Money Talk For ER Docs™

With new legislation comes new opportunities… and sometimes hurdles. That's why it's vital we stay diligent in keeping up with the financial-related topics being tossed around in Congress. Sure, some Laws or Acts never end up seeing the light of day. But today's retirement plan-specific proposals have received almost unanimous bi-partisan support positioning them as highly likely to pass later this year.

We're talking about the SECURE Act 2.0 and all of the very EP-specific changes it contains on today's episode.

It's never fun seeing your investment portfolio go down in value. But with uncertainty, volatility, disruption, and shifts presents opportunity.

In a previous episode, we referenced five action items to take during a downturn. In this episode, we'll re-evaluate one of those topics: the Roth IRA – probably the most powerful, yet illusive type of retirement account available to ER Docs. We'll get into how supercharging it during market downturns can add tremendous flexibility to an otherwise limited financial situation.

The most alluring investment is one that is guaranteed with a high rate of return. What if I were to tell you an investment option that checkmarks both of those boxes does exist right now? You'd probably be eager to get more information.

On today's episode, we'll talk about I Bonds, give some background into them, and even inform you on how to buy them. But are they all what they're cracked up to be? We'll also get into the drawbacks that keep this from being a life-changing investment it appears to be on the surface.

We work with hundreds of ER Docs across the country all with different ages, personalities, beliefs, socio-economic backgrounds and even career paths within EM. It's really a melting pot of people. But despite these differences, we have identified five financial personality types, we feel, encapsulate the majority of our clients.

Our goal for this wasn't to put people in a box or make anyone feel judged; rather, it was to help ER Docs identify their financial strengths so they can feel great about those while also identifying their weaknesses to promote positive change if it's desired. Where does your relationship with money put you on our list?

We all experience that feeling when you make a purchase and you end up regretting it. It happens. Could be as small as spending more than you usually would on a dinner and you're left feeling unsatisfied. Or it can be more significant, like in the case of purchasing a car and that car not living up to the experience you were hoping for. In either case, there's a sense of regret and that regret is tied to your relationship with your income, expenses, and expectations. It can be difficult to assess whether the feeling is temporary – maybe in the case of a one-off transaction – or if it's part of an ongoing trend that persists across your entire financial picture.

On today's episode, we look into a different kind of burnout than the work-related burnout ER Docs are accustomed to hearing about and focus on ways to restructure your relationship with spending to help combat this feeling and reprioritize what's important to you.

We find the average ER Doc pays about 28% in Federal income tax. That's a good chunk of change. But that percentage doesn't consider various other taxes that likely apply: state income tax (~5%), payroll tax (~5%), sales & local tax (~5%), and property tax (~1%). Combined, those add up to somewhere in the ballpark of 44% of an ER Doc's income going toward taxes… and that's before factoring in things like capital gains and estate taxes. With the average ER Doc earning ~$350,000/yr, after-tax income is somewhere just shy of $200,000 given these assumptions. And that's before retirement contributions, insurance premiums, and other pre-tax deductions.

In this episode, we'll break down the main tax categories, give a little background into them, and discuss various "what can we do" scenarios to lessen the tax burden. Every bit helps.

An interesting thing about being a parent is that there is variation from person to person on how children are raised. The topic of money, and the way it's viewed, understood, and managed is no exception. For some, parenting on the topic of money may revolve around financial acuity: making sure their child understands checks and balances and the value of a dollar. For others, it may mean pushing innovation and being an entrepreneur. And for others, it may mean saving a certain amount in a child's name as a cushion for when they leave the nest.

Regardless of your desires, on today's episode, we cover the topic from various perspectives and provide methods that can make a tremendous difference, financially, on your child's life.

We recently did a podcast episode titled, "Should You Be Concerned About A Recession?" where we got into the history of market downturns and what those tell us about what is going on today. The conclusion? Markets reward those who stay disciplined when it's hardest to do so. Basically, inaction is the best course of action. But say staying put isn't for you – are there actions that you can take when the markets are volatile to lessen the blow of losses and even position yourself better for when things improve?

In this episode, we'll go over 5 actionable tips you can do to improve your investment situation, even in a downturn.

There's a particular expenditure that 70% of those 65 or older today will incur and that number is anticipated to only go up in the future. Saying that alone could mean a lot of things: potatoes, a new phone, maybe a walking cane. But the expense I'm referencing is the main culprit for why the elderly, aged 75+, make up the fastest-growing group filing for bankruptcy. To top it off, it's only getting more expensive at a pace faster than even education costs and it's very difficult, and potentially impossible, to insure for. What is this mystery expenditure? Long-term care costs.

If you haven't thought about it, you're not alone. For today's episode, we'll get into the range of costs of care, who you may have to pay for it for beyond yourself, and how to pay, if necessary.

Investors have grown accustomed to fairly consistent positive returns over the past decade. Have there been periods of loss? Sure. But overall, the positive trend has been staggering. And it's that recency bias that can make it tough to cope with downturns in the market. Maybe you're hearing the "should I be selling stocks?" internal dialogue a little louder than you remember hearing it in the past.

If this is you, today's episode may bring the perspective you need to focus on what you can control and make sure logic overcomes emotion, no matter how dire the situation may feel.