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How to become a permanent locum tenens physician

Posted on March 9, 2017January 30, 2021 by SmartMoneyMD

In Latin, locum tenens literally means “placeholder”. Just like in any profession, there are “placeholder” jobs in medicine. Corporations, hospitals, and medical groups use locum tenens often as a means to continue their line of business while looking for a permanent solution. For the locum tenens physician, this can have potential benefits.

You have to be in the right profession.

There are certain specialties in medicine that work well with temporary workers, particularly those where continuity of care is not needed. These specialties include emergency room physicians (like WCI), anesthesiologists (like PoF), interventional radiologists, critical care physician, and hospitalists. These professionals care for people who are either acutely ill or only need services temporarily (like during gallbladder surgery). Once the patient’s condition changes, this specialist’s services are no longer needed.

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Specialties that require no direct patient contact like radiology or pathology also lend to temporary workers. You can work from essentially anywhere and at anytime. Radiology works great for those who like to stay up late at night.

If you are in any of these specialties, you have potential to be creative with your life and find an unconventional means to make a living and care for patients.

Locum tenens for the adventurous doctor.

I know an emergency room doctor who lives in San Francisco but works in Minnesota. I call that geographical arbitrage for the city slicker. You get your higher reimbursements in the Midwest but still get to live in a large city with an inflated housing market and nightlife (No offense to everyone in Minnesota). If he wanted to pick up a few shifts at the local urgent care in Northern California, he can make even more money on the side.

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As a temporary doctor, you can have great opportunities exploring new cities while still getting paid. Obviously this works best if you are either single or have no children, but I know doctors who bring their family with them when they take on locums assignments.

Locum tenens as a financial strategy.

If your profession is in high demand, you might be able to find multiple locums position in the same city! The ability to do this is contingent upon living in a relatively large city or one with populous surrounding suburbs. Hospitalists come to my mind as a profession that allows for this flexibility.

Most locum tenens positions confer the following benefits:

subsidized housing
subsidized travel costs
subsidized meals

Suppose that Dr. X is a locum tenens physician for four hospitals in Phoenix. Each hospital subsidizes a fixed cost of $1000 per week of work plus travel expenses. Let’s say that Dr. X only works at two hospitals in a given month. She has $2000 in housing costs that could comfortably cover a month’s rent in Phoenix! Guess what? She also gets two roundtrip tickets to a city of her choice due to the travel arrangements. This could be anywhere in the country too! This includes Hawaii or Alaska! (No offense to LiveFreeMD, I’m not sure why anyone would want to vacation regularly in Alaska though) ?

Best of all, Dr. X is an independent contractor. This means that she is a sole proprietor who can open an Individual 401k to shell away significant portions of income ($53k!) each year while being a doctor. This arrangement also allows for more flexible business-related deductions for further income maximization.

The benefit of part-time work is that you can work on your own time. No, you won’t get dedicated vacation days, but you could theoretically pile up your shifts and take an extended vacation. Spend a month in Argentina. Hike through the Serengeti. You can’t do that if you’re shackled to a regimented work schedule.

The disadvantages of locum tenens.

The advantage of being a temporary worker is also the disadvantage of being a temporary worker. You get no stability. No stability in income, location, or lifestyle. Your job can be a goldmine for several months and disappear when hospitals find a more permanent worker. Sure, you get paid a higher rate, but you pay your own taxes, arrange your malpractice coverage, and other logistics. There are headaches to running your own business. Some doctors simply don’t have the desire or energy to manage logistics outside of medical practice.

Most families with school-aged children aren’t going to be able to travel for weeks at a time without logistical problems. Sure you can pull your kid out from society and homeschool them, but parents in New York City are already making sure their kids play nicely at their elite private Kindergarten schools so that they can get into Yale for college. Good luck going up against that crowd.

How does this pertain to me?

If you’re a plastic surgeon working in a cosmetics practice, there is no financial, lifestyle, or practical gain in becoming a locum tenens doctor. If you are still in medical school deciding on a specialty, you should be aware that these opportunities exist. I probably wouldn’t base my residency choice solely on whether you could make a permanent career out of temporary jobs, but rather on your interests both in and out of medicine. I know doctors who just like to climb mountains and exercise in their free time. These guys would do great working temporary jobs because they can spend their free time outside of medicine. I know doctors who enjoy practicing medicine—they probably would not be truly suited for a full-time part-time job.

Have you considered working as a locum tenens physician?

(Photo courtesy of Flickr)

Low-cost investment showdown: where do you stash your funds?

