WCI #89: State of the Podcast

This is the White Coat Investor Podcast where we help those who wear the white coat get a fair shake on Wall Street. We've been helping doctors and other high income professionals stop doing dumb things with their money since 2011. Here's your host, Dr. Jim Dahli. This is White Coat Investor podcast 89, the state of the Podcast. If you're finding our podcast informative and helpful, we would encourage you to sign up for our monthly newsletter. It is totally free and and includes useful, actionable information not available on the regular blog posts or this podcast. It's almost like being in a secret club. The kind of club that can boost your knowledge and enhance your wealth at the same time with no strings attached. Sign up today@whitecoatinvestor.com Newsletter. You can do this and the White Coat Investor can help. Our quote of the day today comes from Jonathan Clements who said trying to beat the market isn't just a risky endeavor that will almost certainly end in failure, it's also unnecessary and arguably an astonishing waste of money and time. Thanks for what you do. It's a new Year new you, right? You're on your way into work and I hope you're enjoying the longer days and a little more daylight out there and have set some goals for the new year. I hope some of those goals are financial and I hope that the White Coat Investor can help you to reach those goals. But most importantly, thanks for what you do with the rest of your life. The work you do is meaningful and and it does matter, even when nobody there thanks you for it. Speaking of New Year new you, make sure you've signed up for our newsletter. We send out a monthly newsletter. It's totally free to you the first time you sign up for it. You also get our 12 financial boot camp emails. Those are going to be coming out in book form soon. Expanded obviously in the book, but you can certainly get a taste of it just by signing up for the free monthly newsletter. It's also a great time to take our online course, the Fire your financial Advisor course. If you've decided that this year is the time for you to finally become financially literate, that course is a great way to do it. Yes, I charge a bunch of money for it. It's 499. But you know what? Compared to the value of your time and compared to the value of that information over the rest of your life, that is a steal. It's a great way to get up to speed quickly with the rest of the White Coat Investor community and it's a great Way to finally get a written financial plan in place that you really understand. And the great thing about it is it's totally risk free to you. Seven days, no questions asked, money back guarantee you don't like it, just email us. We'll give you your money back now. You don't have to email us 20 times. We've occasionally had that happen where somebody is just paranoid that we're not going to give their money back. Send us one, we'll get to you. Okay. We don't watch our email every second of the day at any rate. Today I thought we'd do something we've never done on the podcast before, but I've been doing on the blog for a long time. Every year, every January on the blog, we've done a State of the Blog where I talk not only about my conflicts of interest, which I think are really important for you to understand, but also about some of the great things we've accomplished in the last year. And so I'd like to go over some of that on the podcast here. I know a lot of you just listen to the podcast and don't read the blog. Some of this will be information that also shows up on the blog. That blog post actually runs the day after I'm recording this and the podcast won't go live till next week. And so you, this may be some of this information you've already seen, but I like to kind of do this in a format that goes over the three missions of the white coat investor. And those are, number one, to help you to help those who wear the white coat and other high income professionals get a fair shake on Wall Street. That's our primary mission. And back in the day when I started this thing and wasn't even making any money, that was really the driving force. And it still is, to be honest with you. Reason number two, however, is to make money to feed my entrepreneurial spirit, to create jobs for others. That's something I also really enjoy about the White coat investor. And then the third mission didn't show up for a few years into this enterprise and that is to connect you high income professionals in need of financial services with the few good guys in the financial services industry. And so we're going to talk about our enterprise in those three missions in the context of those three missions. So first, getting a fair shake on Wall Street. Our biggest thing that we do is of course the blog. I mean, the blog has over 1200 posts on it now. This year we published 211 posts. I wrote 112 of them, our paid columnist, my daughter Whitney, wrote one. The White Coat Investor Network members, Passive Income MD and Physician on Fire, wrote 47 of them. We had 56 guest posts, five sponsored posts. Now we only take those for the scholarship, and every dollar of those goes to the scholarship winners. And then of course, we had the 52 podcast show notes that were published on the blog as well, one for each week. So that brings the grand total of posts and pages on the blog portion of the site to 1,524, which is pretty impressive. Anywhere from 15 to 22,000. Read those posts