From Residency to Millionaire in 5 Years

SA all right. Welcome to the White Coat Investor Resident Webinar. I'm going to talk really slow at the beginning, let people get in here into the webinar, but welcome. Thank you for coming. Thank you for what you do. As many of you know, I was involved in a nasty trauma last summer. So I've had more interaction with the medical system as a patient and the last year than any other year of my life. And I've come to appreciate doctors and all that they go through as well as everybody that helps them in the medical system, from the housekeepers to the nurses to the medics, you name it. I'm super grateful, way more grateful than I was a year ago for what you do. So thanks for what you do. My name is Jim Dali. I'm the founder of the White Coat Investor. We've been here for the last almost 15 years trying to help doctors stop doing dumb stuff with their money. I'm joined today by Andrew Paulson, the founder of studentloanadvice.com he's going to be teaching us about student loans a little bit later in the presentation. But, you know, we do this. I say we do this. We've only done it one other time. This is the second time we've done this. But the reason we do it is because I can't get out to all of your residencies. I'd love to speak to each of you individually in person, but there's just way too many programs in the country and frankly, I don't like spending that much time on airplanes or in hotels. So we decided we're just going to do a virtually. We figure if we can do it virtually for one residency, we're going to do it virtually for all the residencies and fellows. And I know a few of you are students and some of you are attending, and that's okay. But we're glad to have you here. Okay, questions for this, just housekeeping items. Questions for this webinar go in the comments. And the best place to watch, to leave those is to watch this and to leave your comments. Actually, is the YouTube channel. That's usually the best feed. Now, I know some of you are watching this on Facebook or on Twitter or whatever, and that's fine. But if you start having problems, YouTube is usually the most reliable place and we'll be monitoring all those channels. If we start having problems, they'll my staff will hopefully let me know about that. By the way, there's like 4,100 plus of you registered for this webinar. Now I know you're not all here right now. Says right now 424 of you are here. A lot of you are just going to get this emailed to you. So, yes, we are recording it. Yes, if you signed up for the webinar, you will get that recording and can watch it at your leisure. But what's going to happen tonight is we're going to present for about an hour and a half, probably, and then we're going to stick around for a while. Andrew's got some small kids he probably needs to put in bed tonight. But we're going to stick around for a while and answer your questions. And knowing how many of you signed up for this webinar, we're probably going to be here for a while doing that. And that's okay. We're more than willing to. It's wonderful to be with you, and we want to help you as much as we can. We've dedicated this evening to you. All right, so this is called what Residents need to Know About Money. Some caveats. Anytime we talk about money in a medical setting, I like to use these caveats. Okay, the first one is that money doesn't bring happiness. That's not entirely true. If you actually study it really well, it turns out that more income does make you happier, but only up to a certain point. After 70 or 80 or 100 or $120,000, it really starts leveling off quite a bit. More income actually doesn't make you all that much happier. But the fact is, you and I didn't go into medicine for the money. Okay? But if you ignore can make your life miserable. The doc in the photo is Dr. Rick Hodes. He practices on tuberculosis spines with tuberculosis in them in Africa. And I like to think that I was just as idealistic as he has remained his entire career. When I started out my career. But I think most of us have a substantial amount of that idealism beat out of us at some point during our Ms. Three years or our intern year. And I hope that you can hold on to at least some of that for your entire career. All right, why am I giving this talk? Well, this is my story, okay? I got ripped off, and I got sick of getting ripped off. I got ripped off by every interaction I had with financial professionals for years. Halfway through residency, I got sick of it and decided I better become financially literate. So I started reading books. I lived across the street from a used bookstore, and I read a bunch of terrible financial books. And then I read some good ones. And the good Ones all seem to be saying the same thing. It was amazing. And so I started teaching people online, right? On forums, Student Doctor Network and Sermo and the Bogleheads forum. And after a few years, I realized not very many people. Basically nobody was doing this for doctors. And so I started the White Coat Investor as a blog. It blew up. We started a newsletter, wrote a book, we started a forum, we started the podcast, wrote another book, started putting on conferences in 2018. A lot of you may have been able to come to that. Maybe not a lot of you that are residents. It's a little bit spendy for a resident, but when you're attending, it's certainly a fun event to come to. We started doing online courses. We started a subreddit. And I know a lot of you residents participate on the subreddit. And thank you for doing that. It's actually our fastest growing community. It's about to hit 100,000 people. We also have a YouTube channel. We have the Facebook group. I've written a few more books. A guide for students we designed to give away to first year medical students. An asset protection book. We started another podcast and we just came out with new versions of the fire your financial advisor course, a student version and a resident version at lower price points due to popular demand. So whatever format you like to digest your information in, we've tried to put this into that format, okay? Whether it's video or audio or written or books or whatever. Well, those of you on here tonight, I presume you like webinars and that's why you're here. So we're going to treat this as. As your opportunity to become a little bit more financially literate, a little more financially disciplined. Okay? Some disclosures. The White Coat Investor is a for profit business, okay? 18 people work here. I got to make payroll every month, okay? So 98% of what we provide, what we produce, including this webinar, is totally free to you. But we do sell ads on the website. If you go there, you're going to see the ads. And we sell stuff. We sell books, we sell our online courses, we sell the annual conference. If you buy those, we make money. Okay? So I just want you to be aware of that. But I'm a practicing doc, right? I've worked two shifts already this week. I'm not a licensed accountant. I'm not an attorney, I'm not a financial advisor. So this presentation is not personalized financial or legal advice. This is for your entertainment and general informational purposes only. Okay? If you signed up for this, you may win a free fire your financial advisor resident course. Everyone else can get that course as well for 20% off by using the code RESIDENT20 before the end of the month. That makes it only 239 bucks. I mean, the full attending course is an $800 course. And if you want to upgrade to that later when you become an attending, you get credit for having bought the resident course before. So check that out. We think it's a wonderful resource. Okay, what are we going to talk about today? We're going to talk about the good stuff up front. We're going to talk about the truth about money in medicine that nobody else has ever told you, no one else wants to talk about for some reason. Then we're going to talk about insurance during residency, which is a heavy dose of disability, because you know what? That's the kind of insurance most residents need. Then I'm going to turn some time over to Andrew. He's going to spend an extensive amount of time on student loan management. Because guess what? It is changing. It seems like it's changing every week. In fact, Congress passed a bill at like 7am this morning. Not Congress, just the House. It hasn't been through the Senate yet. That makes some additional changes to student loans if it passes in its current form. We're going to talk about developing a spending plan. We're going to talk about investing tips for residents. We're going to talk about contracts and hunting for the job. And maybe the most important part is transitioning to attending. Hood, the first year of being an attending is the most important year of your financial life, and we want you to get it right. Okay? So that's the plan for tonight. We're going to go probably 90ish minutes. Then we're going to stick around and answer your questions. You can put them in the comments and we'll get to your questions. Okay. The truth about money in medicine. The first one is that few of you went into medicine primarily for financial reasons. Right. You remember that medical school application essay you did? Said you really love to help people and you love science. Yeah, I wrote the same essay and deep down we actually believe it. Remember how excited you were at getting into medical school or matching into your residency? Right. And then somewhere along the way, some other stuff becomes important to us, like our lifestyle, our income, those sorts of things. Well, very few of us will actually practice medicine for free. And I'll show you a survey I've done that really kind of demonstrates that the truth is that the financial lives of doctors diverge pretty early in their career. You don't see the results of that for decades. But at the end of the career, you can really tell the doctors that pay for paid attention to finance early in their career and those who did not. Okay, here's another truth. Future you, 10 years out of training is different from current you. You're going to want some options in your life. You're going to want the ability to go part time or to take a, you know, some parental leave or to change jobs or to, you know, pursue a dream of owning your own practice or something. Something's going to be different in 10 years. And by preparing for that now, and maybe it's just fighting burnout, who knows? Preparing for that now is going to give you those options that you're going to want. I promise you, just about every doc at mid career wants to have the ability to make some of these changes. Another truth is that your intra specialty pay range is going to dwarf what you've seen on the, you know, various specialty surveys for income if. And finally getting rich is actually not complicated. It's not necessarily easy, but it's not complicated. So let's get into a few more details on those truths. All right? This is a really important chart. Okay? I know the numbers and the letters aren't that big on this, but I want you to concentrate with me for just a minute. I want you to look down to those years in the 60s, right? Age 60 to 64 and age 65 to 69. Okay? And you'll notice that leftmost column, that dark green column there represents a net worth of under half a million dollars. Okay, so that's what, like 10 to 12% of doctors in their 60s after 30 years, presumably at least 20 of physician attending physician level earnings have a net worth everything they own minus everything they owe of less than half a million dollars. The line next to that are those who are half a million to a million. So you put it all together and a quarter of Doctors in their 60s are not millionaires. That is a huge tragedy in my view. I do not want that to happen to you. There is no reason that you should make 5 or 8 or 10 or $12 million over the course of your career and have less than a million of it left at the end, especially with the miracle of compound interest helping you along the way. Okay? Burnout is a real problem in medicine, okay? And this, this chart divides it up into the various, you know, generations. You can see that the millennials, you know, are maybe a little more burned out Than, than, you know, some of the. Actually, they're less burned out than Gen X and boomers. If you look at the boomers, boy, 50% of them are saying, it has a severe impact on my life, 46% for my generation, Generation X. Okay? So burnout's a real problem in medicine. And one of the best ways to deal with it is to be financially savvy enough that you can make changes in your career that are probably going to cost you money. Okay, here's the other thing I want you to realize. I survey doctor groups all the time, and I ask them what they would do if I cut them a check for 10 million or 20 million or whatever, enough money that they definitely never have to work again. I ask them, would you come to work tomorrow? And guess what? About a third of them tell me no. They're like, I would basically retire just as soon as I could. A third of Doctors and another 47% say I would cut back at work in some way. I would go part time. I would drop call. I would, you know, take Wednesdays off and play more golf, whatever. They would make some sort of change. And only about 10% of them say, I'd keep working exactly the way I'm working now. What that tells me is that 90% of doctors, and maybe all of them, because that 10% is probably already working part time, but 90% of doctors are working at least partially for the money. And I think you just got to recognize that you're human too, right? People go to work to make money. It's called work because somebody has to pay you to do it. And that's okay. To not view this 100% as you're calling that part of what you're doing every day when you get your butt up at 5am and you go to work for the next 30 hours, part of the reason you're doing that is because they're paying you, and that's okay. Okay? But recognize that how much you get paid doesn't depend on how much you know. It doesn't depend on how long you trained, and it doesn't depend on how unpleasant your work is. Right. Market forces don't necessarily work well in medicine. As a general rule, doing procedures is going to pay you better than thinking. Right? I get paid more to suture up a 3 centimeter laceration than I do to spend 45 minutes with, you know, demented grandma and her six family members and the medics and calling her primary doc and all the other things that it does that are required to Take care of that, lady. I got paid more to put, you know, five stitches into a laceration. That's just the way medicine is. And the sooner you recognize that and that it's probably not going to change, the better. Okay, there's this rumor out there that doctors are getting paid terribly or they're getting paid less every year. Well, it's not exactly true. If you look at the salary trends, right, sometimes the salaries go up higher than other times. But as a general rule, if you go all the way back to the 70s, doctors have gotten paid more and more and more each year, usually at least keeping up with inflation, sometimes a little bit more than inflation. Now, in the short term, sometimes that's not true. But generally in the long term, we do get paid more each year. Being a doc is still a good deal. Financially. It's worth it to go to medical school, even if you have to borrow the entire cost. As long as you manage money well afterward, you're going to be able to take care of the cost of that medical school and still come out way ahead. So don't believe the pessimists out there that are telling you, oh, medicine's dying and you're never going to get paid. You know it's not true, right? Your skills are still very valuable, very rare, and you're going to make money. Okay, how much money are you going to make? Well, I hope none of nothing in this slide is news to you. I'm amazed how many medical students, residents and even attendings I've run into that apparently never seen a slide like this. Guess what? On average, plastic surgeons make more than emergency docs who make more than pediatricians. I hope that's not news to you. Okay. This is a most recent survey from Medscape, I think, and these show the averages for the various specialties. Now, the important lesson to learn here is that this inter specialty difference is actually dwarfed by the intra specialty difference in incomes. I have met family docs making seven figure incomes. I have met pediatricians making seven figure incomes. I have met orthopedists that are barely making six figure incomes. Okay. There's a wide variation in what physicians make. Here's an example. This is a salary survey from a few years ago. This is from my specialty of emergency medicine. I want you to look at the 10th percentile for employee compensation up in the upper left. That was $213,000 that year. Now I want you to go to the lower right and look at the 90th percentile compensation for partners, which was $510,000 that year. That's basically a $300,000 difference between the 10th percentile and the 90th percentile. That's far more than the difference between the average income of plastic surgeons and of emergency docs. And every specialty looks this way. That's just the way the field is. So recognize that. Make sure you're being paid fairly. Half of docs are making less than average money, all right? You better have a really nice job if you're accepting a job that's, you know, paying you less than the average rate for your specialty. All right? Now, when I have medical students over to the house, you know, I joke with them, right? I tell them if you can't live on 2 or $300,000, you have a spending problem, not an earning problem. And they all laugh. But you know what? When I use that joke, speaking to a group of attendings, none of them laugh. They don't think it's funny at all, because a lot of them are spending 200,000, 300,000, $400,000 a year. That said, the more money you make, the easier it's going to be to pay off debt, to build wealth, to give to charity, to help your family, to buy expensive stuff. It's just easier when you make more money. And you're going to care more about your income and your lifestyle in 10 years than you ever did as an Ms. 3. Choosing a specialty. So pay attention to your income. Your income matters. It's the first component in any financial equation of how successful you're going to be. Don't be afraid to try to get paid what you are worth, okay? But the lesson to learn here is not just to try to have a higher income. The lesson to learn is that wealth is not income. And people get this wrong all the time. Social media gets it wrong. Even the IRS gets it wrong. The IRS taxes income. It doesn't tax wealth. Rich people are wealthy. They don't necessarily have a high income. They don't necessarily make a lot of money. They have a lot of money, right? And that wealth is measured with net worth. That's everything you own minus everything you owe. And it's really important that you don't mistake assets for liabilities, right? Like a lot of people, like, oh, I have this great home. It's this wonderful asset for me. Well, kind of, except you got to insure it and you got to maintain it and you got to pay taxes on it, right? In actuality, your home costs you money. It's more of a liability. Your car is certainly more of a liability than it is an asset. So keep those things in mind when you're learning about finance. Some things pay you, some things do not. The things that pay you are assets. The things that do not are liability. But your goal here, over the course of your career, is to take that high income you're going to soon have and use it to actually build wealth. And we're going to talk about how to do that. Okay, here it is. Most important slide in the talk, maybe. Okay. If you've been wondering how to get rich, here is the secret. Step one, make a whole bunch of money. Okay? Get a high income. Step two is don't spend it all. In fact, the less of it you spend, the faster you get rich. Then you put your money to work, you invest it, you make it work as hard as you do, and you make sure you don't lose the money to things like death and disability and divorce. The three big Ds. Right. As well as things like fraud and investing mistakes and leverage. Okay, that's it. That's as complicated as getting rich is. It's not that hard. And the truth is, most Americans have an income problem. You do not, or you soon will not have an income problem. You will have a high income because you are a resident now and you will soon be an attending physician. That's 90% of the job. Right. The rest of it is relatively easy compared to that. Okay? So the greatest task of your financial life is to save up a retirement nest egg. And you're going to need approximately 25 times what you spend each year. So if you spend 100,000 a year, you're going to need 2.5 million to be financially independent to retire. If you spend 200,000 a year, you're going to need 5 million in order to support you. If you spend $300,000 a year, you're Going to need about 7.5 million. That's kind of the way the math works. But for the typical physician, the nest eggs of those retiring comfortably tend to be in the 2 to 5 million dollars range. That's what you need to acquire at some point over the next 20 to 30 years. And what that requires is it requires 20 or 30 years of you putting away approximately 20% of your gross income every year that you don't do. That pushes back that retirement date by a year. Yes, you can get there faster if you earn more or you save more or, you know, have some entrepreneurial pursuits that eventually pay off or maybe take on a little bit more investment and leverage risk. But in general, this is the formula for becoming wealthy, right? You carve out a chunk of your income every year, you invest it, you give compound interest some time to work. And you know what? That $60,000 you're putting away every year is going to grow and is going to grow to an amount that's going to be able to support you throughout a comfortable retirement. You cannot put this off until mid career. You cannot put this off until late career. It will require you to save a ton of money or to dramatically cut back on what you're spending at that point. The math works about like this. This comes from a blog post by a fellow named Pete Adeney who blogs his Mr. Money mustache. And this uses net savings rate, not the more common gross savings rate that I often talk about. And when I'm saying save 20% of your gross income, he's saying this is how much of your net income you need to save to get to retirement, right? If you're not saving anything, you're never going to be able to retire. If you're saving everything, you're already financially independent, right? Everybody else is somewhere in between. And you'll see for a typical career length of 28 or 32 years, your savings rate needs to be 25 to 30% of your net income or something around 20% of your gross income. So that's for a full career. If you only want to work half a career, well, you can just save more money. Put away half your income, for instance, and you'll get to financial independence by mid career. It is an option. Some doctors choose that option. You don't have to. It's perfectly reasonable to work until you're 60 or 65 or 70, as long as you don't become disabled or become disillusioned or burned out. You can do that. But realize that there is the option to retire earlier. And the main way you do it is you just save more of your income as you go along. Okay, so what am I telling you about money, about income, about wealth? Well, I want you to just care a little bit about it, okay? Care how much you make, Care how much you save, maybe calculate it every year. Care about how that money is invested. Don't just ignore this financial stuff. Realize that this combination of financial literacy and financial discipline is really rare. It's rare even among high earners like doctors. In fact, if you possess both of those things, you'll start looking around you at other people in the world and feel like you have a superpower. Okay, let's get into insurance. And I've added some stuff to this section of this presentation since last year because we just keep running into docs who don't have insurance and need it. Docs become disabled during residency all the time. Okay, let's think about your greatest asset, right? Is it your home, your car, Is it a boat? Is it your investments? No, for most of you, your greatest asset is your future earnings, right? The average physician makes $363,000 a year. If you multiply that by 30 years, it's over $10 million. It's an incredibly valuable asset and you should probably insure it. And the way you do that is with what's called disability insurance. And docs really do become disabled. About 1 in 420 year olds are going to have a disability that lasts at least three months at some point during their working years. Between age 20 and age 65. If it lasts at least 90 days, there is a 1/3 chance that that disability will last at least 5 years. 5 years of no income is a serious financial catastrophe for most docs. Now people wonder, they think, oh, people are falling off mountains like I did, or getting in car wrecks or whatever. But the truth is, most of it's illness, right? People get cancer, they get heart disease, or they have some back issue or something. It's not trauma that's disabling most docs. Some docs, yes. But most docs, it's a medical problem. And if you divide it up, you'll see, you know, 13% are injuries, 25% are musculoskeletal stuff, a lot of back and neck kind of issues, arthritis kind of stuff. 12% it's cancer, 10% is mental health, 8% is circulatory issues. You know, often, you know, heart disease, 14% is nervous stuff. Okay? And you'd be surprised how much of that happens, you know, ms, for instance. You know, you may not develop it until residency or afterward, right? Then 18% is other stuff. But that's what people get disabled from. And it happens all the time. We get emails from the insurance agents we refer docs to, we get emails from the docs themselves saying, I'm so glad I bought it. Thank you for telling me. I just bought my disability insurance three months ago and now I'm disabled. It happens. You are not invincible, I promise. Okay, so when should you buy long term disability insurance? Well, you should buy it as soon as you start getting paid. If you're an intern, it's time to buy it. You want to ask yourself, well, when do you want to get paid? Well, that's called the elimination period, right? And the standard one is 90 days. So they don't pay you until you've been disabled for at least 90 days. And truthfully, it's actually at about 120 days because they pay you at the end of the month, but they don't pay you until that fourth month. Most of the time that means you need an emergency fund to cover that first 120 days after you get disabled. Okay. And then you got your benefit amount, Right? How much do you want to get paid? And that is usually tax free money because you typically pay for these policies with after tax dollars. If your employer is buying the policy though, be aware that they're getting a tax break for that. And your benefits are probably going to be taxed probably at a lower tax rate than your typical earnings because it's less money, but it would be taxable if your employer was buying it. And these policies typically pay you until age 65 or 67 with a minimum of two years. So if you got disabled at age 64, it'd pay you for a couple of years. And typically they'll let you insure up to 60 to 70% of your income. So there are really two kinds of policies. There's individual policies where you go to an insurance agent, like the ones we refer to if you go to whitecoatinvestor.com insurance. And these policies are great policies. They have nice, strong definitions of disability. So if you have something happen to you, it's going to pay you. They're portable, meaning if you leave your job, it goes with you. You get to choose the various options, various things you want in the policy. You can choose from, you know, five different, you know, disability insurance companies and their policies, and get the best one for your specialty and health status and gender and state that you're in. Right. The downside of getting an individual policy is it usually costs more than the group policies offered by your employer. It also usually requires you to have some labs drawn, pee in a cup, answer some medical questions, they look at your prescription history, etc. On the other hand, if you just get what your employer is offering, it's probably a weaker definition of disability. So if your disability is kind of in a gray area, it might not pay and it's probably not portable. It's not going to go with you when you leave your employer. Your employer is going to choose all the options and is going to choose the company that offers it. The premiums will be lower, though they might Even be free to you, depending on your contract, but the benefits are not as good. One reason you might want to use it, though, if you're like me and you have to answer pesky questions like do you rock climb and scuba dive and fly small planes or go hang gliding or whatever, the group policies are less likely to ask you those questions and they're less likely to do an extensive exam. So you might find it's a little easier to get a group policy, especially if you have some of those issues. I ended up having one policy of each. I had an individual policy and a group policy. The individual one wouldn't have paid if I got injured rock climbing. The group policy would have, but otherwise it wasn't nearly as good of a policy. Okay, so how to save money when you're buying disability insurance? Because one thing you're going to notice when you buy this is that you're going to get sticker shock, right? Stuff's expensive. So if you want to buy a, you know, you're typically paying 2 to 6% of what you're going to get in a benefit. So if you buy a $10,000 a month benefit, that's going to cost you $200 to $600 a month, okay, it's not cheap. The reason it's not cheap is remember that statistic? One in four people use it, right? One in four people get disabled at some point between 20 and 65. And so that's why it costs a little bit more. So saving money matters. Typically, as a resident, you're only going to be able to buy a benefit of 5,000 to 7,500amonth. But one thing you really want in a policy you buy as a resident is some ability to increase how much coverage you have later without having to prove you're still insurable. So even if you develop a medical problem, even if you take up scuba diving, you want to be able to buy more insurance when you finish residency and can afford more, and they'll sell you more. So we recommend you use our recommended agents. You can get those@whitecoatinvestor.com insurance. Yes, if you go there and buy a policy from them, we get paid. Okay, and there's my disclosure of my conflict of interest. But we think these are the best agents out there selling insurance, so they're going to treat you well. If they don't let us know, we'll fix the problem. Be sure to ask for discounts. Most people buy in an individual policy are going to qualify for some sort of discount. And if you end up buying. Some riders realize that you can always take them off the policy later. So if you want them early on and don't want them later, you can always get rid of them. One thing that residents often find attractive are policies from at least one insurer where you can get a graded premium, meaning you pay less for the premium in the early years and end up paying a little bit more in the later years, rather than having a level premium as you go along. And that's especially helpful if you hit financial independence early and can drop your policy right then. You only had the years where the premiums were really cheap, so that might be a good option for you. Look into that as you talk to the agent. And those agents are going to make a good commission off you, right? They're going to make thousands of dollars for selling you these policies. And so don't be afraid to use their time to really understand what you're buying, to make them. Show you policies from multiple companies and compare them one to another. You're probably only having to buy this once or twice in your career, so make sure you get yourself educated before you do, okay? These policies are generally offered with riders, okay? And it might require a rider for the policy to be a true own occupation specialty specific policy. That means if you cannot practice emergency medicine or whatever your specialty is, it's going to pay you. Even if you can go to the medical school and lecture, even if you can go do urgent care, if you can't intubate, it's going to pay you the full amount. That's true own occupation coverage. You also want a partial or residual disability rider. This pays you when you're partially disabled or when you're coming back from disability. And frankly, everybody buying a policy ought to get this particular rider. If you're buying a policy in your 30s or 40s, you probably want a cost of living adjustment, because if you get disabled early, you get disabled at 38 or something, you're going to be living on this thing for decades, and you're going to want that benefit to adjust upward with inflation. And if you're buying these things as a resident or a fellow, you're going to want some sort of ability to increase coverage later. And there's kind of two versions of that. One's called a future increase or future purchase option. The other one's called the benefit update option, and depends on which policy you buy, which of those you'll get. But if you're buying it as a resident, you probably need that. Other riders for lack Of a better term are a little more gimmicky, right? The student loan ones that make your student loan payments if you become disabled. The retirement ones that put some money into, you know, usually an annuity from the insurance company if you get disabled, or the catastrophic benefit if you get really disabled and can't do two or more activities of daily living, it gives you an additional payment. Frankly, rather than buying these, I'd rather see you spend more money on the base benefit and just get a bigger policy in the first place. Okay. I mentioned earlier the importance of these future earnings riders, the benefit increase riders and benefit update riders. They let you lock in your ability to increase your coverage later. It's often free, right? Sometimes that rider doesn't even cost you anything. So sometimes you might be able to start with as little as $1,000 a month in coverage, right? A really little benefit, pretty cheap. But then it requires you to increase your coverage at set intervals like every three years. And if you don't accept that increase or a certain percentage of the benefit offered, well, you can't increase it anymore in the future. So most of the time it makes sense to exercise that when it is offered to you so that you can get a bigger benefit. The time you really need disability insurance is early in your career, right? When you don't have any sort of a nest egg. You've got all kinds of things you need to buy and you haven't saved up anything for your kids college. That's when you really need disability insurance. And then later on you can, you know, drop the policies benefit amount if you don't need as much. And eventually when you reach financial. But these benefit increase riders sometimes, right as you come out of residency, they'll give you an extra option to increase it, which is exactly when you want to. But you really got to talk to the agents about these. These are complicated.

