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Strange Things in the Precious Metals
Issue #531, July 17, 2018

Buying Years of Retirement
Issue #530, July 09, 2018

Rent-A-Kid for Retirement
Issue #529, July 02, 2018

The Dark Side of Student Loans
Issue #528, June 25, 2018

The Cost of Out-sourcing Convenience
Issue #527, June 18, 2018

Social Security: 66 or 70?
Issue #526, June 11, 2018

Student Loans: There’s (Unfortunately) a Lot More!
Issue #525, June 04, 2018

Co-signing a Note
Issue #524A, May 31, 2018

The Knight Frank Luxury Index and Collectables
Issue #524, May 28, 2018

The Importance of Diversification: The Myth of Diversification
Issue #523, May 21, 2018

How to Save Thousands on Your Food Bill
Issue #522, May 14, 2018

MoviePass and Other Things
Issue #521A, May 10, 2018

Degree Inflation, Long Training Periods, and “Certification”  Part III
Issue #521, May 07, 2018

Degree Inflation, Long Training Periods, and Certification” Part II of III
Issue #520, April 30, 2018

Follow-up on Several Things
Issue #519A, April 25, 2018

Degree Inflation, Long Training Periods, and “Certification”: Part I of II
Issue #519, April 23, 2018

The Kids Birthday Party Hustle
Issue #518A, April 18, 2018

A Pension Question: Part II of II
Issue #518, April 16, 2018

A Physician is an Executive
Issue #517A, April 11, 2018

A Pension Question: Part I of II
Issue #517, April 09, 2018

Is the Correction Over?
Issue #516A, April 05, 2018

Used Car Dealers, Student Loans, the Chinese, and Uncle George’s Rule
Issue #516, April 02, 2018

Starter Homes
Issue #515, March 26, 2018

Redecorating: Beware!
Issue #514, March 19, 2018

NASDAQ Closes at Record High
Issue #513, March 12, 2018

A 40% Chance
Issue #512, March 05, 2018

Several Things
Issue #511, February 27, 2018

Human Capital, Education and Wealth
Issue #510, February 19, 2018

Another Stock Market Update
Issue #509A, February 18, 2018

Some Thoughts on Savings
Issue #509, February 12, 2018

A Stock Market Upfate
Issue #508S, February 10, 2018

Who Can You Trust? Part II of II
Issue #508, February 05, 2018

The Christmas Decoration Pre-worn Jeans Hustle
Issue #Interim Bulletin #507A, February 03, 2018

2018 Outlook for Financial Markets
Issue #507, January 29, 2018

Who Can You Trust? Part I of II
Issue #506, January 22, 2018

Life Insurance Settlements
Issue #505, January 15, 2018

Commodities and Buying the Breakout
Issue #504, January 08, 2018

Buffett Wins His Bet
Issue #503A, January 04, 2018

Practice Real Estate and Free Agency
Issue #503, January 01, 2018

Outlook for 2018: Part III: Stocks and Bonds
Issue #502, December 25, 2017

My Outlook for 2018: Part Ii: Precious Metals
Issue #501A, December 21, 2017

Outlook for 2018: Hard Assets: Part I of III
Issue #501, December 18, 2017

More Thoughts on Bitcoin
Issue #500A, December 14, 2017

Fees and Good Relations with Bankers
Issue #500, December 11, 2017

Salvator Mundi
Issue #499A, December 07, 2017

Should You Rent or Own a Home?
Issue #499, December 04, 2017

A Gift Subscription
Issue #Interim Bulletin #498A, December 02, 2017

Stocks vs Real Estate: Asset Allocation: Part II of II
Issue #498, November 27, 2017

When Good Enough is Fine
Issue #497A, November 22, 2017

Stocks vs Real Estate: Asset Allocation. Part I of II
Issue #497, November 20, 2017

The Saudi Arrests and the Perils of Foreign Investing
Issue #496, November 13, 2017

Gambling and Las Vegas
Issue #495, November 06, 2017

Some Tips on Auto Insurance
Issue #494, October 31, 2017

Bitcoin and the Digital (Crypto) Currencies
Issue #493, October 23, 2017

The Coming Bear Market: Part II How to Prepare
Issue #492, October 16, 2017

Some Observations on Cemeteries
Issue #Interim Bulletin #491A, October 12, 2017

The Coming Bear Market: Part I: The Myth of Buy and Hold Forever
Issue #491, October 09, 2017

The Market makes New Highs
Issue #490, October 02, 2017

The Importance of a New High
Issue #489, September 25, 2017

A Little Insurance: Wealth, War and Wisdom
Issue #488, September 18, 2017

Some Observations
Issue #487, September 11, 2017

How to be Successful in Your Career
Issue #486A, September 07, 2017

How NOT to Buy a Home
Issue #486, September 04, 2017

This Week in the Market
Issue #485, August 28, 2017

Is the “Trump Bump” Running Out of Gas?
Issue #484, August 21, 2017

Gold is on the Move
Issue #483, August 14, 2017

The Importance of Estimation
Issue #482, August 07, 2017

Buying Art and Collecting: Part II of II
Issue #481, July 31, 2017

Buying Art and Collecting in General, Part I of II
Issue #480, July 24, 2017

Physicians need to be More Forceful: Follow-up
Issue #479, July 17, 2017

Physicians need to be More Forceful
Issue #478, July 10, 2017

Your First “Real” Investment
Issue #477, July 03, 2017

Leasing a Watch: Don’t
Issue #476, June 26, 2017

The Importance of Your Children having a Job
Issue #475, June 16, 2017

The Problem with Medical Student Debt is—the Med Schools
Issue #474, June 12, 2017