by email or on the site. We've had 11 million over 11 million page views on the site this year. And since we first started, We've had over 33,500,000 page views on the website. The most widely read post was one of those clickbaity kind of titles, 10 reasons why doctors Spend Too Much Money. The newsletter I mentioned at the beginning of the podcast, we still send that out. We've got 21,725 people subscribed to that. That was an increase of 49% over last year. I did about 10 speaking engagements this year. That's not a big part of the business. And obviously I'm not huge on travel. It's not my favorite thing to do to spend two days flying in order to speak to a group for an hour or two. But I still try to keep doing it just because I know there's some people I can only reach in that manner. And so we'll continue to do a few of those. I mostly do them in the winter. I'm trying to cut back to about a half dozen a year. I think I did 10 this year. I'm continuing to write for ASEP now and for Forbes. I did six and seven articles this year respectively, for each of them. The book continues to sell, although for the first time this year we sold fewer books, fewer white coat investor books than the year before. Actually, what typically happens with a book is you sell a whole bunch in the first three months and then it levels off and just downhills the whole way after that. So this book was actually kind of special in that it continued to climb for about four or five years each year and how many books were sold, and so that's pretty awesome. But it's still quite high in its categories. On Amazon, it ranks as high as second and third in some of its categories. The audiobook as well is ranked highly, as is the Kindle version. Obviously, there's a new book coming out if you haven't heard the White coat investors financial boot camp will be out here, probably March 1st, I think is when it's going to come out. So if you're interested in another book, this one is not a second edition of the White Coat Investor. It's a completely separate book that grew out of those emails that you get when you sign up for the newsletter. We made a big effort on social media this year. We have 13,200 Twitter followers, 8,974 Facebook followers. We started a Pinterest page and an Instagram page. And so that's been a lot of fun to reach out and interact with some of you on social media. That's kind of. If you like your information as quickly as you can, that's the place to get it. You know, things often get discussed on social media weeks or even months before they show up on the blog or on the podcast, just because the production time is basically nothing to get something out on social media. We started that subreddit r whitecoatinvestor on Reddit. It's not the most successful thing we've ever done, but it's certainly reaching some people. We have 910 subscribers there and had over 22,000 page views on that subreddit. One huge success we had this year was the Facebook group. At the end of the year, we had 11,841 members. They'd made almost 34,000 comments and 47,000 reactions on 2,000 different posts. I mean, it's really a hopping place. It's hard to keep track of it all now. The depth of the interaction there is maybe not quite as high as it is on the forum just because I think more people are on their phones in the Facebook group. But certainly it's a place where you can get some answers quickly and where you can certainly kill some time and learn a little bit about finance at the same time, in between cases or anytime you're sitting around waiting for somebody. The white coat investor scholarship. We increased the amount substantially. This year. We gave out over $60,000 in cash and prizes to deserving professional students. We increased the number of winners to 10. This year. We gave the honorable mentions the places 6 through 10 free copy of the fire your financial advisor course. It's a $499 value. The other five winners all got at least some cash. So second or fourth place was worth $2,000 plus a box of books for your class, and fifth place was worth a thousand dollars plus a box of books for your med school or professional school class, and then the first, second and third prize split up the rest of the money. And so our winner, I hope I'm pronouncing this right, Jacqueline Mach, who wrote an essay titled Grit about how she was basically in a rollover accident in the Middle east on kind of a mission trip between her first and second year of medical school and was basically disabled for a year. And she talked about how the grit in her teeth from the sand and the rollover was similar to the grit she needed to get back into her medical school studies. So she took home almost $29,000 from that scholarship. So thank you very much to the platinum sponsors for that scholarship. That includes Larry Keller with Physician Financial Services, Common Bond and Laurel Road, which are student loan refinancing companies. Bob Bayani, also an insurance agent, and physician Home loans at Fairway Mortgage. So thank you for supporting those who support us and our efforts. We're really appreciative of those who contribute to that scholarship and for those who volunteer to judge it and heck, even for those who enter it. Our forum, we just finished the third year of the White Coat Investor Forum. Actually, the front page of the forum now gets more page views than the front page of the blog, which isn't entirely unexpected since every time you go to