By Dr. Jim Dahle, WCI Founder

Every now and then, you will see an article in the financial media complaining that very wealthy people are using the “Buy, Borrow, and Die” strategy to get out of paying their fair share of taxes. High earners like physicians sometimes wonder if this strategy would work well for them. The truth is that it can work for physicians but probably only among the wealthiest and least risk-averse among them. Once they understand how it works, most physicians will likely choose to simply sell taxable assets instead of borrowing against them.

How Does Buy, Borrow, and Die Work?

Imagine you have some assets in a taxable account—perhaps mutual fund shares—that you bought a long time ago. You now need some additional money to spend. You have two choices. The first is to sell those shares, pay any taxes due, and spend