Investment Allocation

[mgriffiths]

3 hours ago, UVAPAC said:

Market really taking a pounding over the last 10-14 days, looks like it's going to take another hit today.  I guess I just have to decide when to man up, and toss some of this money sitting in a saving's account into the market.  If only I had a crystal ball!

When the market is taking a beating is the best time to invest - more bang for your buck!  It's like buying when a sale is going on.

Donald Trump famously made a statement that he likes when the market crashes because that is when he makes a TON of money - real estate becomes crazy cheap, as well as stocks.  He took a lot of heat for the statement, but he is exactly right! (Note, not a political statement on Trump - good, bad, or indifferent - he's just the one who said it).

[Guest UVAPAC]

1 hour ago, mgriffiths said:

When the market is taking a beating is the best time to invest - more bang for your buck!  It's like buying when a sale is going on.

Donald Trump famously made a statement that he likes when the market crashes because that is when he makes a TON of money - real estate becomes crazy cheap, as well as stocks.  He took a lot of heat for the statement, but he is exactly right! (Note, not a political statement on Trump - good, bad, or indifferent - he's just the one who said it).

I just want to get in at the bottom of the barrel, get maximum sale prices 

[SERENITY NOW]

Lots of good advice here.  I would add one more consideration that shouldn't be at the top of the priority list but is still part of our reality as modern health care providers.... asset protection...  

 If we get sued on the job (or if neighbor kid breaks his neck in your pool) and you lose for over limits of insurance coverage, they CAN and will take your personal assets.  All of that money you worked so hard for over the years down the drain in an instant.  You can't plan to just hide it away once you are served the notice since they will have discovered your assets and frozen them... so you need to protect yourself ahead of time.  

First, know the details about your malpractice insurance!  What are the limits?  Is it occurrence or claims made?  Know that there are things you won't be covered for (prescribing for friends / family, "illegal or unacceptable behavior" like hippa violations or workplace harassment).  Also, consider getting high limits on your personal insurance (auto/home etc) and get umbrella insurance on top of it - its generally quite cheap but can at least double your insurance limits.

Next, instead of having a ton of money sitting in vehicles that creditors have access to, its worthwhile to store it away in protected vehicles from the start.  Doesn't have to be offshore accounts or LLCs or other expensive measures, but in general put a good portion of your money into any of the simple things that offer protection from creditors:

1) your home equity / "homestead exemption" - states range from protecting all of your home equity to nothing!  Look into whether titling your home as joint "tenancy by the entirety" would provide more protection.

2) retirement accounts (401k, roth, etc) 

3) cash value life insurance policies / annuities

4) things "off the radar" -- collectibles, gold / silver / etc buried in your backyard that nobody knows about is also safe haha

These are all state specific, so take time to learn your local laws -- check out link below: 

http://www.assetprotectionsociety.org/wp-content/uploads/2013/07/50-State-Creditor-Exempt-Asset-Chart-2013.pdf

 

So, to address OP's initial question.... keep this in mind if you are hesitant about putting money into investments like 401k / roth.  There are so many benefits already mentioned, and I would add asset protection as another big benefit to consider.  Add me to the list of people above who max out both 401K / roth as my top investing priorities!

[mgriffiths]

9 hours ago, SERENITY NOW said:

Lots of good advice here.  I would add one more consideration that shouldn't be at the top of the priority list but is still part of our reality as modern health care providers.... asset protection...  

 If we get sued on the job (or if neighbor kid breaks his neck in your pool) and you lose for over limits of insurance coverage, they CAN and will take your personal assets.  All of that money you worked so hard for over the years down the drain in an instant.  You can't plan to just hide it away once you are served the notice since they will have discovered your assets and frozen them... so you need to protect yourself ahead of time.

and this is likely what will end my PA career earlier than most others...I just crossed my 1 year anniversary at my second PA job (total of 18 months since graduating PA school).  I know I still have significant amounts of medical knowledge to learn, but I also know that I am a d**m good PA and work hard for my patients.  Within the last month I have had two patients start the process of a malpractice lawsuits and get shot down by lawyers who wouldn't even consider taking the case because they know they would lose and is therefore a waste of time (THANK GOD!!! and I don't mean that facetiously).

Note I work in family practice:

1. 87yo female with significant cardiac history, presenting to me with 1 week history of clear cardiac chest pain - in office ECG showing STEMI - I immediately call on-call cardiologist and EMS.  Patient and family refuse to take ambulance and go home...patient dies that night from MI.  Family didn't feel that I did my due diligence in making sure they understood the seriousness of the situation!!

