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Top Mistakes Doctors Make with their Finances [Podcast with Dr. Kristy McAteer]
Through the years, Katherine has seen certain mistakes repeated among physicians and dentists. To better understand and then correct these mistakes, Katherine joins Dr. Kristy McAteer, from Brown University, to discuss the biggest blunders she sees, and how to take actionable steps to correct them.
Top Mistakes Doctors Make with their Finances
Stock Picking
Evidence-based investing shows that, in general, stock picking doesn’t work.
Don’t know what products (stocks, bonds, small companies, large companies, mutual funds etc.) they are buying
Make sure you know the risks, liquidity etc.
Don’t consider the tax consequences when investing
Taxes will have a much bigger impact than anything the stock market does.
Waiting too late in life to start saving for retirement
Dr. Ben invests $2000/yr. from age 18-32 (15 years) with a total contribution of $30,000. Assuming 8% return at retirement age (age 65) he’ll have $743,431.64. If done via a Roth IRA, then all of this money 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!
“Do It Yourself” Investing
Listening to the “news” and considering it fact
Following doctor blogs without knowing if the information is accurate
Assuming the U.S. stock market operates differently according to the political affiliation of the president/congress
What you can do today to improve your financial future:
Starting saving early - You can even start a Roth for your children as long as they have some income (child modeling, summer jobs, etc.) as a long timeline of investing provides the best benefit.
Get help from a trustworthy financial advisor - https://brokercheck.finra.org/ allows you to see the record of your financial advisor.
Work with a certified financial planner who focuses on physicians and dentists, feel free to email us at info@mdfinancialadvisors.com to schedule a complimentary consultation.
To hear the original podcast, check out the Brown University page here.
Listen on Apple Podcast, Google Podcast or Spotify
CONTACT US
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Remember that you can send us any questions or potential topics at: Info@MDFinancialAdvisors.com
Katherine Vessenes, JD, CFP®, 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®, author and speaker, she is devoted to bringing ethical advice to physicians and dentists. She can be reached at Katherine@mdfinancialadvisors.com.