How to build a financial plan that works for physicians, not just their advisers

How to build a financial plan that works for physicians, not just their advisors © Johnny Medina, managing partner, Nhabla

Physicians are among the highest-earning professionals in the country, but they are also among the most delayed in wealth building. They spend a decade in training, accumulate six-figure student loan debt and often do not begin serious saving or investing until their mid-30s or later.

Their careers are marked by high income but compressed timelines. They are responsible for complex decisions, irregular cash flow and families who rely on them. Many enter financial planning conversations already behind, and too often, the guidance they receive is built around general rules, not the structure of their actual lives.

A plan that works for physicians must start with how they actually live and build from there.

To build a financial plan that actually works for physicians, there are six key elements that must be present. Each of them addresses a structural need that reflects how physicians earn, think and live.

Clarity over complexity

Physicians are highly intelligent, but that does not mean they have time to become financial experts. In fact, their cognitive load is often maxed out. Long shifts, high-stakes work and personal obligations leave little room for decoding financial jargon or reconciling scattered accounts.

What they need is not oversimplification but coherence. A plan should make it clear what they own, why they own it and how it serves their goals.

Many physicians enter planning with accounts accumulated over time, such as workplace retirement plans, IRAs, brokerage accounts and insurance contracts, often with no overarching design. A strong plan organizes these moving parts into a structure that makes sense, connects to their priorities and gives them the confidence to act.

Flexible tax structure

Tax deferral is often a default, especially early in a physician’s career. Employer plans and traditional retirement accounts offer up-front savings that feel intuitive. But over time, this can create a future tax problem.

In retirement, these accounts are taxed at ordinary income rates. Add in Social Security, pensions and required distributions, and many physicians find themselves in the same or even higher brackets than when they were practicing. What seemed like a smart savings decision becomes a limitation.

A more strategic plan balances pretax, Roth and taxable accounts. This creates optionality, allowing for flexible income sourcing, better tax bracket management and smoother adaptation to future policy changes.

Asset location

Physicians often focus on what to invest in. Less attention is paid to where those investments live. But placement matters.

Tax-inefficient assets like bonds or actively managed funds can generate avoidable annual tax bills if held in taxable accounts. The same investments placed in IRAs or Roth accounts can perform better simply by reducing drag.

This concept, known as asset location, helps protect returns without altering the risk profile of the portfolio. Physicians who apply it often improve after-tax outcomes with no additional complexity. It is one of the rare financial levers that creates value through design, not sacrifice.

Liquidity planning

Liquidity is particularly important for physicians in private practice or those whose income arrives unevenly. Deferred bonuses, quarterly distributions and lumpy reimbursements make steady cash flow harder to manage.

Even those in employed positions may face significant expenses such as supporting aging parents, paying estimated taxes or navigating a career transition. If assets are locked in retirement accounts or tied up in real estate, options become limited.

A thoughtful liquidity strategy provides accessible capital without disrupting long-term goals. It allows physicians to act when opportunity or challenge presents itself. Liquidity is not just about emergencies. It is about control.

Goal alignment

Traditional financial planning assumes a clean path: accumulate, retire, withdraw. But physicians live on a different arc.

Some want to slow down before age 60. Others want to teach, write or shift into consulting. Many do not want to stop working entirely. They want more freedom in how they work. For others, goals revolve around supporting children, launching a business or simply buying back time.

When financial planning is centered on these lived goals, it becomes more than a numbers exercise. It becomes a support system for what matters. Aligning a plan to values makes it easier to stick with and more likely to produce meaningful outcomes.

Planning is not a product

Physicians are used to systems, not one-time checklists. Financial planning should be no different.

A binder full of projections is not a plan. Life shifts. Tax laws change. Goals evolve. Planning must be continuous. It should create a rhythm of review, reassessment and refinement.

Physicians who engage in planning as an ongoing process gain clarity, reduce decision fatigue and respond to life with greater intention. The value is not just in the outcomes. It is in the confidence that decisions are grounded in strategy.

Conclusion

Physicians deserve more than a financial script designed for someone else. They deserve a structure built around how they actually live and what they genuinely want.

When planning is done right, it brings order to complexity, protects what matters and creates space to imagine something better. It is not just about how much a physician earns. It is about what that income allows them to build, support and reclaim.

That is what financial planning should be: not a product, but a system designed to serve the people who serve others.

Johnny Medina is Managing Partner at Nhabla, a fiduciary wealth firm serving physicians, federal executives and other mission driven professionals. He serves as Portfolio Manager for the firm’s investment strategies and holds a Master of Science in Finance from Johns Hopkins University.