(For Medical Professionals) The Benefits of Business Ownership Outside of Medicine
As an in-demand medical professional, the last thing you’re probably thinking about is getting a second job. Just finding time to unwind with friends and family, take a jog, and squeeze in eight full hours of sleep probably feels like a challenge most weeks.
However, owning a business outside of the medical field while you’re still working in medicine can have some financial and personal benefits – and smooth your path into retirement.
Build Your Wealth
The financial benefits of owning a business go beyond just earning another paycheck.
As a high-income W-2 employee, your tax strategies are often limited. Recent changes to the tax code might mean you’re typically taking the standard deduction rather than itemizing. But if you own a business, you can deduct legitimate expenses related to running that business, including your home office, computers and phones, and travel.
A business can also be a good investment, diversifying your holdings and exposing your money to industries beyond medicine and health care. For example, your second business could manage real estate or consult in areas like leadership, team management, or education. Assuming you can afford to hire a CEO or trustworthy managers, you’ll oversee strategy, not daily operations, while taking home some largely passive income.
Diversify Your Work
On the other hand, if you have time to approach your second business with an operator’s mindset, you might find that it’s an outlet for skills and interests you don’t always get to explore in your day job.
Working in medicine is … well, clinical. You follow procedures. Data leads to diagnosis, treatment, and follow-up. And everything you do has to fall within the boundaries of established protocols. These limits protect both patients and practitioners. But, after years on the job, they might also make you feel like you’re stuck in “analysis mode” for most of the day. And the more specialized your area of practice and expertise, the more limited you may be in what you actually do, whom you collaborate with, and how the larger business actually operates.
A business you own can be a blank slate for your right brain. Instead of just focusing on “the patient in the room,” you can “operate” on everything from personnel decisions to marketing and design strategy.
Become the voice – or face – of your company on social media and establish yourself as a thought leader.
Dream up exciting new products and services that your clients don’t know they want – yet.
Assemble your dream team of professionals and develop a unique and empowering workplace culture that you’re excited to visit when you’re not seeing patients.
And if something isn’t going well, or if you just want a change, you have the power to keep adjusting and improving the company you own until it’s the company of your dreams.
Prepare for Retirement
In addition to that extra income padding your nest egg, being a business owner could make you eligible for additional retirement accounts, like an individual 401(k). This could give you more options for diversification and tax optimization once you’ve maxed out contributions to your other retirement accounts during the year.
Your business could also appreciate into another valuable retirement asset as well. Keep the company in tip-top shape, and it could grow into an attractive acquisition target.
Or, once you’re ready to retire from medicine, retire to the company you own. Work when you want, delegate the rest, and keep earning a little extra on the side.
If you’re interested in starting or buying a side business, let’s meet to discuss how the financial benefits and the additional responsibilities could affect your Life-Centered Financial Plan.
Investment advisory services are offered through Kingsview Wealth Management, LLC (“KWM”), an SEC Registered Investment Adviser. Insurance products and services are offered and sold through Kingsview Insurance Services, LLC (“KIS”), by individually licensed and appointed insurance agents. KWM and KIS are subsidiaries of Kingsview Partners.
