WCI #125: How to Rebalance Your Portfolio

See the show notes for this episode at https://www.whitecoatinvestor.com. One listener asked about how to rebalance his portfolio. A lot of people still get confused about this. He said rather than sell from the oversized asset, and transfer the proceeds to the undersized one, he has always just invested additional funds out of pocket and purchased more of the smaller one. He wanted to know if he was making a mistake. I encourage people to look at their portfolio in its entirety and not at individual accounts when rebalancing. I think most people will find in the first half of their career at least, that it is very rare that they have to sell an appreciated asset in a taxable account in order to rebalance. Most people will find that they can rebalance with just the new contributions, especially in their first decade of saving. And especially if they have been reading the WCI blog or listening to the podcast, they probably have been maxing out some significant retirement account and can do their rebalancing inside those accounts. I recommend you do your rebalancing inside the tax deferred accounts with new contributions if possible. We get into more details on this as well as answer questions about buying a home while still having student loans, using leveraged ETFs in order to maximize tax loss harvesting and donation of appreciated shares, deducting travel expenses, how to start a taxable account, and negotiating an employment contract.

Did you know that the White Coat Investor not only has a podcast and a blog but several books that will help you on your way to financial independence. These books cover topics such as asset protection and minimizing your taxes to keep more of your hard earned money. They discuss plans for insurance, housing, spending, student loan elimination, investing and estate planning. You can learn how to become a millionaire within 5-10 years of leaving residency and how to invest in a sensible low cost and effective manner with or without the assistance of a financial advisor. There is even a book geared directly toward medical and dental students so you can start optimizing your finances early in your professional journey. Find the book that is right for you at the WCI store at https://www.shop.whitecoatinvestor.com or on Amazon. You can do this and The White Coat Investor can help.

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 is for you!

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