Balancing the Scalpel and the Portfolio: Investment Tips for Surgeons

As someone proficient in the precision of surgical procedures, you know that even a slight miscalculation can have serious repercussions. This surgical principle holds true for your financial well-being as well. Whether you’re an early-career surgeon starting to generate considerable income or an established professional with a substantial practice, strategic financial planning can be indispensable.

Just like you didn’t master your profession overnight, it also takes substantial amounts of dedication and time to master your finances. That is why most surgeons hire specialized financial professionals to help them – just like they hire other professionals, for example, CPAs and attorneys.

We believe there are three core principles that, as a surgeon, you need to incorporate into your financial planning and wealth management decisions:

1. Tax-Efficient Strategies

2. Risk Management Strategies

3. Legacy Planning Strategies

This comprehensive guide will look into these three core principles in more detail. It takes financial and physical confidence to live a long, comfortable life. 

Tax-Efficient Strategies for Surgeons

Many surgical professionals we work with often find managing their wealth can get overlooked due to their demanding schedules. Except for April 15th, tax planning is one key aspect overlooked the most. 

Given your current high-income tax bracket or one you expect to experience shortly, many Surgeons pay more taxes due to poor planning. We believe a well-structured tax plan isn’t merely “good to have” but rather an absolute necessity. Without a personal strategy based on your choices for various income streams, deductions, and investment opportunities, you could expose yourself to inefficiencies that can erode your hard-earned wealth.

It pays to remember every dollar of unnecessary expense is one less dollar for your future use. A little discipline now can produce big differences in the future.

Following are five tax planning strategies that our team of financial advisors dedicated to serving the financial needs of surgical professionals can help implement:  

  1. Maximize Tax-Deferred Retirement Accounts: Utilizing tax-deferred accounts like 401(k)s, IRAs, or other tax-advantaged strategies for accumulating retirement plans can reduce taxable income now and allow the investments to grow tax-deferred until they are withdrawn.
  1. Tax-Loss Harvesting: Active management of investment portfolios can be used to sell off underperforming investments to offset capital gains or up to $3,000 in ordinary income, a technique better known as tax-loss harvesting. This strategy can be particularly useful when you anticipate selling assets with gains or moving into higher tax brackets.
  1. Municipal Bonds for Tax-Free Income: Another alternative to consider is allocating a portion of your fixed-income assets to municipal bonds, which produce income that may be exempt from both federal and state income taxes. This can be a way to generate a reliable stream of tax-free income.
  1. Real Estate Investments: Real estate can serve as an investment, a source of income, and a tax shelter. You can invest in income-producing properties or real estate investment trusts (REITs) that produce rental income, which can be offset by property management and maintenance expenses and depreciation.
  1. Tax-Efficient Mutual Funds or ETFs: Another option is using mutual funds or Exchange-Traded Funds (ETFs) designed to minimize capital gains distributions, which can be taxable events. These investments can prioritize tax efficiency and fit nicely into a comprehensive investment strategy to help reduce tax expenses.

Because everyone’s situation varies, you should consider consulting an experienced financial professional who can design a custom plan containing tax strategies designed just for you. Consider this an essential step in fortifying your financial health, just as you would insist on the best strategy for your patients’ physical health.

Risk Management Strategies for Surgeons

In an environment where medical malpractice lawsuits are prevalent and can result in substantial financial loss, wealth protection should be a priority in surgeons’ wealth management and protection strategies. 

Think of it this way: without an effective risk management strategy, your financial security is at risk, and your personal property could be exposed to substantial liabilities. 

A well-structured risk management plan not only helps to insulate your finances from the volatility of legal disputes but can also protect your family, thereby safeguarding your financial well-being and theirs. 