the forum and come back from, you know, the various threads, you hit the front page again. But there are now over 8,361 threads on there and over 100,000 posts on the White Coat Investor Forum written by almost 6,000 forum members. That's a 56% increase in forum members just in the last year. It's a great community that's developed there. But this is the podcast. And last year we had a goal to put out a podcast episode every week, all year. And we're proud that we achieved it. It was a lot of work, particularly on Cindy's part. She put a lot of work in here to really improve both the consistency and quality of the product we're Putin putting out. And I think her hard work has been amply rewarded. The podcast now gives the blog serious competition for reach and impact. A typical blog post is downloaded or a typical podcast is downloaded by 15 to 20,000 people. We put out a total of 86 podcasts, 52 of those were in 2018. And our total downloads for the podcasts are 1.5 million. So that's a 326% increase over last year and an average of 17,432 downloads per episode. There are about 11,100 of you that subscribe to it. And the show is actually ranked number 136th in its category. Its category is business, but on itunes that's where it falls. So that's actually ahead of things like the NPR Morning Report, although it's behind things like Biggerpockets and way behind things like Dave Ramsey. I think he's number one in the category. And How I Built this and Planet Money and some of those really, really popular podcasts that are put on basically by multiple people with all kinds of producers and plenty of money. But we're proud of that to be on there. I don't think any other physician financial podcast is in the top 200 or has ever been in the top 200. The podcast has had 630 rankings, 598 of which were five stars. So thank you to those of you who have left us a five star ranking. If you have not yet done so, please do so. It does help us find more people and get this message out to more of your colleagues. You know, it's interesting, next to the Facebook group, I think this podcast is the best advertising value we offer at White Coat Investor. I mean average 17,000 people per episode. And when you buy an ad, your ads there basically forever. You know, for anybody who comes later and listens to all the podcast episodes in the past. And so I think that's great advertising value. If you are an advertiser and you want to get your message out to lots of docs, the podcast is a great way to do it. Our top three episodes this year were episode number 55 where we went over the basics of investing. Episode number 67 where I had the physician on fire and Passive Income MD on the podcast. We're actually recording another one of Those in about 19 minutes here after this podcast is over. And then number 56 with Mike Piper. All of those had over 20,000 downloads. This year we're going to continue to do interviews on every other episode and the other episodes mostly consist of me ranting and or answering questions from readers. As you noticed, we've implemented Speak Pipe this year, which is a way for you to ask a question on the podcast by recording your voice and submitting it to us. We are gradually getting more and more of these with your voice on them. And pretty soon those are going to be the only questions I'm answering on the podcast, I think. So if you want your question answered, record it on speed. Speakpipe that web address to record your voice message and send it to us and you can do it anonymously if you want, can be found@speakpipe.com whitecoatinvestor we also have a YouTube channel. Some of you are actually watching and listening to this on the YouTube channel. We produced 42 videos this year and now have 1,340 subscribers. That's a 402% increase and had a total of 3,137 hours of viewing in the last year, which is unfortunate because you need 4,000 just to put ads on your YouTube channel. So hopefully this year we can actually put some ads on our YouTube channel. I don't think I'm ever going to be a YouTube star. I guess I'm too ugly. I don't know. But we'll, we'll continue to try to make ways to improve the video cast. White Coat Investor Network had a great year. The State of the blog post actually has excerpts from both Physician on Fire and Passive Income md. If you'd like to read those, you can check that out on the blog. Another big thing we did this year was a Physician Wellness and financial literacy conference. It was a lot of stress to put on a party for 300 of you in Park City, but it was a lot of fun for two and a half solid days to meet you in person and listen to some awesome speakers. You can actually still attend this. You just have to do the online version which is available for 299. It's available the same place as the Fire your Financial Advisor course. It's on teachable. There are links there from the main website, but it's 13 hours of great content from smart folks like Jonathan Clements and William Bernstein and Mike Piper. You know, we offer money back guarantee on that as well if you've watched less than 25% of it. But come on, 99% of those who attended it recommend it to their peers. You're just not going to return it. It's great. It's really, really good Financial Boot camp we had this year, right? We've been continuing that the last year or so and it turns out that about 11,000 people started financial boot camp this year. That is the email course. It's totally free when you sign up