As seen in Physician's Money Digest

Doctors do Better with Comprehensive Financial Managers
By Donald T. Cohen, CPA
Newman + Cohen Financial Management

In today's bear market, physicians are relying on financial professionals for guidance and planning more than ever. The typical physician's long hours and busy schedule prevents him or her from being able to deftly manage his or her personal and business finances. Therefore, it's common for physicians to work with a variety of individuals to help ensure that they are making informed and wise decisions, especially during times such as these when the economy sours and their investment gains dwindle.

However, physicians should consider whether a single adviser would better serve their financial needs. Doctors have traditionally relied on the experience and advice of brokers for their investments, accountants for their taxes, insurance agents for their insurance needs and lawyers for their estate-planning and creditor-protection issues. Assembling such a financial team takes a great deal of time and effort, and the larger the team the greater the vulnerabilities to problems with unethical professionals.

Instead, many physicians are now choosing to work exclusively with a single financial adviser. These doctors are consolidating all of their personal and business financials with highly experienced and trustworthy professionals who specialize in providing comprehensive financial management services.

The advantages of working with a comprehensive financial manager are significant. First, it saves doctors a great deal of time by eliminating numerous meetings and telephone calls with multiple individuals. Most physicians are extremely dedicated to their work, and they welcome anything that can help to simplify their lives and decrease the demands on their schedules.

Second, a comprehensive financial adviser is uniquely capable of assessing all of a physician's personal and business financial needs in the context of his or her portfolio and short- and long-term goals. An adviser can offer investment advice that is particularly appropriate to those using certain tax and estate-planning strategies. Furthermore, an adviser can recommend insurance products that complement specific estate-planning and investment tactics.

When it comes to protecting assets from claims and creditors, comprehensive financial advisers can devise and recommend strategies that may fall between the cracks of the areas of expertise of individual specialists. They can also enable physicians to take advantage of all of the precautions that are available to them under the law.

Moreover, for private-practice physicians, these advisers can recommend and initiate suitable employee-benefits plans. Many of these plans provide access to attractive insurance and investment products for the business owner, and the adviser can help the physician determine which plans are most beneficial both for the physician and his or her employees. In addition, advisers who have medical billing and coding expertise can take a close look at the medical practice's billing policies, protocols and coding to create efficiencies and uncover untapped revenue sources.

Physicians who are considering consolidating their personal and business finances with a single adviser should closely scrutinize the adviser's credentials and qualifications. The right adviser is one with a great deal of experience in working with doctors on investments, insurance, taxes, estate planning and employee benefits. Most importantly, the adviser must be an ethical and trustworthy individual, and it is always wise to speak with several of his or her clients about their experiences with the individual.

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Donald T. Cohen is a founder and director of Newman + Cohen Financial Management (www.newman-cohen.com). He has more than 20 years of experience in certified public accounting, advanced financial strategies and business management with physicians and high-net-worth individuals. He welcomes questions or comments at (800) 966-9306 or via e-mail at donald.cohen@newman-cohen.com