I will be the first to admit that I have a soft spot in my heart for any physician writing on financial or business topics. As such, I was pleased to receive several review copies of Brandon Bushnell’s A Doctor’s Basic Business Handbook: Things I Wish I Had Known When I Got Started. I had the opportunity to read the book on a recent long road trip. Actually, I read the entire book over about 75 miles between Holbrook and Payson in Northern Arizona. There are just 68 double-spaced pages in this introductory book on a variety of physician-specific financial and business topics. He includes a list of additional resources at the end of the book, including The White Coat Investor: A Doctor’s Guide to Investing.
I really enjoyed the book, and not only because it was short enough that I could finish it before sunset on the same November day we explored two national parks and donated $20 to the Navajo Nation in order to pose for a picture at Four Corners. In the introduction, he mentions he developed most of the book as part of the curriculum for the Winter meeting of The Arthroscopy Association of North America. As I read that it dawned on me that I had heard Dr. Bushnell speak last Winter, at Snowbird, the ski resort up the road from my house. You see, I snuck into a session of that meeting at the invitation of his co-speaker, Tom Martin, who is not only Dr. Bushnell’s financial advisor, but also a principal at Larson Financial. [Disclosure: I’ve done some paid consulting for Larson and they’re a paid advertiser on this site.)
Yes, that’s correct, a medical group held its meeting 8 miles from my house, included a financial lecture, and didn’t invite me to do it. Why my speaking invitations seem to always require two days of travel instead of 12 minutes of travel and an afternoon in the powder is beyond me. I probably would have done that one for a couple of lift tickets instead of my usual multi-thousand rate. I’m not sure what Dr. Bushnell got paid to speak, but I’m confident Larson Financial made out well judging by the number of orthopedists rushing to sign up with them after Bushnell’s enthusiastic endorsement. The entrepreneur in me has to acknowledge that as a brilliant marketing move, but more on that later in my single criticism of the book. First, let’s talk about the many things this book does very well.
A Primer On Negotiating Contracts
Brandon Bushnell, MD, MBA
I think every doc owes it to himself to read a book on contracts (preferably a specialty-specific one) at the beginning of his final year of residency, and re-read it every time he changes jobs. The first chapter of A Doctor’s Basic Business Handbook is all about contracts. It isn’t quite as much as you’ll get out of a book dedicated to the topic, but it’s a darn good summary. It covers almost all of the important points, such as term, termination, pay and benefits, enforceability, restrictive covenants etc. If he had briefly touched on the importance of malpractice coverage (specifically who pays the tail) it would have been perfect. The best part of the chapter, however, is at the end when he talks about negotiating, especially the importance of the BATNA- Best Alternative To a Negotiated Agreement. Far too many doctors just don’t get this. The way you “win” a negotiation is by having another great offer that you’re willing to take, and playing them off each other. Bushnell says it like this:
The BATNA is your proverbial Plan B option if things in the negotiation simply do not work out between you and the other party at the negotiating table. If you are negotiating an employment contract with a potential employer, then your BATNA might be a job with another employer in the same market or in another town. If negotiations are not going your way, and you know that your BATNA is perhaps a better deal than the one developing at hand, then you can confidently walk away from the negotiation. On the other hand, if you don’t know what your other options could be, then you hold a much weaker position in the current negotiation.
One party always has a better hand in any negotiation. The way you make sure you have the best hand is to make sure you have another option acceptable to you in your back pocket. Then you have all the power- they either meet your demands or you leave. Either way, you win.
A Great Book for Orthopedists
One place in which this book particularly excels is that nearly all of the examples used and advice given is 100% applicable to orthopedists. A doctor of any other specialty can still apply much of it to his own situation, but I learned a ton about the business of orthopedic surgery while reading it. For example, one of the things I never knew (and you surgeons are going to laugh that I didn’t know this) is that there are procedures that insurance companies will only pay for if you do them in the hospital and others they will only pay for if done as an outpatient. Of course, those lists are different for different insurers, so be sure to be familiar with the lists for the procedures you do and the insurances you take, lest you find yourself not getting paid because you did the right work in the wrong OR.
You should also realize that Dr. Bushnell looks at life through the eyes of an orthopedist, so don’t feel too offended when he throws out figures like $500K a year for a brand new residency graduate and $5000 a night just to take call. We all write from our own perspectives, I suppose, but an acknowledgement that the average physician is making less than half that (and not getting paid at all to take call) may go a long way with some readers.