I have a master's degree in accounting and I'm a certified student loan professional. I am the co founder and lead consultant@studentloanadvice.com and our team is now advised on nearly a billion dollars of student loans for doctors and dentists all across the country. My inspiration came from when my wife and I were trying to figure out how to pay down her student loans from nursing school. Here's a little bit of context on the business student loan advisor SLA that I run. We create custom student loan plans using the principles of the white coat investor. Everything that we talk about today in terms of key financial principles that you need to be aware of we share that same vision. What we'll do is you'll meet one on one with a student loan pro. They'll guide you through your best options to manage your loans. What whether it's pslf, refinancing, married, filing separately, income driven repayment programs, we help you navigate all of that and bottom line will help save you time, money and give you answers on your student loans. Here's what we're going to talk about today. A bid on Student Loans 101 Federal Student Loans, private student loans, the loan forgiveness programs that you need to be aware of, and private refinancing. And then we'll discuss how do you put this into practice? What does it look like to manage your student loans as a resident?

And then for whatever, you can still get the policy. And so that's the way to do it, right? Go get a guaranteed standard issue policy, you can always apply later if you want, and get a fully underwritten policy. The fully underwritten one might be a better policy, might even be cheaper for you. But be aware that if you have any sort of problem in your past, even if you think it's a nothing burger, mention it to the agent. You do not want to be declined for insurance when you could have applied for a GSI policy. Okay? So you can also have the agents shop you around informally with the underwriters. You know, talk about your unique medical problem and see if they think it's a big deal or not before you formally apply and are rejected. Because if you get rejected, that goes in a database and when you apply again in the future, they're going to know you got rejected. You don't want that to happen. Okay? Besides disability insurance, disability insurance is for you and anybody else. It depends on your income. But if there's someone else, depending on your income, you probably also need some life insurance. And the type you should buy is term life insurance. You know, you might even want to buy some of this on a stay at home parent. If you're married to somebody and have a few kids or a child or whatever, and they're staying at home, you might want to buy one on that person too. But the point of term life insurance is if something happens to the insured person. You get a lump sum payment, you get cash, right? Cash on the barrel hub, best thing possible. And you can usually get it pretty fast. You send the insurance company a death certificate and two weeks later you got a million dollars or whatever your policy was, right? Term insurance is pure life insurance. If you die during the term, you get the benefit. That's the way it works. And if someone else depends on your insurance, you probably have a pretty significant need for insurance. If someone else depends on your income, you have pretty significant need for term life insurance. Okay? The good news is, even compared to disability insurance, this stuff's pretty cheap, right? A ten year policy, if you're young and healthy, it's $17 a month for a million bucks. That's it, right? Even if you want a longer policy, a 30 year policy, it's only $45 a month for a million dollar benefit. Okay? Now, disability insurance is cheaper for men, life insurance is cheaper for women. I guess women are more likely to get disabled, but men are more likely to die. So be aware of that and use term life insurance to protect your income during your career from now until the time you become financially independent. Now, there are some agents out there, not the ones we send you to, but some agents out there who will try to sell you a whole life insurance policy. And this is not a term policy that will pay you if you die during a term that you select. It is a policy that will pay you no matter when you die. Even if you die at 92, it's going to pay you now because it's going to pay out to everybody. It costs a lot more than term insurance, sometimes 8 to 20 times as much for the same exact death benefit. And so what happens is people don't buy enough insurance, right? If they need $2 million and they go and somebody sells them whole life insurance, maybe they end up buying a $50,000 policy, which is not going to go very far. These are really products designed to be sold, not bought. I cannot ever remember a time that I saw a resident that needed a whole life insurance policy. 75% of docs who buy these, according to the surveys I've done, regret buying them. So don't buy whole life insurance. Buy term life insurance unless you have a very unique situation. You are 100% convinced that whole life is the right product for you. Just being a doctor, especially being a resident doctor, you still got student loans to pay off is not a reason to get a whole life insurance policy. Okay, so how much money are you going to or how much of this do you want to buy? Well, what do you want the money to do? Do you want your spouse to never have to go back to work? Well, then you need a policy that's big enough to be 25 times your annual expenses. It's got to replace your entire nest egg. Do you want to pay off the House. Well, how much do you owe? Do you want to pay for college? Well, how much do you want for each kid for college? Remembering that, you know, you've still got some time for that money to compound. Remember, you don't necessarily need it to pay off your student loans. Right. Federal and even most private student loans get forgiven if the borrower dies. And then you add it all up, you round up to the nearest million and that's what you buy. Typically it's not an amount like 300 or $350,000 is more like 2 million, 3 million, 5 million. That's what most docs with the term life insurance need are purchasing. Okay. Other things you might want to consider if you're renting, renters insurance, if you own a home, homeowner's insurance, they have similar coverages. Your landlord is not going to cover your stuff if the place burns to the ground. You need renters insurance to cover that. You need your car to be insured. Right. One of the biggest liabilities you have is, is hitting somebody in your car that's worth a lot of money driving an expensive car. And then you can buy an umbrella insurance coverage that sits over the top of your homeowners and your car insurance coverage and gives you additional personal liability coverage. The good news is this is way cheaper than malpractice. For two or three or four hundred dollars a year, you can probably get a million dollars in additional liability coverage. And that's really what most of you probably ought to have. Even as a resident, it's probably worth buying. It's not that expensive and it's good to have that coverage. Okay, Andrew, it's time for you to take it away and me to take a break. Thanks, Dr. Dali.

