4 Physician Bloggers Reveal Their Investment Portfolios

I want to start by thanking Dr. Scrilla, Physician on Fire and Hatton1 for sharing their investment portfolios for this post. Please visit their sites for other amazing content and follow-ups to this post.

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Giving advice on personal finance is challenging. Everyone has a unique situation from income to marital status or financial expertise to risk tolerance.  Financial advisors prey on this difference because it’s hard to find a one size fits all strategy and they can “help customize” one for you … for a small fee.

The personal finance blogging community has helped remedy this problem by sharing information to the masses and encouraging discussion.  But there still remains a gap – the writers try to be open about their situation but details are still missing. Readers bring their own assumptions and believe that the writer must be in the same situation.

The purpose of this post is to share the investment portfolios of 4 personal finance physicians bloggers in different stages of their career. I compiled their financial profile in an “objective” standardized format and removed all numbers. Even with objective data shared in a standardized format, I believe there is still room for interpretation and this is mine.

The other 3 bloggers may post their interpretation on their own site or comment below but I also encourage other physician bloggers to join in. Here is a link to a google doc survey where you can submit your information and find some partners in crime to put together a similar post.

Meet Our Docs

ScrillaLinusPOFHatton1
SpecialtyRadiologyEmergencyAnesthesiaOB/GYN
Career stageResidentAttendingAttendingAttending
EarlyFIRERetiring
Post-Grad Yrs291235
Job TypeAcademicCommunityCommunityCommunity
Previous ProfessionsAir-ForceNoneNoneNone
Add’l degreesNoneMBANoneMBA
MarriageMarriedMarriedMarriedDivorced
Family1 Kid1 KidCouple Kid
IncomeSingleDualSingleSingle

At a quick glance, this is a very diverse group of physicians with 4 specialties, 4 career stages and almost every variation of family situation.

  • Dr. Scrilla is getting things ready to launch his attending career as he finishes up residency.
  • Physician on Fire (POF) is looking to retire from clinical medicine in the next 1-2 years and continue to build his blogging empire.
  • Hatton1 is working on closing up her practice and retiring soon.
  • I am in the early stages of my career with no intentions of retiring any time soon.

Some might say it’s difficult to extract anything of value from such a diverse group but as you will see below even with the variances we have fairly predictable financial profiles over time.

My interest in finance started early when my brother encouraged me to open a Roth IRA at 18 with the money I earned delivering pizzas. I’ve had jobs ranging from grocery bagger to IT tech support and these experiences have given me an appreciation for earned income.  My goals for financial independence are mostly driven by my desire to work because I want to and not because I have to. I see value in what I can contribute to society as a physician but it has to be on my terms.

Account Types

ScrillaLinusPOFHatton1
Emergency FundYesYesYesYes
Roth IRAYesYesYesYes
T-IRA / SEPNoNoNoYes
401(k) / 403(b)NoYesYesNo
457(b)NoNoYesNo
HSANoYesYesNo
TaxableYesYesYesYes
529YesYesYesNo
UGMA/UTMANoNoNoNo
Donor Advised FundNoYesYesYes
Total Types4785

An investor’s account types grow over time with new jobs or side hustles but then at some point, it’s time to start consolidating and simplifying. I don’t shy away from investment accounts and am always researching different account types, their tax advantages, and ways other people are using these accounts. My belief is “try it and fix it later” rather than shoot for perfection on the first try.

It was great to see the other docs having a donor-advised fund because this is my favorite account. We started it 5 years ago and use it regularly for our charitable donations. It has actually pushed us to donate more than we would have normally because of how easy it is to use.  This account will also play a role in our tax planning strategy going forward where we will bunch our deductions to work around the SALT limitations.

Real Estate Investments

ScrillaLinusPOFHatton1
Primary ResidenceRentOwnOwnOwn
Second Home or InvestmentNoYesYesNo
Non-Traded REITNoYesNoNo
Publicly-Traded REITYesYesYesYes
CrowdfundedNoYesYesNo
SyndicationNoNoNoNo

Real Estate usually becomes part of a physician’s investment portfolios at some point in their career ranging from buying a primary home to investing in rental properties. Hatton1 noted on the side that she has owned multiple homes and been part of a hospital syndication in years past but has since simplified her portfolio.

With the growth of crowdfunded platforms, I believe we will see more physicians adding real-estate to their portfolios at an earlier age. Also, I wonder if we will see some pull away from the publicly traded REITs. I moved some of my money out of the Vanguard REIT to invest in the crowdfunded REIT but it’s hard to predict if this is a short-term fad or here to stay for a while.

I’m a big believer in the power of Real Estate and spend a significant amount of time and money investing in real estate.  Diversification away from the stock market is probably my main driver and second would be the tangible aspect of the investment. I enjoy building relationships with my tenants, understanding their life situations, and learning from them whenever possible.

Asset Allocation

ScrillaLinusPOFHatton1
Cash50%5%0%3%
Stocks30%80%80%62%
Bonds15%5%10%34%
Real Estate5%10%10%1%

An old rule of thumb was 100 minus your age for your stock allocation, but I think this is too conservative and most have gone away from it in recent years. My portfolio was similar to Dr. Scrilla’s during residency, with more cash and bonds than necessary.  When I got more comfortable with my finances and had stable cash flows I took on more risk to push the boundaries and get closer to the efficient frontier.  I suspect this is similar to what everyone does and there is nothing wrong with that because the last thing you need is to take a big hit on your first $5000 and then be scared for the rest of your life.

