097 | The White Coat Investor | Origin Story

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097 The Whitecoat Investor's origin story
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Dr. James Dahle, founder of The White Coat Investor, talks about getting his start as a doctor and a blogger, setting up inheritance funds for his children, thinking through his investing strategies, and the motivation that keeps him working on the White Coat Investor.

  • Dr. Dahle describes his childhood in Alaska, and his early financial influences.
  • Why did Dahle’s father encourage him to go to medical school?
  • Dr. Dahle finished his undergraduate degree with only $5,000 student debt, and joined the military to cover the cost of his medical degree in exchange for 4 years of military service.
  • Choosing a college based on buildings and trees may not be as important as that value you’ll get compared to the price you’re paying.
  • Dr. Dahle has decided to give his children their “inheritance” in their early adult life.
    • Roth IRA
    • College fund in a 529
    • “Twenties Fund” in a UTMA account
  • Best possible tax deduction you can get is to hire your children to work in your business, as you don’t have to pay any payroll taxes and it is a deduction for the business.
  • Did Dr. Dahle always have a frugal mindset?
  • Dr. Dahle’s frustrating experience with real estate and life insurance professionals ultimately motivated him to learn more about financial management.
  • What does Dr. Dahle think of mutual funds, and the different types of them?
  • Highlights of establishing a personal investing policy statement:
    • Set your goals
    • Decide on your asset allocation
    • Select your investment
  • How does location impact a doctor’s potential income?
  • The White Coat Investor (WCI) includes detailed information about the Backdoor Roth IRA and has been instrumental in marketing this investment tool.
  • During the early years of the WCI website, what kept Dr. Dahle motivated to keep producing content despite low returns?
  • Dr. Dahle’s wife is officially a 50% owner of the WCI
    • Opens up a new 401k
    • Gives her access to social security, although now the business has to pay into that.
  • Does Dr. Dahle use an accountant at this point?
  • As the WCI has grown, Dr. Dahle has outsourced a number of responsibilities.
  • Why did Dr. Dahle turn down an offer to purchase his business?

 

Links:

The White Coat Investor

Bogleheads

How To Write an Investment Policy Statement

The Humble Dollar

‘The Psychology of Money’ – Morgan Housel

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7 thoughts on “097 | The White Coat Investor | Origin Story”

  1. Still listening to the podcast but had to stop and leave this note: This podcast is striking a lot of chords with me – got my kids through college without debt – they worked, got great scholarships, and I supplied a fixed ‘Dad Scholarship.’ It was an amount I knew I could cash flow. They also lived at home for a portion of this time. I did a UTMA-21 (note the age 21, not 18) for both kids with their early birthday gift money and we funded some as well. Both kids were able to use this money to buy their first cars and got the balance to start off in life. Both left college with money in the bank.

  2. Two of my favorite podcasts/blogs in one show! Epic. Mind explosion. Thanks for sharing your origin story. We are two of those docs you helped with WCI. The ‘impact’ that WCI has had on our lives is huge and I am grateful for it every day. Living like a resident and internalizing FI ideas are why my wife can work part time now and be home with Baby Kpeds and why when we were both working full time we had a 50% savings rate.

    Adding the FI to WCI is transforming our lives and I’m sure many more!

    Thanks again!

  3. For the payment to your child through your business, the income is subject to FICA even though child is under 18 years old. Checked around and filed tax for 2018. We ended up paying 15.3% for the pay that our child got.
    How can you not to pay FICA for child earner income (given not deducted by employer)? Where exactly is the IRS publication states it? Please explain.

  4. PG, the answer to your question (as it is with many tax questions) is “it depends.” If your child is paid by your S corporation, the compensation does not qualify for the FICA exception. If it is paid by you as an ordinary and necessary business expense of your sole proprietorship (and thus, deducted on your Schedule C), and it is your child, and he/she is under age 18, the pay should qualify for the FICA exception.

    The IRS has a webpage discussing this here: https://www.irs.gov/businesses/small-businesses-self-employed/family-help

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