For an audio version of this post, please click on the speaker icon (top left).

 

 

Welcome to this episode of The Doctor’s Bill (Can You Afford It?).

Wonder if you should buy that big ticket item or not?

Well here’s your chance to have a wealth management expert, Johanna Fox Turner, of Fox & Company Wealth Management analyze your overall finances and make a final verdict on whether or not you can indeed swing for the fences and splurge on yourself or whether you should just walk away.

 

 

[Johanna and I have no current financial relationship]

Disclaimer:  This is not meant to be a substitute for paid professional advice but only meant to serve as a suggestion/guideline.

 

The following are the details from our submission form:

 

Item/Experience Desired:

Continue to live in a very expensive home with high property taxes in a HCOL [High Cost Of Living] area for now and in retirement

Approximate Cost:

$50,000/yr in property tax

$50,000/yr in maintenance

How do you plan on paying for this item/experience?

Ongoing cash flow until retirement and then from savings.

On A Happiness Scale of 1-10 (10 Being Happiest), rate what this item/experience will do for you A) Short Term and B) Long Term:

A) 8 B) 8 (10 for my spouse, 6 for me)

Age:

61

Gender:

Male

Occupation:

Physician Entrepreneur/Start-up Founder

Marital Status:

Married

Any Children (If so please provide ages)?

26, 28

How Many Years Till Planned Retirement?

9 (Might still have passive income in retirement but who knows what the future holds)

What is your total household income?

$2,350,000

What is your % Annual Savings Rate? (savings/gross income)

42% of income to savings: 987k

Estimated Annual Living Expenses (Current):

15% of income to living expenses: $350K

43% to taxes (income and property): $1.01M

Market Value of Primary Home [For Renter =$ 0]

$2,550,000

Additional Real Estate Holdings Equity (Market Value-Debt):

$2,150,000 (generates positive cash flow income with no mortgage debt)

Current Liquid Asset Value (Savings, Checking, Etc.):

$1,800,000

Retirement Assets (401k/IRA/HSA):

$4,800,000

Brokerage Account (Taxable):

$1,200,000

Miscellaneous Asset Value (Please elaborate):

$6,000,000 (business value per my accountant.  Unsure if it would be a challenge to sell)

Mortgage Balance:

$500,000 (@2.6% tax deductible; 1.4% effective)

I plan to pay this off in the next two months with subsequent increase in my savings to match the former mortgage payment.

Student Loan Balance:

$0

Additional Liabilities:

$0

Unfunded Future College Costs & Years Left Till Needed:

$0

Other Unfunded Goals and Years Remaining (Today’s Dollars):

$4M desired additional taxable investments prior to retirement to allow security in old age at current spend level.

Any other pertinent information not addressed?

I was a regular doc earning 200k-350k for most of my career until things took off with my new medically themed start-up in 2013 and my income went suddenly to 7 figures.

We loosened the purse strings and now live the high life spending over 300k per year (15% of income) on the fancy house, the full time cook/housekeeper and on multiple international first class trips every year.

My spouse greatly enjoys all of this and I love traveling the world with her but in many ways I am more simple at heart.

For example, I love reading Mr. Money Mustache and have been blissfully happy in the past living outdoors in a tent.

I somehow feel guilty about all of my success and want to do more good for the world as a legacy.

 

 

 

Can a couple with an 8 figure net worth indeed have champagne wishes and caviar dreams without worry?

Or does Mo’ Money actually create Mo’ Problems?

 

Click on the Doctor’s Bill Image and find out the verdict:

 

 

 

 

After you see the verdict please come back to this page and comment whether you agree or not with the decision (and no cheating by looking at comments first!)

 

 

If you would like to submit your own Doctor’s Bill request please fill out the submission form.

 

Note:

If you are in search of financial help, please consider enlisting the service of any of the sponsors of this blog who I feel are part of the “good guys and gals of finance.”

Even a steadfast DIY’er can sometimes gain benefit from the occasional professional input.