The White Coat Investor's Financial Boot Camp

Disability insurance is something that anyone who is working but has not yet achieved financial independence needs.

Disability insurance is something that anyone who is working but has not yet achieved financial independence needs. Insure your income. As a high-earning professional, your ability to generate income is your most valuable asset. Disability insurance protects this asset by providing income if you become unable to work due to illness or injury. Aim for a policy that covers 60-70% of your income, with an "own-occupation" definition of disability specific to your specialty. Key policy features: Own-occupation definition Non-cancelable and guaranteed renewable Cost of living adjustment rider Future increase option rider Residual/partial disability coverage Don't rely solely on employer-provided coverage, as it may be insufficient or have limitations. Purchase an individual policy early in your career when you're healthy and rates are lower. Review and update coverage periodically as your income grows.

Disability insurance gives you an income to live on if you become so disabled that you can no longer work. Protect your dependents. Term life insurance is crucial if anyone relies on your income. Calculate your needs based on replacing your income, paying off debts, and funding future expenses like education. Avoid whole life insurance, which is usually an expensive and unnecessary combination of insurance and investment. Insurance priorities: Disability insurance Term life insurance Health insurance Property and liability insurance (homeowners/renters, auto, umbrella) Purchase insurance based on actual needs, not fear or sales pressure. Regularly review and adjust coverage as your life circumstances change. Remember that insurance is meant to protect against catastrophic losses, not minor inconveniences.

A spending plan is simply a prior decision to spend consciously. Live below your means. The key to building wealth is not just earning a high income, but consistently spending less than you earn. Create a written spending plan (budget) that aligns with your values and financial goals. Aim to save 20% or more of your gross income for retirement, in addition to other savings goals. Effective budgeting strategies: Track spending for 1-3 months to understand your habits Use the "Pay Yourself First" method for savings Automate bill payments and savings contributions Use separate accounts for different spending categories Review and adjust your plan regularly Avoid lifestyle inflation, especially early in your career. Consider "living like a resident" for 2-5 years after training to rapidly build wealth and pay off debt. Focus on reducing your largest expenses (housing, transportation) for the biggest impact.

The only way to eliminate your loans (outside of forgiveness) is to throw massive sums of money at them each month. Develop a repayment plan. Understand your loan types, interest rates, and repayment options. For federal loans, consider income-driven repayment plans…