for the newsletter. The Fire your financial advisor online course we put out a year ago is a smashing success. It's a seven or eight hour course. I mentioned it at the beginning of the podcast. We've had 1,237 students go through the course this year. Everybody doesn't need it. If you can write your own financial plan, you don't need it. If you prefer to use a full service financial advisor and you feel like you know what you need to be looking for with them and you know how to not get ripped off by them, then you don't need the course. But there's a significant percentage of you in between those two groups that the course can really benefit. Again, no questions asked on that. So we've got some big plans for this year. I'm hoping that by not only to get that financial boot camp book out by March 1st, but hopefully by mid year to have an online course aimed at residencies for residency programs to buy for their residents available. So looking forward to that. That's going to be a big effort this spring for us to put that together. Hopefully we can pull it off. Thank you for those of you who are spreading the message of the White Coat Investor by word of mouth. That's actually a significant part of what we do here. Lots and lots of, lots of you, and lots and lots of you have found out about the White Coat Investor and about financial literacy for physicians just because your intern or your resident or your attending or your student told you about it. And so thank you for those of you who are out there doing that. All right, mission number two with the White Coat Investors feeding my entrepreneurial spirit, we did something a little bit different this year. We decided not to put out quite as much financial information about the White Coat Investor. And I'm sorry about that. I know a lot of you really enjoy reading the nitty gritty details of our business, but there's a few reasons why we decided not to do that anymore. You know, when I first came into the space, I decided to do it. I was inspired a little bit by Pat Flynn, who posted monthly income reports. Pat, however, was blogging about how to blog. So he was showing people how to make money online. And so I think it was a really important part of his message. But I enjoyed it because it allowed me to be very, very transparent, you know. But as more docs have kind of entered this space, there's 80 plus physician financial bloggers out there and probably six or eight financial podcasters out there. A lot of them are kind of using these annual reports to copy my business. You know, I'm basically publishing a blueprint of how to do this every year. And so I applaud their efforts to promote financial literacy, but I wasn't super fond of having to start competing with them for revenue sources. You know, nobody was doing everything that we were doing with the podcast and the blog and the newsletter and the books and Everything. But there was always somebody I had to compete against for book sales and somebody else for affiliate marketing and others in podcasting. And you know what? None of them were putting out detailed financial reports. At least most of them were not. And so we decided that rather than give them the blueprint, we were not going to put that out quite so openly. The other issue is with the White Coat Investor Network. I'm basically making a couple of other bloggers sell me some of their equity to learn the secrets of how we made money at the White Coat Investor. And if I'm charging some people for that, I shouldn't give it away for free to somebody else. But probably more importantly, you know, it just started becoming a little bit bigger part of our life. Let me explain what I mean. We're a little bit Internet famous now because through the White Coat Investor, I mean, a million people a month or a million page views a month are happening on the blog. And of course, the podcast is being listened to by 17,000 people an episode. And so it's getting to the point where people are starting to ask my kids. They're like, hey, is your dad the White Coat Investor? Or kids in the neighborhood are going, hey, you guys are rich, aren't you? I read about it on the Internet. And so it just got to the point where it was like, maybe we ought to be a little bit more careful about the financial information that we put out there. You know, I don't want my kids getting, you know, kidnapped and held for ransom because they know the White Coat Investor makes money. You know, it's kind of cute when you're making 1500 bucks a year from your blog. Everyone says, oh, isn't that a cute little side hustle? But when your blog income starts outpacing your clinical income, it can inspire a lot of less than ideal feelings and thoughts about it. So we've cut back on how much financial information we are disclosing there. We continue to give away lots of money. We actually give away more money than we spend each year. So we're incredibly blessed with how much we're making from that business. And of course, we pay lots and lots more money in taxes than we used to. But what I am going to continue to do is to be very clear about our financial conflicts of interest. So I'm going to go over those in excruciating detail. I'm incentivized to run content that relates to my advertisers businesses, especially those with whom I have an affiliate marketing relationship, more frequently than other content I'm incentivized to accept guest posts from financial professionals who advertise