Managing your money might not be as complicated as brain surgery, but the economy is doing some pretty wacky things right now amid the pandemic. Plus, managing your money well actually is pretty complicated. Hiring a financial advisor is a great way to make sure you’re doing all the right things to meet your financial goals, whether they be sending your kids to college, retiring in Paris, starting a philanthropy, or all of the above.
What do financial planners do?
To keep it simple, doctors help patients make informed decisions about their healthcare. Likewise, financial planners help clients make informed decisions about their money. Sometimes, the advice is discrete—like the best way to pay down your student loan. But financial planners can also help you create a comprehensive plan for managing and growing your money.
The two roles are actually more similar than you might think. Just like any doctor would, a good financial planner works with you to understand your unique goals, and then goes from there in terms of giving you advice on matters related to money.
So, if Elena and Alina are both 38-year-old doctors with the same salary, mortgage, and otherwise identical financial stats, the advice they’d get from a financial planner should almost always be totally different. That’s because any decent financial planner would immediately learn that, while Elena wants to retire at 50, Alina wants to work well into her 60s. Those disparate plans make a world of difference in terms of the advice they should get, like at what rate they should be saving money, for example.
Why do doctors need financial advisors?
Financial planning for doctors is super important. To start, as a physician, you’ve worked hard for your career and the salary that eventually comes with it. Teaming up with a solid financial advisor enables you to make the most of your efforts.
Not convinced? Here are just a few other reasons to meet with an experienced physician financial advisor:
- They know your risk. Financial planners who work with medical professionals are knowledgeable in the field of malpractice insurance. They can advise you on just how much risk you should take, depending on factors like where you are in your career, your specialty, and your location. They can also help you guard your assets should you divorce your spouse or business partner.
- They offer comprehensive services. Whatever your financial-planning needs may be, you can bet that there is a financial planner that can help you out. There are tons of firms out there, and they tend to offer a robust range of services, like tax strategizing, loan management, and even estate planning.
- They’re the specialists. I’m sure you did great in your nephrology rotation back in med school. But that doesn’t mean you’d do your own dialysis, right? Financial advisors have spent years mastering their craft, and it shows. Leaving the task of money management to the professionals will literally pay dividends.
- You’re busy. Why spend your limited time figuring out money stuff, of all things? You might be successful in figuring out a day-to-day budget and some moderately successful investments, but figuring out a long-term plan for your assets and growing them to the fullest extent possible takes a lot of time and research. Plus, if you go it on your own, you may be tempted just to do what your colleagues are doing, and that can be a really risky move if your friends aren’t hooked up with a good financial planner.
How much should it cost to meet with a financial planner?
Like any professional service, cost varies based on what you're looking to get out of the meeting.
To get the best bang for your buck, look for planners that use a flat-fee structure. Firms that use this type of payment structure can let you know ahead of time what they charge for services like tax strategizing, investment or student loan management, or general, year-round financial planning. Financial planners that do not offer a flat fee could potentially be preying on people who do not come from generational wealth and therefore have less knowledge about these types of services.
I hope you found this blog helpful! If you have any questions or would like to see another blog exploring any of this stuff in more detail, let us know in the comments.
Looking for a financial planner for physicians in your area? Check out tomorrow’s blog!