All right, let's talk student loans. My name is Andrew Paulson. I have a master's degree in accounting and I'm a certified student loan professional. I am the co founder and lead consultant@studentloanadvice.com and our team is now advised on nearly a billion dollars of student loans for doctors and dentists all across the country. My inspiration came from when my wife and I were trying to figure out how to pay down her student loans from nursing school. Here's a little bit of context on the business Student Loan Advisor SLA that I run. We create custom student loan plans. You using the principles of the white coat investor. Everything that we talk about today in terms of key financial principles that you need to be aware of, we share that same vision. What we'll do is you'll meet one on one with a student loan pro. They'll guide you through your best options to manage your loans. Whether it's pslf, refinancing, married filing separately, income driven repayment programs. We help you navigate all of that and bottom line will help save you time, money and give you answers on your student loans. Here's what we're going to talk about today. A bid on Student Loans 101 federal student loans, private student loans, the loan forgiveness programs that you need to be aware of, and private refinancing. And then we'll discuss how do you put this into practice? What does it look like to manage your student loans as a resident and then as an attending physician? Whether you're trying to pay the loans off aggressively or pursue a loan forgiveness strategy, the goal is how to be out of debt in the most efficient manner so we know where things are. As far as student loans, it costs a lot of money to go to medical school and dental school. It's a mortgage. It's 240, $300,000. And we see a lot of docs that owe even more than that. The average doc that I work with on a daily basis has $330,000 of student loans. And the thing to be aware of as well is if interest rates go down in the future, the government doesn't lower these. The interest rates that you have are fixed over the life of the loan. The most common form for borrowing are federal student loans. Interest rates are typically anywhere from 2 to 9%. And they come in a different variety of flavors. They have Stafford Subsidized, Stafford unsubsidized and plus graduate loans. And before 2010, there was a program named Federally Family Federal Education Loans, that is ffe, but that program has been discontinued. And now for those of you that are in residency, most likely you have direct federal student loans. There are four key protections that federal student loans have. Number one is repayment programs. And we'll go into depth on those repayment programs and what you need to be aware of. There's also forbearance and deferment. That means for a temporary period of time, you, you can put off making payments, but please, please try to stay out of forbearance and deferment. If you request forbearance, typically you are not getting any credit for a loan forgiveness program. You're not making any progress on paying your loans down. And whatever interest accrues while you're in that forbearance, it then capitalizes or it compounds to your student loan balance. When you exit that forbearance. Now, if you do have to use forbearance, we understand if you're out of a job or you're in a financial hardship, you can request for it. But we'd really like you to look at some of these different repayment program options which I think you'll find affordable. There's also deferment, and that is typically when you're in school, you can go into deferment or perhaps you get an illness like cancer and you just can't temporarily pay on your student. Student loans. The third protection is there's death and disability. That means in the event of death or you become totally and permanently disabled, your federal student loans will be discharged. They're discharged tax free. They're not passed to a partner, spouse or children. And the last is loan forgiveness. And we'll talk about a number of loan forgiveness programs that you need to be aware of. Another key question that we get all the time is direct federal consolidation. And this is a very typical step that you'll want to take when you were a newly matched, soon to be intern. But, but now as you are in your residency program, we tend to not see a lot of people consolidate after they have been in repayment for a number of years. But certainly if you're starting your first year of residency, this is something you can do and it allows you to take your dozen or 20 loans and it lumps them all together nice and neatly and it allows you to move into repayment usually this summer rather than waiting for six months for that grace period to expire and starting repayment usually in October, November, December of your first year of residency. Another key component of a direct federal consolidation is if you have some older type of federal student loans, such as those fellow loans or Perkins loans, a direct federal consolidation will get them into a direct loan that's eligible for the latest and greatest repayment plans and forgiveness options. Let's cover some of the repayment programs that you need to be aware of. There's a lot, okay. There's about 10 of these repayment programs. The first four are what I call time. Based on standard is fixed payments over 10 years. Think of it like a mortgage, but over a 10 year period of time. Graduated is also a 10 year schedule, but payments start out lower and increase every two years. So it has a stepping up effect. There's also extended, which is fixed payments over 25 years, an extended graduated, similar to the graduated flavor earlier where payments start out low and increase every two years. There's Also Income Driven Repayment plans or IDR plans, not to be confused with ibr, that is its own repayment program. A key thing and something that we'll talk a little bit about. Repayment programs with student loans are subject to change and there may be some changes as early as this some summer. There's four different income Driven repayment programs. Income Contingent repayment, ICR Income based repayment. IBR pay as you earn pay and saving on a valuable education save if you have six figure student loan debt. Please learn the nuances of each of these programs or have someone help you navigate that because selecting the optimal payment program program is is really critical to effectively approach your student loans. Income Driven repayment programs Payments have almost nothing to do with your interest rate. Payments have almost nothing to do with the size of your student loan balance. They're based solely on the people in your family and your income. Let's take a resident who's making $60,000 and let's suppose they're single. What would your payments look like across the spectrum for repayment programs? You'll notice across ICR the two versions of income Based Repayment Pay and save, there's a wide array. If I'm making $60,000 as a resident, I could be paying $750 or $200 a month. And I would tend to think that when you're in residency it's a great idea to keep your payments as affordable as possible because you're not making 20, 30, $40,000 yet.

Right.

But then something to notice as well is that as your household size increases, the payments start to go down. That is, say you're married and let's say you have two children and now you're a household size of four. Well, you'll notice now that in a couple of those payment saved planet zero. And in a couple of them it's down to about $100 a month. Okay, so there is a benefit to having a family here as far as student loan payments. Let's talk about some of the loan forgiveness programs. Number one, public service loan forgiveness. This is the holy grail of student loan forgiveness programs. And we're going to talk in detail about it because it's really important. The second is IDR loan forgiveness. That's a federal forgiveness program where you get onto one of those IDR plans and pay for 20 to 25 years and then the student loan balance is discharged. However, whatever your outstanding student loan balance is, when you hit your forgiveness term, it is categorized as taxable income. So that means say after you've paid for 20 years, you still owe $200,000 on your student loans. If you're living in a high tax state like New York, you may have $100,000 tax bill that you have to pay. After you've already made 20 years of payments, you have to pay this big tax bill at the end. They call it the tax bomb. There's also a plethora of loan repayment assistance programs and every state different employers they are is very vast. So definitely wherever you're looking to work or to practice or if you're moving states, definitely check it out, look up to see if your state has a loan repayment assistance program. Tends to be for those that work in primary care mental health that will usually be eligible. For those military. The US Military has some fantastic repayment options. And for those of you today that are that are residents, they can help cover a lot of your student loans, typically almost the entire balance that you have. And for those that are still in medical school or thinking about medical school, you can even have the military pay your way. Now you need to know what you're getting into if you're going to go into the military. Because typically for each year that they pay for your medical school or that there is some level of service requirement, 3, 4, 5 years that you will need to fulfill for the military. There's also National Institutes of Health, nih. Are you interested in doing research? There are research opportunities directly for the NIH or for separate entities that affiliate with the NIH and and they typically offer up to $50,000 of loan repayment assistance per year. If you're interested in working in a full time capacity and there's also a National Health Services Corp. Are you interested working in a health professional shortage area or working with medically underserved populations or working somewhere rural or with a large amount of Medicaid patients, know that the NHSC also has a generous repayment assistance plan that can help you pay down your student loans. It's usually over a two year commitment that you would need to provide them to receive that. Okay, let's talk about PSLF. It's been around for about 18 years. Created in 2007 under the Bush administration. There has been more than a million borrowers that have qualified for this program as of December 2024. There's four key requirements. Number one, you need to be on a qualifying repayment program that is one of those income driven plans. Icr, ibr, pay or save, those all qualify. You need to make 120 on time payments. So that tends to be a decade of public service that you need to have post medical school. Number three, you need to be working at a non for profit. You need to be working full time for at least 30 hours per week. And that can be at one employer or across multiple employers. And you need to be working at a non for profit or 501c. Three, there's an employer certification form that you'll want to fill out on an annual basis. You have somebody in human resources or when you're in residency and fellowship, your program coordinator can usually take care of it that certifies and enrolls you into the program. There's tax free loan forgiveness. After you've made your payments for 10 years, they discharge the outstanding student loan balance tax free. So referring to that earlier example, say you have 200 grand that you owe after 10 years of payments. You don't have to pay any taxes on that. Most residencies and fellowships are 501s and our academic positions. However, there's a lot of doctors out there that are not working directly as employees of non for profit hospitals. They are contractors, whether as part of a group or a private practice. Sometimes there are surgery groups and other physician groups that are contracted to work at hospitals. Now, there is one caveat to that and that is for those that practice in Texas and and in California, you don't have to be directly employed by a non for profit to qualify. You could be part of a private practice or private group that contracts at a non for profit as long as you're working at least the 30 hours per week. And last of all, there are a lot of opportunities in the public service space across va. Military, academia, public health, community health centers. There's lots of options if you're interested. Why does it work? Why would you do pslf? Well, it usually means low payments while you're in training, 100 bucks, $200, $300, $400 a month while you're in residency. And then generally the amount forgiven equals what you owed when you graduated from medical school. It is almost always the best option if you qualify, but it's a good idea to set up a side fund to offset legislative and career risk. Let's talk about private student loans. Not as commonly used when you are financing your education. They're more commonly used when you've graduated from medical school or from residency and you're looking to refinance your loans and perhaps lower the interest rate. They're not as eligible for flexible repayment or forgiveness provisions and they're less likely to be discharged in death or disability. Whereas with federal they discharge any federal student loan in the event of death or disability. With private student loans it's more case by case. Private student loans and federal it is extremely rare for them to be discharged in bankruptcy. It does happen, but almost never. Private student loans come in variable and fixed interest rate. Variable fluctuate as interest rates go up and go down, whereas fixed will stay at the same amount over the life of the loan. And I've seen interest rates anywhere from 0 to 14% pretty close to what credit card interest rates are. And please be aware you will get correspondence from private lenders. They find a way to get into your inbox. There are refinancing options for you while you're in residency. Some resident refinance Programs allow for zero to $100 monthly payments. Laurel Robe, SoFi, Splash or a few of those that offer super affordable payments. So no, you don't have to make 2, 3, 4, $5,000 monthly payments while you're on your while you're in residency. If you refinance while you're in residency. Here's an example. Say you have $100,000 in private student loans at a 10% interest rate and you got a 10 year term. That means you'd be paying 1,300 bucks a month for 10 years and you would pay about $160,000. Well, what if you were able to refinance your loan from 10% to 6.5%? What that does is it drops your payments by about 200 bucks a month and in turn saved you $22,000 over the 10 years. It can be really powerful to refinance your loans to a lower interest rate. Now a word of caution. Hold off on privately refinancing federal student loans in training until you are positive whether or not you'll do PSLF post training. That is one of the most important components that I want to instill in you today is please don't refinance. You're federal to private unless you're positive about your job post training. Because once loans are refinanced, they're out of the federal government and they're now with a private lender. You don't qualify for federal programs such as Income Driven Repayment and pslf. I have been on the end working with a fair amount of doctors that thought they qualified for a federal loan forgiveness program when we found out that they had refinanced and it was a six figure mistake. Okay, let's talk a little bit about what's going on in Washington, D.C. student loans are federal programs and they can fluctuate from time to time. There is income driven repayment and some volatility in the PL program. Right now Congress and the Department of Education can modify programs. They can make them more beneficial or they can make them harder to obtain or perhaps more expensive. This summer there may be some policy shifts that can impact existing repayment programs and may even limit forgiveness eligibility. And the impact on you as doctors could mean higher payments or perhaps even having to be in repayment for a longer period of time. A recent example is what has happened with the Saving on a Valuable Education Save program. This was a program that was created under the Biden administration through the executive branch and about a year into its life it was held up by the courts and it's very likely to be eliminated this summer. It's imperative for you to stay up to date on these changes because it can modify your plans. And while we await some changes to come down the pipeline, you know, know that you'll have updates later down the road as far as what, what policies are changing because there are some areas that may change, but all of its proposal right now. We don't want to get too far over our skis. Okay, let's talk about how do you manage your loans? Well, there's two paths for residents. It's really this simple. You either pay them off through a refinance or some standard fixed time based repayment program or you can do loan forgiveness. Now how do you select the path? Debt to income is a great measuring stick. Picture this. You owe $300,000 in student loans and your income is $300,000 dollars when you're in practice. That's a debt to income ratio of one to one. If your debt to income ratio was one or lower, meaning you make more than your student loans, you might be inclined to refinance and pay the loans off rather than do a forgiveness program. If your debt to income ratio is 1 to 1.5, you should run the numbers on refinancing versus PSLF. Typically those who do extended training periods 5, 6, 7, 8 years for cardiology and GI, and you know, some of those surgical specialties, you might end up still benefiting from PSLF because all of those years typically in training would qualify. And if your debt to income ratio is 1.5 or higher, meaning that say you make 300k and your student loan balance is 450k, you would really benefit from loan forgiveness. Another factor to consider is what type of employment are you looking for post training. Do you want to work in non for profits? You want to work in academia? Or do you see yourself more as a diet in the wool private practice person? Let's go over a quick case study to help illustrate this point on if PSLF would work or not. We have a single emergency medicine physician makes $65,000 during their three year residency. While they're in residency on the income driven payment programs and save, you'll notice payments are really affordable. First couple years are even zero because their income was low enough starting out that they had $0 payments and then it gets into that 200 $300 range and then as their income jumps up to $300,000 you'll notice that commensurate with an increase in income is an increase in those payments. What if this same doctor who borrows $300,000 refinances in their intern year? Okay, it would be difficult for this doctor to refinance or get onto a fixed 10 year plan initially at $3,300 a month. But let's say they do. They would pay $3,300 a month over 10 years and in total they would pay about a $400,000 $100,000 of interest plus the outstanding principal of 300 grand. They pay $400,000. If this doctor decides to work at a non for profit post training and stays in there for a decade they would pay $130,000. That's a difference of $270,000 of student loan payments earlier in your career. That can make a huge impact on your financial future and even when you retire. Let's talk about a couple of tips to lower your payments or to lower the cost on your on your federal student loans. First off, contribute to Pre tax accounts 403B 401K IRA 457 Putting money in your retirement accounts Employer retirement accounts this can help lower your payments because payments are based on adjusted gross income. Number two. Dual earning households should consider married filing separately to exclude spousal income. Let's suppose you make $60,000 and your spouse is a full time pediatrician making 200K. If you file jointly, your payments would be based on your household income of $260,000 which would result in a payment of about $1,800. Well, what if you file separately? Then the servicer would solely base payments on your income and it drop your payments to $200 a month. That can have a huge impact on the monthly payments and the payments over the years. Another consideration, you can file an extension on your taxes. And what this will do is it will allow you to delay your income certification that is on an annual basis, just as you file taxes. When you're on these IDR plans, you'll need to certify income presenting a tax return or some other type of income documentation such as a Pay stub or W2. Well, if your income is increasing year over year over year, what if you could use income from two years prior? What if you're in your second year as a resident right now and you can still use your income from when you were a full time student? What this can do is it can allow you to milk some of those lower years of income. And this particularly manifests itself when you go from resident to attending. Okay, let's give a summary here. First of all, income driven repayment is a fantastic way to kick off repayment while you're in residency. Number two, hold off on refinancing federal student loans until you're certain about your job post training. Number three, private refinance private student loans early and often. Consider public service jobs after training if you want to do psla. And it's imperative to stay up to date on these programs such as IDR and PSLF if you're pursuing them. All right, Jim, I'll pass it back to you.