Following are five risk management strategies that should be considered. Each of these financial tactics may help minimize risk and play a crucial role in your holistic wealth management strategy:

  • Utilize Malpractice Insurance: You should ensure you have adequate malpractice insurance coverage. While it’s a basic necessity, optimizing the type and amount of coverage can make a significant difference in safeguarding your assets. This serves as a frontline defense against potential lawsuits.
  • Disability Income Insurance: Given your reliance on a highly specialized skill set, disability insurance should be a part of your risk management strategy. The policy should offer enough income to cover living expenses and maintain your current lifestyle if you cannot work.
  • Life Insurance with Living Benefits: Term or permanent life insurance provides peace of mind for your family’s financial security and can also provide a living benefit. These riders can allow for tax-free loans against the policy, which can be helpful for estate planning and business investments.
  • Umbrella Liability Insurance: You may be targeted by certain types of attorneys due to your high income and net worth. An umbrella policy provides additional coverage beyond your home, auto, and other standard insurance policies and helps protect your assets from frivolous lawsuits.
  • Buy-Sell Agreements Funded by Life Insurance: If you’re in a partnership or group practice, a buy-sell agreement funded by life insurance can help ensure the seamless transition of business ownership. In the event of a partner’s unexpected demise, the policy would facilitate the buyout of the deceased partner’s shares, preventing potential business disruption.

Legacy Planning Strategies for Surgeons

When you think about estate planning and creating a legacy for your family, you may have unique challenges beyond simple solutions like wills and trusts. A sophisticated estate plan can help ensure that your legacy remains intact for future generations and that your financial wishes are as well-managed as the services you provide when operating on patients. 

Following are some estate planning tactics that many surgeons employ as part of their legacy planning strategies:

  • Utilize Family Limited Partnerships: Surgeons often have valuable assets like real estate or private practice shares. Using a Family Limited Partnership (FLP) can help organize family business interests while providing asset protection and tax benefits. This approach can be especially advantageous if there is a need to pass assets to future generations in a tax-efficient manner.
  • Establish Trusts for Asset Protection and Succession: Since surgeons are at high risk for malpractice lawsuits, asset protection is crucial. Revocable and irrevocable trusts can protect personal and professional assets and be effective estate planning tools. Trusts like Dynasty Trusts or Grantor Retained Annuity Trusts (GRATs) can be used for long-term planning.
  • Leverage Gifting Strategies to Reduce Estate Tax: If you anticipate having a sizable estate, you should consider gifting assets to your heirs during their lifetime. Taking advantage of annual exclusion gifts and lifetime exemption amounts allows you to transfer wealth without triggering estate or gift taxes.  
  • Charitable Remainder Trusts (CRTs) for Philanthropic Goals: A CRT can serve dual purposes if a surgeon is charitably inclined. It can sell appreciated property tax-free and provide an income stream for life while also producing a tax-deductible charitable contribution. This strategy can help manage capital gains taxes and provide a philanthropic legacy.

About Surgeons Capital Management

As a specialized financial firm deeply involved in the surgical field, we make it a point to attend professional surgical conferences routinely. Doing so helps us stay up-to-date on best-in-class strategies that are designed for use by surgeons. 

Our focus and specialization enable us to provide tailor-made wealth management solutions for you and your family.

At Surgeons Capital Management, our team boasts collective experience of more than 200 years in private wealth management. We exclusively cater to Surgeons, their families, and surgical practices.

Serving surgeons nationwide, our team of financial advisors is ready to collaborate with you wherever you are located. Connect with us to learn more about our planning, taxation, risk management, and legacy planning strategies and services for surgeons. 



Duly-registered and duly-licensed financial professionals with Surgeons Capital Management offer securities through Equitable Advisors, LLC (NY, NY 212-314-4600), member FINRA/SIPC (Equitable Financial Advisors in MI & TN), offer investment advisory products and services through Equitable Advisors, LLC, an SEC registered investment advisor, and offer annuity and insurance products through Equitable Network, LLC (Equitable Network Insurance Agency of California, LLC in CA; Equitable Network Insurance Agency of Utah, LLC in UT; Equitable Network of Puerto Rico, Inc., in PR). Equitable Advisors and Equitable Network are affiliates and do not provide tax or legal advice or services.  Surgeons Capital Management is not a registered investment advisor and is not owned or operated by Equitable Advisors or Equitable Network. 

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Surgeons Capital Management

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Surgeons Capital Management is a private wealth management firm that works solely with surgeons and surgical practices.