2. 55yo male with "chest pain."  Within the last week he had eaten some weird foods, microwaved multiple meals in Ziploc plastic bags, increased soda consumption, etc., etc.  I asked major questions like: "Does chest pain radiate/spread - No;" "Any relation to exercise, walking, etc. - No;" "Does eating make it worse - YES!"  Patient has no cardiac history, no smoking history, is within ideal BMI range, etc., etc.  Told him to cut back on caffeine and stop eating weird foods, if pain continues either return or go to ED.  Next day, pain is continuing so wife takes him to ED...BAM...NSTEMI!!!  In reading ED report he flipped every single answer from above and claimed nothing had changed in the last week.  He survived and myocardium damage very limited, but decided to start process of malpractice...again the lawyer stated there was no case based on my charting.

I feel blessed that these clear cut cases did not become marks (or at least haven't thus far) on my malpractice record, but it is still anxiety inducing - not so much because of the malpractice aspect, but more so because theoretically my assets could be at risk and I plan on growing my assets significantly over my lifetime.  The idea that some idiot could take them over a ridiculous malpractice case is enough to make me go berserk.  Of course I understand why malpractice exists, and feel blessed that I haven't screwed up in a way to majorly affect someone's life/health (YET!), but this is also why I make sure I chart thoroughly because that is all that saved me in the above cases.

[ShakaHoo]

Who is buying this market?

Who is running from this market?

What are people putting their money into?

[Cideous]

10 minutes ago, ShakaHoo said:

Who is buying this market?

Who is running from this market?

What are people putting their money into?

Bonds.

[GetMeOuttaThisMess]

My wife still maxes her Roth IRA and Roth 457b at work with Vanguard Wellington (balanced fund) contributions.  Me?  I'm drawing down on mine till SSI and two pensions kick in at 65.

[Boatswain2PA]

1 hour ago, Cideous said:

Bonds

How much are you making on your bonds?

[Boatswain2PA]

1 hour ago, ShakaHoo said:

Who is buying this market?

We have continued maxing out 401K contributions through the Covid shutdown/market crash.  We are now well above where we were on Mar 1st.

60% S&P, 20% small cap, 20% foreign.  No bonds as they generally offer little return and many municipal bonds continue to be riskier than many stocks (in my opinion).

[mgriffiths]

I have just been continuing to do what I have always done.  Maxing Roth IRAs and my 403b annually.  Slow and steady wins the race with simple, regular contributions, and my race has a LONG TIME until it's over.  Therefore this will be a bump in the road over the long haul, and if it's not then we have MUCH bigger things to worry about than electronic and paper money.

I do use Personal Capital.  It's super cheap, and I actually haven't paid a penny in fees in multiple years because of referrals (you get 3 months free for each person who you refer and they open an account).  It's simple, cheap, and they do the work of rebalancing as needed.  I don't expect them to do any better than I would doing it myself, it just keeps me from having to deal with any nitty-gritty.

[Cideous]

7 hours ago, Boatswain2PA said:

How much are you making on your bonds?

I'm up 6% for the year which is pretty great considering....

[Boatswain2PA]

I think that is surprisingly good for bonds!

[Mayamom]

6% on bonds?  I've never had that much luck!  Yes I'm still investing.  Market is recovering. (although I'm still down 100K)  Good time to buy.  

[GetMeOuttaThisMess]

I never would've guessed the ROI for this year before fact checking it myself.  I used Vanguard as my comparison source.  Most of the large bond funds are at 5-6% range for the year.  This is why I like my Admiral Wellington fund.  A bit of both worlds.

 

 

 

 

 

Edited June 13, 2020 by GetMeOuttaThisMess

[Cideous]

14 hours ago, Boatswain2PA said:

I think that is surprisingly good for bonds!

 

So last early fall I switched from 90% stocks 10% bonds to the other way around.  90% bonds rest in stocks.  I felt the rise in the market last year was unwarranted.  I was about a two months early, but since then my stocks have been in "meh" category with my bonds really toeing the line.

My year to date bonds is:   

1 Yr

 

+9.53%

 

 

 

Edited June 13, 2020 by Cideous

[Believe]

Maxed roth IRA january 1st in a target date retirement fund thru vanguard.

Still contributing to 401k thru work, won't max this year as I'm hitting loans hard. 

