A high-earning physician finally made the decision to streamline his financials and minimize his tax burden. That first year, he saved more than $30,000 in taxes. Now he has a consolidated view of his investments, an ongoing savings and investment strategy, and understands how he can use the money for his family’s future.
One of SVA Plumb Financial’s clients, a successful, high-earning physician, likes to understand every aspect of a medical issue before proposing a solution. For years, this tendency had led him to avoid putting together a comprehensive wealth management plan simply because he didn’t have the time to dive deeply into the process. Finally, after much prompting from his tax advisor, the physician decided to take the plunge and talk to SVA Plumb Financial’s wealth management team.
In an initial analysis, the wealth management team identified several potential risks in the way the doctor’s assets were structured. Fortunately, they also saw a lot of potential.
First, team members reduced his exposure by moving excess cash out of accounts that were only insured for up to $250,000 and invested the excess to provide inflation protection. Then, they helped find and consolidate several of the physician’s retirement plan accounts. They advised the doctor to keep the high guaranteed rate plans and uncovered an opportunity for him to engage special “catch up” provisions on his contributions to two other plans. This strategy saved him more than $30,000 in taxes each year for the next three years.
Next, with SVA Plumb Financial now managing the physician’s finances, the team coordinated with his attorney to draft new estate documents—documents that hadn’t been updated since his children, now in their 20s, were infants.
The doctor also wanted to establish a charitable foundation, but instead, SVA Plumb Financial recommended putting a charitable gift fund in place, which is easier to administer and lower cost. The doctor agreed with the strategy. Now, in higher-earning years, he can allocate extra money into that fund, earn a tax deduction and later decide on the charity that will receive the funds. The doctor has chosen to fund his charitable giving for retirement during his high-income years, once again minimizing his taxable income.
Today, SVA Plumb Financial regularly meets with the physician to update his plans based on his goals and income. They make everything as easy as possible for him by handling calls with his attorneys, retirement plan administrators and other institutions to keep his assets on the right track.