All right, thanks. I appreciate that break. You know, Andrew may know more about managing physician student loans than anybody else on the planet. And although he's covered, you know all the basics today. If you want someone to talk to about your specific situation, run the numbers with you. You can book a consult with him@studentloanadvice.com thanks so much, Andrew for that great presentation. Okay, we've got a few more sections to cover today. You can also ask questions, put them in the comments. Right. And we'll, we'll get to as many of those afterward as we can. All of you who registered for the webinar today are going to be entered for a drawing to win a free copy. Our fire year financial advisor resident course. This is the one we came out with just in the last year. A lower price point than the the regular fire your financial advisor, but presumably when you want to upgrade it as an attending, you get credit for what you paid for the resident course. So. All right, let's talk about a spending plan. Right? Some people call this a budget, but nobody likes that word. So we're going to call it a spending plan. Okay, let's talk about your income and what you should do with your income. Okay. Average resident salary in 2024 was $63,000. The median American salary was about $60,000, $59,000. The median American household income is about $75,000. Right. Notice how close all those are. So if you're having trouble living and saving something on your income as a resident, how do you expect your patients to do so? Right. So I don't buy this idea that you're living in poverty as a resident. It's just not true. Yeah, it's harder if you're in a higher cost of living area, but you are not living in poverty. That said, the time to get wealthy as a physician is not during your training. It's the first few years after your training. And that is the key to accumulating wealth as a physician. It's what you do that first year, first two years out. It's not what you do with your resident or fellow salary. So sometimes I run into residents who are maxing out their 403B and maxing out a personal backdoor Roth IRA and a spousal backdoor Roth IRA, and I'm like, whoa, put the brakes on. Enjoy some of your money. But I do like to see people save at least something and get in the habit of saving for retirement, even during residency. Okay, what are the principles of budgeting? Well, the first one is the main one. Stop spending when you run out of money. Right. You'd be amazed how many people struggle with this, including doctors, including resident physicians. Then you assign every dollar a job, right? Every dollar. This is, you know, zero sum budgeting, basically. So everything you make gets assigned a job. And here's another key that I think is worthwhile. You want to get to the point where you're spending what you made last month, not what you're going to get paid this month. Try to get a month ahead on it. It relieves all kinds of financial stress in your life. I'm still amazed when, you know, we get paid a day or two late as a partnership, that I have partners who are literally decades out of residency, who act as though their whole financial life is going to blow up because their paycheck came in two days late. If you're spending last month's income, that is not a problem. Okay. Use your emergency fund. Right. Approximately four months of spending or so. So it'll pay for that time period until your disability insurance kicks in to lower the deductibles on your insurance policies. But only tap that emergency fund for emergencies. It's not for a quick trip to Vegas. Right. Unless your grandma died. In Vegas or something, you got to go to the funeral, all right? Use sinking funds for upcoming large expenses, right? If you have a big expense that happens every year, you know it's coming, you start Planning for it 12 months in advance by putting a certain amount of money each month into it, maybe in a separate savings account, maybe in the same one you're using. Just use a spreadsheet to keep track of it separately. But the main point is, when you're spending your money is you want your money to go toward those things that you care about. Those things are going to make you happiest, right? Some people are into travel, some people are into clothes, some people are into cars. Whatever you're into, you know, spend. You know, spend well on that item and be very frugal with everything else. The things you don't care about. If you actually look at your spending, you go pull your credit card statement, you go pull your bank account statement. You'd be surprised how much money is going towards stuff that doesn't even make you any happier that you don't even care about. Stop spending money on that stuff so you can spend it on what you really care about. Technology can help. Some of the. Some of the apps out there, like you need a budget or Dave Ramsey's every Dollar can really help people who struggled with doing this with pen and paper or even with, you know, an Excel or Google sheet, you can be flexible about the categories as well, right? Use the ones that work for you. And if, heaven forbid, you need some money in one category and you got some extra in another, shifted over, for crying out loud, give yourself some grace with this process. For most people, it takes about six months of budgeting before they really figure it out. So don't expect to get it right the first month or even the second month, right? But do embrace your true expenses, right? What you're actually spending is what matters. Don't just use this hypothetical idea of what you think you'll spend in a given month. You got to actually track what you're actually spending. Okay, let's talk a little bit about investing for residents right now. I told you before, this is not necessarily the time to get rich. But lots of residents do invest something for their retirement, even during their training. So your two best investments, the first one is any match that your employer has given you for your 401k or 403 contributions, right? A match is basically part of your salary. So go to HR, get a copy of the plan document for the 401k or 403 or whatever and find out if there's a match and how much money you got to put in the account to get that match and make sure you're putting in at least that amount. The second best investment for lots of residents is your credit card. Quite frankly, a lot of you come into residency carrying debt on a credit card. Sometimes it's at 15%, 25%, even 30% interest. If you've got a 15% credit card debt, paying that off is a guaranteed 15% return. And you're just not going to find that anywhere else in the markets. Okay, Maybe there's an exception in your student loans. If you're getting the rate subsidized. All those, those plans seem to be going away. Or if you're expecting pslf, well, maybe you don't pay off debt, but you know, you still pay off your credit card debt. You can still pay off your auto loan, just maybe not make an extra payment. Payments on your student loans. Okay, use retirement accounts, right? There's two big varieties of these. The first one is the one you get the upfront tax break on, tax deferred or traditional accounts. And the other one's the one that you don't get the upfront tax break on, but when you take the money out of the account in retirement, it comes out tax free. Those are generally called Roth or tax free accounts. They're both better than investing without those accounts though, right? Without those accounts, you're just investing in a taxable account and your money grows slower because you have to pay taxes and all the dividends and any capital gains you generate while you're investing that money. So use retirement accounts. Your money will grow faster. The general rule of thumb, while you're in residency or fellowship, maybe your first year out these years where you have lower income than your peak earnings, is to use Roth accounts. But this is like the most complicated thing in personal finance, whether to make Roth or tax deferred contributions. There's lots of exceptions. The primary one residents should be aware of is if they're trying to keep their income lower in order to decrease their student loan payments so they can maximize their public service loan forgiveness. In those cases, you might want to use tax deferred accounts even though it's going to mean you'll pay more in tax later. Here's a good example from James Lange's excellent book Retire Secure that shows the difference difference between investing in a regular taxable account and investing in a retirement account. Right. The dark shaded one down there is investing in a regular taxable account, the lighter shaded one is a retirement account. And you can see that not only do you reach retirement with more money, but instead of your money going down so quickly in retirement, it actually may go up in retirement. It's just that tax protection is really valuable. Learn about your retirement accounts. Use your retirement accounts, get into the habit of maxing them out when you can. And take advantage of the fact that Uncle Sam will pay you to save for your own retirement. Okay? In general, especially during your training when you're busy and you really ought to be concentrating on learning medicine. Stick with a simple investing plan, right? Most 401ks, most IRAs offer some sort of target retirement fund fund. This is a fund of funds, right? You're buying a mutual fund that actually invests in three or four other mutual funds and it's a set and forget it solution. They're low cost, they're generally broadly diversified, and they automatically adjust and rebalance themselves so you can just forget about it. Just put the money in there. As long as you're investing only in retirement accounts that offer these funds, they're perfectly fine to use. And because you're investing in a retirement account later on down the road, when your portfolio is more complicated, you got more accounts that you're investing in, you got to make some changes. Well, there's no tax consequences because it's inside a retirement account. So if I could do it all over again, I'd probably invest in nothing but target retirement funds until I had $100,000 saved for retirement. They're perfectly fine options to use, especially the low cost ones like those in the thrift store savings plan, those available from Vanguard and some of those available from other companies. You just need to look a little more carefully when you're using other companies. Make sure they're actually the low cost index fund variety of target retirement funds. The truth about investing, especially early on, is that what really matters is how much you save. If you want to have a big retirement account, put a bunch of money in your retirement account. Time in the market matters a whole lot more than timing the market right. You're always worried to make your investment because you're worried it's going to go down because the President or Congress or the economy is going to do something. Quit worrying about that. You're not going to spend this money for 10, 20, 30, 40, 50 years. Trust me, it's going to grow over that time period. If you use any sort of reasonable investment, quit worrying about whether it's going to go down next month or not over the next 30 years. It's definitely going to go up, especially if you're using the recommended investment of a broadly diversified index mutual fund. Okay, early on, getting a slightly higher return doesn't have a very big effect. You know, truthfully, boosting your income and boosting your contributions has a much larger effect, especially early on. Okay, what good is a WCI presentation when I don't include my favorite picture off the Internet? And this is it. This is a couple in divorce court. Okay? They're in divorce court in 1999 dividing up their Beanie babies. You might not even know what these are. Residents maybe, I don't know. Are residents even alive in 99? I guess most of you probably were, but you were too little to remember these things. Beanie Babies were like the ultimate speculative investment, right? People bought them for five bucks and then after a while, all of a sudden they're worth 50 bucks. And then of course, in 2000, they all crashed back to $5 in value. Well, those are speculative investments, right? Similar to bitcoin, gold, other precious metals, empty land, you know, collectible cars and art, those sorts of things. They rely on somebody paying you more later than what you paid now and limit those in your portfolio. I mean, I've met lots of people that just love their bitcoin. It's fine to put a little bit of your portfolio into bitcoin, but try to limit it to something like 5%. In general, good investments are your low cost stock index funds, low cost bond index funds, well managed real estate, small businesses you control, radiology centers, urgent cares, dialysis centers, ambulatory surgical centers. Those sorts of things can be doctors greatest investments. But you don't want to be out there picking individual stocks or paying somebody else to pick stocks for you. With an actively managed mutual fund, you don't want to be buying a bunch of whole life insurance I talked about earlier and limit how much money you put in speculative investments. Okay? Stick with those simple investing plans. I mentioned this earlier. I don't know how this slide got in there twice. And that one as well. Okay, let's talk about contracts. Okay? Eventually you're all getting out of residency and you're going to need your big girl job or your big boy job, okay? And you probably ought to get that contract reviewed. But be careful when you're out there on the job hunt, okay? The main problem is you go out there is that you don't know what you want. You just don't have enough experience yet. I'm amazed when I interview New graduates or residents soon to graduate to join our group. They're asking the dumbest questions, right? They have no idea what they want or what really matters when you're getting a job. But three or four or five years out, you will know that. You'll know what you care about. And so try to learn from those ahead of you and figure out, you know, the mistakes they made and know what to ask at your interviews. The truth is that most physician jobs now are employee jobs. Only like 20 or 25% of physicians are now self employed. And you are at an informational disadvantage. I promise you, the person on the other end of your negotiation knows more than you do about what you are worth, about what comparable jobs pay. So try to get as much information as you can. Try not to be at so much of an informational disadvantage. Know what you're worth, okay, look at the salary surveys. Talk to last year's graduating residents. You know, get your contract reviewed by a firm that can provide you data from firms like mgma, et cetera. Okay? You have a lot more power than you realize, especially if you're going to a smaller town. They are begging for you to come. So make sure you're getting paid fairly. Know what you're worth, okay? You're no longer competing against a gazillion other people. Once you're an attending physician, you'll be surprised. Unless you're going to a really popular area in a really popular specialty. It's just not that competitive. And you can negotiate way more than you think you can. Okay, know what yourself. Know what you want out of a job as best you can. Talk to your attendings. Try to experience as many different types of jobs during your training as you can. But the truth is that about half of doctors are going to change jobs within just the first couple of years. And a lot of times that's just because they didn't know what they wanted. You know, they join an employee job and they realize, oh, I really wanted a partnership job. You know, I don't want to be someone else bossing me around all the time. Time. Or they thought they wanted an academic job and really they wanted a private practice job. Those sorts of situations, okay? So the better you know yourself, the better you can choose the right job the first time, but don't beat yourself up. If you got to change jobs, obviously lots of jobs do that. Just wait to buy a house until you know whether you like the job and the job likes you. It's okay to come out of residency and not own a house you can rent for six to 12 months while you're trying to learn the nice areas in town to live and what you can afford and whether you like the job and whether the job likes you. It's perfectly fine, right? Yes, sometimes the cost of houses goes up over that year, but that's okay. You're going to be in such a better position a year later, you'll be surprised. Most of the time you'll end up buying something different than you would have bought a year prior and you'll avoid all those transaction costs and having to move twice. Right? Plus, in the worst case scenario where you have to leave town to get to your new job, you're not going to have to save, sell the house you just bought and pay tens of thousands of dollars in transaction costs and you just make better decisions a year later. So I encourage every graduating resident to fellow to at least consider renting for at least a few months in the new area unless they know it very well and know for sure they're going to love that job. Okay, Try to match your job to what you're really interested in. Try to recognize whether you're going to be happy as an employee or not. Know if your student loan plan is PSLF that you can only look at jobs that qualify for pslf. That might involve sacrificing living where you want to live. It might involve sacrificing some income or some control over your job. But if that's what you've decided to do, then you know it does limit your job search. Try to figure out how much partnership or ownership of your job matters to you. Recognize that it's way easier to move out out of academics than into academics. So if you think you might want to do academics, start there. And remember, when you're joining a group or you're joining a job, the people matter more than anything. Okay? Try to get a good match and have people that actually care about you and have been there for a long time and are planning to spend their whole career there. Those sorts of things really end up being what matters in the long run. And of course, recognize 10 years out of training, you're going to care more about the control over your job and your lifestyle and your income than you do right now. Okay, get your contract reviewed. We have a bunch of recommended contract review firms on the White Coat Investor website. Just go to the recommended tab and scroll down. They'll tell you what you're worth. They'll explain all the terms in your contract to you. They'll help you Know where to focus your negotiations. You can even get them to do the negotiations for you. They'll get your contract reviewed. It only costs a few hundred dollars. It is money well spent, okay? Way too many errors happen by docs who have never had an employment contract and they just sign whatever and then find out they have these terrible non compete terms or they have to pay for their own tail insurance when they leave in a year or who knows what other kinds of crazy stuff is in that contract. Get it reviewed so the reviewer can tell you this is really weird what they're trying to put in here. You need to get this changed. You might want to consider getting this changed, but they're underpaying you. You want to know all that stuff. So get your contract reviewed, okay? Understand what's going to happen with that contract if you leave or you get fired. Pay special attention to tail coverage, right? If it's an occurrence policy, fine. But if it is a claims made policy, who pays for the tail and under what circumstances? I ended up negotiating with my group. We now have an occurrence policy, but previously we had a claims made policy and somebody was going to have to buy a tail if I left that group. So we negotiated. So if I left, I'd have to pay for the tail. If they fired me, they'd have to pay for the tail. But it was interesting because the managing partner didn't even know what a tail cost until I made him go look it up. It was over $50,000. It's not a small sum of change. So check that out. If you're not going to be getting an occurrence policy, pay attention to the non competes and restrictive covenants. Right? The Department of Labor is trying to pass a rule that says these are illegal. It has not passed yet. Okay? It's basically non competes are still out there. They're not illegal. Make sure you don't sign one that you're not willing to abide by. Oftentimes there's a radius, 10 miles, 15 miles, something like that that you can't practice if you leave. And that probably lasts one to two years. But if it's a reasonable non compete, there's a very good chance it will be enforced if you leave that job. Now I think these are kind of ridiculous if you're in a hospital based specialty like emergency medicine or anesthesia, or if you're an intensivist or a hospitalist or anything like that. But for a lot of specialties it's not terribly unreasonable. They don't want you to come in, meet all the patients and then take all the patients with you as you open a new practice across the street. So pay special attention to any non compete clauses in your contract. Expect at least some of your compensation to be production or quality based. But try to minimize how much, especially that first year. Especially when you don't have any data on how busy you're likely to be that first year. You know, it's fine to make it more production based if you realize you're a particularly productive physician. But maybe not in the first year, maybe not the first contract. One of my favorite questions to ask when negotiating contracts is, is that the best you can do? You'd be surprised how often they just give you a better contract just for asking that. Everything's negotiable. You know, the larger the employer, the less is going to be negotiable. But you might be surprised. They might not negotiate on salary, but they might give you more vacation. So don't be afraid to ask for it. Okay? Remember, the contract is just a written record of what you agreed to verbally. So make sure you're negotiating with the actual person who can make concessions to you. Everything's negotiable. Know what you care most about. It might be how much call you're taking or what parental leave is going to look like. Maybe you're planning to have a kid a year or two out of residency. You might care a lot about a signing bonus, right? You got some debt to pay off or you got to come up with some money for a house down payment. A signing bonus might not matter more to you than you know, how much time off you get or what your actual salary is. So focus on what you care about and use the tools available@whitecoatinvestor.com to compare your contract and salary to others. If you go to whitecoatinvestor.com salary we have some great tools available there. And of course we have partners that will review your contract and get you as much salary information as can possibly be had out there. Okay, Our last section before we get to the Q and A and probably the most important one right, you're about to go out on over a cliff's edge attached with nothing but a rope, and it's time to do it right? So let's get that most important year of your financial life exactly right. Okay? I want you to leave residency with a written financial plan, okay? If you fail to plan, you plan to fail. And you don't want what's going to happen naturally to happen to you. Okay? What happens naturally is you instantly grow into your income and you spend it all. You never save anything for retirement. A year later you start having to make payments on your student loans and all of a sudden you're living hand to mouth as a physician. The beautiful thing about a written plan is you can refer back to it later when you forget what it says. It can help you to stay the course with your investments in a nasty market downturn. And as you write it, it will expose the gaps in the plan, the gaps in your knowledge base, and so you can go out and fill those in. There's really four ways to get one. The first one is just a DIY method. What I did right, you read financial books, you go to webinars like this, you listen to the White Coat Investor podcast, you read the blog posts, you ask questions on the on the online communities, and you write it yourself. Lots of docs feel comfortable doing that, but most don't. Most need a little bit of help. So the first thing to consider is our fire your financial advisor course, right? This helps you get a written financial plan in place, walks you through step by step, saves you all that time that you would have to spend, you know, asking questions on forum and reading financial books and just gives you the high yield step stuff and shows you how to write your own financial plan. If that's not quite enough for you, you can hire an advice only financial planner just to write the plan. Then you can implement and maintain the plan down the road. And of course there's always the option just hire a full service financial planner and investment manager which will not only come up with the plan, but you know, they'll work with you to come up the plan, but they will implement it and maintain it over the years. And we have both those types of financial advisors on our recommended financial advisor page. Okay, so here's the various versions of the fire your financial advisor course this month. If you use resident 20 code, you get 20% off them. Okay, we came up with the student and resident one just in the last year because people ask for a cheaper one. It's obviously cheaper than the full version, which is the attending version. Right now the resident version is 239 with that 20% discount and you get that credit when you upgrade it to the attending version. Course we even have a version that qualifies for cme. If you have CME funds, you can buy that one. It does cost a little bit more, but we include eight hours of CME burnout material in that course. So that's fire your financial Advisor. That's our flagship online course here at the White Coat Investor. You can bet our financial advisor advertisers love that name. Okay, we're going to give the resident version of this course away to five of you that registered for this. You're probably not going to win. 4000 of you registered for this webinar, so you're probably going to end up having to buy it if you want it. But you can wait a day or two and we'll email the winners. Otherwise, you'll need to buy the course. It's only 239, right? That's like an hour of time for a financial planner. It's a heck of a deal. By the way, we have a free resource, Financial Bootcamp. You can sign up for that@whitecoatinvestor.com financial bootcamp. It's basically 12 emails. It's a 12 email course to try to get you up to speed with other White Coat investors. So I recommend you check that out as well. Okay. Some other options. Okay, I mentioned the financial advisors. If you go to whitecoatinvestor.com financial advisors, you can get an advice only advisor. You can get a full service advisor. Recognize that these are way more expensive than the online course we're offering. Okay? But they will help you more, right? You're gonna have somebody to take you by the hand and walk you through this stuff. Recognize that financial advice, good financial advice, is not cheap, but it's also not crazy either. So if later in your career you realize you're paying $40,000 a year for financial advice, recognize that there are people out there willing to do it, full service people who do a great job for something like $10,000 a year. Okay? The most important year of your financial life is your first year out. And if you tell me what you did with your money that first year out, I can basically predict the rest of your financial life really accurately. Okay? So what I want you to do is I want you to have a written plan for your first 12 paychecks, okay. For your first 12 months out of residency, I want you to actually write down what you're going to do with that money before you leave residency. How much is going to go towards student loans, how much is going to go toward, you know, vacation. How much is going to go toward, you know, retirement. How much is going to go towards saving up a house, down payment, or whatever your priorities are. Write it out, leave residency with it. Your typical financial priorities as a new attending are things like, you know, beefing up your emergency Fund paying off some high interest debt you haven't gotten to yet. Maybe you've been driving a beater since you were an undergraduate and that thing's just got to go at this point. Point. Maybe you need to save up a house down payment. Maxing out retirement accounts is always a good thing. You might have some moving expenses, you might have a car loan you still need to get rid of. You might want to do some Roth conversions. If you made tax deferred contributions during residency, you might need to pay off your student loans. Maybe you're getting married or going on a honeymoon or having a baby. Who knows? But the point is, if you're like most new attendings, you're going to run out of money before you get all the way down your list, okay? So you need to make a list of your priorities. And when the money runs out, the money runs out, okay? So don't end up, you know, spending your money on stuff that's not that important to you. Have a plan. Okay. Some other things to do. When you become a new attending, you probably need to increase your disability insurance. If you're still totally insurable, you can just buy a new policy. If your new job offers a group policy, maybe add that one to the individual one you bought as a residential. Maybe if you're not so insurable anymore, it's time to exercise that future purchase option. If someone else is dependent on your income, you might need to increase how much term life insurance you had. Maybe you had a million dollar policy as a resident. Maybe you actually need a $3 million policy. Go get that. If you haven't picked up an umbrella insurance policy yet, it's time to do that. As you become a new attending, update your will. Especially if you have children, right? The will doesn't just say where your stuff goes when you die. It says where your kids go when you die. Who's going to be taking care of them? Who's going to be managing whatever money you leave for them on their behalf? Make sure you update your beneficiaries as well. If you've gotten married, if you have kids, if you got divorced, update those beneficiaries. You don't want the money going to your ex. Okay, now the four most important words in this talk. Live like a resident. This is the secret to becoming the wealthy physician that your patients and your parents and your friends think you already are. Now, what do I mean by live like a resident? Well, what I mean is I want you to pick a period of time, something like two to five years. When you leave training, where you deliberately set yourself up for future financial success, right? You're going to earn like an Attending, but you're still going to live like the average American household, right? That's making 60 or $75,000. And there should be a huge difference between what you're getting paid as an attending and $75,000 a year. And that is what you use to build wealth, to pay off debt, to wipe out your student loans, to save up a house down payment on your dream home. Right? Use that money to build wealth. And you know, if you're not in an awesome financial position, maybe your live like a resident period is four years. If you are in a great position, maybe it's only 18 months. But I encourage you to have some sort of period before you grow into your income. Okay, here's the way it looks. Let's say you make a $300,000 as an attending. You're making 60 as a resident. 300 gross is really 225 after you pay off your taxes. If you live. You know what? Don't even live like a resident. Give yourself a big fat raise, a 50% raise, right? That'd be huge in corporate America. Go ahead and live on $90,000, right? This would be awesome. That still leaves you $135,000 a year to build wealth with. How long will $200,000 in student loans last? When you're sending $10,000 a month to it, it's going to be gone in less than two years, right? This is how you wipe out student loans very quickly. This is why medicine is still a good investment, even if you got to borrow the entire cost of attendance of medical school, because you can just live like a resident. You can for one or two or three or four years and wipe out those student loans. And then you have a high income without that debt. Okay, what have we learned tonight? I'm going to go over these before we get to the Q and A period, okay? Financial literacy is important. This stuff matters. You're going to become a better doc, you're a better physician, you're going to be a better parent, you're going to be a better partner. Protect your income and your family with disability and term life insurance. Get your student loans forgiven or pay them off rapidly by living like a resident. Learn to live on a budget. Learn to do this as a resident. For many of you, it's the first time you've ever had any sort of real income in your life. Learn to budget. It's not that complicated. Millions of Americans before you have done it. You can do it too. Get in the habit of investing something as a resident, right? Especially if your employer is offering you a match in the 401k or 403b. Make sure you get the right job for you and have your contract reviewed and have a written plan for those first 12 paychecks. And be careful interacting with the financial services industry. There's a lot of people out there that call themselves financial advisors that are really product salesmen and even many real financial advisors overcharge way too much. Okay, questions. We're going to answer as many as we can get to tonight. If you don't want to ask your question question here, you can always email me. Editor whitecoat investor.com you can go to the website, right? There's a search bar in the upper right if you've got a question. Trust me, over the last 15 years some other doctor has had the same question and I've probably written a blog post about it. Use that search bar. Check out our podcast, check out our YouTube channel. You can go to our online communities. We have the White Coat Investor Forum, the White Coat Investors Facebook group, the R whitecoatinvestor subreddit, and the few the financially empowered women. Okay. You can ask your questions in any or all of those forums if you like and get answers from a lot more people than just me. Consider picking up that fire your financial advisor resident course. That code is good, I guess through June 7th and you'll be able to use that to buy that course. Just use code launch 2020. You know what, I'm not sure that's right. I think it might only be good through May. Why don't we have somebody check on that and let me know how long that's good for. And I think the code now is resident 20, not launch 20. I think that's the one we used last year and didn't update this slide. All right, Andrew, it's good to have you back here because I know a whole bunch of these questions are going to be about student loans. So let's get to the questions and Michelle, help us out. Put our first question up. Let us start answering these so we're not up here all night.