Industry and Hospital Relationships
I really enjoyed the third chapter, which is about establishing proper relationships with industry and the hospital. This is something I rarely see discussed in financial books, even physician-specific ones. Granted, this is a far bigger issue for orthopedists than for emergency docs, since I can’t seem to find a drug rep for Keflex and Percocet to come buy me lunch. This chapter contains a great discussion of Stark Laws and Anti-Kickback laws (and no, they’re not the same thing.) It also discusses the relatively new Sunshine laws (you know, the ones that report online the $12 lunch someone bought you and the $20 you got for doing a survey on Sermo.) The last part of the chapter is about the medical staff, with three pages discussing how to get paid to be on call. No wonder orthopedists are usually the first specialists at a hospital to get paid to take call.
Coding, Billing, and Pricing
I also enjoyed the fourth chapter. It’s always tough to write about coding and billing in anything but your own specialty, but I thought the book did a pretty good job on a tough topic. It was fairly procedure heavy, and didn’t go into as much detail on Evaluation and Management codes as I would have liked to see, but again, I learned some things about coding procedures I didn’t know previously. (By the way, excisional debridements pay a lot more than incisional debridements.)
Marketing Your Practice
The best chapter in the book is the fifth and final one, about marketing your practice. It was excellent, especially his first point. This is another one that is completely true, but far too few doctors realize it. He says step # 1 is “Be Nice.” As someone who refers patients to a doctor a dozen times a day, what he says is absolutely true. Treat me like a jerk when I need help in the ER and you’ll find yourself only getting self-pay, drunk jerks who threaten to sue everyone (while the nice, sweet-smelling, insured folks go to the other group.) The whole chapter is filled with pearls.
My Sole Criticism
The second chapter, on personal finances, could use a lot of improvement. It read like the typical doctor-specific finance book written by a financial advisor, rather than by a doctor. While I thought tip # 1 (Don’t act rich) was right on, the rest of it was pretty much useless, lacking any specific advice. For example, the paragraph (yes, a single paragraph) on Debt Management didn’t mention refinancing, IBR, PAYE, REPAYE, or PSLF. The Investing Section (two paragraphs) didn’t even really mention anything about investing except that you should hire an advisor to do it for you. In fact, that is a major theme of this entire chapter. I suppose that’s fine, since 80%+ of physicians not only want a financial advisor, but probably should use one. The problem is, if the main point of your chapter on personal finances is “Hire help” you ought to spend a significant amount of time teaching people how to do so. I think this may be a result of Dr. Bushnell’s experience. His advisor, Tom Martin, while nowhere near the least expensive option out there, is a pretty darn good advisor.
First person to name this National Park in the comments section automatically wins a book!
Perhaps Dr. Bushnell assumes that most advisors are like Mr. Martin. Unfortunately, hiring an advisor giving good advice at a fair price is far more difficult than one would assume after reading this chapter. In many ways, by the time you know enough to recognize a good one, you know enough to do the work yourself. This chapter could have been dramatically improved with a lengthy discussion of how to hire a good advisor, an acknowledgement of the fact that good financial advice is expensive, even when offered at a fair price, and perhaps even a discussion of the fact that it is possible to do much of it yourself with an appropriate amount of discipline, interest, and easily acquired knowledge. I also think it probably would have been better if he had disclosed that the book he enthusiastically recommended on page one of the chapter was written by his own financial advisor and speaking partner, but there was certainly no legal requirement (and many would argue, no ethical requirement) to do so.
While any regular reader of this blog can skip the entire second chapter, the rest of the book more than makes up for it making the book well worth the price of admission (<$15 and 2 hours.) To make matters even better, Brandon sent me five review copies, which were given away to readers who posted comments within a few days of publication of this post.
[Update 2/23/16- Drawing has been held. Winners have been notified. The rest of you will have to buy it!]
If you didn't win, buy A Doctor's Basic Business Handbook on Amazon today!
What do you think? Have you read the book? What do you wish you had known when you left your training? How did you learn how to interact with industry and the hospital? What do you do to market your practice? Comment below!
Sounds like a good read, and I’m in Orthopedic surgery fellowship about to sign a contract.
Sounds like a good read!
Thanks for the post.. and.. I would like a book…
Ha! I love these reviews. Put me in the drawing for a book!
As a newly graduating resident, I think this is a huge part of medicine in general that isn’t taught AT ALL. It’s learning as we go. But I’m actually going to start a practice with my partner after I graduate and think a book like this could really help.
There’s more to a business than money and more to medicine than medicine, unfortunately.
Thanks for the critique – The more physicians I can learn about being successful, the less likely I am to burn-out…already!
