Money Mistakes Even Smart Doctors Make: Not Considering All 4 Cornerstones

Money Mistakes Even Smart Doctors Make: Not Considering All 4 Cornerstones 

By Katherine Vessenes, JD, CFP®, RFC
President, CEO, Financial Advisor


We have been doing a lot of financial plans for 50 and 60-year-old doctors recently. They are on the verge of retiring and wanted us to tell them how much longer they needed to work.

With one or two exceptions, these doctors are in much worse financial shape than they ever realized.

A number of doctors were going to run out of money in retirement, long before they would run out of life. A couple of them would leave their un-employed spouse with almost no funds of support, if the doctor died first. Most had no money set aside in the critically important tax-free category.

Thank goodness they came in to see us when they did. We still had time to make changes that would have a much better impact on their future, and the future of their families.

This article will cover some of the common mistakes even smart doctors make with their money, and more importantly, how to avoid these mistakes.

Mistake: Not considering all 4 financial cornerstones.

 We believe when you are building a solid financial house, one that can withstand the storms of time, you need to place it on a firm foundation. That foundation should include the following 4 cornerstones:

  • Building Wealth

  • Protecting Wealth

  • Distributing Wealth

  • Transferring Wealth  

Unfortunately, most doctors just focus on accumulating wealth—and this single focus can be very detrimental to their financial future.

Even more alarming is that most financial advisors make the same mistake. You can do a great job of building wealth, but if you don’t take the other three cornerstones into consideration, you may not be able to KEEP your wealth.

As my daddy used to say to me, “It’s not how much you make, it’s how much you can keep that makes the difference.”

We see many doctors who are so focused on building wealth that they have never even considered some other important parts of the financial equation such as:

  • How much money will my spouse and children need if I die prematurely?

  • How much money will I need in a nest egg to provide a steady, dependable retirement income?

  • Will I run out of money in retirement?

  • What effect do taxes have on my income now and in the future?

  • What will happen to my family if I am too sick or injured to work?

  • How much will it cost me to pull money out of my retirement plans? (The answer? A lot more than you think!)

Those who focus just on accumulating or building wealth, tend to be preoccupied with the stock market, even to the point of getting depressed when the market is down. The truth is, money can be made in a down market and there is a good chance they should be investing MORE when the market is down. This is like a sale at your favorite store. The time to buy is when the prices are down.

My advice—pay more attention to your plan than to the market. We tell doctors that standard indices, like the S&P 500, are really meaningless to them. The reason? We create a customized financial plan for every doctor.

When using this roadmap to their desired future, we know the range of returns needed to reach these important financial goals. As long as our doctors’ investments are averaging within that range most years, they will get to their desired future. Sure, some years we will be below that range, but other years we will be above it. That is why it is important to update your plan regularly.  

This also means for most clients we don’t need to take the risk of being completely invested in the stock market. They can still get to their financial future by taking less risk, allowing them to sleep better at night.


  • Your personal, customized financial plan is more important than the market returns.

  • You need to look at all 4-cornerstones to build and KEEP your wealth.

  • Standard indexes may have nothing to do with you and your portfolio.

  • Update your plan regularly.


Katherine Vessenes, is the founder and CEO of MD Financial Advisors who serve 500 doctors from Hawaii to Cape Cod. An award-winning Financial Advisor, Attorney, Certified Financial Planner®, Registered Financial Consultant, author and speaker, she is devoted to bringing ethical, fiduciary advice to physicians and dentists. She can be reached at