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JAAPA Podcast

lifestyle wealth Apr 30, 2022

If you're a PA or future PA, this is a must listen.

Some new data was recently published on the lifetime financial modeling of an average family practice PA. It's really unique for this type of information to come out specific to the PA profession, as most similar projections have been done based on the physician model. I was a guest on the JAAPA Podcast discussing this exciting publication. 

Does the model apply to you? How does your cost of living affect the projections? What about student loan debt, and funding retirement?

Tune in to the podcast to find out more!

https://jaapapodcast.libsyn.com/

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Should I Buy Whole Life Insurance?

wealth Apr 23, 2022

This post may contain affiliate links. If you make a purchase, I will be compensated at no additional cost to you. For my full disclosure, click here.

 

I recently asked you guys the worst money advice you had ever received, and tons of you said buy whole life insurance.

I shared the response and got a lot of questions.... what in the world is whole life insurance? Why do you say to buy term life insurance?

Let's break it down...

Whole life insurance, indexed universal life insurance, and other similar policies are permanent life insurance. They don't end after a certain number of years, like term life insurance does. The main difference is that these have a built in "cash value" or "investment" that you are creating with your premiums over time. 

Sounds great, right? Not so much.

They also have complex rules and fees. If you want to gain access to the money before a designated number of years, there is a fee for that. There is also a monthly premium fee. And...

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Are You Covered?

wealth Jan 11, 2022

This post contains affiliate links. If you make a purchase, I will be compensated at no additional cost to you. For my full disclosure, click here

 

It's not enough just to build wealth, you have to protect it! You may not perceive yourself as having wealth, but if you have money in your checking account, a savings account, retirement account at work, car, house or all of the above - you have wealth! Let's talk about various types of insurance you should be considering to keep yourself protected. 

1. TERM LIFE INSURANCE
- If you have anyone who depends on you financially, you NEED life insurance. This can be a spouse, child, etc. Term life insurance (as opposed to whole life, universal life, etc) is inexpensive. We all feel nothing will ever happen to us, but the unfortunate reality is that it's possible. It would be bad enough for your family to lose you prematurely. Don't add insult to injury by leaving them in financial disarray. You should have at least...

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The Secret Drag On Your Investments

wealth Feb 15, 2021

If you're a consistent investor, CONGRATULATIONS. That alone is a major accomplishment!

If you're not sure how to invest, click here for help getting started.

As hard as you are working to save and invest, I'm sure you would want to know if something was draining your investments behind the scenes. 

Well, something is.

It's your investing fees.

Fees come in several forms. The first is related to the investment itself. Each fund you choose has an expense ratio that represents the fund's internal operating expenses. It is represented as a percentage, and can be interpreted as the percentage of your returns that is taken from your account to pay for the fund's fees. 

Not sure what the expense ratio is for the funds you've invested in? Just google the fund's ticker (collection of capital letters representing the fund name). Click the Morningstar link. The expense ratio will pop right up. 

What's a good expense ratio? I prefer <0.10%. Most of my funds are...

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Backdoor Roth IRA

wealth Jan 18, 2021

Roth IRAs are one of the best tax-favored accounts to use for retirement investing. 

You invest "after tax" dollars (meaning your contributions are not tax deductible). The contribution limit for 2022 is $6000, unless you qualify for a catch up contribution. After age 59 and 1/2, all of the funds in the account can be accessed TAX FREE. Yes, you read that right. In addition, Roth IRAs have several other benefits:

  • You can withdraw your contributions (not the growth) at any time.
  • You can make a withdrawal without the 10% penalty before 59 and 1/2 if you use the funds for qualified educational expenses (you will still pay income tax on the earnings portion).
  • You can make a withdrawal of up to $10,000 without any taxes or the 10% penalty before age 59 and 1/2 if you use the funds for a first time home purchase as long as you made the contribution >5 years ago (if it has been less than 5 years, you'll pay income taxes on the distribution).
  • No required minimum distributions in...
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So You Want To Be An Investor

wealth Aug 03, 2020

This post may contain affiliate links. If you make a purchase, I will be compensated at no cost to you. For my full disclosure, click here. 

Are you wanting to "get into the market" or "become an investor", but you're not sure where to start?

IF YOU HAVE A 401(K) OR OTHER WORKPLACE RETIREMENT ACCOUNT, YOU ARE ALREADY AN INVESTOR. 

