Written by: Naomi Olson
In today's world where there's no shortage of information, it has become difficult to make the right financial decisions. People now readily share their opinions on the internet however wrong they may be. So how do you make sense of it all and figure out the best investment? Financial advisors can help you. Imagine, 90% of individuals who see a financial advisor feel that the advice they received benefited them. Ironically, only 8% of people speak to financial advisors about their financial decisions. Here are five ways a financial advisor can help you as a physician.
1. Performs Health Checks on Finances
Financial advisors will help you to get insights into the current state of your finances. They will look at your savings, investments, pension, insurance, mortgages, and loans. This information will aid the advisor to understand your financial affairs and habits. Financial advisors will be less concerned about recommending products. They will provide you with a clear picture of your finances and help you identify opportunities. If you're a physician who has just had a radical career change or even had a family, a financial advisor will help you to organize your finances.
2. Budget Creation
A budget is the most important tool that will help you on the path to financial independence. However, the process to make an effective budget is difficult and time-consuming. A financial advisor will look at your expenses and income to spot any areas you can save money from. The financial advisor will also help you to adjust your budget in the future should your circumstances change. A solid budget will always give you a sense of security that your finances are working for you.
3. Ensuring Financial Security for your Family
As a physician, it is important to think about how your dependents will cope financially in cases of any illness, loss of work, or death. You would never want to leave your dependents in financial ruin in case something happens to you or your job.
Financial advisors will recommend to you the best protection insurance covers like medical indemnity insurance, life insurance, income protection, and medical malpractice insurance. All this will give you that peace of mind that your family will be well taken care of should the worst happen.
4. Setting Financial Goals
Before saving and investing, you need to have a financial goal you're working towards. The financial goal could be buying a house, building up a nest egg for retirement, or even saving for a long vacation to a foreign country. By assessing the terms of your contract, financial advisors will help you develop a suitable plan that will enable you to achieve your financial goals. For short-term goals, the financial advisor may advise you to save money in a fixed deposit account while for long-term goals you may have to consider investing in the stock market.
A financial advisor will sort through the thousands of financial products and will choose those that align with your financial goals. They will help you focus on reducing your debts and saving for retirement.
5. Maintains Discipline and Monitors your Portfolio
A financial advisor will help you continuously monitor your investments as you are working towards your financial goals. The advisor will also spot any drastic changes in the market and using their expertise, they will be able to provide guidance on the changes that you can do to stay on course towards your financial goals. The financial advisor will also ensure that you are disciplined in your spending as this is one area that derails many people's journey to financial independence. Finally, they will help you build solid financial principles like a savings culture that will be invaluable throughout your life.
Most physicians have little experience dealing with finances. This coupled with the vast financial information and products available on the market can make the decision-making process in personal finance a tedious endeavor. A competent financial advisor will help you as a physician set financial goals, create a budget, check the health of your finances, and monitor your portfolio. A financial advisor will help you come up with a thorough financial plan which outlines all the steps you will take to save enough money to achieve your individual goals.
Related: How Large Medical Groups Can Drive Down Their Tax Liability And Enhance Their Retirement Savings