And how to assemble the right team to address them
Financial planning for physicians is not like financial planning for other high-income or high-net-worth individuals.
There are various reasons for this, including complex student loan burdens, a delayed earning curve, unique employment structures, income variability, and specialized needs surrounding asset protection and insurance. Additionally, many physicians recognize they’re “HENRY,” High Income, but Not Rich Yet—and they are looking to assemble a team that can help them build wealth for themselves and their families.
Physicians are typically aware of some or all of the challenges above. But they are often unsure of how to seek assistance in tackling them, or which professionals are best to tackle which issues.
The Financial Planning Landscape
The financial landscape is populated by various professionals, each playing a distinct role. Understanding these differences is crucial for physicians seeking financial guidance.
Financial Advisors
Financial advisors are primarily focused on managing your investments. They often work on a percentage-of-assets model, meaning their compensation is directly tied to the size of the assets they manage for you. This approach aligns the advisor’s financial incentives with your portfolio’s performance, fostering a mutual interest in its growth and success.
Key functions of a financial advisor include:
- Portfolio Design and Asset Allocation
- Ongoing Portfolio Management
- Investment Risk Management
CPAs
CPAs, or Certified Public Accountants, are professionals who specialize primarily in accounting and tax-related matters. Their expertise is often invaluable in ensuring that individuals and businesses alike are not only compliant with tax laws but also optimized for tax efficiency.
However, CPAs are narrowly focused on optimizing tax strategies, and may not always consider the broader picture of long-term financial planning, or the specific goals of the individual physician.
Personal Lawyers
Eventually, many physicians will retain a personal lawyer who will play a vital role in their financial life, especially in asset protection and estate planning. Lawyers provide legal guidance on protecting assets from potential lawsuits, ensure compliance with healthcare regulations, and assist in navigating complex legal risks.
In estate planning, lawyers are indispensable for drafting wills and trusts, creating healthcare directives and powers of attorney, and strategizing to minimize estate taxes. They work collaboratively with financial planners and CPAs, ensuring that a physician’s financial and estate plans are comprehensive, legally sound, and aligned with their long-term goals and family dynamics. (This work is especially important now that the federal estate tax exemption has been permanently set at $15 million per person ($30 million per couple) starting January 1, 2026—plenty of physician families fall on or near that threshold once you count practice equity, real estate, and life insurance.)
Financial Planners
Financial planners offer a comprehensive approach, integrating aspects like asset protection, risk tolerance, and long-term goal setting. They often work in conjunction with all of the professionals above, providing a holistic view of a physician’s financial health. Below we dive deeper into financial planners for physicians, including what they do and whether you need one.
Financial Planners: the ‘Financial Quarterback’
The best financial planners act as a ‘financial quarterback’ for physicians, ensuring all elements of their financial plan work in harmony. They coordinate with other professionals, like CPAs, financial advisors, and lawyers.
The financial quarterback role involves overseeing the entire process, ensuring that each component, from investments to tax planning, aligns with the physician’s long-term goals. A good financial planner also holds both the client and other financial professionals accountable, ensuring that every decision and action taken is in the best interest of the client’s financial future.
Ben Yin of Generational Financial Partners, a financial planning firm whose clients are 95% physicians, has a framework for what this quarterback role entails, which he calls the “5 Mizes” (note these are especially applicable for independent contractor physicians):
1. Optimize
A financial planner optimizes contributions to retirement plans like Solo 401(k)s or SEPs, reducing taxable income and bolstering future financial security. Distinct from a CPA, the financial planner will optimize these contributions not just to lower a particular year’s tax burden, but as part of an integrated financial plan for the future.
2. Maximize
This involves leveraging business expenses to their fullest—a critical component of financial planning for independent contractor physicians. This could even involve adding children or family members to the payroll for additional savings.
3 & 4. Customize & Fleximize
Independent contractor physicians enjoy the flexibility to tailor their insurance, retirement contributions, and investments to their personal and family needs, moving away from one-size-fits-all solutions. A financial planner takes the lead on customizing these tactics to be as flexible as possible for the individual’s goals.
5. Minimize Taxes
Techniques such as the Qualified Business Income deduction (made permanent under the One Big Beautiful Bill Act of 2025) or Pass-Through Entity Level Tax (PTE), which allows you to pay some of your state income tax through an LLC, can substantially reduce a physician’s taxable income.
Do Physicians Need a Financial Advisor/Planner?
Many high-earning individuals eventually opt to hire a financial planner and wish they had done so earlier in their wealth-planning journey. Physicians in particular have unique needs that make this kind of long-term planning even more beneficial.