Can Mary this is coming in from Mary Hoop. Can we buy a house as a first year attending without a down payment with a physician loan?

Yeah, you can, right? You might need a small down payment. Some of those physician loans require a 3% or a 5% down payment. But the point of a physician loan is you can put down less than 20% without having pay stubs. You just need a contract in place and they only pay attention to what your actual student loan payments are. And you can put down less than 20% and not pay PMI, right, which is private mortgage insurance. That doesn't do you any good. All you're doing is paying the insurance for the lender in case you default on your payments. So you can do that. I would encourage you to rent for a little bit. Make sure you really want that job before you buy a house. But absolutely, you can use a physician or a doctor loan to buy it. We've got recommendations on our website. Just go to the recommended tab and go down to mortgage lenders. And those are all your physician loan lenders.

This is coming in from Samuel Pettigrew. Is there an ideal calculator for calculating if it is best to pay off loans or do pslf? I can take this one, let you catch your breath, Jim. So we have a bunch of resources on the White Coat Investor blog, right? There are I don't know how many blog posts there are, probably 20 on on public service loan forgiveness talking all about should you do it, what income at what debt, what are the payments going to look like, is it going to benefit you? But a good rule of thumb that I had talked about about earlier is generally if your income as an attending doctor is less than your student loan balance, let's say you owe 300,000 and you're going to make 250,000 as a pediatrician, you'd be a candidate for PSLM. Now, there is exceptions to the rule and it typically is Those who have five, six, seven, seven years of training and are going to be making 500k, 400k, 600k, typically a whole lot more than their balance and they can still benefit. But a good rule of thumb is you want to be making more than your student loan balance for this to work out for you.

Yeah. You know, I think it might even be simpler than that, Andrew. I mean, if the job qualifies for pslf, right? If the job qualifies, you're working at the VA or you're at a community health center, you're an academic doc or whatever and you made payments during your training, right? Residency, maybe a fellowship, this is probably your best option, right? It's free money. It's free money. I mean, maybe if you only did a three year residency and you only owe $120,000 and you're making $300,000, okay, you might have this stupid thing paid off. Before you'd ever get any forgiveness, just making regular payments. But you know, most of the time I, I don't think it's all about a calculator. I think it's more about does the job qualify? Right. Does the job you want qualify for pslf? The question you should be really asking is am I only going to look at jobs that qualify for pslf? You know, once you have the job, it basically comes down to does the job qualify or not. Don't you think, Andrew?

Yeah, and I mean that's a, that's a big thing that, that I, you know, do on a day to day basis with, with doctors is they're graduating from residency and they come to me and they're like, I got two great job options and they both sound awesome. And one of them qualifies for PSLF and the other one doesn't. And the one that doesn't qualify for PSLF to actually pay me less. But then after two years, then I become a partner. Right. And so, you know, you've got to weigh these different variables.

That's a more complicated situation for sure. But it's really part of the job. You know, the job calculates. You can't just look at the student loan plan by itself. You got to consider what job you want and which one's going to be better in the long run and that sort of thing.

I think it's just, I think it's just, it's one of the factors that you need to consider when you're, when you're taking your job. So, but, but it's, you know, just to reiterate the point, hit at home. If you're working at a non for profit institution and you got more than $100,000 of student loans, you should definitely look at it.

So yeah. Yeah. All right, next question.

This comes in for machams. Which accounts would you rank contributions to? An order of significance of priority, HSA, 401k, 403b, etc.

Well, I mean like anything, the answer is it depends, right? The first question I'd ask is are you getting a match from the employer in that 450 and 401k or 403b? If you are, that's where your money ought to go first. Get the match, it's part of your salary. After that. One of my favorite investing accounts is a health savings account. If you've got, if your only health insurance plan is a high deductible health plan, you are eligible to make HSA contributions. And those are the, that's the only triple tax free account. You get a tax break for the money you put in. It grows tax protected. And yes, you can invest your HSA money and if your employer's plan doesn't let you, you can roll it over to Fidelity or whatever. And then when the money comes out, as long as you spend it on health care, it comes out tax free too. That's better than your Roth IRA. That's better than your 403. Right? So I like the HSA at the beginning, at least after you get any match from the employer. But in general, other than those Factors, I like IRAs a little bit better than 401ks and 403bs. You can often get lower expenses. You can often get better investments. You have a little bit more control over it. You might have a little less asset protection depending on what state you're in. But these are all good things, right? You know, it's not like for sure, the 401k is always worse or always better than the Roth IRA. You got to look at the other details that go into it. Now ideally, if you're an attending physician, I'm going to tell you you should be maxing all that stuff out. But that's not so easy to do as a resident. So as a resident, you're probably going to have to choose.

This comes in from Abby Joy Garcia. Can you give advice on how to select a bank for a high yield savings account? And do you recommend opening one?

Ah, this is a great question. I'm going to first start by answering the question you should have asked Abby. And what that one is, is where should I put my savings? Because the answer is probably not a high yield savings account today. Okay, high yield savings accounts right now are paying like 3, 3.5%, something like that. But if you go to Vanguard or even if you go to Fidelity or Schwab or something, you're going to be able to get a money market fund that pays more than that. No, it won't have FDIC insurance, but that's okay. It's still a very, very safe investment. And I think you'll make 4% or 4.2%. The point of cash management though is get it into something that's going to pay you right? Get it out of your checking account that's paying you nothing and get it into either a high yield savings account or a money market fund that's going to pay you 3 or 4 plus percent these days. And if rates go up, well, you know, it might pay as much as 5% or more. But which bank to select? I don't know. There's a lot of banks out there that offer high yield savings accounts. Mine's at Ally Bank. I think they might have advertised once with the white coat investor. I don't think they do anymore. But, you know, I thought they were a pretty good option. I've still got the account. I just don't have any money in it because all my cash is sitting at Vanguard in a money market fund because it pays more than the Ally High Yield Savings Account right now. But a few years ago, that wasn't the case. There was a time when that High Yield Savings account was paying 1% and the money market fund was paying like 0.25%. So you do have to pay attention to what the yields are. That may change over time. They're perfectly reasonable to use. But I think right now money market funds are probably a better option.