Ps…is that Canyonlands National Park?
Escalante.
Free stuff.
How about canyon de chelly national monument, spider rock?
book please.
Have only ever been to Grand Canyon, so totally a shot in the dark.
Not even gonna try to name the park. My traveling experience is limited to the Midwest.
But would love to be included in the book drawing.
sounds like a great book
Thanks for the helpful review!
My guess for the photo is Capitol Reef national park.
Sounds interesting – would love to win a free copy!
Great review from this very helpful website. Keep up the great work. I would love to be entered for a book.
Thank you for the helpful review. I curious to get your thoughts on this: in the near future, can sufficient knowledge about finance can be sufficiently obtained by an individual’s self-study based on their financial interest plus everyday practical exposure to the business of medicine in our daily work as MDs (as in your book)? Or, is an MBA (as in the author of this book) becoming more and more of a necessity to be able to safely manage business nad personal financial life as an MD?
Good to see you on the site Jason. I don’t think an MBA is required in any way, shape, or form. The nice thing about tailoring your own education is you only spend time and effort on items that apply to your situation. An academic course, by its very design, is going to include stuff that you don’t need or want to learn.
In your situation, of course, and perhaps mine, an MBA would increase your credentials and perhaps make people pay a little more attention to what you say. I’m sure you would learn some useful stuff in the MBA as well. But required? Not even close.
Great. Thanks for the advice. Hope all is well!
oh and in case you have to specifically mention it, I would like to be entered for the book drawing as well 🙂
MBA is almost never necessary; this coming from one with these credentials. If you can’t resist, try auditing a night business class at a local college. Then decide.
Good to know. So what made you decide to pursue the MBA? Was it as Dr. Dahle mentioned – “increase your credentials and perhaps make people pay a little more attention to what you say”
Satisfied a personal interest. Also consider more targeted advanced studies for unique institutional needs: (medical informatics, pensions/finance, taxation/LLM, etc.). MBA might be the best for small/solo practice, still not necessary, though.
book
How does it compare to: “Physician’s Guide: Evaluating Employment Opportunities & Avoiding Contractual Pitfalls” ?
The book reviewed in this post is much broader and shorter.
They should make this stuff part of the required residency training.
Monument Valley? This book sounds concise and helpful
Thanks for the helpful review.
Thanks for another great and detailed review…I need Norco and Bactrim reps…lots of hypodilaudidemia and “spider bites” to treat in the Midwest!
Thanks for the review, will check it out.
Would love a copy of the book.
Thanks
Another very helpful post- thank you! And KMFC for book drawing 🙂
WCI, I’m starting to feel like you have more conflict of interest with Larson Financial than you let on. It’s good that you make mention of the fact that you have been paid by them and refer business to them through this site, but you also casually drop in the fact that 80% of people probably need an advisor, and mention how great Mr. Martin’s advice is despite being very expensive.
I understand you run this as a for-profit business, but from the outside I feel that your COI with Larson Financial has become significant enough that any mention you make of anything in relation to them in a positive manner needs to just be tossed out the window. It doesn’t mean you aren’t speaking the truth, but you know quite well that their firm dramatically overcharges in regards to their AUM fees (and in my case the Larson’s themselves breached our contract).
You need to be very careful of your casual mentions, even unintended, because you are reaching the point in popularity where just the mention of Larson in this post is going to be driving them business that is not warranted or justified. It seems like the more likely outcome of this book review will be to drive Larson more business, not get people to buy the book.
Just to clarify my own comments as well — you’ve made it clear through this blog you DON’T think that most doctor’s actually need a financial advisor to manage their money, and you have also made it clear that you think no one should be overpaying for asset management.
Your implications in this article from this article is that physicians should go pay for advice, and if they have to overpay for someone they consider to be a good advisor then they should do so. I think that runs contrary to the entire spirit of your blog.
I’m not sure I understand where you’re drawing implications from. First, let’s be clear about where I stand on financial advisors in general, then we’ll talk about Larson specifically.
# 1 Most doctors are going to benefit from an advisor because they do NOT read this blog, do NOT read any financial books, pay ZERO attention to their finances etc. For any reasonable sum, if they’re exchanging it for GOOD advice, they’re going to be better off. I bet this is 80% of doctors. William Bernstein estimates it at 99%. Don’t believe me? Go talk to your colleagues. Most of MY partners want and need a financial advisor and they could sit down with me at any time for free and pick my brain.
