Today on the Finance Flash Go! podcast, we’re going to discuss stock market corrections.

A bull market refers to a financial market in which prices of assests are rising, or are anticipated to rise.

The traditional definition is a market that has risen in value by 20% or greater.

Please enjoy the Finance Flash Go podcast! We plan to release a new episode every weekday answering important finance questions. If you ever want to submit a question to our podcast, send an e-mail to [email protected], and please be sure to check out Jordan Frey’s blog prudentplasticsurgeon.com where he gives great financial advice.

A brief disclaimer: While we are providing knowledge and awareness around financial topics in this show, we are not held responsible for any financial decisions you choose to make in response to the podcast. We hope to provide accurate information in regards to money and different methods of wealth creation, but it is always the learner’s responsibility to due their due diligence before making important financial decisions.

We hope you enjoy the show and thanks for tuning in, and if you like the podcast please subscribe, share, and leave us a review on the podcasting platform of your choice!

Today on the Finance Flash Go! podcast, we’re going to discuss stock market corrections.

A stock market correction is defined as a drop in the overall stock market of 10%.

They can last for days, weeks, or months and generally occur on average once a year.

Please enjoy the Finance Flash Go podcast! We plan to release a new episode every weekday answering important finance questions. If you ever want to submit a question to our podcast, send an e-mail to [email protected], and please be sure to check out Jordan Frey’s blog prudentplasticsurgeon.com where he gives great financial advice.

A brief disclaimer: While we are providing knowledge and awareness around financial topics in this show, we are not held responsible for any financial decisions you choose to make in response to the podcast. We hope to provide accurate information in regards to money and different methods of wealth creation, but it is always the learner’s responsibility to due their due diligence before making important financial decisions.

We hope you enjoy the show and thanks for tuning in, and if you like the podcast please subscribe, share, and leave us a review on the podcasting platform of your choice!

Today on the Finance Flash Go! podcast, we’re going to talk more about annuities and a particular variety of annuity.

An single payment immediate annuity is a product and agreement between an individual and an insurance company that pays the owner a guaranteed income starting pretty much immediately. It differs from a deferred annuity, which begins payments at a future date chosen by the annuity owner. An immediate payment annuity is also known as a single-premium immediate annuity (SPIA), an income annuity, or simply an immediate annuity.

Buyers can choose monthly, quarterly, or annual income. Payments are generally fixed, but variable and inflation-adjusted annuities are also available.

People often buy immediate payment annuities to supplement their other retirement income. It is also possible to buy an immediate payment annuity that will provide income for a limited period of time, like 5 or 10 years.

One downside of an immediate payment annuity is that payments usually end upon death with the insurance company keeping the remaining balance. That’s how the insurance company makes money.

Please enjoy the Finance Flash Go podcast! We plan to release a new episode every weekday answering important finance questions. If you ever want to submit a question to our podcast, send an e-mail to [email protected], and please be sure to check out Jordan Frey’s blog prudentplasticsurgeon.com where he gives great financial advice.

A brief disclaimer While we are providing knowledge and awareness around financial topics in this show, we are not held responsible for any financial decisions you choose to make in response to the podcast. We hope to provide accurate information in regards to money and different methods of wealth creation, but it is always the learner’s responsibility to due their due diligence before making important financial decisions.

We hope you enjoy the show and thanks for tuning in, and if you like the podcast please subscribe, share, and leave us a review on the podcasting platform of your choice!

Today on the Finance Flash Go! podcast, we’re going to talk about whole life insurance.

First, what is life insurance for?

Life insurance is insurance needed if you have anyone depending on your income to live. This includes spouses, partners, kids, etc.

Don’t have any dependents? Then you don’t need life insurance. Are you and your dependents financially free? Then you don’t need life insurance.

Unlike term insurance, which lasts only for the “term” that you buy it, whole life insurance is designed to pay out when you die, no matter when that is, even if that's at age 95.

That is an upside, I guess, to whole life insurance.

However, there are a whole lot of downsides that make whole life insurance really not a great or even mediocre option for 99% of physicians out there.

This is not a comprehensive list but the downsides include:

- It is wayyyy more expensive than term life insurance

- The returns are low

- These bad returns (often negative) are front loaded

- Most policies are surrendered prior to death, meaning that those who bought them found they did not serve a purpose

- Many more!

So, don’t buy whole life insurance, especially if you are a resident.

Buy term life insurance that you can drop when you reach financial freedom!

Please enjoy the Finance Flash Go podcast! We plan to release a new episode every weekday answering important finance questions. If you ever want to submit a question to our podcast, send an e-mail to [email protected], and please be sure to check out Jordan Frey’s blog prudentplasticsurgeon.com where he gives great financial advice.

A brief disclaimer While we are providing knowledge and awareness around financial topics in this show, we are not held responsible for any financial decisions you choose to make in response to the podcast. We hope to provide accurate information in regards to money and different methods of wealth creation, but it is always the learner’s responsibility to due their due diligence before making important financial decisions.

We hope you enjoy the show and thanks for tuning in, and if you like the podcast please subscribe, share, and leave us a review on the podcasting platform of your choice!