Posted on March 7, 2017January 30, 2021 by SmartMoneyMD

I opened my first investment account in medical school at E-Trade. I was roughly $160,000 in loan debt, but I opened a Roth IRA along with a brokerage account at the same time. I believe that stock trades at E-Trade were only $9.99 a trade, which was one of the lowest in the industry.

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I knew nothing about indexing at the time. Never heard of Jack Bogle or Vanguard. That was probably still okay, since I did not have much disposable investment income at hand. Now that I am more attuned to the available options in the market. The following are a list of where I continue to place my investments and my impressions so far:

Vanguard

This was my first custodian after I started indexing my funds. Great low-cost options are available, along with Admiral funds for even more savings after you’ve reached a certain amount. There are essentially no service fees as long as you commit to electronic documents. The website interface is relatively basic but functional. I wished that Vanguard offered more detailed analyses on funds, but most of the time I already have done my homework about which funds to purchase prior to venturing on the Vanguard website.

My second pet peeve of Vanguard is that there is no easy way to calculate an annualized rate of return on my investments. The Vanguard interface has a “Balances Over Time” tab that calculates an overall growth of your funds like this:

A 10.5% rate of return is deceptive if you don’t account for the duration investment. My annual rate of return is a meager <4%!

Sometimes you don’t want to load up a spreadsheet to do these calculations by hand. I still keep my investments in Vanguard, but I have since started to diversify even more, as we will see below.

Fidelity

I started placing funds in Fidelity over the past year, due to a slightly lower expense ratio, and the fact that they offered airlines miles on keeping funds with them.

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As I had written before, you can earn up to 50,000 Delta, American, or United airlines miles by stashing at least $100,000 in Fidelity. You can also receive miles for smaller investments. The Fidelity index fund options track all of the standard markets that Vanguard funds do, so you don’t really sacrifice much if you are a Vanguard loyalist.

I like the Fidelity interface. There are clear cut menu options, customer service is relatively competent and prompt. My employer uses Fidelity for its 401k custodian, so I’m able to reduce the number of logins to keep track of.

Charles Schwab

I opened a credit card account with Charles Schwab years ago when they offered a free iPod Shuffle after the first purchase. I promptly closed my account a year later when I realized that I was not getting any further benefits from using the card. I never even considered their investment wing until now, because their expense ratios were horrible. Not anymore:

Schwab may have the lowest expense ratios to date!

This is only a recent change since March of 2017, presumably because of the competition in the market, especially from robo-advisors who also charge minimal management fees. I plan on placing all of my future investments in Schwab.

Where do you keep your investments?

Are you turning away millions of dollars as an academic doctor?

Posted on February 7, 2017January 30, 2021 by SmartMoneyMD

After doctors finish their medical training, there is a spectrum of career options that range from full-time clinical medicine (which most people choose) to full-time academic medicine to full-time researcher. Whichever path one takes will surely benefit society, but can have a major impact in compensation. Over the course of one’s career, there is unfortunately a huge discrepancy in earnings.

Think millions of dollars.

Or for you gamblers, it’s like getting to the final table (guaranteed $1 million earnings) of the World Series of Poker every few years, but donating your earnings back to your hospital administrators. These administrators then make you work harder for less pay.

Sounds fair, right?

Let’s take a look, step-by-step, at how there can be such a discrepancy in earnings despite being the same type of doctor.

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How doctors generate revenue in private practice.

As a doctor involved in direct patient care, you generate revenue directly from your services. The more services you provide, the greater revenue you bring into your practice (or your employer). For many doctors who participate in insurance plans, this is measured in revenue value units (RVUs) or something similar—anesthesiologist work is measured in ASAs, which are calculated on the difficulty of a type of surgery and modified by the duration of a surgery.

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Even doctors who don’t participate in direct patient care—that means you, pathologists and radiologists—have productivity that can be quantified. Additionally, there may be other factors in physician productivity that aren’t directly quantifiable, such as the number of consults that are generated and procedures that other specialists perform on patients that you cared for who otherwise wouldn’t have received treatment. If you look into capitated care models, managed care models, and closed-system models, the revenue streams becomes even more obfuscated.

No matter how confusing this may seem, medicine in a private practice model is still service-driven. The more you work, the more money you bring into your practice or your employer. Hopefully this work translates into a higher income for us all.

How doctors generate revenue in academic medicine.

If you are a physician in an academic center or university setting, the revenue generating component is more opaque. I look at it like a black box:

No one knows what happens inside the black box, not even the administrators!

