soonest, and I’m confident in long term advantages of equity exposure. #Forgetaboutit and #EnjoyRetirement.

  • Resolutions . . . I still have a day to lose 40 pounds, learn the piano and Spanish, and start a blog!

  • Gasem

    “Ignoring it” is fine if you’re still working. You just bolster your poor planning with “one, two, three, more year/s”. Once the W2 bites the dust you best risk adjust away from the accumulation mindset and toward a plan of portfolio longevity. I calculated a BH3 @ 4%WR portfolio (which is a 80/20 AA non efficient portfolio) had a 13/100 failure rate at 30 years. By simply risk adjusting to a 50/50 2 fund portfolio the same 4% WR 30 yr failure rate dropped to 1/100. If you drew a bad SOR (40% worse than the average) with a BH3, you started running out of money at year 13 and were 100% out of money at year 27. By Risk adjusting to a 50/50 2 fund, at 30 years you had more money than when you started, on the same bad SOR line. In old age you need to be able to buy hamburgers. You can’t buy hamburgers with bravado. Portfolio accumulation and deflation are very different creatures in my experience, and I am living that experience. My portfolio is down also.

    It’s quite true the market always recovers. It is also true that as long as your passive portfolio is closed to withdrawal, it will likely recover because it just follows the market. Once you start taking money out of your portfolio to buy hamburgers however, it may or may not be true your portfolio recovers. 86/100 in fact survived for 30 years on a BH3 @ 4%WR. Homey likes the 99% survival option better.

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