Today on the Finance Flash Go! podcast, we’re going to talk about tax rates.

It’s very important to understand the difference between your marginal and your effective tax rate.

When people talk about their “tax bracket,” they are really talking about their marginal tax rate. This is the rate that the next $1 that they earn is taxed at.

But, we have a progressive tax system in the US. This means that every dollar that you make is not taxed the same way. The first $1000, let’s say, is taxed at a much lower rate than is the rest of your income. As you make more taxable income, you progress up through the tax brackets.

These change all the time with different political administrations, however, the highest tax bracket is usually around 33%, give or take. So, if you make a certain amount of income, usually above $400,000, every dollar above that income amount will be taxed at the highest rate. That is your marginal tax rate.

Your effective tax rate is equal to the amount of taxes you pay divided by your taxable income. This is basically the averaged out tax rate that you pay for all of your taxable income. It is by definition less than your marginal tax rate.

Please enjoy the Finance Flash Go podcast! We plan to release a new episode every weekday answering important finance questions. If you ever want to submit a question to our podcast, send an e-mail to [email protected], and please be sure to check out Jordan Frey’s blog prudentplasticsurgeon.com where he gives great financial advice.

A brief disclaimer While we are providing knowledge and awareness around financial topics in this show, we are not held responsible for any financial decisions you choose to make in response to the podcast. We hope to provide accurate information in regards to money and different methods of wealth creation, but it is always the learner’s responsibility to due their due diligence before making important financial decisions.

We hope you enjoy the show and thanks for tuning in, and if you like the podcast please subscribe, share, and leave us a review on the podcasting platform of your choice!

Today on the Finance Flash Go! podcast, I’ll share my thoughts on familiarity bias in stock investing.

Familiarity bias is when we feel that an investment is good, or even worthwhile, because we are familiar with it.

We feel that we have some “insider” knowledge of a product, industry, field, technology, you name it. So, we believe that we can leverage this familiarity and perceived knowledge to invest and outperform the market.

This plays out allllll the time, especially in stock investing. Someone works in product development and thinks some new technology will push some product into the stratosphere. So they buy some stock in the company with the technology and/or product.

As physicians, we are particularly susceptible to this bias

If I had a dollar for every doctor that has told me they like to invest in medical technology because they really feel it is going to take off…Oh yeah, and because they feel they can understand it, I could shave a few years off of my retirement.

That’s exactly the problem with familiarity bias. It lulls us into a false sense of security. All of a sudden, we think we can beat the stock market and time the market and do all these sorts of things that we just can’t.

When you invest, you are minimizing risk and maximizing return.

The only way to do this in the stock market is through index fund investing and approximately the market. In doing this, I pin my hopes and money on the entire US and world economy. If something good happens for me and my money, it’s happening for everyone.

When you speculate, you are hoping and banking on something happening that is good for you and inherently bad for others. Right?

You are making a bet, and someone has to win and someone has to lose.

Even if you are making a small bet, like on medical technology stocks because you are a doctor and know the field, you are still speculating.

Think about your investments right now and see if you are relying, even a little, bit on the speculative component on the stock market’s value.

If so, I would strongly consider adjusting to minimize your risk and maximize your reward.

Please enjoy the Finance Flash Go podcast! We plan to release a new episode every weekday answering important finance questions. If you ever want to submit a question to our podcast, send an e-mail to [email protected], and please be sure to check out Jordan Frey’s blog prudentplasticsurgeon.com where he gives great financial advice.

A brief disclaimer While we are providing knowledge and awareness around financial topics in this show, we are not held responsible for any financial decisions you choose to make in response to the podcast. We hope to provide accurate information in regards to money and different methods of wealth creation, but it is always the learner’s responsibility to due their due diligence before making important financial decisions.

We hope you enjoy the show and thanks for tuning in, and if you like the podcast please subscribe, share, and leave us a review on the podcasting platform of your choice!

Today on the Finance Flash Go! podcast, we wade in tricky water…discussing good vs. bad debt!

Can debt be good? Or it all bad? These are important questions to ask.

A straw poll of most people would likely reveal an overwhelming majority who believe that all money owed is bad.

I wouldn’t be surprised to find that an even greater majority of physicians believe that all debt is bad. We spend so much of our lives under the burden of student loans. Physicians also notoriously use borrowed money to finance the lifestyle and gratification that they have delayed for so long.

So, what is good debt?

I’ll borrow my definition from Robert Kiyosaki in his book, Cashflow Quadrant.

Debt is good if you are compensated or paid for taking it on.

You may be screaming at the computer or phone screen right now saying that this is not possible. When we borrow money, we have to pay interest on top of the principal. So, how the heck would we get compensated for the debts that we take on?

What is bad debt?

Well, it’s the inverse of good debt.

Therefore, it’s debt that you are not compensated or paid to take on. I would venture to guess that most of the debt that most physicians think of fall into this category.

You can use good debt to improve your ability to accrue income producing assets.

This is my favorite use of debt.

