Saving and Investing – Why Physicians Struggle

Saving and Investing

Let’s face facts. To be perfectly honest, most physicians are lousy at saving their money, particularly when it comes to investing or retirement planning. My clients often complain about lack of savings for their future and I am increasingly asked for advice on this topic.

In my experience working with thousands of physicians all across the U.S., I have found that surprisingly few doctors work with trusted financial advisors (different than stockbrokers) to plan for and protect their financial future.

Since my primary expertise is in business growth and marketing, I have made it my business to research and identify reputable financial advisors who work with physician clients to help them maximize the right plan for their best possible financial opportunities.

How Financial Advisors Differ from Stockbrokers

Unlike stockbrokers, most financial advisors are registered investment advisors (RIA) and have a legal, fiduciary responsibility to put the interests of their clients first. This is not true with non-fiduciary stockbrokers who need only to provide “suitable advice” given the client’s financial resources.

Fee-only Advisors vs Commission Advisors

Almost all registered investment advisors are fee-only. This means that they do not get financially compensated by earning commissions on the sale of financial products. Commissioned advisors (including virtually all stockbrokers) earn income from the commissions paid from selling various financial and insurance products.

Conflict of Interest

There can obviously be an inherent conflict of interest when the majority of a financial advisor’s income comes from selling financial products. Fee-only advisors charge fees for their planning and advisory services. Many (not all) also collect a small percentage of their client’s “assets under management.”

Objective Advice

Fee-only advisors are also in a position to offer an objective second opinion of your financial situation. This is particularly true if the advisor works with their clients on an as-needed or hourly basis or if they develop a financial plan for review for a fixed fee.

If you need a recommendation regarding a reputable RIA firm, feel free to contact me @lonnie.hirsch@hirschhealthconsulting.com or call me at (800) 924-5447.