# 2 Physicians can manage their finances just fine on their own if they have a reasonable temperament and will put in the relatively minimal time and effort required to learn how to do it and the time and effort required to actually do it. Many readers of this website, certainly all the regular readers, and even many of the casual readers fall into this category. I do. I bet you do too. The money saved not paying for advice will make these doctors richer and will help them reach financial independence sooner.
# 3 If someone is going to hire an advisor, the most important consideration is to get good advice. The second most important consideration is to get that advice at the lowest possible price. In many ways, you GET what you DON’T pay for.
Now, let’s talk about Larson specifically.
I’m very much aware of your experience with Larson as you have mentioned it to me on multiple occasions. I’m sorry you had such a rotten experience. I know you’re sorry and I’m sure they’re sorry as well because in some ways you’ve now become an “anti-Larson advocate” to anyone you come into contact with in real life or online. It’s obvious to me after interacting with you that you, like me, are a do-it-yourselfer at heart and no advisor would have ever measured up to your expectations. I don’t fault you. I’m the same way. That’s why you and I don’t currently use any advisor. But your level of financial expertise is dramatically different from that of the average physician.
I’m not worried about “driving business” to Larson for a couple of reasons.
# 1, they’re a paid advertiser on this site. I’m supposed to drive business to my advertisers. Otherwise, what’s the point of them purchasing advertising? I don’t see that as a problem. All my financial conflicts of interests with them are disclosed and they have zero control over the content on this site. Let’s review my financial conflicts of interest with Larson Financial again for anyone interested:
A) Paid advertisers on the site
B) Have bought up/partnered with other paid advertisers on this site they met through this site increasing the value of all of their businesses
C) Pay me consulting fees
D) Buy me airline tickets, hotel rooms, meals, movie tickets etc when I’m out consulting with them.
E) We’ve worked on several projects together. Some of which have panned out and some of which have not. We’re currently working on another one and if it works out, you’ll eventually hear about it on the site.
I’m not sure I can disclose financial relationships any better than I have with this particular firm.
I have similar relationships with other financial firms I have vetted. This website is a for-profit institution and has been since day one.
# 2, I think Larson is a good firm and throw them into the category of “good advisors.” Are they perfect? Absolutely not. Are there less expensive options particularly for asset management? Absolutely. Are they charging more than industry averages? Not really. Did they, at least in the past, have a lousy process for selling VULs to people who may not need them, want them, have understood them, and been committed to holding them until death? Absolutely. Has that been fixed? I’m convinced it has been.
Regarding Mr. Martin, I know him personally. As I recall, I don’t think you do as he was not your particular advisor. I think I’m a pretty good judge of an advisor’s competence. I judge Mr. Martin to be competent and in fact far better than the vast majority of advisors, including fee-only advisors and including physician-specific advisors. He’s got a practice full of physician families, has appropriate credentials, was educated at prestigious institutions and knows what the heck he is talking about. What more do you want in order to judge an advisor as competent? Of course, you can’t really hire him since his practice is pretty much full. If you go to Larson, you’re going to get a different advisor who may not be as competent. But that’s a challenge any advisory firm faces.
I met Tom Martin and he is actually one of the nicest guys you can meet.. the heart of a teacher and really passionate to educate physicians on personal finance and wealth building. I almost signed with them 3-4 years ago.. but their initial “fee-only” charge as they would tell you at the first dinner turned into an AUM fee when we were about to sign an agreement with them. And this was after a 1-2 hour signing a contract.. you think we were doing a mortgage?! The AUM fee was not stated upfront and only stated in the contract at the very end? We backed out. And that was one my turning point to educate myself on personal finance.
I agree with WCI… most physicians do not know or care to know much about personal finance and they’re probably better off with someone else hand holding them.
As a general rule, an AUM fee is considered “fee-only”.
My experience… they initially stated to us a flat $400-500 every quarter and would “refund the fee” if they couldn’t show how they saved us that amount or more within the prior quarter. AUM was not mentioned until literally the very end of signing an agreement? Perhaps my miscommunication…?
Sorry… logged in for the forum… Im both ST and Sajimone for clarification.
Obviously I don’t work for the firm, control their rates, or control their practices. I can tell you this though- you’re going to have a very hard time finding a firm willing to do your financial planning and investment management for $1600 a year. I suspect the $400-500 a quarter was a financial planning fee and didn’t include investment management. Financial advice/services is just really expensive stuff. I’ve been cheering on some hourly-rate physician specific advisors but have watched them raise rates from $75 an hour to $150 an hour to $200 and hour and still struggling to be really successful financially.