[EMEDPA]

On 6/22/2018 at 3:13 AM, Guest UVAPAC said:

Hi all, 

I have two questions, and was looking for advice from other PA-C's as to how you are managing/investing your money.

2)  I have started saving for my first child to go to college.  We started a 529 plan.  Initially I was having $100 put into the account bi-weekly, and I am starting to think this may be underfunded.  I was looking for advice from other parents out there as to how much you are contributing.  I was hoping to pay for the full tuition cost, but don't know if that is realistic or not.

Thanks, and as always I would love to hear thoughts on what/where you are investing your money.  

My kiddo is heading off to college in 2 months. we put $175/mo into their account in a 529 to max out the tax benefit for 18 years. We ended up with 50k. That will help, but we will still need to tap other sources. 

[Boatswain2PA]

4 hours ago, Cideous said:

 

So last early fall I switched from 90% stocks 10% bonds to the other way around.  90% bonds rest in stocks.  I felt the rise in the market last year was unwarranted.  I was about a two months early, but since then my stocks have been in "meh" category with my bonds really toeing the line.

My year to date bonds is:   

1 Yr

 

+9.53%

 

 

 

that is spectacular for bonds.  Woukd you share what bond fund or bonds have returned soch an investment?  At that rate I may also be interested.

[Cideous]

2 minutes ago, Boatswain2PA said:

that is spectacular for bonds.  Woukd you share what bond fund or bonds have returned soch an investment?  At that rate I may also be interested.

 

 

Of course....

 

 

State Street U.S. Bond Index Non-Lending Series Fund Class M

Information on this investment option was provided by your plan sponsor, plan trustee, investment manager, trustee or third party data provider. This investment is not a mutual fund.

Performance

YTD (Daily)*

 

+5.87%

Average Annual Returns

1 Yr

 

+9.53%

3 Yrs

 

+5.08%

5 Yrs

 

+3.92%

10 Yrs

 

+3.87%

 

 

 

Hope this helps

[Boatswain2PA]

Weird, I am unable to find your particular Bond fund (M) at State Street.  

I was hoping to find an expected graph that showed your bond fund doing much better March-May, but then dropping in June.  This would represent people fleeing the stock market and buying bonds, but then reversing course as the stock market has recovered.

In either way, while your bond fund has done very well so far the past year, it compares poorly with the S&P returns over the long run.

To each their own.

[Cideous]

For me it is about safety.  While some are losing thousands in a drop, I lose a few hundred here and there.  Remember I was 90% all in on stocks last year.  I only switched it when I felt the market was over-valued and I'm glad I did.  Once we return to some form of normalcy, I will prob go back to a 75% stocks 25% bonds split.

[Boatswain2PA]

understandable.  You certainly timed it right.  im never that lucky!

[cinntsp]

On 6/30/2018 at 6:26 AM, mgriffiths said:

 

1. 87yo female with significant cardiac history, presenting to me with 1 week history of clear cardiac chest pain - in office ECG showing STEMI - I immediately call on-call cardiologist and EMS.  Patient and family refuse to take ambulance and go home...patient dies that night from MI.  Family didn't feel that I did my due diligence in making sure they understood the seriousness of the situation!!

 

...can't fix stupid.

[cinntsp]

I continue to invest the way I always have in general(target retirement fund or 70/20/10 split of total stock market index, international total stock index, and bonds), but did buy a bunch of pharmaceutical and defense contractor stocks with my extra spending money when the market tanked from COVID.  15-50% gains, so not too bad.

Edited June 16, 2020 by cinntsp

[ShakaHoo]

17 hours ago, cinntsp said:

I continue to invest the way I always have in general(target retirement fund or 70/20/10 split of total stock market index, international total stock index, and bonds), but did buy a bunch of pharmaceutical and defense contractor stocks with my extra spending money when the market tanked from COVID.  15-50% gains, so not too bad.

Overall I agree.  Have a plan, and stick to that plan.  Dollar cost averaging.  Overtime, this should be a successful recipe.

 

It is hard for me to fight the urge to "time the market."  When the market is 2-3% away from an all-time high, while 20% of the United States population is unemployed, companies are suffering a miserable first and second quarter secondary to COVID19, civil unrest in the United States, a presidential election incoming, a trade-war in the making with China.... it is hard not to feel like I should take the money, and await the next drop.

After-all how long can the fed prop up the economy?  How much higher can the US national deficit rise before it becomes concerning?  What happens when all of the mortgage and car loans are defaulted upon?