As a young physician, I found that most of my colleagues were completely financially illiterate- myself included. The simple fact is that we have dedicated our time and efforts to learning about medicine, not finances. We also tend to find reading material on the subject dry and uninteresting. However, with more and more physicians in debilitating debt from student loans, learning how to manage your finances has never been more important.
ANYONE can learn about investing (which I believe is the way to truly build real wealth in this country). If you plan to save and retire off your income alone, you can do it but will need to continue working much longer than if you invest money from the very beginning in the stock market. Make your money work for you.
I have found that there are several helpful financial websites out there for physicians such as White coat investor https://www.whitecoatinvestor.com/ and Physician on Fire https://www.physicianonfire.com/. I have referred many physicians to these sites. However, in talking with my fellow physician friends (mostly women physicians), these websites are full of great information but can still feel overwhelming, especially when first starting out.
So, I will be starting a financial series and breaking it down from the beginning to help you get started. No, I am not a financial advisor. No, I am not backed by a financial institution. I’m not really getting anything out of this other than maybe a few clicks to my website (but as other bloggers can attest, it barely adds up to anything). Why am I doing this, then? Well, I see a need. I was in your position. I have retired early thanks to wise investments and financial principles and now I have the time to help out those interested in the stock market but are afraid to jump in. I do not claim to be an expert, but I don’t think you need to be in order to reach your financial goals (whatever they may be). Hope you find it helpful. We are starting with baby steps.
SET UP AN ACCOUNT FOR INVESTING
(This is separate from your 401K-make sure you have maxed that out first before investing in another account to receive the tax benefits of 401k).
You will need to pick a trading platform. There are many companies for this. They are all pretty similar and it ultimately doesn’t really matter which one you go with as long as you just start investing. Back in the day, people used to use stock brokers and they would call on the telephone and urge you to invest in certain things. Now, all you need is a computer and you can easily set up your account and start investing on your own.
I personally use Charles Schwab. You could also pick Etrade, robinhood, Tdameritrade, etc. Don’t get paralyzed by the choices, just pick one.
Here is the link to Charles Schwab to make it easy for you:
Click on “open an account”
Type of account you want to open: “Brokerage”.
Then just follow prompts to open your account- will take less than 20 minutes.
You will need to transfer money into this account (you can link your bank account to make it easy or send in a check). I recommend linking your account so that you can easily contribute in the future or set up automatic transfers each month. Make it easy on yourself to keep investing!
Again, you can do this with any trading platform you wish- I happen to use this one, so I am sharing with you as I have found it easy to navigate, follow my stocks, and actively trade stocks. I also like the interface of the app for my I phone.
Make it your goal to set up an investment account this week.
Once your account is set up and money is transferred (make take a few days to have money accessible for you to invest), we will get started.
Expect my next post within the week. It will go over the next step, which will be choosing what to invest in. To delve into that further, we will have to get into some financial terminology but I plan to keep it simple, brief, and to the point. We will talk about long term investing and mutual funds and how to do it.
Future Topics I plan to cover in the most basic way possible:
Investing- Mutual funds
Saving for College: Setting up a 529 plan
Making a will/estate planning
I hope you follow along and share with any friends who may find this information useful as we work our way into investing.