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Author Archives: LarsonFinancial

Strategies to Protect Your Assets Against a Lawsuit

Medical malpractice insurance is something you’ll need as a doctor, whether it comes from your employer or you buy a policy yourself. When it comes to the specifics of which approach to take, there are multiple factors to consider.

One such consideration is something called “damage caps.” There are a few select states that have place a cap on all forms of damages in medical malpractice cases, including compensation for the costs of long-term medical care and disability. So it would make sense to only cover yourself up to the cap amount with your policy, right?

Not necessarily. Most states that have caps in place only cap non-economic damages, such as pain and suffering. There is rarely a cap on economic damages, so you’ll still likely want to cover yourself for more than the cap amount.

In terms of policy, there are two main forms: Occurrence and Claims Made policies. Both have advantages in different situations.

Claims Made policies are terrific for situations where there is a lot of turnover, or uncertainty as to how long the policy will be needed. Occurrence policies can be beneficial with long-term employees.

You have a vested interest in your medical malpractice coverage and you should know the carrier and coverage limits that are in place, regardless of who pays the premiums for the policy (you or your employer). To figure out what levels of coverage you need, talk to your insurance broker to create a plan that fits your needs.

Lastly, there are ways to protect yourself outside of medical malpractice insurance. Continually work to improve your communication skills and bedside manner. A healthy relationship between providers and patients and managing expectations go a long way to reduce blame when something goes wrong.

Is your medical malpractice coverage in a good spot? We can talk through your strategy together.

Advisory services offered through Larson Financial Group, LLC, a Registered Investment Advisor.
 
Securities offered through Larson Financial Securities, LLC, member FINRA/SIPC.
 
Larson Financial Group, LLC, Larson Financial Securities, LLC and their representatives do not provide legal or tax advice or services. Please consult the appropriate professional regarding your legal or tax planning needs.
 
Professional liability services offered through MedInsure Group, LLC, a Larson Financial Group affiliated company.

When Planning for the Future, Don’t Overlook Your Estate

Just like disability insurance protects us in the event of a career-altering illness or injury, estate planning can help protect your family in the event of incapacity or death. Estate arrangements should be something every doctor considers in his or her financial plan.

At the highest level, an estate plan allows a living person to arrange for things such as healthcare directives in the event of incapacity and the guardianship of minor children and disposition of assets upon death.

An estate plan can contain a variety of documents depending on complexity, including powers of attorney for healthcare or finance, a basic will and/or a living trust. Ultimately, an estate planning attorney is the person who determines which documents are the best for each situation.

Estate plans can become critical for an individual or a couple with young children, allowing them to name guardians for the children and a trusted individual to receive resources to provide for the care of those children. The same applies to those who have children with special needs.

The distinction between guardians and trusted individuals is an important one, as the person or persons you select as guardians may not be the best money managers—and they don’t have to be. You can be as specific as you want when you determine who will manage the money and support for your children.

We recommend updating your estate plan every three to five years, or when a specific life event occurs such as the birth of a child. A financial professional and an estate planning attorney will be your best resources for adjusting and updating your plans.

Is it time to update your estate plan?

Advisory services offered through Larson Financial Group, LLC, a Registered Investment Advisor.

Securities offered through Larson Financial Securities, LLC, member FINRA/SIPC.

Larson Financial Group, LLC, Larson Financial Securities, LLC and their representatives do not provide legal or tax advice or services. Please consult the appropriate professional regarding your legal or tax planning needs.

Think Twice Before You Borrow the Maximum

As you weigh your options in buying a new home, you’ve got many factors to consider. Cost of the home, monthly mortgage payment, moving costs, etc. You may even get pre-approved from your lender for quite a bit of money, especially as a doctor. Be careful, though, because it may not be a good idea to borrow that full amount.

Especially for doctors looking to buy their first home, a good ballpark for your first mortgage is to keep it within 2-3 times of your annual income. That may not always be possible, especially in more metropolitan areas where home prices have gone up. In those situations, it may be a good idea to consider other options such as buying a condo or renting for a period.

If you’ve got an idea of the price range of a home, you’ll need to find a mortgage specialist to help you along. Many lenders offer something called physician loans. These kinds of products typically offer low or no down payments with no mortgage insurance. For a physician without enough cash on hand for a large down payment, this could be a good choice; keep in mind, however, that interest rates and lending guidelines can vary among lenders.

Some lenders will also try to offer a higher mortgage than you may be able to afford. Talk with your financial advisor about the various loan and mortgage products available to you. Doing so can help you decide how much house makes sense for you, given your other commitments or priorities.

You may feel the desire to use that full approval amount for your home. After all, living lean during medical school can make you eager to push that new higher income to the limit. During the decision-making process for a home, which is both emotional and financial, you can lean heavily on your financial advisor. They can help to ground you and give you perspective on the various familial, societal or other pressures you’re under to live large.

A final thought to keep in mind: buying a home is more than just the mortgage payment. There are upkeep costs, renovations if applicable, furniture, décor and more. These expenses can quickly add up based on the size of your home and your tastes. Remember, you can upgrade as you go along. Owning a home is a big step. Pace yourself!

