“Fire Your Financial Advisor” Review

As many of you know the White Coat Investor, or Dr. Jim Dahle, is a well known emergency medicine physician, personal finance author, blogger, and podcast-er. Recently, Dr. Dahle decided to venture out and create an online course using a program called Teachable.

Fire Your Advisor

As an affiliate partner, I was given the opportunity to take the course for free. The following is a review of this course, which is called Fire Your Financial Advisor. The review is long, but this course includes over 6 hours worth of video and presentation information all-in-all. My favorite sections are Sections 2, 5, 7-9. [As you can tell, it’s hard for me to pick just one… this information is extremely high yield].

And, let’s let the cat out of the bag at the beginning of this review. The course is expensive at $499, but it is only expensive if you ignore what you are getting out of it:
1) The ability to create your own financial plan (usually costs $2000-5000 from a financial advisor).
2) Over the next 60 years by investing via a do-it-yourself method instead of using an advisor, you will save yourself literally millons of dollars.
3) If you are in training and have >$150,000 in debt the student loan section alone will save you thousands of dollars. Interestingly, I created an entire page on this exact topic (Refinancing Loans During and After Training) recently. It’ll be out soon.
4) There is a 7-day no questions asked refund policy. Don’t like it? Not helpful? Just ask for your money back.

The Purpose

The provocative name of this course would imply that you can learn everything it takes to become a CFA, CPA, or CPA + FPS. While this course will tell you about those acronyms and why they are helpful to know about, it is more focused on teaching you how to make a financial plan that is tailored to your goals.

All in all, there are twelve sections in this course. Let’s go through each and review them. I’ll also include a sneak peak of some cool stuff I learned in each section.

Section 1. Introductory Materials

I’ll make this section review brief. In this section, Dr. Dahle spends time teaching you what you do and don’t know. It starts with a helpful pre-test that will allow you to gauge your current knowledge. It discusses what the course will help you accomplish, such as creating a thorough and complete financial plan or how to tell a good advisor from a bad one. He also spends time pointing to other resources that can be found on the White Coat Investor Website.

Section 2. What You Need to Know About Financial Advisors

I found this section extremely helpful. It helped me better understand the cost of financial advising and how to pick apart the good from the bad. Here are some things you can expect to learn from this section:

  1. What is the difference between fee-based and fee-only advising?
  2. What is AUM (Assets Under Management) and how much will it cost you to be advised this way? (Hint its millions of dollars… hence, why WCI created the course)
  3. He goes over how to save yourself money (doing it yourself) and how you can save money, if even after the course, you feel the need to use an advisor for a specific need.
  4. Discusses Roboadvisors and what they are and how they could (possibly) be useful for you if you require an advisor
  5. Tactics of good advisors versus bad.

Sneak Peak: If you are using a financial advisor and think you understand how they get paid, you are probably wrong. If using a fee-based advisor, it will cost you millions.

Section 3. What You Need to Know About Insurance

If you don’t have a strong handle on any of the following insurance products, this section is for you: Disability, Life (term, whole-life, and the differences), Home, Auto, and Umbrella. Some of the highlights of this section include going over which insurance companies offer own occupation disability insurance products. [If you don’t know what “own occupation” means, you should buy this course]. Other items discussed includes different kinds of riders on insurance products. This is a high yield section.

Sneak Peak: Ironically, the insurance salesman that led to me being unable to get disability insurance when I didn’t need it and shouldn’t have applied works for a company that does NOT offer a true own occupation disability insurance product. So, even if I could have gotten it, it wouldn’t have been what I needed. What a joke. This is when my distrust for insurance and investment “advisors/salesmen” began. I would have known this if I had taken this course. [Cue the bad commercial: “Don’t be financially stupid TPP, be the ‘Fire Your Financial Advisor’ TPP].

Section 4. Developing a Plan for Housing

This section walks you through the salient points of when to buy a house, how much it will cost you, and when is the optimal time to buy a house following training. It gets pretty specific diving into how much expensive of a home affords you the opportunity to still afford to make plan work for retirement.

Other highlights include discussion on different kinds of mortgages and when each should be used (doctor versus standard) and whether down payments are necessary and what benefit they provide to you when buying a home.

Sneak Peak: One of my favorite items discussed here is how realtors get paid (Is it from the seller or buyer’s side?). This helped me understand how to tackle putting an offer in on a home and where certain conflicts of interest exist. Keep your cards close to the vest.

Section 5. Destroying Your Student Loans

This section provides a fantastic overview of student loans. This was by far and away my favorite section. Man, I wish I had seen this during medical school or residency. It would have saved me tens of thousands. If you are in residency, fellowship, or a new attending who has not refinanced your loans via either the federal government Income Driven Repayment (IDR) programs or through a private lender this section is worth the cost of the entire product.

