How to Ban Financial Failure

What would you do if you found yourself without the resources you expected at retirement? Unfortunately, the prospect of financial failure at retirement is high – if you don’t plan properly. Here’s how we help our clients avoid financial failure in their golden years and how you can plan ahead to ban financial failure, too. 

Don’t Rely on the Best-Case Scenario

The problem with many financial plans, and much of the financial advice you hear in the media, is that it’s based on the best-case scenario. The underlying assumptions are that the market will keep increasing and give a consistently high rate of return; favorable tax laws won’t change; you will continue to earn the same income you currently do, or more, until retirement; and that until retirement, you and your family won’t encounter a crisis that requires a large amount of money to resolve. 

But we all know that life is unpredictable. We can follow all the rules and do all the right things and still face unexpected challenges that turn our plans upside down. That’s why the best way to avoid financial failure is to have a contingency plan. 

Have a Contingency Plan 

Having a contingency plan assumes that some unexpected things will happen in life. It doesn’t rely on the best-case scenario but instead takes into account the fact that there will be detours along the way. We work with our clients to create a Financial Treatment Plan that is built to be successful under all circumstances. We do this by stress-testing situations before implementing them in order to see if they are a good fit for the Plan. We call it evidence-based financial planning. The best part is, we structure it in a way so that there’s no cost differential compared to a plan that’s built on the best-case scenario only. 

Having this kind of robust plan means our clients don’t have to be reactive when something unexpected occurs, such as a market crash or health crisis. Instead, they have peace of mind knowing they’re still on track for the future. 

Failure Cannot Be an Option

It’s understandable why so much financial advice is doled out based on the best-case scenario – it’s easy to sell. But it’s simply not realistic for many people. None of us have a crystal ball to see what life has in store for us. That’s why we need to take all adverse circumstances into account when planning for the future.

If you want to learn more about how we help dentists plan for their future, you can find out more on our website or in our upcoming book, Your Retirement Smile. You can take control of your financial future – we can help.

Take control of your retirement

The Goal Standard of Guaranteed Retirement Income

One of the most important things our clients want is as we go through the financial planning process is guaranteed retirement income. This is a big goal but it’s also an achievable one. We develop a Financial Treatment Plan for the dentists we work with that do just that, built on a solid foundation of three key elements. 


Maximum Protection 

Read: insurance. This includes having full auto, homeowners, liability, disability, health, and life insurance in amounts that fully cover you in case something unexpected were to occur. Some dentists we work with balk at this step because they don’t want to spend the money on the insurance premium. However, a single terrible accident or event could wipe out all your financial resources if you’re not insured. That’s why we consider it the first key foundational piece in your strategy for guaranteed retirement income.


Savings Rate

This second cornerstone requires discipline. We tell our clients that they must be disciplined and put aside 15% or more of their gross annual income. So if you bring in $300,000 per year gross, you should be saving $45,000. Is that a lot? Yes! But that’s what it takes to create the foundation for guaranteed retirement income. It’s the minimum to offset inflation, taxes, standard of living increases, and other wealth-eroding factors. Ideally, the savings rate would be even higher than 15%. 


Cash Liquidity 

Finally, we come to liquid cash in the form of CDs or checking, savings, or money market accounts. It’s important to establish this cash reserve even before putting money into retirement accounts. We advise our clients to have 50% of their yearly gross household income liquid. A dentist who makes $250,000 per year gross, for example, should have $125,000 easily accessible. 

This is just a brief overview of foundational pieces of the Financial Treatment Plans we develop for the dentists we work with. If you’re interested in learning more about planning for guaranteed retirement income, look out for our upcoming book, Your Retirement Smile or visit our website. We help dentists plan for their future and we’d love to help you.