This comes in from Andrew Lamb. And if the retirement account your residency offers is with a different firm than retirement accounts offered by future employers, does it make sense? Does it make a difference if you merge the accounts or not?

Well, in general, what you're asking is what to do with your residency 401k when you leave residency, right. And there's a few options. The one taken most commonly is probably to just, you know, if it's a Roth 401K or a Roth 403, you just roll it into your Roth IRA. If it is not, if it's a tax deferred account, you might want to consider converting it to a Roth IRA and paying the taxes on it in that relatively low income year. You might not have the cash to pay that tax bill on it though, so keep that in mind. Another commonly taken option is just roll it into your new 401 or 403. That gives you simplicity. You only have to manage one account, and you can do that every time you change employers. Most of the time, most employers are getting the picture that you can't offer crappy 401s and 403s or your employees are going to sue you. And so Most of the 401s and 403s out there these days are pretty good. They're good enough to use. And so that is an option. And the beautiful thing about it is there's no tax bill. It's just a rollover from one account to another. Now, every now and then, the old one is way better than the new one. And in that case it might make sense to leave the money with the old One, take advantage of whatever low costs or great investment it's offering. You'll have to manage multiple accounts, but it might be worth it to you. Just keep in mind what you probably don't want to do as a physician, and that's what's the right answer actually for lots of Americans, is to roll the money out into a traditional Iraq. The problem with doing that as a physician is you're going to need to make your Roth IRA contributions via the backdoor Roth IRA process. And if you got a bunch of money sitting there in a traditional ira, the Roth conversion step of that process is going to get prorated. And you don't want that to happen. I mean, it's not the end of the world, but it kind of defeats the purpose of the whole process. So try not to roll it out into a traditional Iraq, roll it to the new 401k or do a Roth conversion on it is generally the right answer.

And I'll also say on that too. Don't, don't forget about your other employers and retirement accounts. One time from one of one of my wife's previous jobs, we got a check in the mail because we just forgot about and they were like, you need to roll this over. So, you know, just please be aware of that. Keep tabs on those other retirement accounts from old employers.

Yeah, a lot of times if you don't have a very big balance in there, they can force you out of the plan. Oftentimes I think my partnership plan, my physician partnership plan, I think once you have $7,000 in it, I think they can't force you out. But if you have a really low balance in there, often they can just send you a check. Yeah, be careful.

It happened. And we got the 10% penalty, so, you know, early withdrawal. So. This comes in from Arlette Capeta Romero. Hi. I will be a PGY one in a very high cost, cost of living area in July. I have no debt, student loans. Nice. I plan on maximizing my Roth IRA all four years of residency. What else do you recommend doing? No. 403 bat, no. 403B match. Very new to this.

All right, well, congratulations on matching number one. Number two, congratulations on getting through school with no debt or student loans. You don't mention a contract either. So I'm assuming that maybe your parents helped you out with that or something. So congratulations on that. You're starting ahead basically of 75% of doctors right now. You know, obviously the very high cost of living is not going to help you build wealth as much as a low cost of living area might. So hopefully it'll help you get some awesome training. You know, maxing out a Roth IRA is great. Putting some money into your residency, 401k or 403b, especially if there's a match, is great. What else do I recommend doing? I think you should eat, I think you should keep a roof over your head, and I think you ought to do a few things that are fun, you know, I mean, don't try to get rich as a resident, especially if you're living in a very high cost of living area. The time to get rich is that live like a resident, period. As you're leaving training, okay? Save something for retirement, but don't feel like you got to put away half of your half of your resident salary toward retirement. Retirement. You know, you do not have to live that tight to be successful as a physician. Okay? So I think that's pretty good. You know, look into whether there's an hsa. If there is, you might want to use that. But if you're getting to the point where you're maxing out a roth IRA and you're maxing out a spousal roth IRA and you're Maxing out, you know, your 403B and your HSA, you're probably trying to do a little too much as a resident. It's probably time to dial it back. You know, why don't you go on a fun trip on your, you know, two weeks of vacation you get as an intern and go blow some of that money or replace your beater or something, whatever, right? But chances are a lot of this is just going to get eaten up by the cost of living in that high cost of living area.

This comes in from Chucho Med tv. From a strict economical point of view, why would it be better to be in a W2 versus a 1099 locum tenems job?

Okay, well, you can't just say W2 or 1099, right? It's not that simple. You got to look at everything, right? For example, when you are a 1099, right, you're an independent contractor, you're in business for yourself. There is no employer paying for the stuff that employers typically pay for. So what do employers typically pay? Well, they typically pay half your payroll taxes. That's Social Security and Medicare, and it's thousands of dollars a year for an attending physician. They typically pay something toward your retirement accounts and they set them up for you. They typically pay something toward your health insurance. They might pay for some disability or Life insurance. So just going to be a 1099. If the pay is the same as a W2 and a 1099, but you get all that extra stuff as an employee, you're better off being the employee, right? For a 1099, they have to pay you more than they would pay you as a W2 for you to come out ahead because you're going to have to pay for all that stuff yourself. Now you also get to pick your own retirement plan. You get to pick your own health insurance. Right. You get to, you know, maybe you don't want disability insurance through the company. And you can buy an individual disability insurance plan if you're a 1099. So you get more control as a 1099. And so long as they're paying you More As a 1099, I like being in control. Right. It allows you to deduct some of your business expenses. And you know, I like the idea of doctors owning their jobs a little bit more. More. And I do think locum tenants can be a great way to start out a career. Right. They're often giving you extra. They're paying you more than you'd make if you're in that job as a regular employee. Plus they're paying you living expenses. I mean, you can really make a lot of money in a locum tenens job. I know some people that have done that the first few years out of residency and it really paid off well for them. But it's more than just W2 versus 1099. Right. It's important to understand the difference, but recognize that as a 1099, you got to pay for some stuff that your employer would typically pay for. As a general rule, I think about 10% more is about right for like an emergency physician. If you're getting paid 10% more or more than that, it's probably worth being a 1099 versus a W2. But you really do have to run the numbers. Every situation is different.

This comes in from Jared Atkins. I'm a first year family medicine resident planning to aggressively pay off $200,000 of loans. What IDR program would you recommend at this point? How would advice change if Republican bill proposal passes? Okay, so you know, let's, let's talk a little bit about what the existing programs are and just a teeny bit of a flavor on the proposal. We just don't want to go too far down the what's, what's proposed because everybody, all the proposed stuff could change. Right. So first of all, I think this is a great approach if you're trying to aggressively pay off your loans, I would think that while you're in residency, I would. I don't know. Actually, you probably never even got on an income driven plan, Dr. Atkins. You probably tried to apply and everything got caught up in this whole wave of the same SAVE program. But what I would do is I would pick the income based repayment plan that is ibr. It is the only income driven plan that was created by Congress. The others, such as Save, ICR and pay, they were all created through the executive branch. And those are easier to be done away with, modified, shuttered.

Okay.

So I would, I would do the IBR plan while you're in residency and I would, I'd try to pay what you can. Right. Maybe you're not going to be able to pay off all the interest while you're in residency, but, you know, I would try to make whatever payment you can while you're in training to keep the balance from growing. As far as changes and what is currently proposed, the Republican proposal that as of this morning passed the House. Okay, pass this House by, I think one vote. And now it needs to go through Senate, the next, the next branch in the government. And is, this is a reconciliation bill. So that means they don't need, you know, they don't have the, you can't filibuster this, this vote, meaning that you need 60, 60 votes in the Senate. They only need a simple majority. Republicans hold a 53, 47 majority currently in the Senate, Senate. So that means they need 51 votes. It's a really high likelihood that there will be some bill that passes that has some modifications for these programs. Well, right now what they're proposing is they want to take the four income driven plans, save, Pay, ICR and ibr, and lump them all into ibr. Okay. So if you're on save, if you're on pay, if you're on icr, there's a chance you could end up being on the IBR plan plan, which means your payments are probably 15 of your income. Okay. Perhaps higher than what you're paying previously. Now, there's one program that is currently in proposal and it's called repayment assistance plan wrap. And payments are about 10% of income. And it also has a subsidy component like the SAVE program. If that payment program were to become law or, you know, get, get written in, it's probably not going to go into effect until next summer. Okay. Usually takes about a year for this, sometimes even two years to get rolled out. Once they have you know, dropped this. The, you know, new laws and new regulations. Loan servicers, they need time to update things. There's 8 million people in SAVE right now, 20, almost 30% of all borrowers. And they've all got to get into a new program some point, right? So know that there is another payment program on the horizon and there will be more details to come, but right now I plan on ibr.

Yeah, I think it's also important. I mean, you're a PGY one, right? I'm not 100% convinced and maybe you are, maybe you're sure, but I'm not 100% convinced that you know for sure you're going to be paying off your student loans. Right. A lot of things can change. I think the time to really make this decision is as a PGY3, you know, if you're in three year family medicine residency, that's when you decide, okay, am I really going to be paying off my student loans or might I consider a job that would qualify for PSLF? Because you know, you come out and you're making 275 or whatever as a family medicine doc, it might make a lot of sense to go for a PSLF if you end up in academics or you end up at a community health center or something like that, that. So I'd be real cautious, especially if you end up thinking about refinancing any public loans. Now generally you don't do that during residency anyway. But you want to be real sure you're not going for PSLF before you refinance any federal loans.

And maybe, maybe what you could do as well is if you don't want to, if you don't want to just continue to watch the loans grow, start setting aside a little chunk of money in an account, right? Student loan side fund or slush fund or whatever. And then once you graduate and you take that job with the private practice, you've got a little bit of savings that you can then dump into loan. That way you can kind of watch this play out as far as your career and what you want to do, but then you've got a little bit of savings to help put in the loan.

So.

All right, this comes, this question is, thanks for doing this. Can I be phased out of my income based student loan repayment plan as I recertify my income, if I far exceed my loan balance, thus excluding myself from candidacy for pslf? This is a great question and I think it's important to mention that 2 of the income driven payment programs out there right now pay Pay an income based repayment have a income threshold that you need to meet. It's called partial financial hardship. What that means is generally you need to get into one of those income driven plans while you are still in residency or in the year that you're transitioning from resident or fellow to attending. Because if you try to enter them when your income is greater than your student loan balance, you may not qualify for them. But in this case, what if you make more than your student loan balance and you still want to go for pslf? Are you then kicked out of these payment programs? No, you're able to remain in them now with the pay plan and with the income based repayment program, there is a payment ceiling and that goes into effect when you no longer qualify for a partial financial hardship. And they cap your payments at whatever the standard 10 year plan is, which is generally about 1% of your student loan balance. So say you have $300,000 of student loans, your payments will cap it generally about three grand. So as long as you apply for it and qualify for it once while you're in training, you should be able to stay in it for the duration of repayment. Up. This comes in from a Never had a credit card. Should I open one now even though I have my debt of student loans as an intern?

Yeah. Well, some people go through life and never have a credit card. It is true that you can do that. It seems challenging to me. I think I probably would get a credit card. I carry a number of credit cards if for no other reason than it seems easier to buy gas at the pump. Right. The point of credit cards though is that they're misnamed. Credit cards are not actually for credit. Right. If you need to borrow money, the last place you want to do that is probably from a credit card because the interest rates tend to be so egregious. There are lots of people that have ended up in bankruptcy because they just couldn't control their spending once they had a credit card. And then everything they bought and didn't pay off ended up compounding at 25 or 30%. So you can get in trouble with credit cards, but as long as you're only using them for convenience and being very careful, trying not to let them cause you to spend more than you otherwise would. And there's good, good data showing that credit cards are likely to have that effect, I think it's fine to have a credit card. It's certainly easier to buy things online. It's certainly easier to book a plane flight to buy gas at the pump, those sorts of things. With the credit card, you often can use a debit card to do that. But I think there's a little more security, frankly, with a credit card when you do that. So should you open one with. Well, probably just because it's a convenient way to live your financial life. But do you have to in order to get a credit score or something? No. That student loan debt's probably going to take care of as much of a credit score as you're ever going to need for any sort of mortgage or anything you get later. But I probably would get at least one credit card at some point. Just be careful not to let it cause you to have a spending problem.

All right. This comes in from Miranda. Hi, Jim, I'm, I'm a spouse tuning in on behalf of my husband who's working tonight as an empty 2. What are your thoughts of sending med student loans into forbearance and paying them off after residency?

Oh, yeah. Well, they asked me this one, Andrew, so I'm going to give them my bill, please. Then you can, you can give them the real answer. That's a terrible idea. Don't do that. Thank your husband for working the evening shift, though. It can be brutal, especially during residency when you're doing six of them in a row or something. But forbearance deferment, bad idea. It's a bad idea. You've got to be really stressed for cash to even think think about doing that. You are almost always going to be better off in an IDR program. You know, even if it's not the best IDR program, you're going to be better off in an IDR program. And especially, you know, if you've got a family, which it sounds like you do, and you've got, you know, you're going to be having not that much income because you're using your medical school income or your intern year income. You know, your payments are going to be practically the same as you'd get in forbearance. Right. You're probably going to have something like $100 a month payments and you can afford that. But those payments go toward your 120 monthly payments you may need for public service loan forgiveness. So it really preserves that option going forward. Whereas if you go into forbearance, something terrible could happen to you. You could get to the end of your residency, realize you're going to take a job that quantum qualifies for PSLF and not have made any payments toward it. So now you got to make all Your payments as an attending making a huge income instead of getting all those, you know, years of low payments. So forbearance, deferment. I am not a fan. I almost wish they weren't options. I recognize some people may need the option. I think it's legally required to offer it. But I hate it as an option. Andrew, do you hate it more or less than I do?

I'm on the same wavelength. It is, it's not great. You know, please, please, you can get onto an income driven plan. It's, it's 200 bucks or 300 bucks or $150 a month. And those, it's probably zero for the.

First year or two. Right.

The first year too. It's almost always zero because if he's a PGY2 right now, if he isn't enrolled and he applies right now, he can still use his taxes from last year when he only worked half the year. Right. And you know, it, it just, or, you know, or I mean Even half, half PGY1 half PGI2 I guess last year in this case because he's probably wrapping up his second year right now. But just, it could just really set you back here. You know, you don't know what, what the future holds. And I think about, you know, say there were two years that, that this doc could have ended up getting credit for PSLF when he would have been paying 200 bucks a month. And now he's going to have to end up paying $3,000 a month as an attending physician and extending his clock for another two more years. Right. And, and so there's a lot of money, you know, at stake by making this little decision to do this now. And frankly, I just think it's a, it's a good habit to get into paying these. Right. Get into the habit of paying this and then it's going to be really, really easy when you get the jumping income.

Yeah. Miranda, thank you for tuning in. I recognize lots of docs don't have time to do this. And you know what? When they have an engaged spouse, when they have, you know, somebody that's really managing their income well, it, it's pretty powerful. So thank you for being here tonight.

This comes in from, from Joanna Martinez. What is a great resource to get started on investing? I don't know anything about it.

Well, well, you've come to the right place, right white coat investors, the right spot. Let's start with whitecoatinvestor.com any topic you want on investing. If you put it in the search box. Box you're going to get a whole blog post about it. We've got four books, right? And three of them cover a lot of information about investing. The student guide in particular, like the last half of the book, is literally just terms to help you become financially literate. Now a lot of people are like, oh, I'm a resident. I'm not going to buy the student book, but it's probably still worth buying, even if you're a resident. If you prefer podcasts, we. We've got a White Coat Investor podcast. If you prefer video, right? We've got White Coat Investor YouTube channel with all kinds of videos on it. We have online courses. The fire your financial advisor course will teach you all about investing. And there's a resident version, as you can see on the screen. We're selling it at a discount right now just for you guys watching tonight. Resident 20. And I guess we better make it so launch 20 works too, now that we've had it on the screen for a half hour. We'll get that fixed after the webinar. But there's lots of great things out there if you're willing to read books. We've got a whole list of books by other people besides me on the website and I'd start reading some of those. Come into our communities and start asking your specific questions and people will help you. There are a lot of people engaged who are not that far ahead of you and can remember what it felt like to not know anything about investing. They will take you by the hand and help you. And if you really just need a professional to help help you, we've got a list of financial advisors that can, that can really do it for you at a fair price if you need them to. So lots of resources. It all starts atWhite Coat Investor.com.