Surprised? Most people don't realize that their retirement accounts are simply a big bucket labeled with the way taxes are applied, with INVESTMENTS inside. 

Let's review a few tips to make sure you are investing well. 


1. USE TAX FAVORED ACCOUNTS FIRST
- You cannot underestimate how much taxes will affect your investments over time. 401(k) plans offers pre-tax contributions that give you an immediate tax benefit. A Roth 401(k) or Roth IRA offers tax free withdrawals in the future, but requires contributions with money you have already paid taxes on. HSAs have tax benefits as well. All of these options...

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The Ideal Investment

wealth Jul 27, 2020

Health Savings Accounts (HSAs) are amazing investment products for retirement. If you're not using one, you are missing out. I know this may seem odd, but let me explain why. 

An HSA, in its most basic form, is intended for medical expenses. It combines the pre-tax benefits of a 401(k) contribution with the tax free growth of a Roth IRA. 

Here is the full scoop:

1. MONEY ROLLS OVER EACH YEAR
-Unlike an FSA, the money rolls over if unused in that year. It's not a "use it or lose it" system. 
2. CONTRIBUTIONS ARE PRE TAX
- Contributions are pre tax if you contribute through an employer. If you purchased your own plan, they are tax deductible. 
3. GROWTH IS TAX FREE
- Probably the best feature!
4. MONEY CAN BE USED FOR MEDICAL EXPENSES AT ANY TIME, TAX FREE
- Just make sure you keep qualifying medical receipts. This essentially gives you a separate medical emergency fund in addition to your regular emergency fund. 
5. MONEY CAN BE USED AFTER 65 FOR ANY REASON PENALTY...

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Financial Independence

wealth Jul 13, 2020

This post may contain affiliate links. If you make a purchase, I may be compensated at no additional cost to you. For my full disclosure, click here. 

People talk a lot about "financial freedom" or "financial independence". But what does it really mean? There are so many different variations of this out there and different people use different terms. We will keep things simple. 

Financial independence means you can live entirely off of your investments. 

Some people utilize stages to describe financial independence. One example is the following:


1. FINANCIAL SECURITY
- This means your investment returns could cover your bare minimum expenses, with no thrills or extras. Few people will quit their job at this stage (unless they have some source of additional income), but it allows you the security of knowing your investments could cover your major bills should you need them to. Some people call this "lean financial independence". 


2. FINANCIAL INDEPENDENCE
-...

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How To Increase Your Savings Rate

wealth Jul 06, 2020

This post may contain affiliate links. If you make a purchase, I will be compensated at no additional cost to you. For my full disclosure, click here.

 

The key to wealth is your overall savings rate. I say this ALL THE TIME. Recommended savings rates vary from 10% (see books like The Richest Man in Babylon), 15-20% (Dave Ramsey), and upwards of 50% (see the entire FI/RE movement). Regardless of if you are saving nothing at all, or just a small amount, increasing your savings rate even slightly will make a HUGE difference in your future.

But how do you increase your overall savings rate when you're already feeling strapped for cash?

Here are a few suggestions:

1. GET ORGANIZED
- If you're not tracking your expenses routinely, it is nearly impossible to know where you can cut expenses to increase your savings rate. A monthly budget is a fundamental requirement. 

2. PAY OFF HIGH INTEREST DEBTS
- Carrying high interest debts is the equivalent of running a race with...

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Your First Million

wealth May 25, 2020

This post may contain affiliate links. If you make a purchase, I will be compensated at no cost to you. For my full disclosure, click here

 

Becoming a millionaire isn't as hard as you would think. For ease of numbers, let's talk about how to become a millionaire using only your retirement accounts. This is an incomplete picture because your home and other accounts contribute to your net worth and would help push you over the millionaire net worth mark, but for simplicity we will use only retirement investing for now.


SO HOW MUCH MONEY DO YOU HAVE TO SAVE MONTHLY TO BECOME A MILLIONAIRE BY 65?


This varies depending on your current age, as one of the major contributors to the end balance is how much time you have left before age 65 for compound interest to work in your favor. Let's look at the numbers by age. We will assume you are starting with an initial investment balance of 0, and that you receive an 10% rate of return.


  • AGE 25 - $171/MONTH
  • AGE 30 - $280/MONTH
  • AGE 35 -...
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