Items discussed in this section include:

  1. The difference between IDR, ICR, IBR, PAYE, REPAYE programs offerred by the government and which is best for you while in training.
  2. What PSLF (Public Service Loan Forgiveness) is and how you should view this prospect? Afraid of the government getting rid of this promise? White Coat Investor has a solution for you.
  3. (Actually creating a page on refinancing during residency myself) WCI discussed the different programs that allow you to refinance during residency and the benefits and consequences of this decision.
  4. Refinancing after residency.
  5. And the ultimate question: Whether to pay-off loans or invest money.

Sneak Peak: When you refinance after training you should almost always seek a variable rate as you are pretty sure to lose money with a fixed rate (for the same time frame) unless two things happen: The variable rate goes up fast and soon after you get loan. This is unlikely to happen.

Section 6. How to Spend Money to Increase Current and Future Happiness

If you have read any of WCI’s posts this is the section where he teaches you how and why to live like a resident after residency. He further discusses how to make a budget and how to stick to it. He also describes what an emergency fund is and where it should be held.

Sneak Peak: WCI tells you how if you explain to him what someone did with their money in the first year after residency, he can tell you “with surprising accuracy” what the person’s financial future looks like.

Section 7. Creating Your Investing Plan Part One – Setting SMART Goals That Matter To You

This is the meat of the course. WCI walks you through several practical aspects of an investment plan. Here are some highlights:

  1. An appropriate savings rate and what the rule of 72.
  2. How much you need to retire based on the Trinity Study (don’t know what that is? You should).
  3. The four pillars of savings for your kid’s college education.
  4. Extremely practical excel spread sheet functions to help you determine how much something will be worth in the future (i.e. if an investment grows at 5% for 20 years, how much will you have?); the payment function (want to know how your car payment is calculated?); and the period function (how long will it take with your planned monthly payments to pay something off)?

Sneak Peak: Your savings rate (how much of your income you save each year) matters much more early in your career while returns matter a lot more later in your career.

Section 8. Creating Your Investing Plan Part Two- Understanding Your Investing Accounts

If section 7 is the meat to the course, then section 8 is definitely the potatoes. Again, this section alone pays for the cost of the course. Really high-yield stuff. Want to know the difference and tax implications of short term capital gains versus long term capital gains? Ever care to know how much you can give your kid to invest before it is taxed? What about capital gains on houses in the real estate market?

It is also discusses the differences in different retirement accounts: 403B/401K, 457, SEP-IRA, Roth IRA, Solo-401K, and defined benefit plans. Confused? You won’t be after the course.

Sneak Peak: If you have lived in your home for 2 of the past 5 years and sell it for less than $500,000 this income is tax exempt. You can also avoid taxes if it is exchanged for another property.

Section 9 Creating Your Investing Plan Part Three- Asset Allocation and Implementation

This section provides the basics of what most people think about “investing.” WCI discussed stocks, bonds, mutual funds, REITs, ETF’s. Active versus passive management. Expense ratios. Index investing. Factor investing versus total market investing. Asset allocation. Most efficient to least efficient tax efficiency for asset classes. Value funds versus growth funds. Mutual fund loads and the 12B1 fee. If these terms mean nothing to you, you should have already purchased the course.

Sneak Peak: WCI gives you a continuum of being invested in real estate from doing it yourself (Want to landlord your starter home when you move into the big house?) to actively investing in real estate through mutual funds. He discusses the risks and benefits of all the different varieties in between.

Section 10 (Estate Planning) and Section 11 (Asset Protection) and 12 (Staying the Course)

These three sections are really all about protecting your financial plan and how to stick to it.

Want to know what a revocable trust is and how it differs from an irrevocable trust? What about when to pursue getting one? Do you know how you can avoid the death taxes for your heirs? This is all addressed in Section 10.

Want to know what your likelihood of being meaningfully sued as a physician? What about how to protect your assets in the case of that very unlikely event? This is all discussed in Section 11.

Section 12 is crucial. You need to have a financial plan that allows you to stay the course in a downturn or recession. You can’t be scared of a bear market! WCI also discusses how long you should wait before you change your financial plan and continuing financial education.

Take Home:

This is a great course as many of the sections address financial questions many people have regarding financial advising and whether you need one. It walks you through all of the important parts of creating a financial plan and, I asssure you, you will have a complete plan by the end of the course. While this plan normally costs more than $2000, you can create your own strong and independent financial plan by purchasing this course for $499.

I highly recommend this course for anyone who is interested in saving themselves millions of dollars over the next 60 years as you avoid having to utilize a financial advisor.

What do you think? Have you seen the course? What did you think about it? Have you fired your financial advisor?

TPP

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