Cine bun. I'm scared of investing right now because of the political economic climate. Is it safe to invest now?

No, it is not safe to invest now. It is never safe to invest, right? You will always have something to worry about anytime you have the opportunity to put money away for later, right? The point of investing is to take some risk and be paid for taking that risk. That is the risk that the great returns you're expecting don't show up. And so as you put together your portfolio, as you put together what you invest in, you want to balance two fears. The first one is fear of missing out, right? Fear of everybody else having great investment returns while you have your money sitting in CDs or bonds or a money market fund. And the Other fear to balance is fear of loss. And you want to get that mix of risky assets to not so risky assets to that point where those fears balance each other out, where your fear of missing out is about equal to your fear of loss. Okay. And for lots of people, they find that at 60% stocks and 40% bonds or 80% stocks and 20% bonds. And you just need to pick an asset allocation where you feel like, okay, I can put money into the market. Now, I realize that it might go down for a while, but the truth is, you know, you're on the resident webinar. Presumably you don't need this money for literally decades. Decades. Okay. I don't know what the stock market is going to do this week or this month or even this year, and maybe not even this decade. But I do know what it's going to do over the next 20 or 30 years. It's going to go up and you're going to be glad you invested. And time in the market matters a lot more than timing the market. Hope that's helpful. Anything else you can add to that, Andrew?

Yeah, I wish I could just help illustrate this even more. And you can see a chart over the last 20, 30, 40 years. It's just, it's like a hockey step up and up into the. Right, right. And that is because you have some short term volatility. You have, you know, the 2000.com bubble. You know, you have the 2007, 2008 financial crash crisis. And then you have the, you know, the, the crisis that, that happened during COVID as well, four or five years ago. And you have these blips where the market went down, but, but then it has continued to rebound. And yes, there will be this volatility in, in the short term, but the way to think about it is think more long term. You're probably 30, 40 years before you're going to need this, this money. Right? So I wouldn't be afraid of, of this, the short term changes and political climate.

So yeah, understanding financial history helps a lot. Right?

Yeah.

Go back and look at 2020. Right. We're all terrified to invest. The whole world was melting down. You couldn't even get toilet paper. But you know what? All that money invested in 2020, you have made a killing on same thing in 2022. And interest rates went up 4,4% in like six months. Right. The market tanked. And guess what? All that money you invested then earned 25% in 2023. It earned 25% more in 2024. Right. You don't want to let these periods of time freak you out, right? Even just last month, right. President Trump announced all these tariffs and the market tanked. Well, it's back, right? It's only been a few weeks. So don't let you know. Don't let what you see in on CNN or what you're seeing on Fox News or what you're seeing on USA Today or what you're seeing in Internet forums freak you out. Have a long term perspective and recognize you're not investing this money for next month or next year. You're investing this money for decades from now.

This comes in from Blake Jones. If you anticipate becoming disabled from a previous pre existing condition, can you collect multiple GSI long term disability calls?

I have never heard of this strategy. I don't think this is very possible. As a general rule, a GSI policy tends to be connected to your employer and most people only have one employer. But I suppose if you went and got three jobs, each of which offers a GSI policy, I suppose it's possible then you could get policies that would all pay you even though you're collecting money from other policies. But you got to read the fine print, right? Use one of our recommended agents to help you understand how they would pay if you had more than one. But for the most part, I think this probably is not, you know, a viable strategy for most people. Certainly if you anticipate becoming disabled from a pre existing condition. I would start with the GSI policy. If any GSA policy policy is available to you and get as much as they'll sell you, right?

This comes in from Sai Prashanth Haranath. What if you are in your late 40s, have made many mistakes and want to course correct course now.

All right. I think we had an attending sneak into the resident webinar here. That's okay. We're glad you're here. We had a bunch of people sneak into the student webinar too. Residents learn from this, right? This is why you start now. I don't know, maybe. Maybe Cy is a resident, but probably not, probably not in late 40s. Here's the deal. No doctor is really ever more than 10 years away from retirement, no matter where you're at right now. Because if you save enough of your money, you can actually become financially independent in about 10 years as an attending physician. And so don't beat yourself up too much. You know, most people do not get it perfect. Most people make lots of mistakes, right? I talked about how maybe buying whole life insurance is not a great idea. Guess who bought a whole life insurance policy as a medical student, right? I've talked about how hiring, you know, product salesman masquerading as a financial advisor is not a good idea. Well, guess who did that, right? I've made plenty of mistakes and the point is you want to correct them as quickly as you can. So you make them as early as you can with as little money as possible as you can. But if you got to your late 40s having never made a mistake, that would be pretty unusual, right? Most of us have made some errors. So concentrate on your income, concentrate on your savings rate, clean up your mistakes, become financially literate, you've got plenty of time. Lots of people don't even think, think about retirement before their late 40s. You know, if you have a typical career, if you work till you're 65 or so, you still got 15 plus years to make up for any mistakes you've made. So you certainly can do it. It's really never too late. I mean, I guess it's too late if you're on your deathbed, maybe, but for most time it's never too late. So just get going now and don't beat yourself up too much about starting a little later than some people do.

We had a question the other day come in from a reader too. And this doctor was in their mid-40s and they had a negative net worth of $500,000 then. That was 10 years ago and that was when they had first discovered white coat. They felt pretty beat down. How am I? Half a million dollars still in debt, presumably student loans and maybe a mortgage in there, and I'm in my mid-40s now and they just sent us a note the other day and now they're in their mid-50s and now they have a net worth of $2 million. The bottom line is you can do it. You can do it if you follow these simple, simple principles of investing, of paying off your debt and so many of those components that we talk about here today, day. So yeah.

Okay, next question is from Brandon. If you have no dependence, is term life still recommended? Generally, no. Generally, no. I mean, if you think you're going to have dependence in a year, well, maybe you buy it just in case so you don't become uninsurable or something. But in general, I don't recommend you buy life insurance unless somebody else depends on your income, right? I mean, maybe you'll never have any other dependents. Who knows? Lots of people stay single their whole life, never have any children. You know, they generally don't need term life insurance. You know, you probably have enough money pretty quickly in your life to pay for your own burial. And other than that, you know, term life is a death benefit payable to somebody who needs money in case you die. So yeah, stay away from it if nobody depends on you. As a general rule.

This comes in from Joanna Martinez. Is interest accruing when placed on forbearance due to the SAVE plan? It shouldn't, it shouldn't be accruing if you were previously in the SAVE plan and as of last summer when all of the lawsuits started to ensue, really around July or August, everybody, all 8 million borrowers in the SAVE plan were placed into this forbearance and it shows should be an interest free forbearance. Now I have had a couple of people that have let me know they have been continuing to receive interest or it's been charged on their loans. If that's the case, you need to reach out to your loan servicer, you need to reach out to federal student aid. I would file a complaint with the student loan ombudsman and just let them know I've been on the SAFE program and I'm, you know, under the understanding that it shouldn't be accruing interest current. Okay. Now that aside, there's no payments due currently as well. But you need to be prepared to switch payment programs probably as early as this summer because this saved plan, it doesn't look good. It's very bleak that this plan is going to stay around very long. And another thing too is that the SAVE program is not accumulating any credit currently for the PSLF program. So that means a lot of you out there that have been in this limbo for a full year haven't been initially getting credit for pslf. And I know that's a really hard pill to swallow.

Okay.

There is a program that is called PSLF Buyback. We've written an article about it, we've covered a little bit on White Coat Investor. But it's a way that you can recharacterize these forbearance months due to save and even if you've had some other previous one ones earlier on in your training and get credit for those months. But know that this is something that you can do when you should have hit your 10 years, which is probably, you know, five, six, seven years out.

For a lot of you. Yeah, it's important to recognize this is not regular forbearance. Right. The regular forbearance program, if you just come out of med school and put your loans into forbearance. You do get interest on that. That interest is not waived. So this is like a special save forbearance. While Congress monkeys around with the student loan program.

This comes in from Rohan Dalby. Can you explain PSLF process further? Do you apply for the program when starting medical school or when starting residency? Okay, that's a good question. So the PSLF program, you begin to apply for this when you are, are employed as a resident. Unfortunately, you can't do that while you're in, in medical school typically because I don't think you can hold a 30 hour job on a weekly basis. I don't think you're able to do that. Dr. Daly, when you're in med school, maybe like you're like. I think people work a little bit in their fourth year if they get through all their clerkships and rotations. But other than that, I think you're too busy to work during medical school. So know that the PSLF program program would start when you're in residency, assuming you're at a non for profit institution, which most of you, probably 98% of you are, and, and then that would proceed on post training as well, should you stay in the public sector. This comes in from Gianna Caldera. What does it mean to file a tax extension? Okay, so I think this is going back to when I was discussing one of the strategies to help keep your student loan payments low. And the whole premise of this is that each year when you go from student to resident to fellow to attending, your income is usually increasing every year unless you go from a high cost of living area to a low cost of living area, from student to resident to fellow to attending, your income is usually increasing every year unless you go from a high cost of living area to a low cost of living area for your residency and then for your fellowship. Okay, pretty, pretty rare for income to drop, you know, year after year. But what happens is when you file an extension on your tax, rather than having to file your tax return on April 15, they now give you six more for your residency and then for your fellowship. Okay, pretty, pretty rare for income to drop, you know, year after year. But what happens is when you file an extension on your taxes months to file the tax return. So rather than having to file in April, you can now file in October. Now a key point on this is that you're still supposed to have paid all your taxes by April 15th. And if you've underpaid and then you don't pay the tax, you know, then you don't file your return for five or six months later. Well, there's going to be some penalties and fees that are assessed on that if you underpaid your taxes initially. So picture this, picture that you start. Other than having to file your tax return return on April 15, they now give you six more your repayment in July or August, as most residents do. Well, each year around May or June. Gianna they will require you to certify your income. Well, what happens before you certify income in May or June? You file your taxes in April. Well, if you delay filing your taxes, rather than filing in May, you now file in October. What the loan servicer will require is your most recently filed taxes that are still from two years ago. So this is a way that if your income is increasing, you can use income from earlier years to help keep your payments lower.

Yeah, which can mean getting more money forgiven via public service loan forgiveness. The actual tax extension is really easy to file as as long. No big deal. It's like half a page. I file a tax extension every year mostly because I don't get all the K1s. I need to file my taxes in time to file in April. But the actual mechanics of it is super easy. It's no big deal at all to file a tax extension. In fact, you should never feel pressure to file your tax return in April. It's very easy to do it in September or October. But Andrew's right. The taxes you're owe are owed in April. So if you don't pay them, you'll owe penalties. It's really just a little bit of interest on what you should have paid in April. It's not the end of the world. But if you think you're going to owe money on your taxes, you should probably make some sort of payment in April about what you think you're going to owe on your taxes. But filing the tax extension is no big deal and in this case can really help with your student loan management plan.

From Logan Muir. I will finish residency at age 34 and would like to be more aggressive with my investments early in my career. In your opinion, what is a reasonable level of risk and mutual fund bond, Mutual fund to bond ratio?

What's reasonable? Well, reasonable is a pretty broad range, right? I would say somebody coming out of residency. It's hard for me to imagine having less than 60% of your portfolio being in, you know, stock or real estate, you know, aggressive kind of investments. On the other side, you know, how aggressive can you be? Well, there's no reason you got to stop at 100% stock. Right. Most people coming out of Residency, they owe $200,000 in student loans and if they got $20,000 of investments, you know, their, their actual ratio of stocks to bonds is far higher than 100%. You're investing on leverage. So if you think about it that way, you can be pretty darn aggressive with your investments early on. But in General, something between 60% and 100% stock in the portfolio is probably fine for somebody just coming out of training. As the years go on, you may want to add some bonds to the portfolio, especially as you get close, close to retirement. Keep in mind this assumes you can actually tolerate this aggressive portfolio. It doesn't do you any good to be 100 stocks and then the first time a nasty bear market comes along, you sell them all low. That's not a good idea. Right. Far better to err on the side of having a little too much in bonds and realizing in the middle of that bear market that this is no big deal. I'm going to bump up my asset allocation. I'm going to be a bit little more aggressive. Far better to do that than to panic sell and end up buying high and selling low.

And you know, another thing you can consider too is target date funds that just automatically rebalance over time. They start out typically in a heavier equity allocation. Maybe it's 70% equity and it's 30% fixed income or bonds when you're a new attending and then when you're 65, it's probably flip the script. Right. And so that's another way that you could facilitate this if you are. We're worried about how to approach this from a, you know, starting out.

Yeah, the experts at Vanguard that put together these target retirement funds, if your retirement's decades away, basically the funds are 90% stock. So that I guess this is as close to a recommendation as you're going to get from Vanguard for you. They think if you're not going to retire for 330 years, you should be 90% stock.

This comes in from Blake Delgadillo. What's the advantage of wiping out $300,000 in loans in a few years, given you only pay around 130k over 20 to 25 years with IBR and have the rest forgiven. So you know, Blake, I think you're talking about that example where I was looking at PSLF and I was looking at a standard repayment program over a 10 year period of time. So PSLF is a 10 year forgiveness track, right. Where you make your required payments for 10 years and whatever your outstanding balance is, they discharge it. And in that scenario, that doctor, that emergency doc paid $130,000 and got their entire balance discharged. The alternative to that was fixed payments over 10 years, that was $400,000. Okay, now what you're talking about here is the 20 to 25 year track. With IBR, most physicians will pay off their loans before they're going to qualify for that. What's called income driven repayment for G forgiveness. And that's because generally the only scenarios that will work out for the 2025 year track are those that have student loans that are 3, 4 or 5x their income. I don't really like that plan at all. I don't know that Dr. Dolly likes it much either. But you pay for 20 years and then at the end of the 20 years you have to pay a tax on whatever your outstanding loan balances. So unless you, you know, oh, 5, 6, 7 or $800,000 of student loans, if there's any dental specialists out there, you might be in this boat. But most of you are not going to benefit from the 20 to 25 year plan because you make too much. You'll end up paying the loans off before you get anything forgiven on the 20 year track.

Yeah. IDR forgiveness is like a disaster plan, Right. If you have a disaster when it comes to your student loans, this plan might be the way out of the disaster. Right. If you owe $1.2 million in student loans and you only want to work half time, you know, and so you're making $120,000 a year and you got 1.2 million in student loans. Yeah. This is probably the way to do it. But keep in mind you're probably still going to get a $500,000 tax bill at the end of it. Right. This is not an awesome plan. This should not be the mainstay of any physician's student loan management plan. The two good options are PSLF, which is tax free forgiveness after 10 years, including those years in residency, or refinancing your student loans, living like a resident and wiping them out. Right. Those are the two good options. This carry your debt for 20 to 25 years and then have a huge tax bomb at the end of it is not an awesome plan. It's only really a good idea for those who really have some pretty terrible debt to income ratios or have had something happen to them that keeps them from being able to earn much money. You know, maybe you didn't, maybe didn't match into a residency, for example, and you got $400,000 in student loans and, and you go take a job as a, as a tech in the er, you know, then maybe, maybe this is the plan. You know, but as a general rule, I don't like, I don't like the IDR forgiveness plans. I feel terrible that a doc goes 25 years into their career and still has student loans.