On the other end of the spectrum is Hatton1 who has a higher bond allocation because she is close to retirement.  Liquidity and stability have more value than aggressive stock investments because now her portfolio will be her primary source of income.  I wonder what she thinks about the potential for a bond market risk in the next 5-10 years and how she might adjust her portfolio?

Why do I keep 5% in cash? So, while I believe in taking on risk and maximizing opportunities for leverage, there is a part of my brain that likes to have a “what if” fund.  These can range from job loss, home repairs to opportunity for a unique investment. This past winter my cash allocation helped significantly because I was able to pre-pay my property taxes on 4 properties without having to source the funds from my investments. So yes, I keep a dry powder in cash but it’s not always advised.

Debt & Liabilities

ScrillaLinusPOFHatton1
Student LoansYesNoNoNo
MortgageNoYesNoNo
Car LoanNoNoNoNo
Credit CardNoNoNoNo
Business LoansNoNoNoNo

Finally, we get to debts and liabilities.  One of the cornerstones of financial independence is eliminating all forms of debt and POF and Hatton1 are definitely role models for that thought process.  I keep a mortgage because I like the idea of interest rate arbitrage and maximize my returns but I am still early in my career so I can ride out any fluctuations in the market.  I suspect that as Dr. Scrilla lowers his student loan debt burden he will take on a mortgage, but then eventually we all want to shed these liabilities to be independent. No fancy car loans? I suspect this is a unique group of physicians who are focused on their finances and understand the difference between “good” and “bad” debt.

Conclusions

Did we learn anything of value from this information? Rather than revealing anything earth-shattering or POF’s secret to wealth, I believe it shows that physician finances are more alike than we might believe on the surface.  Dr. Scrilla’s portfolio is a little more conservative for someone who is young and POF’s is a little more aggressive for someone close to retirement.  Hatton1 followed the traditional path but I would have probably expected more real estate though that is probably a bias on my part because every other article I read is about real estate investing or crowdfunding. The point is, there is nothing fancy behind the curtain and if we share our information openly we can learn from each other to push the envelope further.

What did you learn from these investment portfolios?

–Dr. Linus

13 comments

  1. Good article. Good idea. In answer to your question on bonds, I have not bought any new bonds since the Fed started raising rates. I do reinvest in the funds that I own. I am letting short-term assets pile up. In my peak earning years I never kept any cash. You have a favorable bias toward real estate and I have a negative bias. I do own some VNQ. I do not want to deal with tenants. At this stage I want liquidity and no-fuss.

    1. Thanks for playing along! This is exactly what I hoped to show. No “right” answer to personal finance and the preference will change with time and experience.

  2. Our answers were quite similar, Linus. I think it’s great that you’ve been using a DAF for five years now. I think this is our fifth year with them, as well.

    The fact that the two of us approaching retirement are 100% debt-free is telling, too. It’s impressive how low your spending needs can be when you have eliminated student loan and mortage debt.

    Cheers!
    -PoF

    1. We opened our DAF more as a way to make donating easy and not have to keep track of receipts but over time it has just ballooned.

      I think most people hide or nervous about discussing their finances which makes them appear more complicated than they actually are.

  3. Kudos on the innovative post. Great to see how 4 physicians compare along various stages of their career.

    I myself have started directing the majority of my investment money into real estate this past year, mainly private syndication deals. This component of my portfolio provides a great passive income stream and helps me weather the volatility of the spock market (and allows me to take a more aggressive asset allocation (I’m at 75% equities at age 47 in my “investment portfolio component”

    1. It’s always great to get a look under the hood of other investors in similar life situations. This post probably didn’t reveal anything shocking but that’s the main point. Some new investors assume that the rich have this complicated investment plan that they could never achieve.

      I’m starting research syndicated real estate deals and will be reaching out for some pointers.

    1. Too much faith in anything is always dangerous. Ironically I would read this article as a sign to potentially increase real estate investment.

      As affordability decreases, more people will rent and thus improving the outlook for the rental market. It’s when affordability increasing and mortgage rates are low that people shift to buying rather than renting.

      Always fun to try to predict the future. Thanks for reading.

  4. Curious how much of the cash allocation in the emergency fund. Obviously when at the beginning of career is emergency fund is considered as cash allocation it will likely result in high alocation to cash. The correct size of emergency fund is critical even if it leads to high cash allocation as this will correct itself as portfolio grows.

    1. I believe most of the cash allocation was in emergency funds. This is where percentages can be misleading when looking across different career / net worth stages. I didn’t ask $ amounts because I wasn’t sure if everyone would be comfortable revealing.

      The “correct” size of the emergency fund will be personal preference. Some would say why does a resident need a large emergency fund if they have a balanced budget. While others argue if you even need a emergency fund later in your career as you have other funds to fall back on.

      Personally, I like 3 months worth of take home pay in my “emergency fund” but I keep extra cash for buying opportunities.

  5. Pingback: stitch kigurumi
    1. Haha if 4 months is well established then sure. It does require a good amount of work but if you just enjoy writing then put it online and go from there.

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