SHOPPE BLACK

Many healthcare professionals dedicate their lives to caring for others but often neglect their financial well-being. Wealthcare Financial Group, founded by Martin A. Smith, bridges this gap by providing specialized financial planning services for doctors, nurses, and other healthcare workers.

This article dives into Smith’s inspiration for the firm, the unique challenges faced by healthcare professionals, and how Wealthcare Financial Group helps them achieve a secure financial future.

Tell us about the work you do.

Wealthcare Financial Group, Inc. is dedicated to maximizing and protecting our clients’ wealth through personalized, strategic financial, and retirement planning and investment management. We build custom model portfolios that are diversified based on “asset class” and optimized based on where the economic cycle and our near to intermediate-term outlook of the economy.

For corporate employees and executives, we specialize in managing concentrated stock wealth and balancing growth and risk control to ensure long-term financial health. We advise on estate planning and insurance strategies to ensure that our clients are knowledgeable about Wills, Trusts, making charitable donations, and tax-efficient transfer of their estate.

For institutions, we provide robust employee retirement plans, expert investment management, fiduciary consulting, and the formulation of investment policy statements to ensure compliance and accountability. At Wealthcare Financial Group, Inc., our goal is to offer tailored, stewardship-focused strategies that meet our clients’ unique financial needs and objectives.

What inspired your decision to get into the financial services industry?

I was originally inspired to enter the financial services industry when I first visited New York, specifically the New York Stock Exchange in 1990. My late mentor, Rev. Tom Skinner, and his wife Dr. Barbara Williams-Skinner, including Howard University’s student Chaplain, Rev. Michael Worsley took about a dozen undergraduate students on a field trip to the NYSE, followed by a luncheon with the late Earl Graves, CEO and publisher of Black Enterprise Magazine.

I grew up in East Palo Alto, California, a predominately Black neighborhood, which contrasted in just about every way with Manhattan except for the obvious disparity of wealth and income that is on constant display around Wall Street. As a Sophomore at Howard studying Communications, I wasn’t predisposed to “finance” in my upbringing.

Needless to say, I was aware of my financial illiteracy, and this bothered me because when I saw the “suits” and skyscrapers along Wall Street, on one hand, I felt intimidated, while also having a strong sense of belonging to that professional community.

After gaining several years of experience as a Financial Consultant and Assistant Branch Manager with A.G. Edwards & Sons, including with Merrill Lynch’s Global Private Client Group, I launched Wealthcare Financial Group, Inc. in 2003 as a Registered Investment Advisor.

Healthcare professionals often face unique financial challenges. What are some of the biggest financial mistakes you see doctors, nurses, and other healthcare workers make?

Healthcare professionals often lack the time and energy to manage their finances, leading to several common mistakes:

1. Not creating a plan: Without a financial plan, managing income, expenses, and long-term goals can be challenging.

2. Ignoring debt management: Many graduate with student loan debt and lack a clear plan to handle it.

3. Insufficient retirement planning:

   Relying solely on employer-provided retirement plans without additional savings can be risky.

4. Making poor investment choices:

   Rushing into investments without research or advice can result in losses.

5. Inadequate insurance coverage:

   Many lack disability insurance or other crucial coverage.

6. Disregarding estate planning:

   Ignoring estate planning can lead to issues in asset transfer and potential legal problems.

7. Overspending and lifestyle inflation:

   Higher incomes often lead to increased spending, causing financial strain.

8. Not seeking professional advice:

   Handling finances without expert guidance can mean missed opportunities and increased risks.

You mentioned retirement planning is a key service at Wealthcare Financial. What are some strategies specific to healthcare professionals to ensure a comfortable retirement?

We recommend the following strategies for healthcare professionals:

1. Start Early and Contribute Regularly: 

   Begin saving for retirement as early as possible to take advantage of compound interest. Consistently contribute to retirement accounts, even during residency and fellowship years when income may be lower.

2. Maximize Employer-Sponsored Retirement Plans: 

   Contribute the maximum allowable amount to employer-sponsored retirement plans, such as 401(k) or 403(b) plans. Take full advantage of any employer matching contributions, as this is essentially free money towards your retirement.

