Misdiagnosis = Misprescription

More Money Does Not Solve Your Problems

Picture of by Dr David Phelps

by Dr David Phelps

“The majority is going to have a higher failure rate than we've ever seen before. 

 The decision to follow or disregard the majority's thinking is up to each of us.”

Being misdiagnosed and, therefore, prescribed the wrong treatment does not just happen between patients and doctors. It occurs often and may be occurring with your financial security and financial goals. So, how do you know if your financial advisor, wealth manager, or whoever advises you is accurately diagnosing your problem?

The Dangers of Self-Diagnosis. Seek Expertise.

Our schooling, training, and clinical experiences taught us how vital it is to refine our diagnostic skills to the best of our ability. It’s not until we can diagnose the true issue of a patient that we can offer the right prescription, treatment, or course of action. 

But how often does a patient come in with a chief complaint saying, “It's this tooth. I need this tooth fixed, etc.”? After examining the patient, you find it’s actually the adjacent or opposing tooth from the opposing arch. Or perhaps a patient feels like they have an upper tooth problem and want a tooth taken out only for you to find that they have a sinus infection?

There are all kinds of issues that people try to self-diagnose. Often, they are untrained and inexperienced, leading to misdiagnosis. Therefore, if most followed their own treatment, it would not lead to their desired outcome. That’s the reason to seek a professional – an expert in the field with experience and knowledge.

This also applies to your finances. Yes, there are many professionals out there like financial advisors and money managers who help clients with money management and retirement planning. But there are two things you should know about financial advisors before doing exactly as they advise.

  • 1. Financial Advisors Are Only Experts in One Area

I'm not saying financial advisors are bad people or that they're intentionally misdiagnosing. They just don't have a full breadth of the investments that they can offer to their clients.

They only study one area: traditional financial markets. Most financial advisors don’t study alternative investments like real estate. Since it’s not an area of their expertise, it’s not an area offered to clients. 

  • 2. Many Financial Advisors Lack Sufficient Experience

Improper diagnosis in the financial realm can occur due to insufficient experience/time in the market cycles. Most financial advisors today weren't working during the 60s and the 70s when we had stagflation and interest rates went as high as 20%.

They are only familiar with an economic environment of falling interest rates and massive federal stimulation that has kept the markets going up. Their confidence and trust is in the Fed coming to save the day.

Go back enough times in history, and people who have been around long enough (earned expertise) have learned not to trust the federal government. There’s precedence, and there’s no preventing the inevitable. The Fed does not control the economy. It will catch up to them no matter how much they try to manipulate it.

There are many reasons a misdiagnosis can occur but the most prevalent one today is a lack of experience and exposure to markets. This is why most financial advisors fail to offer or know what a client truly needs in allocating capital, reaching financial goals, or reaching any other goals that depend on said financial goals.

Many Are Prescribed Incorrectly For Their Financial Goals

In my experience, many high-income and high-net-worth individuals who would like to find an exit plan from their active income or at least the ability to slow down at some point have never been given an accurate diagnosis, therefore the correct prescription has not been given.

How do I know that? People in their 50s and 60s are calling me, having very little to show for 20, 30, and sometimes 40 years of hard working experience.

To clarify, it’s not all the fault of their financial advisers. Sometimes, these individuals didn't even work with one until the last few years. The issue remains that what advisors offer is not the solution.

Sometimes, the problem is the doctor, the high-income earner and the highly specialized professional, didn't take the time to understand that they needed something more in their financial health. Therefore, the doctor just followed the crowd, thinking it was enough. Or they thought they would have more time to catch up before their retirement age.

Having a better understanding of finances, even with no formal study in college or thereafter, and understanding the benefits and risks of tangible assets gives you a wider range of opportunities. It also affords you greater confidence in listening to experts but making your own decisions. 

Tangible Assets Is Where I Found My Investment Success

Tangible assets are where I have the best opportunity to navigate my capital today and what I’ve done successfully for over 40 years now. It allowed me to leave my active income from clinical practice almost 20 years ago when I was in my 40s.

I was curious and learned an additional skill beyond my clinical skill set at a young age. I delved into finances and investing in tangible assets like real estate. Now, it's not the only game in town, but it's one that works very well. 

Investing in real estate has helped me and the hundreds of other dentists and couples I mentor to find their freedom path and get there sooner rather than later.

It’s what I love to do today. I don't work. I just have a passion for giving back. When you get to a point where finances don't really matter anymore, that’s when you find your true purpose and meaning.

I’m certainly not the wealthiest person in the world but when you have enough and know how to make your capital work whether in a recession, an upmarket, or a sideways market your focus can be devoted more fully to what you love.

Today, I love helping people overcome the uncertainty of “How much is enough?” and “Where do I go from here?” and learn how to take their equity from wherever it is today and put it in a coordinated game plan that allows them to make the moves to their transition to more freedom in their life. That's what I love to do through the community of Freedom Founders.

How To Get An Accurate Diagnosis

The options we’ve covered that do not work are self-diagnosing and diagnoses from insufficient experts like financial advisors. So, if you can’t do it yourself and an expert can’t do it without error, then what’s the solution?

It’s a combination of the two, but it requires brutal honesty regarding your situation, clarity on your goals, and experts you work with (the key is in cohesion) who have done it many times before and can give you the breadth and scope of a different model than what the herd mentality goes for.

A guide should be one who has successfully used a path to reach a destination and who knows the pitfalls, the dangers, and how to avoid them. 

Has your current financial guide achieved the Freedom and the lifestyle that you desire? If not – be wary. 

The majority is going to have a higher failure rate than we've ever seen before. The decision to follow or disregard the majority's thinking is up to each of us.

But, if you keep doing what you’re doing – as successful as you might be in certain elements of your life – you likely will not obtain the results you truly desire (hint: It’s not about a pile of cash at the end of your life).

Hard work and longer hours are not sufficient unless that's what you want to do for the rest of your life. Is that truly what you want? The choice is yours.

To your freedom!

– David


P.S. Whenever you’re ready, here are some other ways I can help fast track you to your Freedom goal (you’re closer than you think) :


1. Schedule a Call with My Team:

If you’d like to replace your active practice income with passive investment income within 2-3 years, and you have at least $1M in available capital (can include residential/practice equity or practice sale), then schedule a call with my team. If it looks like there is a mutual fit, you’ll have the opportunity to attend one of our upcoming member events as a guest. www.freedomfounders.com/schedule

2. Become a Full-Cycle Investor:

There are many self-proclaimed genius investors today who think everything they touch turns to gold. But they’re about to learn the hard way what others have gained through “expensive” experience. I’m offering a free report on how to become a full-cycle investor, who knows how to preserve and grow capital in Up and Down markets. Will you be prepared when the inevitable recession hits? Get your free report here.

3. Get Your Free Retirement Scorecard:

Benchmark your retirement and wealth-building against hundreds of other practice professionals, and get personalized feedback on your biggest opportunities and leverage points. Click here to take the 3 minute assessment and get your scorecard.

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