By: Ivan Hoffman, CFP®, Valeo Financial Advisors
At last, all of your medical training is about to pay off. Perhaps the 16 hour work days won’t go away completely, but at least your pay check will reflect compensation received for services rendered. No more fresh student loans to sign, no more embarrassing residency stipends that pale beside the pay checks of your friends with a bachelor’s degree. Your gross monthly income now approaches your annual resident’s salary, and should pave the way to prosperity. You must now focus on patient care, track to partnership, Medicare and Medicaid paperwork, continuing medical education, and clinical excellence. Your financial life is about to become much less complicated and far less demanding of your time and attention. Buying a house, replacing that high-mileage vehicle and paying down a mountain of student loan debt can be managed when the time permits. Right?
Wrong!
Our experience suggests otherwise. Although, clinical and business issues are critical to developing your career as a physician, you cannot expect your new found revenue stream to take care of your other financial obligations without your attention. It is more important now than ever to establish a strong financial foundation. This is the period in your life to begin taking a proactive stance to solidifying important financial decisions. Fortunately (and unfortunately) for you, there are numerous financial professionals ready and willing to serve. These financial professionals will come in all shapes and sizes. You have probably already met a few of them, but you should be prepared to begin receiving calls, emails and mailings from various types of insurance agents, mortgage brokers, private bankers, financial advisors, stock brokers, realtors, malpractice attorneys and accountants, to name a few.
School is out, but your homework is far from being done. Find out who these people are and ask the hard questions:
1. What is your company known for?
2. What are your credentials?
3. Have you or your firm ever been disciplined for unethical actions?
4. How much will this cost me?
5. What is your incentive? How do you get paid?
6. How often will we talk?
7. Will I talk with you or someone else?
8. Will you provide references?
9. Can you show me an example of an engagement letter / agreement?
Be keenly aware of conflicts of interest. Don’t be the next physician preyed upon by salespeople looking out for their interests instead of yours. Surround yourself with people whose business model centers upon objectivity. Begin to build a team of trusted advisors. You have earned the right to financial prosperity. Take it upon yourself to be ready for it.
Ivan Hoffman, CFP® is a financial planner at Valeo Financial Advisors, a fee-only financial planning firm servicing clients throughout the U.S. Ivan is also a NAPFA-Registered Financial Advisor (National Association of Personal Financial Advisors), as well as a member of the MD Preferred Financial Advisor Network. He can be reached at 888-488-2536 or idhoffman@valeofinancial.com.