The service portion of being a doctor in academic medicine is diluted into many different roles. Some of these roles aren’t directly related to patient care, so any revenue that is generated doesn’t go through the typical insurance panels.

Take, for instance, research. This is a very valuable component to the healthcare industry, but there is no visible compensation in research unless there is a breakthrough discovery. Research funding in the U.S. comes mostly from the National Institutes of Health (NIH). Most researchers have to apply for funding through an arduous process every few years! The funding that one receives through a research grant is unlikely to even cover your salary!

Teaching medicine is another example where the income stream is not clear cut. Insurance companies pay you for taking care of their insured clientele, not for educating future doctors. It doesn’t matter if you’re taking full liability for a full inpatient service, presenting grand rounds, or writing a case report.

Let’s compare a specialist working in academic medicine with one in private practice.

Suppose that you are a vascular surgeon who decides to work at a teaching hospital. You have a faculty appointment at the medical school but you are primarily a clinician working 85 hours a week. The call schedule is only once every five weeks, but you get called in every time you are on call (hey, ruptured aneurysms wait for no one!). You also spend time teaching medical students, residents, fellows, and prepare grand rounds cases. Your hospital pays you about $500,000 a year, but your salary is essentially capped. That means that you’ll likely be earning the same take after five to ten years on staff. You’re making big money, but you’re also spending a lot of time at the hospital.

If you decided to leave the university setting, there are a number of options that could materialize. You could join a hospital group, get paid a much lower starting salary than what the university might actually offer you, but build up to that $500,000 a year. You’d still be working those 80 hours a week. The difference is that by not being involved with teaching or research, you might actually free up a few extra hours a week. No bad, eh?

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A third option might be to join an office-based vascular surgery group. You might be brought on board with a salary lower than what you might get at the university, but there is room for growth. After several years of servitude, you purchase into the group and build equity in the equipment. There is an angio-suite that you own along with the practice. You are still working those 80 hours a week (yeah, what a brutal subspecialty), but you bring in a cool $1.5 million each year.

Think about it. A vascular surgeon can have a $1 million income difference depending on where she decides to work. I’ve actually seen situations where the income differences are even greater. Now we’re talking serious money.

What’s the moral of this story? Vascular surgeons have tough jobs!

It’s not about the money!

Look, life isn’t all about the money. Some of us don’t enjoy yachting on the weekends or having caviar every night. Some of us who do may even be fortunate enough to have alternative sources of income. Our happiness levels start to plateau after a certain amount of income and net worth. I like to think of it like this:

Your happiness actually increases if your income potential is hopeless, but happiness will also plateau with increasing income.

For some doctors, academic medicine is a means to pay the bills AND be happy. What is not to like about conducting research that could potentially revolutionize healthcare or simply educating future generations of physicians? Some of us actually enjoy writing and editing scientific manuscripts. Academic institutions are structured to allow doctors to do just that. These roles may not necessarily maximize a doctor’s income potential, but they contribute to society and personal satisfaction. If you would like to put a price on that, state your argument in the comments section below. 😉

What should I do if I’m undecided?

There’s not going to be a magic ball that tells you what to do. I know plenty of doctors who left academic medicine after several years when they needed a change. I also know several doctors who decided to enter academia after many years of pure clinical practice. The doors remain open no matter what decision you make early in your career.

Remember why you entered medicine; I hope that it was to care for patients. At the end of the day, you still need to be happy. However, it doesn’t hurt to consider the financial implications of your decisions.

How did you decide between academic and purely clinical medicine?

Just receive your first job offer? What should you do next?

Posted on January 13, 2017January 30, 2021 by SmartMoneyMD

Congratulations! After a decade of slaving away in your medical training, you’ve got your first job offer in hand! If you’re really lucky, you might have several offers to evaluate. But wait, there’s all this legalese and gibberish—nothing makes sense!

Do you just hire a contract lawyer and be done with it? How much is a good rate for a contract review anyway? You call around to your friends and colleagues who graduated a year or two before you to inquire. They give you some advice, but it turns out that they might not be too familiar either. What should you do?

There are some fundamental aspects to understanding job contracts that everyone should know. These are the things to follow:

Have someone review your contract.

Yes, this means shelling out some money and having a contract lawyer or a review company who is familiar with your area look at the contract. As much as you want to save money, this is money well spent. The last thing you want to do is move your family to a new city for a new job only to realize that you have to take call every other night even though there are ten doctors in your practice!

