What Return Will I Get On My Investments? (AKA “The Run/Pass Analogy”)

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When having discussions about investments with clients, there is one question we get more than any other… What return will I get on my investments? It’s a great question. In our long-term financial plans we have to use a long-term estimate of market returns, so in a way we’re forced to answer this question. As such, our clients sometimes expect us to know the answer. After all, you can walk to the bank and they tell you exactly what the interest rate will be on a CD or savings bond. Can’t you do the same thing with all investments? Let us ask you a similar question: what exactly will the profits in your business be next year? And if we were investors in your business, what would be our exact return be? You don’t know for sure. In fact, you can’t know. Will there be a recession? Will all your patients disappear like …

Nate WilliamsWhat Return Will I Get On My Investments? (AKA “The Run/Pass Analogy”)

5 Investing Principles Every Dentist Should Know and Follow

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This post is the fourth in a series of five posts that lay out the PFG Investment Philosophy. This describes the five investing principles that every dentist should follow. Through these posts, we try and lay the foundation of knowledge around investments that clients should know, and answer the most commonly asked questions. Having a sound, well-researched, time-tested investment philosophy is like having a game plan to use against your next opponent. Most investment advisors (to say nothing of investors) do not have a specific investment philosophy to use to face the future. Instead, most investors, as well as many so-called advisors, look at last year’s returns (or last 5 years, or whatever) to pick their current plan. Unfortunately, this “return chasing” is a great way to lose your money. Here is what this plan looks like graphically: (idea for image borrowed from Carl Richards, author of “The Behavior Gap,” a book …

Nate Williams5 Investing Principles Every Dentist Should Know and Follow

The Two Best Investments for Dentists

Nate Williams Investments 2 Comments

This post is the third in a series of five posts that lay out the PFG Investment Philosophy. This describes the two best investments for dentists. Through these posts, we try and lay the foundation of knowledge around investments that clients should know, and answer the most commonly asked questions. What are the Best Investments for Dentists? There are two. First, Invest in Yourself and Your Business We believe in this key principle of investing in yourself and your ability to earn a good living. We advise young dental school students to finish school; we advise recent grads to get a good job where they can further their skills and to look for a practice to buy or start; and we advise doctors who are in practice to reinvest back in their businesses in the form of advertising, new equipment and continuing education. But you personally can only do so …

Nate WilliamsThe Two Best Investments for Dentists

Why Should Dentists Invest?

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This post is the first in a series of five posts that lay out the PFG Investment Philosophy. Through these posts, we try and lay the foundation of knowledge around investments that clients should know, and answer the most commonly asked questions. Question #1: Why Should Dentists Invest? The wealthiest people in the world, and the wealthiest doctors, are good investors. Why? They want their money to work for them. If you’re going to last 30+ years in retirement, you’ll need your money to work for you long after you’ve stopped working for yourself. Investing is not gambling. We don’t “put our money in” and cross our fingers hoping that on some magical day it will all come back to us. Just like you expect a profit in your own dental practice, we fully expect a return on our investments. We advise investing in real companies with real people working to …

Nate WilliamsWhy Should Dentists Invest?

Why Dentists Should Have (and Max!) a 401(k) Profit Sharing Plan

Nate Williams Investments, Practice Management Leave a Comment

For years we have been advising clients to establish and make the maximum contribution to a Safe Harbor 401(k) Profit Sharing plan. Of course this advice is always tailored to each client’s specific circumstances. Most of our clients have heard this advice enough times from several different sources, that they readily agree to get on board. Recently, however, we were asked to speak at a dental society meeting to a group of 40 dentists and decided to quantify the effects of having a 401k or not. Some of the general benefits of having a 401k include: The ability to setup an automatic savings plan (this is like “auto-flossing” while you sleep). The ability to get a current-year tax deduction at a time when we reasonably think you’re in your high earning and therefore high tax bracket years. The ability to allow the money to grow tax-deferred, meaning no tax on …

Nate WilliamsWhy Dentists Should Have (and Max!) a 401(k) Profit Sharing Plan

How to Avoid the Dark Side of Investment Forecasting

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Most of us hate uncertainty. And it’s our dislike of uncertainty that keeps the weather man and economic forecasters employed. But when was the last time you checked your favorite forecaster’s track record before acting on his or her prognostication? Chances are . . . never. Why bother, right? The weather forecaster gets close enough most of the time – so the economics guys on CNBC and in the newspaper are pretty close most of the time, right? They’re paid to be investment forecasters, after all. Wrong. And that belief could be costing you money. Please follow and like us:

Brian HanksHow to Avoid the Dark Side of Investment Forecasting