3 tips for physicians to find the best financial advisor

Dec 12, 2019

Not every financial adviser has your best interests at heart.

Believe it or not, some financial advisors do not have to abide by their own version of a Hippocratic Oath. As a physician, you are a fiduciary, a professional who is obligated to put your patients’ best interest first. But, did you know that not all financial advisors are required to abide by a fiduciary standard? As a physician, you have a Hippocratic oath. It’s a smart idea to find a financial advisor that is bound to the same set of standards to serve your interests first.

Here are three things you should ask in your search for a financial advisor.

1. How are they paid?

Chances are good that you’ll want transparency from your financial advisor about how they get paid. There are two main types of payment arrangements in the industry: fee-only and fee-based.

Understanding the differences between these payment arrangements is critical. Fee-only financial advisors generally act as fiduciaries. In other words, they promise to act in the best interests of their clients at all times. They do not receive commissions or incentives from insurance companies or brokerage firms for recommending particular products.

While fee-based advisors also charge asset management fees for their services, they may also be compensated for selling certain products. This may cause a conflict of interest when it comes to giving you advice.

Always ask a prospective advisor to describe how they are paid and whether or not they hold themselves out as a fiduciary.

2. What are their credentials?

As a physician, conducting thorough research may be second nature to you. One of the most valuable research tools for vetting financial advisors is BrokerCheck, a website maintained by the Financial Industry Regulatory Authority (FINRA). Use this site to learn more about the backgrounds and certifications of brokers and financial professionals before you start to work with one. BrokerCheck reveals which types of securities licenses a prospective financial advisor holds and whether they’ve ever been disciplined or involved in arbitration. It also shows any customer complaints that have been lodged against the advisor.

As for credentials, the most well-recognized financial planning credential is the CERTIFIED FINANCIAL PLANNER™ (CFP®). The CFP® program consists of five comprehensive areas of personal finance. The designation is awarded after candidates pass a 6-hour board examination covering the entire curriculum and submits to a background check. Candidates must have at least an undergraduate degree in order to start coursework for the CFP® program and must have three years of relevant work experience in order to use the credentials. The certification also requires ongoing continuing education courses.

3. Do they understand me?

As a physician, it’s important to work with an advisor who understands your unique needs. Sure, you are likely to be a high-income earner. But you have special considerations that many other professions don’t have due to the significant changes in the industry, income compression, tax reduction needs, and asset protection concerns. And, you may have started with significant student-loan debt and entered the workforce later than many other professionals, so you may need to make up for lost time when it comes to saving for retirement.

Ask a prospective financial advisor if they specialize in working with physicians. We consider advising physicians on their financial life to be both an art and a science that comes only through experience, knowledge and understanding of your specific situation.

It’s a smart idea to find a financial advisor that understands you, is credentialed, bound to a high set of standards, will always serve your interests first and specializes in working with physicians. Someone who treats their profession like you do.

Julianne F. Andrews, MBA, CFP, AIFis a principal and co-founder of Atlanta Financial Associates. She specializes in working with physicians and executives in the healthcare industry. Her passion for working with physicians comes from being a pediatrician’s spouse for more than three decades. Julie has been featured on Forbes’ list of America’s Top Women Wealth Advisors since 2017 as well as Forbes’ Best-in-State Wealth Advisors since 2018. Julie can be reached at jandrews@atlantafinancial.com.

The advisors at Atlanta Financial Associates, Inc. are in a unique position to understand the financial planning needs of physicians: our co-founder is married to one, and we have specialized in working with physicians to enhance and protect their wealth for more than three decades. Our process, MDFIT™, is designed precisely for the unique wealth management needs of physicians. We are a fiduciary advisory firm. We don’t receive commissions for selling any investments, and we will only act in your best interests at all times.

For more information on making sound financial decisions as a physician, download our free report on the 5 Critical Tax Planning Strategies for Physicians.

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