Investing and Investments

How Much Should Parents of Young Children be Saving in 529 Plans?

To deal with this logically, you have to back into the figure after making a few assumptions. Let’s say you have a five year old child that you expect will one day attend an expensive private college. The tuition, fees, and room and board at such a college cost roughly $70,000 per year today or […]

If You Don’t Have the Money to do Both Simultaneously, Should You Save For Your Future Retirement or For Your Child’s Future Education?

Each of us has to answer that for him/herself, but here’s my take on it. I’d opt for retirement savings first. My primary reason is that there is outside help available for a child’s education, but not for retirement. Loans are available to fund college expenses but are not available to fund retirement costs. My […]

Investment Management Fees for Retirement Plans Should be Paid Out of the Corporation Rather Than Out of the Retirement Plan

If you pay an advisor to manage your retirement plan investments, ask them to bill your practice for their fee rather than take the money out of the retirement plan (which is the common practice). If investment fees are paid out of the plan, they will be allocated pro-rata among the participants. Generally, the doctor […]

The Practice Should Pay Current and Future Investment Fees, NOT Reimburse the Plan for Past Fees

Under the retirement plan laws, the practice can put money into the plan as an annual contribution, a rollover contribution from another plan, a corrective contribution (to fix a prior mistake) and related earnings on that corrective contribution. A reimbursement to cover past fees will be treated as an additional contribution which would be required […]

A Lesson Learned From Recent Stock Market Volatility – 2% to 3% Swings in the Overall Market Seem to be a Daily Occurrence – SO WHAT?

To me, long-term investing (the only kind I’m interested in for most of my money) means trying to identify companies in outstanding businesses, with outstanding managements, and whose stocks are not already over-priced. I have found that owning part of such a business (and that’s what being a stockholder means) usually provides me with a […]

Planning for Retirement

Advice to Older Doctors – How Much Does It Cost To Live In Retirement Compared To Pre-Retirement Costs? Over the years, I’ve read articles stating that the cost of living in retirement is about 70% of pre-retirement costs.  The explanation is that eliminating employment-related expenses (extra transportation, meals, clothes, etc.) will lower our costs without […]

Young Doctors – Own Your Own Practice!

Advice to Younger Doctors – One of the Best Financial Decisions You Can Make Is Owning Your Own Practice As Soon As You Are Able:  The ADA’s Health Policy Institute reports that the percentage of dentists under age 35 who own their own practice fell from 44% in 2005 to just 28% in 2017.  This […]

$12,000 Standard Deduction Helps Children on the Payroll

The New $12,000 Standard Deduction Will Help “Older” Children or Grandchildren Who Are Earning An Income Through Your Practice:  Many Newsletter readers employ young children in their practices so that these children become eligible to fund Roth IRAs.  The decades-long growth potential is massive even with the relatively modest contributions made each year.  If these […]

Avoiding Passive Activity Loss Limits Through “Aggregation”

Watch Out for the Passive Activity Loss Rules that Limit Losses from Passive Investments Like Real Estate to Income From Your Passive Activities: The big up-front tax deductions from the real estate build-out will normally be limited to your rental profit. If you own your practice in one entity, say an S corporation, and you […]

DOL’s New Fiduciary Rule for Financial Advisors Struck Down

The new fiduciary standard was supposed to end conflicts of interest at financial service firms, but has instead caused disruption between these firms and their clients.  Investment firms including Merrill Lynch and Edward Jones ended their commission-based relationships with their brokerage customers and moved them into more expensive fee-based accounts that charged a percentage of […]

close all