Lawrence B. Keller, founder of Physician Financial Services in Woodbury, N.Y., works with advisors in a state where "going bare" isn't possible. His firm works with mostly younger doctors, and focuses on strategies that include the use of estate planning, insurance, tax planning and investment management.
"Physicians today aren't like those in the past, who knew that if they saw enough patients the income would be there," he says.
"High-Maintenance" Dentists
When Jake Jacklich retired from the Navy last year and became a
financial planner, he decided he needed a specialty. He eventually
chose dentistry-partly due to having a father who is an endodontist.
But there was another reason: He found very few advisors were focusing on the area.
"The general consensus is they are high-maintenance clients," Jacklich says.
They have a reputation of being very inquisitive, he says, inclined to delve deep into why advisors may choose a particular investment or strategy. "They ask a lot of technical questions," Jacklich says.
Whether or not the reputation has merit, Jacklich sees a clientele
encountering a number of issues that beg for help from an advisor.
Among them are the rising costs of operating a practice and a general
lack of retirement planning, including exit plans for when they retire
and sell their practices.
With only a handful of dentists on his client list thus far, Jacklich
sees opportunities ahead. "They are good clients," says Jacklich, a
financial planner with Waddell & Reed Financial Services in
Virginia Beach, Va. "They know that they are experts at medicine, and
generally want my help and appreciate the work I do for them."
At least one other advisory firm sees dentists as a lucrative market
and has devoted significant capital to serving the market. Mercer
Advisors, a Santa Barbara, Calif.-based company that was created in
2001 through the merger of Mercer Global Advisors and dental consulting
firm ExperDent Consultants, currently has about 3,000 clients, mostly
dentists and doctors, and about $3 billion under management.
During the last five years, however, the company has focused its growth
strategies on the dental market-an effort that focuses on providing
practitioners with comprehensive services ranging from financial
planning, investment management, estate planning and practice
management.
As part of that effort, Mercer Advisors last year acquired Financial
Vision Advisors in Atlanta, a dental specialist advisory firm founded
by former Financial Planning Association President Elizabeth Jetton.
The company also is constructing a 40,000-square-foot dental education facility in Scottsdale, Ariz., that will offer dentists training in the latest dental clinical procedures, says Gene Dongieux, one of four co-owners of the company and chief investment officer. A major reason the company has shifted its attention to dentists is because of the limited earning potential of doctors, Dongieux says.
The dental market, however, isn't hamstrung by managed care companies and stands to see an increase in earnings because of the dental needs of aging baby boomers, he says. "What we have done is we have focused on the most complicated financial problems that these groups of dentists have," he says of the company's services.
The company consists of three entities, he notes: Mercer Advisors, which provides investment management and financial and business planning; Mercer Transitions, which provides services for dentists looking to transition into a partnership and Mercer Mastery, which provides dentists with practice management services.