Five financial habits of highly successful doctors
Many mid-career doctors and medical specialists Wealth Dimensions works with are focused on intentionally building wealth. While they are 10 to 15 years way from retirement, they are keenly aware that making smart financial decisions over the course of their career will not only lead to long-term financial security but enable them to achieve what matters most – even when they are no longer generating a healthy income from their medical practice.
So what makes highly successful doctors such good financial decision makers? In our experience, it comes down to these five habits:
Investing the time to clarify and articulate their priorities. Determining what’s truly important to you is more than a fifteen-minute exercise. It requires both time and thought over a period of time when you’re not you’re seeing patients. If you have a spouse or partner, it includes candid conversations about your individual and collective goals, values, and priorities. A good financial advisor with a strong background in holistic financial planning can help in this process of self-discovery by facilitating conversations with you and your significant other about your priorities as well as what this means for your financial life.
Having a dynamic financial plan. The most effective financial plans are a dynamic breathing document that adjusts over time as life progresses. The purpose of a dynamic plan is to translate your goals, values, and priorities into a financial playbook that you can follow over time as well as adjust as life throws you a positive or negative surprise. As a medical professional, this financial plan should consider the dynamics of your profession. If you already have a financial plan, and it’s falling short of capturing how you wish to live your life today as well as in the future, then it’s probably not working hard enough for you. As a result, you may want to revisit the plan in light of your goals, values, and priorities.
Optimizing cash flow. Our successful doctor clients enjoy life. Yet, they always ensure they are not overcommitting to a lifestyle that could compromise the achievement of their goals and life’s purpose. It’s so tempting with the taxing demands and stress of the profession to want to live beyond one’s means. Our successful doctors set realistic parameters of how they spend their earnings to enjoy life in the moment, while intentionally creating wealth over the longer term by making good financial decisions. If you feel like your life is out of balance with either too much work, or a spending pattern that puts more pressure on your career, then it’s time to assess in detail how you’re spending your earnings so that you can set priorities and goals that enable you to optimize your cash flow.
Implementing long-term strategies for building wealth. A combination of retirement planning, tax planning, and estate planning are critical to intentionally create wealth over the long term and leave a lasting legacy for your family. However, this multi-faceted planning needs to be accompanied by investing your wealth in a thoughtful and disciplined manner that aligns with your goals.
Exploring the implications of critical career decision points. Given the flux of the medical profession, a number of our doctor clients are faced with making important decisions about the direction of their careers. These decisions can involve the design of their practice model as well as a practice transition. In our experience, those who work closely with a financial advisor to understand the financial implications of these types of important decisions well in advance of making them, achieve a higher probability of professional and personal success. If you’re faced with an important career decision, we encourage you to review the ramifications of your options in light of your entire financial life.
As you think about your life today as well as your vision for the future, consider practicing these five habits of highly successful doctors to help you achieve ongoing success and what truly matters most to you.
For informational purposes only. Not intended as investment advice or a recommendation of any particular security or strategy. Opinions expressed in this commentary reflect subjective judgments of the author based on conditions at the time of writing and are subject to change without notice. For more information about Wealth Dimensions, including our Form ADV Part 2A Brochure, please visit our website at www.wealthdimensions.com or contact us at 513-554-6000.