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This may cost you several hundred dollars up to a thousand, and it will sting especially if you are in your first job. This is something that I don’t recommend skimping out on.

Someone who is familiar with your area may know that there are certain rules or laws that pertain only to your city. Moreover, they may know the history and track record of hospitals or medical practices in the area. That information by itself is invaluable.

Read the contract yourself.

Hiring someone to review your contract simply isn’t enough. You need to spend some time reviewing the legalese as well so that you can be informed about what your contract reviewer is going to say. Here are a few key items that I considered:

Salary: How much are you going to get paid? How long is that guaranteed for? Are the any incentives to exceed the standard salary? I would compare the offer salary to what is considered the norm in your field (MGMA, AMGA), and how many years that you have been in practice. For instance, there are different ranges for starting salaries depending on your given specialty. Try to find out what they are, and figure out where you stand in the range.
Noncompete: Some contracts have restrictive covenants that prevent you from working within a certain distance and duration of the employer in the event that you decide to leave the group. The laws vary depending on which state you are in, and you can determine if any of these rules are enforceable. How much do these laws actually matter to you? If there is any possibility that you would need to stay in the area if you left your job, you should consider getting this clause removed or negotiated.
Growth: Will your job be any different after your first few years? Do you have any possibility of becoming a partner, owning any equity in the practice, or expanding? Is there any real estate in the practice that you could potentially own?
Time off: Is there PTO? Does it accrue? Is it enough for your needs?
Maternity leave: This is huge. Some hospitals or employers will stiff you on the maternity leave. They may not have a clause at all for this. If there is any possibility that you would need to invoke this benefit, negotiate this in or walk away.
Locations: Some practices have multiple offices in different locations in different cities. How much do you want to travel? Do you have to fly to satellite offices (Yes, this can happen)?

Compare your offer with others that you might have received.

You can really learn quite a bit if you have two different offers on the table. There is unlikely going to be one ideal offer that is a no brainer. You will have to settle on certain conditions. Some practices or hospitals are just arranged differently. If everyone else in the group is taking call for the entire state, it’s not likely that you can get away with negotiating that out of your contract.

Consider the overall terms of the contract.

This category includes everything that is not objective. How is the writing in the contract? Are your potential employers sticklers? Do they nickel and dime you? This really calls upon your Spider Sense. Some of us are great at identifying things that could go wrong. Others, not so much. How flexible is the employer? Do they want to hire you badly enough to amend their rules?

Remember. Don’t push your luck and burn bridges. If an employer is unwilling to agree to your terms, don’t get angry. If the subject in contention is a deal breaker for you, just walk away. I think that most people are willing to be open amenable to negotiation as long as it does not put them in a financially or logistically challenging position.

Good luck!

What other terms have you considered in contract negotiation?

(Photo courtesy of Flickr)

How good is the real estate market now?

Posted on January 6, 2017January 30, 2021 by SmartMoneyMD

I love watching those home renovation shows where investors buy a run down crackhouse, bring in their demolition crew, and sell the property a three-times the original purchase price. Amazing eh? We know these situations are the exceptions, but how good is real estate for building wealth?

I’ve certainly zero experience in the rental or the buy-and-hold markets. The only real estate I deal with is my own home (which I sunk a foolish amount of money into fancy kitchen appliances) and a REIT fund that’s losing money in my IRA. Is real estate an investment vehicle that I hope to venture in one day? Sure. Everyone else including my mother-in-law dabbles in it and is convinced that it will be the savior for my retirement.

I believe that the financial freedom advocates are divided in their opinions of real estate. There are plenty of early retirees who are convincingly opposed to owning any home—I think several have written manifestos against property ownership. Whether or not their math is sound, the opponents to home ownership are typically the ones who basically spend their days traveling the world and country hopping.

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Sure, but what if I wanted to stay put? Is it worth sinking in a chunk of change to own a piece of America? Let’s see:

Scenario 1: Upper East Side Manhattan Co-op

This unit is in a prime location on Park Avenue in the Upper East Side of Manhattan. You can run to Central Park and exercise every day if you’d like. I wished that I lived in a place like this. This is a 1000 sq. ft unit on the market for $1.1 million. This is more than twice the size of my apartment rental in NYC! This is actually a reasonable price per square foot. Let’s look into some statistics:

Prewar building with an HOA of $1,582 a month! If you owned this unit outright, you’d still be contributing about $2000 a month for HOA and utilities! The property tax on this unit will run about $90,000 a year. So all in, your annual upkeep on this co-op will be about $114,000! Oh yeah, don’t forget that it is also customary to tip the doorman during the Christmas holidays too. A look at the Zillow pricing history shows that the pricing for this unit has been relatively stagnant over the past few years. So much for appreciation of this property’s value:

We love dealing with 7-figure properties!