For example:
Complex Student Loan Burdens: Physicians often graduate with significantly higher student loan debt compared to other professionals — the average medical school graduate now carries approximately $223,000 in education debt. Managing and strategically planning around this debt is a central aspect of their financial planning. This could involve navigating through various repayment options, understanding loan forgiveness programs like Public Service Loan Forgiveness (PSLF), or balancing loan payments with other financial priorities like retirement savings or home purchases.
Delayed Earning Curve and Shortened Accumulation Period: Physicians typically enter the workforce later due to prolonged education and training periods (medical school, residency, possibly fellowship). This delayed start means they have a shorter time to accumulate wealth for retirement compared to other high-income professionals who start their careers earlier. Effective financial planning for physicians needs to take into account this compressed timeline for both savings and investment growth.
Unique Employment Structures and Income Variability: Physicians often deal with a variety of employment arrangements, from traditional salaried positions to independent contractor roles, or a mix of both. This can lead to income variability, affecting how they plan for taxes, retirement, and other financial goals. Additionally, physicians working as independent contractors may lack employer-provided benefits, necessitating individual solutions for retirement savings, insurance, and other benefits typically offered by employers.
Specialized Insurance Needs: The nature of the medical profession brings specific risks, making disability and malpractice insurance crucial components of a physician’s financial plan. These insurance products are often more complex and tailored in the medical field than in other professions. Understanding the nuances of these policies, such as “own-occupation” disability insurance, is essential in protecting a physician’s income and career.
For some, the interest and capability to manage their finances independently exist, potentially saving on advisory fees. However, the intricacies of financial planning and the sheer work of managing one’s career often lead physicians to partner with outside professional expertise. And, the best financial planners can offer insights and strategies that might not be readily apparent to those outside the financial sector.
Fee-Based vs. Fee-Only
There are two general types of financial planners: fee-based, and fee-only.
A fee-based advisor will typically charge a fee for their services and also earn commissions on products they sell. This model can be beneficial when a physician needs both advisory services and product-based solutions (like disability insurance).
Fee-only advisors: These advisors charge solely for their advice, eliminating potential conflicts of interest related to product sales. This model aligns the advisor’s incentives purely with the client’s interests.
Each model has its merits, and the choice largely depends on the specific needs and preferences of the physician.
The Role of a Fiduciary Financial Planner
Finally, the last concept to understand before choosing whether to hire a financial planner is that of a financial fiduciary. A fiduciary simply has a legal obligation to act in the best interest of their clients. This role is particularly significant in the context of physician financial planning due to the complexity and long-term nature of the decisions involved.
Choosing a fiduciary ensures that the advice given is unbiased and solely in the physician’s best interests, be it in investment choices, tax strategies, or retirement planning. Physicians should be wary of advisors who are hesitant to affirm their fiduciary role or who seem to push specific financial products. In other words, if they don’t charge you a fee for their time, what products do they have to sell you for them to make money? Transparency and a client-first approach are key indicators of a trustworthy fiduciary advisor.
This fiduciary responsibility ensures that a financial advisor’s guidance is not colored by personal gain but is instead focused on the physician’s financial well-being.
Not everyone needs a financial advisor/planner
Some physicians have both incredible business and financial savvy, and the time and inclination to do one’s own financial planning. They enjoy all things financial—they look forward to reading the Wall Street Journal and keeping up with investments. If that describes you, great! There are absolutely physicians out there who do a great job on their own.
On the other hand, most physicians either don’t have the interest or are simply not good at it. Some are terrible.
Yet many become convinced they can be their own financial planners, usually after having read a blog post (or a few dozen blog posts) from a site like White Coat Investor (they’ve even got a post about “How to fire your financial planner.”)
There is a lot of good advice on that site, but the problem is when you become convinced the job is so easy that you can do it yourself. We’ve encountered many physicians who DIY’d it for years while making tragic mistakes that set them and their families back years. Lots of doctors try to be their own financial planners but fail in the end.
Then there’s another question: just because you can, does that mean you should? We could all probably paint our own house, but that doesn’t mean it will be a good paint job, or bring us joy. Many physicians would much rather spend their precious hours at their kids’ baseball games, or traveling the world.
Conclusion
At ApolloMD, we work with and refer our physicians to trusted partner Benjamin Yin, MBA, Co-Founder and Principal of Generational Financial Partners. Ben’s expertise is in developing personalized financial strategies that are tailored to align with each physician’s individual goals and needs, ensuring they are well-prepared, protected, and positioned for prosperity.
Wondering whether your current setup — CPA, advisor, attorney, insurance broker — is actually working together, or whether you’re missing a financial quarterback to tie it all together? Ben Yin offers a free 30-minute “Zero Call” to talk through where you are, where the gaps might be, and whether having someone coordinate the whole picture would change the math for your family. Book your Zero Call here.
