When I engage new clients, there are often a range of financial issues that need to be rectified or optimised. In this article I would like to highlight the 5 main ‘problem areas’ Doctors typically have not properly organised, and demonstrate how financial advice for Doctors is of tremendous value.
1) Tax planning
Unfortunately too many Doctors still work with generalist accountants. While many of them certainly provide solid advice, all too often I see incorrect tax advice getting Doctors potentially into trouble with the Tax Office, or missing out on valuable deductions or other tax savings. There are specific tax rules that apply to medical professionals, and it is critical that you seek specialist advice to get the best outcome. Also, tax planning is not about saving tax at every cost, without regard for the long-term consequences; it needs to be sustainable and be part of a holistic plan.
2) Debt Management
Doctors typically have high levels of (non-deductible) debt and often no specific plan to repay it. Quite often, the loan balance will ebb and flow, but very little progress is made with actual debt repayment. The banks are keen to lend Doctors as much money as they like, and often allocate a Private Banker to manage this relationship. However, you need to remember that Private Bankers work for the bank, not for you, and quite often will not give you the best interest rates. It pays to get an independent review of your finance facilities from time to time.
3) Cash flow management
The number one issue plaguing Doctors when it comes to their finances, is the absence of a structured cash flow management plan. Whilst taxes and personal living expenses are high, big mortgages and school fees put an extra dent in your free cash flow. If you’re not careful and manage your business and personal cash flow, you will find it extremely difficult to get ahead financially. You can counter this by having a solid plan…
4) Wealth creation/investment
Indeed, many doctors lack a plan when it comes to accumulating wealth and making the most of their income. Investment decisions are made on an ad hoc basis, and portfolios are typically overweight in property. This lack of a clearly defined personal plan often leads Doctors to become frustrated about their lack of progress in building their balance sheet. This is where financial advice for Doctors makes all the difference, by focusing on your goals and outlining a clear way forward.
5) Legal issues
There are many legal documents Doctors are confronted with:
– estate planning documents – employment agreements; – lease agreements; – trust deeds; – binding financial agreements; – etc.
The danger lies in not seeking professional legal advice when establishing these documents, and doing it ‘on the cheap’, or failing to regularly have these documents reviewed. The cost could be tremendous.
How can we help?
We specialise in providing financial advice for Doctors, and have a developed a specialist approach and processes that allow us to deliver highly beneficial advice that is time-efficient. Please feel free to contact us for an obligation-free second opinion on 08 6160 5918 or yves@affluenceprivate.com.au. We are available to work with interstate clients.
About Yves Schoof
I specialise in managing and coordinating the financial affairs of medical professionals and have been recognised as one of the best financial planners in Australia. I am a Certified Financial Planner and member of the Financial Planning Association of Australia.
As I understand your time is extremely valuable and scarce, I am able to offer flexible meetings times, including outside business hours and during the weekend. I can even come and meet you somewhere convenient, or talk via videoconference on Skype.
My first consultation is free. I allocate up to 90 minutes to discuss your personal circumstances and to establish how I may best assist you. Where you already have an existing adviser, I would be happy to offer a second opinion. I always quote a fixed dollar fee before we start working together.
Please contact me on yves@affluenceprivate.com.au or call me direct on 0432 885 295. You can follow me on Twitter @YvesSchoof or connect with me on Linkedin to receive new articles.
Disclaimer
Yves Schoof and Affluence Private Wealth are Authorised Representatives of Synchron, AFS Licence No. 243313. The information posted is intended to be general in nature and is not personal financial product advice. It does not take into account your objectives, financial situation or needs. Before acting on any information, you should consider the appropriateness of the information provided and the nature of the relevant financial product having regard to your objectives, financial situation and needs. In particular, you should seek independent financial advice and read the relevant product disclosure statement (PDS) or other offer document prior to making a decision.