In fact, a recent report by the Eliman Group shows that Co-Op sales in Manhattan for Q3 2016 has been declining:

Courtesy of Douglas Elliman Q32016 report. High profile real estate guys in the city. www.elliman.com

Let’s suppose that you are looking at this property for investing in cash flow. I’d say that the unit could command perhaps $3000-$3500 in monthly rent as a one bedroom unit given its great location and building amenities (read: doorman).

How can one possibly get positive cash flow on this unit?

Answer: You can’t.

The rental income wouldn’t even be enough to pay for the taxes, let alone the doorman’s salary through the HOA fees. This is the sad truth of about the NYC real estate market. Many of the owners are either holding companies or longstanding owners who bought the units decades ago at the fraction of the price. Fortunately with the prime location of this co-op, the value of this property will not diminish significantly over time.

Lesson learned: If you have a huge chunk of change that needs to be parked somewhere, New York City isn’t a horrible place to put it

Scenario 2: Condominium near the University of Indiana Campus in Bloomington

I arbitrarily picked a college town in a relatively inexpensive city. Consider that you’re trying to find a unit near the university to rent to graduate students. A quick find shows that there is a condominium within walking distance of the campus:

You can get a whole lot of land for little money in the Midwest!

This is a two-bedroom, two-bathroom unit for $105,900! Modest amenities, great location, and in a relatively good complex. I would be great for two graduate students or a small family. Further details show that the unit does have an HOA of $245, which I am not thrilled about in a small suburb, but not the end of the world:

Sewage and trash are included in the HOA, so that might shave off $60 in utilities a month.

How can I get cash flow out of this property?

With a downpayment of $20,000, one could probably negotiate a 30-year mortgage to cost a little less than $400 a month. If you include the HOA fees, you’d be paying about $600 a month at the minimum to maintain. I think that one could rent out each bedroom for $500, or the entire unit for $950 a month.

Let’s say that you rent out this unit for $950 a month, and your costs are $650 a month for mortgage, HOA…etc. Assume that you only get to rent this unit for 11 months of the year. With $300 of ‘net-profit’ per month for 11 months of rent, you get about $3,300 per year. With an initial downpayment of $20,000, you’re actually getting a 15% return annually. Not bad!

This amount is not going to fund your doctor lifestyle, at least it’s positive cash flow. Let’s say you buy five or ten of these units and rent them all out. You hire a maintenance person or even a property manager. You suddenly have $10-15k a year of extra cash flow for owning approximately $1 million worth of properties that you’ve leveraged with a little over $100,000 in parked costs.

Not bad, eh?

How have you used real estate to fund your cash flow? What suggestions to you have for me to get started with real estate?

Ways to generate ancillary income as a doctor

Posted on December 31, 2016January 30, 2021 by SmartMoneyMD

Diversification is a path to reduce risk. This applies not only to our investments, but also our income. As doctors, we are sort of like one-trick ponies. I pretty much only do a handful of procedures and clinic-related activities. Most doctors are paid based on their clinical productivity.

If you are injured and cannot perform your typical duties, you are screwed. Sure, there’s disability insurance, but the cost of coverage does balloon up for most doctors in mid-career. Many of us pay almost a full month’s salary towards disability premiums in order to cover one year! This is not insignificant especially if you are trying to repay loans or build up a nest egg.

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What can doctors do to diversify their income?

Keep your primary profession

Okay, so this isn’t diversification, but it does boost your income stream, allowing you to have more to invest. The easy option is to do what you are already doing. You can rarely find something outside of your medical profession that can offer you a similarly high hourly rate. And it won’t be anything new that you’d be doing compared to your primary job. Add some shifts if you are a shiftworker. You can opt for locums opportunities or moonlighting (working a second part-time job) if your primary employer allows for it.

Some radiologists that I know actually do locums opportunities when they’re on vacation! There are many primary radiology jobs that offer significant amounts of time off. Sometimes family schedules prevent you from taking off for vacation (spouse’s job or kids’ school schedule)

One of my friend’s spouse is an ER physician. He lives in the Bay Area, but actually has several part-time options in the midwest, where reimbursements are higher!