Let’s start with an example from my life. My wife and I bought a duplex for $174,500 using 25% down. Thus, we owed about $130,000 on the mortgage when we closed. We increased our debt by six figures!

But…that’s not where the story ends. Every month, our tenants pay rent. This rent covers our mortgage. It also covers all other expenses like taxes, insurance, and maintenance. There is also extra that we put (usually tax-free) into our pockets.

There is no better example of getting paid to take out debt than investing in cash-flowing real estate.

I don’t think anyone can argue that this is bad debt.

Please enjoy the Finance Flash Go podcast! We plan to release a new episode every weekday answering important finance questions. If you ever want to submit a question to our podcast, send an e-mail to [email protected], and please be sure to check out Jordan Frey’s blog prudentplasticsurgeon.com where he gives great financial advice.

A brief disclaimer While we are providing knowledge and awareness around financial topics in this show, we are not held responsible for any financial decisions you choose to make in response to the podcast. We hope to provide accurate information in regards to money and different methods of wealth creation, but it is always the learner’s responsibility to due their due diligence before making important financial decisions.

We hope you enjoy the show and thanks for tuning in, and if you like the podcast please subscribe, share, and leave us a review on the podcasting platform of your choice!

Today on the Finance Flash Go! podcast, we’re going to discuss tax credits.

Now let’s chat about tax credits.

Tax credits are different from tax deductions in that the full amount of a tax credit is deducted from the amount of taxes that you owe in a given year.

For instance, if you have a $5000 tax credit, that means that you pay $5000 less in taxes that year.

In contrast, a $5000 tax deduction will save you an amount equal to $5000 multiplied by your margial tax rate.

So, a tax credit is more valuable than a tax deduction.

An example of a tax credit is the child tax credit.

Please enjoy the Finance Flash Go podcast! We plan to release a new episode every weekday answering important finance questions. If you ever want to submit a question to our podcast, send an e-mail to [email protected], and please be sure to check out Jordan Frey’s blog prudentplasticsurgeon.com where he gives great financial advice.

A brief disclaimer While we are providing knowledge and awareness around financial topics in this show, we are not held responsible for any financial decisions you choose to make in response to the podcast. We hope to provide accurate information in regards to money and different methods of wealth creation, but it is always the learner’s responsibility to due their due diligence before making important financial decisions.

We hope you enjoy the show and thanks for tuning in, and if you like the podcast please subscribe, share, and leave us a review on the podcasting platform of your choice!

Today on the Finance Flash Go! podcast, we’re going to discuss tax deductions.

A tax deduction is a form of a tax break.

Essentially, a tax deduction lowers the amount of a person's taxable income. In this way, the amount of income that you are taxed on in that given year is less. Thus you pay less taxes.

The amount that a tax deduction saves you in taxes is equal to the whole sum of your deductions multiplied by your marginal tax rate.

Some tax deductions are able to be taken directly from your taxable income. These are called “above the line” deductions or income adjustments.

Other tax deductions only can be counted if, when summed up, they are greater than the defined “standardized deduction” for that given tax year. If they total less than this, it is better to take the standarized decution which in this case would be greater.

Mortgage interest payments, property taxes, job related expenses, healthcare costs and other payments are eligible for tax deductions.

Please enjoy the Finance Flash Go podcast! We plan to release a new episode every weekday answering important finance questions. If you ever want to submit a question to our podcast, send an e-mail to [email protected], and please be sure to check out Jordan Frey’s blog prudentplasticsurgeon.com where he gives great financial advice.

A brief disclaimer While we are providing knowledge and awareness around financial topics in this show, we are not held responsible for any financial decisions you choose to make in response to the podcast. We hope to provide accurate information in regards to money and different methods of wealth creation, but it is always the learner’s responsibility to due their due diligence before making important financial decisions.

We hope you enjoy the show and thanks for tuning in, and if you like the podcast please subscribe, share, and leave us a review on the podcasting platform of your choice!

Today on the Finance Flash Go! podcast, we’re going to discuss target date retirement funds.

Target date funds are funds offered by many brokerages in which they base the asset allocation on the estimated year that you plan to retire.

The funds are generally composed of index funds in select stock/bond allocations that decrease in risk as you approach your targeted retirement year. The asset rebalancing is performed automatically by the fund without you needing to actively do anything.

The disadvantage of target date funds are that their expense ratio is typically a bit higher than just doing the work yourself. However, the increase in fees is not typically large.

Please enjoy the Finance Flash Go podcast! We plan to release a new episode every weekday answering important finance questions. If you ever want to submit a question to our podcast, send an e-mail to [email protected], and please be sure to check out Jordan Frey’s blog prudentplasticsurgeon.com where he gives great financial advice.

A brief disclaimer While we are providing knowledge and awareness around financial topics in this show, we are not held responsible for any financial decisions you choose to make in response to the podcast. We hope to provide accurate information in regards to money and different methods of wealth creation, but it is always the learner’s responsibility to due their due diligence before making important financial decisions.

We hope you enjoy the show and thanks for tuning in, and if you like the podcast please subscribe, share, and leave us a review on the podcasting platform of your choice!