MtoM #137: Roadie Becomes a Millionaire and Finance 101: Retirement Accounts for the Self Employed
Sep 25, 2023
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Interview with a concert roadie who became a millionaire. Discussed alternative careers, living below means, retiring in affordable countries. Also covered retirement accounts for self-employed individuals like individual 401(k), Roth conversions, contribution limits, and more.
Self-employed individuals should consider an individual 401(k) and cash balance plan for retirement savings, while also utilizing an HSA for tax advantages.
The podcast highlights the financial success of a concert roadie, emphasizing the value of non-traditional careers, developing transferable skills, and potential benefits of living abroad.
Deep dives
Saving for Retirement as a Self-Employed Person
The main retirement savings option for self-employed individuals is an individual 401(k), which allows for both employee and employer contributions. Contributions can be made on a pre-tax or after-tax basis, with the possibility of converting after-tax contributions to Roth. Depending on age, a cash balance plan can also significantly boost retirement savings. In addition to retirement accounts, an HSA can be used for healthcare expenses and further tax advantages. After maxing out retirement account contributions, individuals can invest in a taxable brokerage account for additional savings.
Benefits of Living and Working Abroad
The podcast features a guest who pursued a career as a concert roadie and achieved millionaire status. Living in Brazil, he leveraged low living costs and the ability to save on expenses provided by his employer, despite living with Crohn's disease. The guest also embraced opportunities outside his main profession, such as working for Tesla, demonstrating the flexibility of a career change and the importance of developing transferable skills. The conversation highlights the value of exploring non-traditional careers and considering living abroad to improve financial well-being.
Choosing the Right Mortgage for Physicians
For young doctors, a physician mortgage can be an advantageous option for purchasing a home, as it often requires a smaller down payment and doesn't require private mortgage insurance. However, for those further along in their careers or with better use for their money, a conventional mortgage may be a better choice. The podcast encourages listeners to carefully consider their financial circumstances and goals when deciding on a mortgage, providing resources to explore various mortgage and refinancing options.
On this episode we have a great interview with a concert roadie who has become a millionaire. This White Coat Investor lives in Brazil and has a degree in mechanical engineering but has been a roadie for his whole career. He loves his job and all of the travel and once in a lifetime adventures he has had through his career. He makes a six figure salary and has kept his cost of living low and savings rate high. He wants all of your to know there are so many jobs out there that don't require advanced education and huge amounts of debt that can provide a reasonable salary and a great career. If you are disciplined, intentional and live below your means you can have a wonderful life, fulfilling career, and still fund your retirement. Stick around after the interview for Finance 101 to talk about retirement accounts for those of you who are self employed.
At some point in our financial lives, it will be time to buy a home. A physician mortgage can be a good vehicle for a young doctor who’s just out of school and has a more effective place to use their money than on a big down payment. These loans allow doctors to secure a mortgage with fewer restrictions and a lower down payment than a conventional mortgage. But if you’re further advanced in your career or deeper into your journey to financial freedom, buying a home with a conventional mortgage and then, later on, potentially refinancing that loan to a better rate with a shorter time frame could be a great move. Wherever you are in your financial journey, make sure you use the mortgage that will be most financially beneficial for you. Hop over to our recommended tab to learn more about all of your mortgage and refinancing options at https://whitecoatinvestor.com/mortgage.
The White Coat Investor has been helping doctors with their money since 2011. Our free financial planning resource covers a variety of topics from doctor mortgage loans and refinancing medical school loans to physician disability insurance and malpractice insurance. Learn about loan refinancing or consolidation, explore new investment strategies, and discover loan programs specifically aimed at helping doctors. If you're a high-income professional and ready to get a "fair shake" on Wall Street, The White Coat Investor channel is for you!