3. Utilize Tax-Advantaged Accounts: 

   Consider contributing to a Roth IRA or traditional IRA to benefit from tax advantages. Roth IRAs offer tax-free withdrawals in retirement, while traditional IRAs provide tax-deferred growth. For those who qualify, Health Savings Accounts (HSAs) can also serve as a tax-advantaged way to save for healthcare expenses in retirement.

4. Diversify Investment Portfolios: 

   Ensure your retirement portfolio is diversified across various asset classes, such as stocks, bonds, and real estate, to spread risk and enhance potential returns. Regularly review and rebalance your portfolio to align with your changing risk tolerance and retirement timeline.

5. Plan for Healthcare Costs: 

   Anticipate higher healthcare costs in retirement and incorporate these expenses into your retirement planning. Consider long-term care insurance to cover potential expenses that Medicare may not, such as assisted living or nursing home care.

6. Address Student Loan Debt: 

   Develop a strategy to manage and pay off student loan debt efficiently. This may include refinancing options or income-driven repayment plans. Balancing debt repayment with retirement savings is crucial to ensure both short-term and long-term financial health.

7. Maximize Income Potential: 

   Explore opportunities for additional income, such as locum tenens work, consulting, or telemedicine, to boost retirement savings. Consider setting aside a portion of any extra income directly into retirement accounts.

8. Seek Professional Financial Advice: 

   Work with a financial advisor who specializes in healthcare professionals to develop a customized retirement plan that addresses your specific needs and goals. Regularly review your retirement plan with your advisor to make adjustments based on changes in your financial situation or retirement goals.

What are some emerging trends you see in the financial planning industry?

Having worked in the investment industry for 30 years, I have witnessed the impact of emerging technologies on the financial services industry and investors, in particular.

There was a time when the notion of “online investing” was unthinkable because information was just becoming more widely available through the internet, and for too long financial advisors aka “Stock Brokers” and their respective Wall Street firms were the gatekeepers and hoarders of pertinent financial information.

Fortunately, this has since changed and today, investors are well-informed, and empowered and many manage their finances autonomously. It will be interesting to see how artificial intelligence shapes the way we approach financial & retirement planning and investing in the years to come.

What are some of the biggest challenges facing the financial planning industry today, and how can advisors overcome them?

The biggest challenge facing the financial planning and investment industry today is the same as it has always been, the lack of full disclosure, which leads to a failure of adherence to fiduciary responsibility and compliance.

In 2009, I became the first African American to earn the Accredited Investment Fiduciary (AIF) and Accredited Investment Fiduciary Analyst (AIFA) designations, credentials awarded by the fi360 and the Center of Fiduciary Excellence (CEFEX).

The biggest takeaway for me from my fiduciary education was that brokerage firms that employ financial advisors would not allow their advisors to obtain a fiduciary designation because, in a legal dispute, the burden of proof is on the client to prove that the financial advisor is a fiduciary and therefore obligated to act in the best interest of his/her client.

In other words, having a fiduciary designation places a big bull’s eye on the back of every financial advisor and subsequently the brokerage firms that employ them.

I decided that serving as a fiduciary is not only in my client’s best interest, it is also in the best interest of my firm and the financial professionals employed by Wealthcare Financial Group, Inc.

In this regard, my motto is “A well-informed client makes for a strong and long-lasting client relationship.” Stated differently, “How much better it is to get wisdom than gold. And to get understanding is to be chosen, rather than silver.” Proverbs 16:16

For individuals with families, how can they effectively plan for wealth transfer and ensure their legacy is passed on smoothly to future generations?

The most important thing for individuals with families to do to ensure the safe and tax-efficient transfer of their estates to future generations is to come together and discuss the matter of their estate planning needs.

We have to be willing to have this important discussion because without doing so, the estate remains at risk of “shrinkage” through taxes, probate, and legal fees.

Therefore, the families need to hire a financial advisor and request assistance with estate planning. The financial advisor should be able to recommend a capable Estate Attorney and Certified Public Accountant (CPA). Together, the financial advisor, attorney, and CPA must work to outline a comprehensive plan that addresses the families’ or individuals’ estate planning needs, within the broader context of that individual’s or family’s wealth management needs.

In 5 words or less, what’s your best piece of financial advice?

Hire a Fiduciary, and #Vote!

Don’t wait to prioritize your financial health. Contact Wealthcare Financial Group today for a complimentary consultation and learn how they can help you develop a personalized plan to achieve your financial goals.