Critters and Varmints in your Home and Yard
Issue #473A, June 07, 2017

Leveraged ETFs
Issue #472, May 29, 2017

Leasing a Vehicle: Don’t!
Issue #471, May 22, 2017

Issue #470, May 15, 2017

More on Buying Jewelry
Issue #469, May 08, 2017

Buying Jewelry: Gold, Diamonds and Pearls
Issue #468, April 30, 2017

Thomas Sowell: Part III of III
Issue #467, April 24, 2017

Thomas Sowell: Pat II of III
Issue #466, April 17, 2017

Live Close to Where You Work
Issue #465, April 10, 2017

Medtronic in Hospital Management
Issue #Interim Bulletin #464A, April 07, 2017

Thomas Sowell: Part I of II
Issue #464, April 03, 2017

A Political Contribution a an Investment: Part II of II
Issue #463, March 27, 2017

A Political Contribution as an Investment: Part I of II
Issue #462, March 20, 2017

Buffett Selling Vacation Home
Issue #461, March 13, 2017

Advanced Placement (AP) ourses
Issue #460, March 06, 2017

The Importance of a Credit History
Issue #459A, March 02, 2017

A Credit Card Scam
Issue #459, February 27, 2017

The Electronic Health Reord
Issue #458, February 20, 2017

Issue #457, February 13, 2017

Platinum and Palladium
Issue #456, February 06, 2017

Economic Outlook for 2017: Part II of II
Issue #455A, February 02, 2017

Economic Outlook for 2017: Part I of II
Issue #455, January 30, 2017

A Story From Vegas
Issue #454A, January 25, 2017

Land Donation Deals and the IRS
Issue #454, January 23, 2017

The Theory of Gambler’s Ruin
Issue #453, January 16, 2017


By Robert M. Doroghazi, M.D., F.A.C.C.

A Second Home

Issue #Interim Bulletin #451A, January 04, 2017

    Diane and I spent the New Year’s weekend at the Lake Ozark condo I purchased in 1996. We had a great time, and it reminded me that I haven’t written about a second home in some time. I think most physicians make enough that some time in your career you should be able to give this serious consideration. This discussion is not about undeveloped land, or land purchased for agriculture and/or hunting or fishing.
    1) Always purchase a “first-tier” property. You want to be right on the shore or the beach or the golf course. These are the most desirable, the most fun, and most importantly, they will hold their value the best. Everybody wants an unobstructed view.
    2) Stand-alone home or condo? There are pros and cons for each. The stand-alone has more appreciation potential because you own the land. But then there is maintenance: a few professionals find doing the maintenance relaxing, but most don’t, so you must either spend your valuable spare time raking the leaves and painting, or hire someone. With a condo, this is included in your fees.
    With a home, you make your own decisions. The larger the condo association, the quicker you will appreciate why our great country was established as a republic rather than a democracy. Some people seem so gooney that you wonder how they accumulated enough money to buy the condo.
    3) Travel time is important. The ideal is about 2 ½ hours or less. That way you can easily drive down on Friday afternoon and back on Sunday to be home for supper. My condo is 1 hr., 10 min. away. It makes no sense to me to live in Chicago or NYC and own a place in the Florida Keys.
    4) Promise yourself you will use it at least once a month. The average place at the Lake of the Ozarks is owned for—-3 years. What a waste. Considering the time cost of money, maintenance and depreciation, it costs 1% of the value of the property per month, 10% per year, to own a residence. If you purchased a place for $200K and find out 3 years later that you planned poorly and decide to sell it, you are out at least $50K.
    Don’t go to a place “cold” and buy. Spend time there first so you are sure you like it and you know what you want.
    5) I would not consider a 2nd home until A) you’ve paid off at least ½ of the mortgage on your primary residence, and 2) you have completely paid off your student loans. Remember, this is a discretionary purchase.
    6) Don’t expect to buy this with 5% down. Banks prefer (require) a down payment of at least 25% on a second home.
    7) Some people purchase these for their personal use only, some are willing to rent part-time. This is up to you. The IRS has very specific rules: check with your accountant. Large recreational areas have agencies that specialize in such rentals. The typical split is 60% for the owner, 40% fee. 
    8) You will generate serious goodwill by letting family or friends use the place. Consider: My condo is 4 BR, 4 bath, 1,900 sq. ft. and would rent for $300 per day during a summer weekend. If they stay a week, they have saved $2K, can fix their own meals, and have a much nicer experience than staying in a hotel. 
    9) Several subscribers have planned very well. They purchased a 2nd home 10 or 20 years ago, and after retirement sold their first home and mover permanently into their previously second home.         
    India has passed the UK as the world’s 5th largest economy.
    RMD comment: put this in perspective. The UK has 63M people, India 1.25B. Thus India has exactly 20x more people than the UK, so the average person in GB makes 20x the average person in India.
    I believe that the strength of a nation is determined by 3 things: 1) wealth, 2) land mass and 3) population. If Modi and those that follow him are successful, India has the potential to be a real power. Note that Indians are currently the most successful immigrant group in the US (average income more than $90K per year), which means that when conditions are favorable, they will prosper.
    I recommend Rogue One. If you like the Star Wars movies, you won’t be disappointed. If you’re not a big Star Wars fan, you’ll still be entertained. There is a scene at the end where Darth Vader literally walks through about 50 rebel soldiers. It shows the true power of a Jedi of the Dark Side. I believe it is one of the 10 most powerful scenes in all of the Star Wars movies.
    Immediately after the election, John Deere (DE) broke out to a new high. It paused for 5 weeks, and has now again broken higher. DE pays a 2.2% dividend. See chart below.

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