The money you earn today can have a transformative effect on your future and the people you cherish.
That said, today’s busy chiropractors often lack the time and expertise necessary to take a comprehensive approach when it comes to financial planning. Protecting and building your wealth requires a team of professionals who can create a coordinated strategy to ensure a lifetime of financial success.
Most of us have experienced financial planning on an ad-hoc basis. For example, as when buying or selling an investment or setting up an IRA. But when considering financial planning or wealth management, a deeper journey is required.
The challenges of today’s healthcare professionals are complex and may involve debt avoidance, equity creation, tax mitigation, income insurance, investment strategies, and more. For this reason, it’s important to seek out a financial advisor who will coordinate all the various aspects of your financial life to reflect your goals.
This is not just about asset management. More importantly, it’s about your values.
Consider the whole picture
You would never treat one part of the body without considering the whole. Similarly, the best financial advisors are committed to gaining a holistic sense of each client’s needs. Besides inquiring into your income, savings, debt burden, and current investments, they should ask such questions as:
- What’s important to you about money?
- What are your personal goals?
- What are your professional goals?
- What do you do (or want to do) for your children?
- Ideally, where would you like to be when you are 45, 55, 65, and 75 years old?
- What are your quality-of-life desires (houses, travel, boats, cars)?
- How often do you want an overall review of your financial situation and progress made toward your goals?
- Do you donate to charitable causes or volunteer?
- What do you want to do for the world at large?
This broad inquiry is a crucial step toward creating customized financial services and solutions that address your needs as a chiropractor. Because, like the body, the various aspects of your financial life are interdependent and require thoughtful care and maintenance (see diagram).
Still, it can be tempting to put off comprehensive financial planning for another day, especially when immediate concerns such as patient retention, marketing strategies, and monthly cash-flow issues are top of mind.
Where do you start? When considering the “big picture” of smart wealth management, it can be helpful to break it down into the following formula: Wealth Management = Investment Consulting + Advanced Planning + Relationship Management [WM = IC + AP + RM].
Investment consulting
Sound investment strategies can grow and preserve your wealth. A continual assessment of where your assets can best perform, taking into account time horizons and risk tolerance, is the foundation of savvy financial planning.
Advanced planning
Beyond investing, there are other financial challenges that are of importance to today’s successful chiropractors. These include wealth enhancement (managing cash flow and tax mitigation), wealth transfer (passing down wealth), wealth protection (risk mitigation and insurance), and charitable giving (supporting causes that are personally meaningful).
Relationship management
Your needs are varied and they change over time. These interrelated challenges require ongoing coordination and collaboration between a team of trusted legal, tax, insurance, and investment advisors.
Though vital, too few chiropractors approach their financial lives from this holistic perspective. Instead, they often unwittingly allow things to fall through the cracks. This unfortunate habit can lead to myriad problems such as paying too much in taxes, not being able to retire on time, loss of financial freedom, ongoing stress about money, and not being able to pass on wealth as desired.
The other option is to position your money to achieve that which you value the most—peace of mind and financial freedom for you and your family.
Like many professionals, you’ve likely worked with or are currently working with a financial advisor. Still, you may wonder if the guidance you are receiving is fully addressing your needs.
Ask yourself: “Is my financial advisor looking beyond my portfolio to take into account my values and goals? Is he or she communicating across the entire spectrum of professionals to coordinate solutions for my specific challenges?” If not, seeking a second opinion can be a proactive step toward taking charge of your financial life.
Whether you’re just out of school, in the middle of building your practice, or are on the verge of retirement, smart financial planning is a responsibility as well as a privilege. You owe it to yourself and your loved ones to find the right person to guide you through the often confusing and intimidating waters of wealth management. Because, like the health of your patients, the power to achieve your goals is in your hands.
Todd Calamita, CFP, is a fee-only Certified Financial Planner and author. He focuses on providing wealth management solutions to chiropractors and their families by helping them preserve their wealth, mitigate taxes, take care of their heirs, and protect their assets. He can be contacted at todd@chirowealthmanagement.com or through chirowealthmanagement.com.