Yeah. I think I can count on one hand the, the doctors that I've worked with that have gotten that. And you know, with, with pslf, there's, we've had hundreds, you know, hundreds that have, that have gotten over the line.

So anyways, yeah, I, I mean, is this, is this really a better plan than, than going to the VA for six years? I mean, it just seems like PSLF is going to be almost always the better plan for most doctors.

It's, it's a, I mean, especially for physicians. Right. For, for you, as, as a physician, you have, you know, you have eslf, you have standard repayment and then you could work at a place like the va or you could do research for the nih. Like there's all these other cool kind of auxiliary programs that could really help pay this off where you're just not going to have to keep these around for 20 to 25 years unless you. Yeah. You know, there's a situation where you have to work part time or, you know, you've just really got a, you're a career changer and you, you know what, I've worked with people that were attorneys and then they wanted to become doctors and then they've got their law school debt and their medical school debt. Right. But very, very unique exceptions for people to actually do that. This comes in from Dane Rana. Did we remain on SAVE until it's phased out and we are presumably shifted to another plan automatically or what plan would you recommend we move to for the average resident?

Come on, Andrew, what's your, what's your crystal ball show well gonna happen in Congress? Come on.

This is where I'm gonna throw out what I learned from business school? It depends. Okay, so haven't used that yet, but I don't know what your plan is. Dane. Are, are you, are, are you going to work in private practice?

Are.

Do you owe 100 grand? Do you, do you want to work at a non for profit or you kind of just, is it up in the air at this point? Okay, because if, if you are dead set on doing pslf, why not put in an application, throw in an application for ivr. If you're in residency right now, you know, you by, by virtue of applying now, your payments are really going to be similar. I would, I would try to get the ball rolling right this, who knows how long this takes, right? Even if there's a bill, you know that, that talks about the changes. Maybe there's nine months for people to move payment programs. I wouldn't just, I would be inclined to apply if you're still in training, if you are, if you graduated from training and you're now an attending, I probably hold off a little bit because now certifying as an attending or switching plans as an attending is going to be a big jump in payments. Okay, now as far as what's going to happen with the save plan, you're probably going to be moved into another payment program and the payment program that they would default move you into may be IBR or it may even be the standard 10 year plan. And I really don't like the standard 10 year plan for a resident because it's usually unaffordable.

So yeah, those ones are hard to answer. And you know, one option is book a consult with Andrew, sit down, run your numbers with him, and then you get six months of email questions free afterward. And one year now, one year, one year of email questions. So as Congress figures this out, you can, you can get your plan updated via email with Andrew. So not a bad, not a bad option for those with a complicated student loan situation.

Nats, is it better to try to save 20% for retirement while paying off student loans in three to four years, or is it better to pay off the loans first?

Welcome to the most complicated question in personal finance. You know, closely followed by Roth versus traditional contributions. Right? This is the classic debt versus investing question. And the only way to know for sure is to have a functional crystal ball, right? You got to know what investment returns are going to be over the next three to four years. And if you knew that and you knew they were going to be lower than the interest rate on your student loans, well then you should pay off the student loans. If you know your investments are going to do better than your student loan interest rate over the next three to four years, you should invest the money. But since you're like most of us and you don't have a functional crystal ball, you make the best guess you can. Frankly, I think most doctors that are willing to live like a resident for a few years can do both. You can max out your retirement accounts and you can pay off your student loans in three to four years. So I think a lot of people just kind of use a mixed approach. But I do run into people all the time on the Milestones to Millionaire podcast who just hate debt. They're like, we're going to do the debt first. And they call us up after 20 months and their student loans are gone. You know, they haven't, they haven't saved a thing for retirement, but the student loans are gone in 20 months and they're thrilled, so you can do it that way. But, you know, I think most people probably take kind of a mixed approach, a balanced approach, and, and after three or four years, the student loans are gone, and they've got a fair chunk of change sitting there invested for retirement already.

Yeah, I, I agree with, with that approach. I think doing both just say saving for retirement, starting to, you know, get this, get back to broke. Right. That, that's what we're trying to do first. First get back to broke. And once the loans are paid off, you know, then, then usually you're. You're. Maybe you're a couple hundred thousand dollars in the green at that point. Right. So try, try to do both. But it comes down to, you know, kind of your individual preference. Right, Right. As far as, are you okay with the debt or is it keeping you up at night? Because I work with some docs and they're like, it's keeping me up at night. Or some even have religious purposes behind this that they're like, you know what? Even though it mathematically doesn't make sense to pay my student loans off first, I'm just going to do that because holding the debt around for a longer period of time than you should can sometimes lead to some poor financial decisions after that. Right. You know, although people talk a whole lot about, you know, debt, but debt is leverage, and leverage can help with returns, and it can hurt with returns. So I would say do both at the same time. Saving and paying down the loans.

Yeah, there's a lot of nuance to this. There isn't necessarily a right answer. Go to the website search Pay Debt versus Investors. You'll find several blog posts that go through all the factors to consider as you make this decision, but frankly, if you live like a resident, you can do both.

All right, this comes in from Ryan954. As a general rule, should you try to max out 403B, 457 and 401A over taxable accounts, when would you favor taxable over one of those accounts?

All right, well, There's a lot of nuance that goes into this, right? As a general rule, yes, it's better to invest in retirement accounts than in a taxable account because your money grows faster. But that assumes you're going to leave the money in there for retirement, right? In general, it's hard to get to retirement account money before age 55 or age 59 and a half. You can get to it. There's a few hoops to jump through though. So if you're investing to buy a house next year and you're 35 years old, no, you shouldn't be putting that in a retirement account. That should be in a taxable account, right? So money that you know you're going to need relatively soon, don't put it in retirement accounts. Another thing to consider, 403 and 401Amoney is yours. 457 money, particularly in a non governmental 457B account, is technically your employer's money. It's deferred compensation. And if your employer went bankrupt, there is at least a theoretical risk. Although it may be happening now for the first time that I've ever seen with doctors with a steward owned hospital where you can actually lose that money if the hospital goes bankrupt. So if you're worried your hospital is going to go bankrupt and this is a non governmental 457B, well, that's a pretty good reason to invest even for retirement in a taxable account over that 457. But in general, you max out the retirement accounts and then if you're still saving additional money, you put that in taxable.

This comes in from Mochams. Should interest amortization be taken into account whether deciding whether or not to consolidate federal student loans loans. I wonder if they're talking about interest, interest capitalization maybe, or.

I think that's what they're talking about. I think they're talking about capitalization.

Yeah. I mean, and so we do get this question a lot is, before I do a consolidation on my federal loans, should I try to pay off all that interest that accrued while I was in med school? It's probably a lot of money. I see 20 to $50,000 of interest accrues during medical school. Okay. Now, there was a couple of years that many of you were probably in medical school when there was no interest on the loans because of COVID From March of 2020 until September of 2023, there was no interest on the loans, which was a very big plus during the, you know, the hard times of COVID Now I I don't know that you're going to have enough money to pay that 20, 30, $40,000 up front. Certainly, you know, if your loan balance is low, if it's less than 100 grand, and you know you're just going to pay them off, sure, I think that's, that's a fine decision to do, but I don't know that you're going to have the capital to do that when you're moving for residency and things. Things are tight and I would say right now just knock out the consolidation. Do what you can in terms of payments during residency. It's not the time to get rich. As we've iterated over time. That comes after training when you can make the decision to go PSLF or refinance them and pay them down aggressively. Why allocate to bonds over money market funds?

Okay, great question. There are three possible interest rate scenarios, right? Interest rates can go up, they can go down, and they can stay the same. In normal times, bonds have a higher yield than money market funds, okay? So in two of those three situations, you make more money in bonds than you do in money market funds because you're taking more risk, you're taking on more interest rate risk. So if interest rates go down or if interest rates stay the same, you come out ahead owning bonds over money market funds. If interest rates go up, you come out ahead owning money market funds instead of bonds. So if you have a functional crystal ball, then you can decide which one of these to do. Otherwise, if you're like most people, you put some money into stocks, you put some money into bonds, you put some money into cash and you rebalance it periodically and you get what you get. So, you know, if you don't have a functional crystal ball, I wouldn't necessarily, you know, try to, try to play the interest rate game, the interest rate prediction game, which is really what you're doing here, trying to decide between bonds and money market funds. Certainly for money you need anytime soon, in the next year or two, leave it in cash, leave it in a high yield savings account or a money market fund, or if you know you need it on a specific date, you could buy a short term CD or a bond or something. But in general, you know, bonds of any significant length are for a little bit more long term money.

This comes in from Mark. Do you think an Army Reserve pension is worth going after if I only have seven years left to reach it, or do you think it'll interfere with my career and ability to put more, more money away as An Attending.

Well, this one's hard to know without the numbers. You got to run the numbers. I guess the first thing I'd ask is how much do you like being in the army, right? Do you like doing the things that being an army reservist is going to make you do? You know, maybe there's a deployment out there. You know, one of the big reasons I got out of the military is because I didn't like being deployed, right? And they probably could have thrown a whole lot of money at me to try to get me to stay in, and I still would have gotten out because I did not like being deployed. I didn't like being away from my family and coming home and having my kids not recognize me. That was an unpleasant experience for me. But maybe that sort of thing doesn't bother you. Maybe you love being in the army, so, sure, stick around. And I think I'd make this decision primarily based on non financial factors. But if you want to, you know, look at what the financial consequences would be, you've got to get the financial details right. Figure out how much that pension is going to be worth if you quit now versus if you stay in seven years. Figure out how much less you're going to make if you spend time in the army in the meantime, you know, figure out how much you would have to put away to replace that pension. And you can kind of, you know, you can try to quantify that by looking what a simple similar thing, an immediate annuity, you know, buying a pension would cost. And you can kind of run some numbers and give yourself a sense of whether this is a good financial move or a bad financial move. But mostly I think I'd make a decision like this primarily on the non financial factors.

This comes in from Neha Joy. My sister is a hospitalist from India on an HB H1B visa. What happens to her disability insurance if she comes back to India in a few years from now on due to some disability? Will she still get paid?

That's a great question. And what you would need to do is read the contract, right? She's got disability insurance, it sounds like. So she needs to go read the contract and see what it says. And if it's not very clear, I would call the company that sent the contract and give them a hypothetical. What if I went back to India and got disabled? Would this pay me? And I think the way it would probably work, but I don't know this for sure. It's hard to keep track of how this stuff works when you Start involving other countries. I think it would be based on what she was making at that time, which is probably less if she goes back to India. So maybe she bought a $20,000 benefit policy but she's not making that much back in India. And maybe it pays her some smaller amount but I don't know for sure. I think some of these don't pay if you leave the country so you might as well dump them if you're leaving the country permanently. But it really is. You got to read the contract. Right? These are complicated contracts and you got to get into the details. When you have a detailed question like this, your insurance agent can also help you to decipher the contract. If you're not sure exactly what happens in this situation, you can certainly call one of our recommended agents. Go to whitecoat investor.com insurance. They will help you answer this question. They will know the answer. But I don't know the answer and I'm guessing you don't know it either. Andrew. No.

This comes in from Jasmine Beloy. Should people on PSLF that are already on forbearance be making monthly payments even though it won't count towards pslf? No, it's not counting. Right. Why are you paying money if you're on forbearance if you're not getting any credit for pslf? I, I would, I would hold off making payments. I, what I would do is I would those, those the amount of money that you would have been paying on a monthly basis. I, I'd set it aside an account so that when they do turn payments back on for you, you're, you're ready to go and you already have some funds earmarked for your student loans.

And I guess consider getting into Ibrahim. I guess that's the big question and get my payments counting again.

This is from Grace Kim. Could you apply for PSLF after being on an idr? Yes. So Grace, IDR is just the vehicle that gets you to pslf. Income Driven Repayment is, you know, bases your payments on about 10, maybe 15% of your take home pay. And if you're working for a non for profit institution for at least 30 hours per week making a payment on an income driven plan, you are accumulating credit towards PSLF even if you haven't applied previously. Right. But it's a great idea to fill out the employer certification form. You can find that on studentaid.govpslf because that gets you enrolled in the program. Then they will know oh, Dr. Kim is, is working towards the PSF program and if you haven't done it in previous years, know that you can get retroactive credit.

All right, Andrew, we're pushing. We've been doing this for over an hour, answering the questions. We're pushing 9 o' clock here in, in the mountain time zone and it's got to be almost 11 o' clock now on Eastern. I got a shift at 6am and I'm starting to get hungry. I haven't had dinner yet. So let's take two more questions and we'll call it good. Those whose questions, we don't get to send them to me via email. Ask them on the groups you can see on the screen there. We'll get your questions answered eventually, but we're not going to stay up all night answering them. So let's take this one and then whatever's after Zach's question.

So this comes in from Zach Watson. I've been making Roth IRA contributions as a fellow, but my income is about to increase past pass the limit in July. What should I do with the Roth IRA contributions I've made so far this year?

Oh, Zach, that was a mistake. You shouldn't have done that. Okay, I wish I'd get this message out to people. So here's what you're going to have to do. First of all, stop making direct Roth IRA contributions. Okay? So now you need to be doing your Roth IRA contribution via the backdoor process. So you're going to have to re characterize all the contributions you made so far this year to traditional IRA contributions. It's not that hard to do, but that's what you'll need to do is recharacterize them. Okay. And then, you know, once you've made your entire contributions to the traditional IRA for the year, you want to just convert them back to the Roth ira. So you're going to owe taxes on whatever money those contributions you've made already. You know, whatever gain you've had in that Roth IRA from your contributions for this year, by the time you eventually do that conversion, you're going to owe some taxes on those. But the sooner the better to clean this mess up. You certainly don't want to keep doing what you're doing now if you're not going to be able to make direct Roth IRA contributions for 20, 20, 25.

This comes in from Blake Delgadillo. Can you clarify how a private practice job may still qualify you for PSLF if that company employs 501C3 entities? It's a great question, Blake. So there are two states currently in the US, California and Texas, where you don't have to be directly employed, employed meaning paid as a W2 by said hospital or non for profit, and you can still qualify. So in California and Texas, you can be part of a contractor, be it locums, be it a private practice, private group that is contracting you at a non for profit.

Okay.

And that's because there's a corporate law that has to deal with medicine in Texas and in California where you as a physician cannot be directly employed by those institutions. Now, academic centers and federally qualified health centers kind of, you know, are on, kind of on an island of the, of its own. But this is a really, really cool opportunity for those of you in Texas and in California. I've worked with hundreds and hundreds of docs in those states pretty recently that have gotten eligible for public service loan forgiveness. But the key thing is that the non profit where you actually are contracted to work at, they need to sign the employer details for you. And if you're just getting started with this process, call up medical staff, they can usually point you to the right person. Generally it's going to be a medical officer, maybe even the CMO that is going to sign the form for you. Okay. So it's definitely worth a shot. Shot and can really swing things, you know, massively now that you may not have to refinance them and just pay them off and look at something like pslf.

Yeah. Well, very well, Andrew, thank you so much for being with us tonight to answer all these hardcore student loan questions I knew we were going to get from the residents. Thank you to all of you who participated in this webinar. You've all been entered into the drawing. We'll let you know in the next day or two if you, if you, if you won one of those five free courses. Everybody else is 20% off. 20% off through June 7th. We'll get them to add the launch 20 code. The resident 20 code will also work. We'll just extend the period through June 7th because I don't think I fixed this slide. And, and we'd love to have you in the course. Like all of our online courses, it comes with 100% money back guarantee for a week, no questions asked, no risk to you, et cetera. Thanks for being part of the White Coat Investor community. Please, please, please tell your fellow colleagues, your attendings, your medical students about the White Coat Investor. Let's get this information out there. There's no reason the docs should continue to have their reputation as terrible investors. We can do better. Let's spread the word. Thanks for what you do on a daily basis. And thanks for what you do to boost financial literacy among your colleagues. Have a great night. We'll see you next time.