with me more frequently than those who do not, although the only sponsored post we ever do all the money goes to the scholarship I'm incentivized to recommend you refinance your student loans when perhaps it wouldn't be a good move for you, although that doesn't happen very often unless you're going for public service loan forgiveness. I'm incentivized to recommend you seek out professional help with insurance, financial planning, investment management, student loan advice, purchasing and selling real estate, negotiating contracts, borrowing a practice loan, preparing your taxes when perhaps you can do some of that or all of that on your own. I'm incentivized to recommend alternative investments such as real estate over boring index funds. I'm incentivized to accept advertisers who don't meet my standards for recommendation to friends and family. I'm incentivized to recommend fee only advisors who charge AUM fees than when maybe a flat fee advisor would be less expensive. Although I think I'm pretty careful about telling you to prefer flat fees. Or at least do the math with AUM fees. I'm incentivized to recommend you use a physician mortgage loan over a conventional although I don't recall ever actually doing that. I'm incentivized to recommend you read financial books, including especially my own. I'm incentivized to recommend you take my financial course and those of my affiliate partners. I'm incentivized to recommend you attend our live conferences. I'm incentivized against recommending content by others who have the same affiliate marketing partners or who compete for the same advertisers unless I'm a partial owner of their site. I'm incentivized to recommend the content to position on Fire and Passive Income md and I'm incentivized to recommend you use the White Coat Investor forum other over other forums like the Bogleheads forum and the White Coat Investors Facebook group over those of others. So lots of conflicts of interest, but I'm just not willing to do this for free. And there's no way to avoid conflict of interest at all unless I am. And it's just too much work to do it for free, guys. So what we're going to do is just continue to disclose our conflicts of interest and let you do with that information as you see fit. All right? Our third mission is to connect you with the good guys. Mostly that's done with our Recommendations tab on the website. And in our choice of who we take for advertisers, I view taking an advertiser as basically at least a low level of endorsement. We do at least a minimal amount of vetting before taking an advertiser. And then of course, as white coat investors continue to use their services, we do additional vetting. If you have a lousy experience with one of my advertisers, I want to know about it because we remove them. And if you have a particularly good experience, I'd like to hear about that too. So that is the state of the blog and the state of the podcast for 2019. I wanted to do something. I wanted to mention one other thing though. One of the things we really regretted about the podcast this year that we probably owe you an apology about. As you'll recall, about a year ago in January, we had Jordan Goodman on the podcast that was podcast number 35. And we actually just recently, a month or so ago, recorded an update to that podcast and I recommend you go back and listen to that. It's podcast number 35. It turns out during 2018, Jordan Goodman got in a lot of trouble. He actually was fined and had to pay a whole bunch of money back because he was involved in a Ponzi scheme. He ended up settling the SEC charges without admitting or denying the allegations and, and agreed to disgorgement of 2.29 million plus prejudgment interest of $315,850 and a hundred thousand dollar penalty and to be subject to an injunction. And you know, so he got in a lot of trouble for some of the things he was promoting. Now he didn't actually promote the Ponzi scheme he got in trouble for on the podcast, but if you'll recall from that podcast, he did promote a lot of the affiliate relationships that he does have. And Cindy and I got to the end of that podcast and we looked at each other and said, should we really run this? And we made a bad decision. We shouldn't have run that podcast at all. And I apologize to you for that. But at any rate, we've got a big old, I think it's 20 minutes long addition to that podcast explaining my thoughts on each one of those products that he mentioned. I also ran a blog post about the part that more than anything you guys were interested in, which was the whole mortgage acceleration process and how that works and how it's maybe not quite as awesome as he made it sound on the podcast. So apologies for having that guest on. Please know that we have changed our process and we have a much stricter process and a podcast guest policies for bringing people on the podcast. But we won't let that happen again. All right, let's get to a few of your questions. I think we're only going to be able to do three today because we're starting to run out of time. The first one comes from Peter Steinberg. It's one of the Speak Pipe questions. Let's listen to Peter's question.

Hi, Jim, it's Peter Steinberg in Boston, Massachusetts. Love the show, love the podcast and love the website. Keep up the great work. My question is I recently got married and I wonder if you have any white coat investor tips for newlyweds in terms of dealing with their finances. Thanks so much.