Are you considering buying a new home? Let’s talk it over together.

Advisory services offered through Larson Financial Group, LLC, a Registered Investment Advisor.

Securities offered through Larson Financial Securities, LLC, member FINRA/SIPC.

Larson Financial Group, LLC, Larson Financial Securities, LLC and their representatives do not provide legal or tax advice or services.  Please consult the appropriate professional regarding your legal or tax planning needs.

A Disability Doesn’t Have to End Your Career

Disability insurance exists to protect our income, should we suffer a debilitating injury or illness. But for doctors, standard disability insurance usually fails to meet our needs. Disability insurance is a good tool to have for any professional, but doctors have a few particular needs.

Firstly, we invest significant time and money into our education and training prior to starting in practice. We expect this investment to result in an above-average income, especially considering the 10+ year delay in saving for retirement, a home or paying down student loan debt. We need that income to reach our financial goals.

Second, many specialties require the use of your hands—typically for surgeries, which often require fine motor skills. In many other professions, accommodations can be made to allow someone to continue working. For doctors, it’s impractical or even impossible to continue performing surgeries or other procedures if you become disabled.

Your employer may offer group disability, but this tends to be inferior to individual policies you can find in the marketplace. These policies can include things like timeframes on your coverage, after which it can be difficult to meet the definition of a disability unless you’re incapacitated or even near death.

Be sure to work with a financial professional who represents your interests, rather than that of a particular company or singular policy. Review various options available to you and learn about some of the additional features, such as riders that continue to make retirement plan contributions or pay student loans.

When you’re shopping, you may want to consider some of these traits in your search:

  • “True” Own Occupation Coverage will protect you in your specialty even if you’re able to work in a different capacity, such as teaching in a medical school.
  • Residual disability riders are supplemental tools that start to pay benefits in the event of a gradually debilitating illness and continue to pay benefits after you’re able to return to work as you build your practice back up to pre-disability earnings.
  • Non-Cancellable and Guaranteed Renewable typically refer to guaranteed coverage so long as you make your premium payments. You also won’t lose coverage after experiencing a disability and returning to work.
  • Future Purchase Option riders allow you to purchase additional coverage without providing proof of good health, taking into account only the financial requirements of the increased coverage instead.

Whatever your policy choice, shop around and involve your financial professional. Choosing the wrong disability coverage could be disastrous for the substantial investment you’ve made in your career.

Is your disability coverage protecting you, or is it time for a change?

Advisory services offered through Larson Financial Group, LLC, a Registered Investment Advisor. Securities offered through Larson Financial Securities, LLC, member FINRA/SIPC.

Larson Financial Group, LLC, Larson Financial Securities, LLC and their representatives do not provide legal or tax advice or services. Please consult the appropriate professional regarding your legal or tax planning needs.

Insurance services offered through Larson Financial Group, LLC, an insurance agency.

Living in Retirement: The Second Leg of the Retirement Journey

We talk a lot about retirement goals, and for good reason. If you have a plan in place, it’s much easier to retire at the age you want. But simply reaching retirement age and retiring is only the first half of it. Living comfortably in retirement is the end goal of saving, and your plan should ensure you reach that goal.

There’s no magic rule for retirement savings, as you may need to save above and beyond the standard 401k/403b and Roth IRA funding. Each individual will have different goals and time horizon, but a good rule of thumb is to plan to save 15-20 percent of your gross income per year to comfortably live in retirement without worry. Again, everyone is different.

It can be beneficial to have a target age in mind when you’re crafting your retirement strategy. Some doctors want to retire as soon as they can; others may enjoy their work and plan to work longer. When you’re choosing a target age, you can then determine the action you need to take now.

If you’re a doctor starting your career, it can benefit your retirement strategy to understand what your monthly cash flow will look like as you’re starting out. It can be quite a shift going from resident to in-practice. If you understand the dollars flowing in and out of your account, you can properly budget for things like loan repayment, risk management costs, and paying off other debts.

If you’re later in your career and you’ve found that your retirement plan isn’t where you’d like it to be, or maybe you got a late start, there are ways to recover. Getting a second opinion from your financial advisor can be key to making corrections to your strategy, including assessing your risk allocation, properly diversifying your investments and reviewing your goals annually.

Regardless of where you’re at with your plan, it’s important to consult with your advisor. Oftentimes, we’ll read financial articles and they could inspire us with false confidence or an overwhelming sense of dread, depending on market shifts. Your advisor can help keep you grounded and sticking to your plan is almost always the best course of action.

Are you on track to live comfortably in retirement?

Advisory services offered through Larson Financial Group, LLC, a Registered Investment Advisor.
Securities offered through Larson Financial Securities, LLC, member FINRA/SIPC.

Larson Financial Group, LLC, Larson Financial Securities, LLC and their representatives do not provide legal or tax advice or services.  Please consult the appropriate professional regarding your legal or tax planning needs.