I was ecstatic to hear that Jim at The White Coat Investor was available to do a guest interview in our second part of our Millionaire Mob guest interviews. In our first session, I interviewed Gwen of Fiery Millennials. Physicians seeking personal finance advice is an interesting one. They often have student loans from the long draining med school years, but at the same time make great money once they are full-time employed doctors. Asset allocation discipline is very important for doctors. They often have large amounts of money (and friends/family know it), which can suck them into poor investment decisions. Learn more about the personal finance habits of doctors in our personal finance guest interview with The White Coat Investor.
Personal Finance Guest Interview With The White Coat Investor
I was a millionaire before The White Coat Investor ever made any real money. While The White Coat Investor is for-profit and is now financially successful, I started it in order to give doctors and other high income professionals a “fair shake” on Wall Street. In essence, I want to help doctors stop doing dumb things with their money so they can concentrate on their health, practices, and families.
What is the one piece of advice that you’d give to people just realizing that they need to get their ‘financial fitness’ in order?
You have a second job, and over the course of your lifetime it will pay you more than your regular job. Whether you know you have this job or not, you have it. Whether you know how to do this job or not, it’s yours. If you do a poor job, you’ll have a poor outcome. Nobody cares as much about it as you do. What is this job? A pension fund manager. And guess what? Every one in America has been given this job in our brave new 401(k) world.
What is your favorite form of passive income?
A financial advisor once told me that Asset Under Management fees are the best form of passive income. I agree. However, I also think they’re somewhat unethical. Why should someone pay ten times as much to have a portfolio managed than someone else pays? It doesn’t make any sense. Kind of like realtor fees that way. I think my favorite form of passive income is book royalties. Write it once and let Amazon sell, market, print, and deliver the book. With direct deposit, you don’t even have to cash the check. Awfully passive. Check out The White Coat Investor Book here. (Millionaire Mob agrees check out my book here)
What have you learned from creating passive income streams? Do you like to take your side income and recycle it into new opportunities?
I’ve learned that the internet is the Wild West of entrepreneurship where anything goes and you’re limited only by your own ethical standards. Yes, I do like to use my income to invest. But I also like to use that income to buy fun things and experiences, make my life easier, buy some of my time back, and support charitable causes that are important to me. We were proud that 2017 was the first year where we gave more money away than we spent. Maybe some day we can give away more than we pay in taxes.
Do you have any mentors or people that you follow that have influenced you to be financially independent?
Physician on FIRE writes a blog specifically for physicians that want to reach early financial independence. I like his blog so much I bought part of it. I highly recommend it for any high income professional or really anyone interested in financial independence or early retirement in their 30s, 40s, or 50s.
What inspired you to create your site? What’s one thing that you didn’t know that you know now?
I love doctors. I think they’re some of the best people in the world. And it causes me immense pain to see them waste the incredible wealth-building opportunity their salaries provide. It is even more painful to see someone else take advantage of their desire to help others in order to sucker them in to some terrible financial idea. That’s honestly what drives this whole thing. I’m very passionate about helping people do well by doing good.
There are so many things I didn’t know that I know now I don’t even know where to begin. How about this- if you create enough value for other people, some tiny percentage of it will eventually find its way back to you. This is consistent with what we found in our interview with Vital Dollar.
Everyone wants to get into passive real estate, but no one understand the time consuming nature of being a landlord. Do you agree that it is more time consuming than first imagined?
I really don’t enjoy being a landlord, nor am I good at it. So I now outsource pretty much everything by investing in syndicated properties (including online crowdfunded syndications), private real estate funds, and the Vanguard REIT index fund. I figure I am much better able to add value to websites than real estate properties, so that’s where I spend my time and effort. I think real estate is a great asset class, but there are many ways to invest in it that don’t require you to own an entire property yourself nor do ANY management at all.
Conclusion on Finance Interview with White Coat Investor
Stick with your plan. Put your assets in the right spot including pension plans. Don’t get over your skis with your passive income streams and focus on a few that are important to you.
What have you done to build a passive income stream or increase your income? Please let us know in the comments below.
Check out the rest of our Personal Finance Guest Interview Series where we interviewed several experts in the field of personal finance, financial independence and passive income. There is a lot to learn from each our experts that have stayed disciplined in their personal finance goals and are focused on helping others achieve theirs.