So basically he's asking how should newlyweds deal with their finances? Well, I think it's worthwhile when you get married to combine your finances. Combine your investment accounts as much as you can, combine your bank accounts as much as you can, combine your budget as much as you can. All of your income is now our income. All of your debt is now our debt. Okay? That's what marriage is. You're combining your lives. You know, some people try to do separate finances, but I think it's a mistake. I think what often happens doing that is some one person does it really poorly, the other person does it okay. Whereas if you get both of you in the room, I think you do a knockout job when both people are contributing to it. It's just like, you know, if each of you were paddling on one side of a canoe, you know, it's just going to go in circles unless you're both paddling equally. So you do get a few things that you ought to know when you get married. First, stay married. The worst financial catastrophe out there is getting divorced. Not only do you end up having to pay alimony for years, but you cut your assets in half and you decrease your income. I mean, it's just bad all the way around. Enjoy your lower tax brackets, too. When you get married, you benefit from the married tax brackets. Now, there can still sometimes be a marriage tax penalty, but at least you get to enjoy those lower brackets. And particularly if your spouse is not also a high earner, you often get a married bonus. Don't Forget about spousal IRAs. Even if your spouse is not working, you can still contribute to a backdoor Roth IRA for them. That's $6,000 a year if you're under 50, 70, if you're 50 plus of course you might also now have somebody else depending on your income. So if you didn't have life insurance before, it's time to buy some term life insurance. And you know a lot of people when they're budgeting, when they're married, they find it's beneficial to have some money that you don't have to account to your partner for. Whether you call that an allowance or what you call it. That's probably a good thing to do just to reduce a little bit of marital discord. Alright, second question. This one's anonymous. Let's play it.

Hi, my partner and I started funding a 529 for unborn child. We're using Vanguard's Nevada based plan with my partner listed as the owner beneficiary. The plan is funded with about 20,000 and we have it set for monthly thousand dollar contributions. We have a couple questions regarding this plan. First is we're going to be transferring the 529 to our child at birth. Will this trigger a gift tax? In this case only a change to the beneficiary would be necessary. So I believe there should be no tax consequence. The second part to that question is whether there's any benefit to transferring ownership status in addition to beneficiary status, or should we just stick to changing the beneficiary? The second question is whether 529can be used as a form of multi generational inheritance or legacy. For example, if we Significantly overcharge a 529, can that be passed along from generation to generation and will that trigger a gift tax? Since in that case the goal is to leave something for when we're no longer around, there would be a need to change the ownership, not just the beneficiary status, or at least that's what we believe.

Okay, so basically this questioner is asking three different questions. First, does a 529 plan transferred from you being the beneficiary to your child trigger gift tax? And yes it does. That probably doesn't matter because the federal estate tax exemption is so high. But if you have a lot, a lot of money and we're talking about 22 million plus married, then that could be an issue because it uses up some of that exemption in some states, of course those exemptions are lower amounts and it can really matter. But you can transfer up to about $15,000 per year per spouse per person and not be subject to gift taxes at all. And so that's 30 grand a year if there's two parents. And so that's pretty easy to avoid. But if you're giving it to a new generation, if you're going from child to grandchild or parent to child, then yes, that does trigger gift tax. He also asks about the benefit of transferring ownership status to the child. And there's not a lot of difference in whether the parent owns it or the child owns it. Really doesn't matter much. There is a lot of benefit if a grandparent or an uncle owns it. Just less of it shows up on the Free Application for Federal Student Aid, at least until the money is given. When the money is given, it becomes the child's income. But until the money is given, those assets don't count against you on the Free Application for Federal Student Aid. So the way most people get around that is they use the 529 money from grandpa or from the uncles for their junior or senior years so that they're not hosed by having this high income that works against them tax wise or works against them financial aid wise. It doesn't work against them tax wise. Then the final question was, can you pass a 529 along from generation to generation or will that trigger gift tax? Well, here's where the gift tax gets triggered. It's when the beneficiary changes from generation to generation. And so what you got to realize is that, you know, that's what really matters. That's what they're really paying attention to. But remember that, you know, even if you review the IRS publications on this subject, the answer is really not in there as to what happens when you change an owner of the account. One issue is that some 529 plans don't allow the change in ownership and will issue a 1099 as a full distribution. So be sure to look at your state's plan as to whether that is even allowed before you start going generation to generation on this one. But Spirit Rider, who's actually a participant on the White Coat Investor forum and also on the Bogleheads forum, answered a related question in this way. He said that the answer is that there's no answer. Code 529 does not even mention the concept of the account owner. There are no finalized 529 regulations, and neither the proposed 1998 regulations or the 2008 announcement of proposed rulemaking address this issue. And there's no other guidance on this issue at all. And to my knowledge, there are not even any private letter rulings. So the answer is nobody really knows. And maybe there's a loophole there. You can take advantage of, but I'd probably steer clear of it and just use 529s for their intended use, which is for the parent or an uncle or grandparent to save up for that kid to use for college. There's a little bit extra money, roll it to their niece or nephew or their child, you know, and try not to make this into some crazy loophole that you're trying to squirrel hundreds of thousands of dollars from generation to generation with. All right, our final question comes from Rachel. Let's play her question.

