4 Reasons Financial Planning Is A Challenge For Doctors — Matthew James Wang
When it comes to financial planning, there are certain factors which distinguish physicians or doctors from others. An article ‘4 Reasons Financial Planning Is A Challenge For Doctors’ by Joanne Finnegan published by Fierce Healthcare elaborated on these reasons and factors.
This article was of keen interest to me since this summer my colleagues and I are hosting a Merrill Private Wealth Management financial boot camp specifically tailored to physicians and healthcare professionals. This will be a three three-part series which will cover a variety of topics of interest — ranging from managing medical school loan debt to building one’s net worth after residency to financing options to creating one’s own practice.
The reasons mentioned in the article consisted of –
Less time to save for retirement
Doctors usually have a short career span, they get a late start due to medical school and they hope for an early finish to their careers. They must factor in their medical student loans which can take years to pay off and faced with burnout, they may retire early.Thus, with about 35 years to save for retirement compared to the average 40–45 years, this shorter span makes doctors more in need for financial management.
Complex Investments
Since doctors usually have higher income, they look for more complex investments. For example, taxable brokerage accounts, backdoor Roth IRAs, cash balance plans. Thus, doctors need to be careful when deciding what best fits their plan.
Asset Protection
“With the threat of lawsuits, including medical malpractice, physicians need to plan for the possibility of an adverse event or outcome”, thus a basic asset protection plan can help protect retirement savings.
Lifestyle Costs
When it comes to their lifestyle, doctors tend to overspend. “They need to prioritize their spending and ensure their financial habits align with financial goals”
It is due to these reasons which distinguish doctors or physicians from other clients and require a special or different kind of wealth management.
Read the full article here.
About Matthew James: Matthew James Wang is a strategic servant leader with over a decade of experience leading teams, managing relationships, and driving product development for institutional investors. He started his career as an active-duty U.S. Army intelligence officer where he was awarded a Bronze Star award for his contributions in combat overseas. He currently serves as Vice President and Product Manager for Bank of America’s global prime brokerage business.
