Money Minutes for Doctors #23 - Top Mistakes that Doctors have Made with their Finances
Regrets, I've had a few But then again, too few to mention… so goes the timeless words of Frank Sinatra. We should all be so lucky as Ol’ Blue Eyes! That said, with humanity comes the uncanny ability to make a mistake once in a while. This axiom holds true for physicians as well when making decisions involving finance and, despite our best efforts, we find ourselves in many of the same predicaments as other investors. Having a well thought out strategy that is formulated with a trustworthy and specialized financial advisor is generally the best way to navigate the oceans of personal finance. Back to discuss this month’s episode is our indefatigable navigator, Ms. Katherine Vessnes.
About Ms. Vessenes:
Ms. Vessenes works with over 300 physicians and dentists from Hawaii to Cape Cod. Her firm uses a team of experts to provide comprehensive financial planning to help doctors build their wealth and protect their wealth while reducing taxes now and in the future. Katherine is a longtime advocate for ethics in the financial services industry; and has written three books on the subject of investment strategies. She has received many honors and awards including: numerous tributes from Medical Economics as a top advisor for doctors, multiple 5-Star Advisor Awards, honored as a Top Woman in Finance, in addition to being selected to be on the CFP® Board of Ethics. Katherine can be reached at: Katherine@mdfinancialadvisors.com or 952-388-6317. Her website: www.mdfinancialadvisors.com.
Quick Summary:
Top Mistakes that Doctors have Made with their Finances
Stock Picking
Don’t know what products (stocks, mutual funds etc.) they are buying
Don’t Consider the tax consequences when investing
Wait too late in life to start saving for retirement
Dr. Ben invests $2000/yr. from age 18-32 (15 yrs.) w total contribution of $30,000. Assuming 8% return at retirement age (age 65) he’ll have $743, 431.64. If done via a Roth then $743, 431.64 is tax free!!
Dr. Chloe invests $6,000/year from age 42-65 (24 years) w total contribution of $144,000. Assuming 8% return at retirement (age 65) she’ll have $432,635.64
A difference of $310,796 between the two approaches!!
Listening to the “news”
US stockmarket operates regardless of political affiliation of the president/congress etc.
DIY Investor – dangers
Following doctor blogs that may or may not have accurate advice
What you can do today to improve your financial future...
Starting saving early - Can even start a Roth for your children as long as they have some income (child modeling, summer jobs etc) as long timeline provides best benefit.
Get help from a trustworthy financial advisor - https://brokercheck.finra.org/ website to check record of your financial advisor
Work with a Certified financial planner who works on physicians
