Thanks to our medical financial podcaster Dev Raga for this week’s wealth building strategy: Automated passive index investing.
Each week, I have asked a finance blogger or podcaster to share their personal wealth building strategies. I am hoping these will be useful to compare lots of different strategies and perspectives to provide ideas and insight in your own investing journey.
Dev Raga is a rural GP with an interest in all things medical finance, and runs a popular medical financial blog at Devraga.com.
Dev Raga bases his podcast episodes around powerful principles such as pay yourself first, save 20% of your post tax income and automate passive stock market investing.
His approach is simple, effective, and easily implemented by busy (Non-finance) professionals.
“9 to 5” profession:
Investing, teaching GP registrars
What are your Investing Goals?
The aim is to create enough passive income via dividends. I don’t want to sell any of my assets, and will live off dividends/rental income for retirement and preserve capital.
What is your investing time frame? How far along are you?
I am in year 11. Investing time frame 40 years.
What the Most Powerful Wealth Building Tool Available to You?
Income. Reinvestment of dividends, and let this compound over 40 years.
What wealth building habits are you utilising to reach your goals? Pay yourself first 20% of after tax income and invest it. Automate it. Reinvest dividends. Buy broad based index funds. Have few investment properties. Keep it simple.
How long have you been using this strategy?
Since internship Used to save up to 50-70% of income. Now 20% of after tax income is saved.
Were there other strategies before? If so, what made you pivot?
No other strategy.
What makes your strategy suit your personal situation?
Its easy, simple, low cost. I am a doctor, so focussing on my expertise while my money works for me.
Where do you Stand on Home Ownership vs Renting? Why?
I own my own home. No debt. Living in your own home is an emotional decision. My own home is not an investment. Renting = living in someone else’s home. I don’t have to ask for permission to put a nail through the wall in my own home. I don’t have to ask permission to have a dog in my own home.
Where do you stand on the great property vs shares debate? Why?
I have investment properties. I don’t think I will buy another one anytime soon. My Vanguard index fund portfolio never rang me during Covid and asked for a rental reduction, or fix the plumbing.
Where do you Stand on Investing for Capital Growth vs Income? Why?
Both. I believe for an investment to be good: it needs to be more valuable in 40 years, and during that time frame it needs to pay me income. Otherwise its speculation.
Do you have any financial regrets?
Didn’t start early. But I started in my 20s. Should have started in my teens.
Any final suggestions?
Keep finances and investing simple. The simpler it is, you are more likely to follow the plan.
To see all the wealth building strategies shared with Aussie doc freedom, check out the Ultimate Step by Step guide to Wealth building, with wealth building strategies.
Aussie Doc Freedom is not a financial adviser and does need offer any advise. Information on this website is purely a description of my experiences and learning. Please check with your independent financial adviser or accountant before making any changes.
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