Do things that are peripherally related to your career

I frequently receive surveys conducted by medical consulting firms with monetary compensation. Sure, the surveys will never replace your day job, but it can bring in another $50, $100, or even more depending on how involved the questionnaires are, and how well research in your profession is funded. I have noticed that professions that utilize medications more frequently will have more options for medical research related survey work.

Speaker fees: Let’s say that you are an expert in G6PD deficiency. There is a new medication on the market to treat it, and the company needs experts to vouch for their product. Yes, you will become a shill for a faceless corporation, but you can get paid for giving a talk. You won’t get rich off of these events, but it does add ancillary income.

Consulting: Likewise, you can either be an expert in the science or an expert in the process of certain treatments or specialties. You can start your own company and offer your technical knowledge of a particular subject. I have seen full-time clinicians start side consulting businesses, only to transition to them full-time when they become busier!

Find occupations outside of your primary career

I once met a doctor who ‘retired’ from clinical care at age 42 to start his financial corporation. I’m not sure what he actually does, but perhaps he sells insurance vehicles or offers wealth management services. That’s a significant 180 degree change, but I guess he likes what he is doing and is probably good at it.

From seeing what other money bloggers out there are doing for ‘side hustles’ or ancillary income, there is a wide range:

Food delivery / messenger: Delivery services like Postmates, UberEats, and other startups need drivers and messengers for the lazy! I’m not sure what the going rates are for messengers, but based on the pricing for customers, I’m assuming that one could command anywhere from $10-$15/hr depending on your region. @financialpanthe has reported doing this on his free time, and also the consequences of looking like a lawyer in the process! Kudos to him. I would assume not to risk running into my patients while I was making a delivery.

Uber/Lyft driver: This is the foundation of food delivery. I suppose that this is a fun way to meet interesting people while making some money. Sam @FinancialSamurai appears to have an interesting arrangement to activate his Uber activity whenever he wishes to drive across town to run an errand anyway. Nice. It is also less stressful since he already has multiple income streams that don’t require a set time commitment. Would I want to pick up an Uber passenger on my way to work? Uh, probably not.

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Real Estate: This is a big one. If buying your shares of VNQ (substitute your favorite REIT) isn’t active enough for you, you can invest in the real estate market. Plenty of money bloggers deal with real estate, like @FinancialSamurai @RetireByForty and others. There is definitely more involvement (or headaches) in real estate, but you can leverage your investments and generate significant cash flow while having a physical piece of investment property. I certainly have not had the energy to dive into the real estate market, although I would be willing to venture into this source of income if the right opportunity comes around.

Online sales: eBay, Amazon, and Etsy will have you covered. If you have a source of items that other people might want (like your handmade Russian-style finger puppets), you can have a wide audience with limited initial investment. There is still a cost of time involved in the sales process that can be time consuming. Remember, as a doctor you are trading your time and skills at a relatively high hourly rate for your services. If you are making online sales, you are doing the same thing at a lower rate. But hey, diversification is diversification.

What other means have you discovered to generate ancillary income?

(Photo courtesy of Flickr)

Earn some airline miles while investing in low-cost funds

Posted on December 17, 2016January 30, 2021 by SmartMoneyMD

I like airline miles and fancy hotels just like everyone who has gotten themselves in this predicament. There are practical ways to redeem these perks (converting to cold hard cash), and highly luxurious ways of capitalizing on them (like flying in first class with your personal butler) that don’t actually save you money but simply allow you to travel and vacation in style.

In any case, those of us who are looking for low-fee ways to invest can choose low-fee funds from Fidelity while earning airline miles. If you are able to put $100,000 in a taxable investing account in Fidelity for at least 9 months, they will award you with 50,000 airline miles! They have offers for American, Delta, and United miles.

This can translate into at least one free domestic airline ticket (maybe $400) or something fancier if you are into that game (this may be a topic for future posts).

Fidelity lowered its index fund fees earlier this year to compete with Vanguard’s fees. The differences in savings are negligible over the long term, but worth noting:

For instance, Fidelity’s S&P 500 index fund has an expense ratio of 0.045%, compared to Vanguard’s at 0.05%.

You can still receive a certain number of miles if you put in a smaller amount. I typically keep my taxable investments inside a Vanguard account, but given the recent change of lower fees with similar funds and airline mile perks, I plan to roll in some uninvested funds over the next year into my Fidelity account.

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Note: I do not have any financial interest in Fidelity or any of the airline affiliates. All of the links in this post are public links.