I was listening to one of your recent podcast episodes and you mentioned to your military members to try to find a state to reside in that does not have any income tax. I currently live in Arkansas and I really love it in Arkansas, but I am being taxed like seven different ways, quite literally. Arkansas has a state income tax. We have a, of course, state franchise fee to be in business, city business license. Arkansas also taxes not only residential properties, but they tax personal property as well, which means your vehicle, if you have livestock, you know, things like that. And this year, for the first time, because I started a private practice, I got hit with a commercial property tax as well. So they wanted to tax my laptop and my desk and all kinds of things. So as much as I love it in Arkansas, I am really sick of the taxes, but I cannot see a way to avoid them. I did previously live in Florida and I despised it. So I don't really want to move back, but I am really sick of the taxes here. So I just thought I would call in and see if you can think of any kind of way around it that's, you know, mostly legal. Thanks so much for your help.

Basically what Rachel's asking here is how do I become a resident of another state? I couldn't quite tell from the question whether Rachel was a military member or not. But the way military members do this is when they get stationed in a tax free state like Alaska or Washington or Nevada or Florida, they change the residency to that state, which is totally legit. And then when they leave still on active duty, they maintain that residency even if they're living in a higher tax state. So that's why when you drive around the military base, everyone has Alaska and Washington and Nevada and Florida plates, Texas plates. You know, those seven tax free states I think there are, because then you don't have to pay state income tax on your military earnings. There are a number of other states as well that don't make you pay it if you're stationed out of state. I think Arizona was that way, but I think there's another half dozen or maybe a dozen states, states that don't tax military income in that respect. And so if you're in the military, shoot, take advantage of it if you qualify for it, but you can't. If you're a resident of Arkansas, just decide that you're a resident of Texas. You know, you have to meet the requirements of being a resident in Texas, you know, and that usually means living there more than 180 days a year. And you also usually have to establish a residence and establish a bank account and change your driver's license and all that kind of stuff. You can't just willy nilly decide you're going to be a resident of some other state. You know, read your state laws as far as what the regulations there are. But obviously there's significant, you know, location arbitrage there. You know, to be able to go to a state where the cost of living is lower and the tax bill is lower. All right, I think we better wrap it up there. I'm supposed to be interviewing Physician on Fire and Passive Income MD right now. That podcast will run in a week or two. If you're finding our podcasts informative and helpful, we would encourage you to sign up for our monthly newsletter. It is totally free and includes useful, actionable information not available on the regular blog posts or this podcast. It's almost like being in a secret club. The kind of club that can boost your knowledge and enhance your wealth at the same time, with no strings attached. Sign up today@whitecoatinvestor.com newsletter. You can do this and the White Coat Investor can help. Head up, shoulders back. You've got this. It's a new year and a new you. Check out the resources available to you at the White Coat Investor and we'll see you next time on the podcast. My dad, your host, Dr. Daly, is a practicing emergency physician, blogger, author and podcaster. He is not a licensed accountant, attorney, or financial advisor. So this podcast is for your entertainment and information only and should not be considered official personalized financial advice.