I can also tell you this, investors who are very fee-sensitive don’t tend to do well with any financial advisor long-term. I include myself in that category. Advisory firms generally want docs who don’t care they’re paying 5 figures a year to someone else to take care of this. And those docs who are happy with their service, also don’t care that they’re paying 5 figures a year to get this off their plate.
Sorry, was traveling the last few days so could not respond.
First so my views are clear — you are running a privately held business and you can run it as you want. If you want to change the name of the blog to “White Coat Investor Sponsored by Larson Financial and Hosted by GoDaddy” and put 10x the advertisements on your website that’s your prerogative. I think you run a great service here that I personally profit from tremendously, primarily for free, on the backs of those who click on those advertisements and sign up with Larson et al.
To add more background on my own perspective on financial planning and Larson (this is a summary, not all details). I don’t know Tom Martin and can’t/won’t comment on him.
-I signed up for Larson as a PEM fellow to make sure I was on the right track (I was fine re: investments, questions on other things). I worked with Jeff and Paul Larson
-I received great advice on disability insurance and estate planning
-I signed up for their investment management just because they were helping with everything else, not because I needed it
-Larson frequently justifies their high AUM fees by having access to DFA funds, and Jeff Larson repeatedly told me that net of fees their asset management would outperform what I could do on my own because of DFA access. Whenever I asked for proof of that I was told there was no way to provide an apples-to-apples comparison. I was also then told that I was paying for convenience not performance.
–I asked a lot of general questions for advice such as contract negotiations, refinancing questions, etc. When I would go long periods without any answers I would complain.
-Jeff Larson then decided that my “expectations” were not realistic and said that I could have “15 minutes every quarter” to talk with him and that was it.
-Jeff also then tried to double charge my contract fee and blatantly violated our contract. When I called him and Paul out on it when we terminated our working relationship, they clearly wanted me to go away and at my request refunded me part of the $1,500 I had paid them from the initial contract (not the AUM fee).
-Overall when I DID get advice from them it was of good quality. However the Larson’s themselves were poorly prepared for our meetings and usually had the paraplanners do all the work, and Jeff in particular clearly never reviewed notes from prior meetings as I frequently had to correct him on things we had already talked about and which had been ignored.
-The paraplanners changed frequently so I could not maintain a working relationship with anyone. I repeatedly asked to be informed if my paraplanner was departing (it happened twice) and they never actually acknolwedged my request.
Assertions I disagree with, also coming from a different background:
-I still ask for advice all the time. Sometimes I pay someone, sometimes I ask people and get it for free. There are very few if any doctor’s who DON’T need to ask for advice.
-In academic medicine (where I am), with lower salaries, I don’t think we make enough to blithely throw away 5-figure numbers a year to spend 1 hour rebalancing an account when Vanguard can do it for 1/10 the price or I can do it on my own for free. I will pay for other pieces of advice, but I consider it irresponsible to recommend someone pay Larson for basic retirement planning unless they are just getting started. Once they are on the right track then they should leave the Larson AUM fees behind and pay 1/10 the price for someone else to do it if they don’t want to do it themselves. Basic retirement and taxable investment account advice is the easiest to find and available close to free and it’s where most doctor’s waste most of their $
-I work with trainees almost every single day. The 99% from Bernstein or the 80% you quote of doctor’s that don’t want to deal with this may have been true 10 years ago but I do NOT believe it is true of current medical students or recent med school graduates.
-This current crop of graduates with high debt (many who face lower salaries than the generation before us) are VERY aware of financial issues (even if they don’t have answers). They want help and are less willing to pay exorbitant figures to just have someone tell them what mutual fund to use for their Roth IRA.
–Doctors graduating now have easy, free access online (through WCI, Vanguard, blogs, etc) to all sorts of financial advice doctors did not have 20 years ago. It’s creating a generation of doctor’s who can figure some of this out on their own. Even those not interested in finances will be learning things on their own that the older generation never did or could
-This is the group that will keep WCI a viable business the next 30 years. I’m not talking about the 1% that want to do it all themselves. I do think in the next few years most of those that don’t want to think about money will still react negatively to overpriced advisors and want to do more of the investing themselves
-Current graduates have a hunger to learn the basics even if they farm out the rest to someone else. The estate planning and many other things SHOULD require consultation with someone. For basic retirement account management, which is where Larson et al make their $$$, it’s ridiculous to tell someone to pay Larson 1.3% AUM when they can get the same advice for 0.3% (or less).
-Despite more and more doctor’s becoming company employees, medicine is more a business than it ever was before, and doctor’s fully realize that, also making them more aware of their own personal financial situation and desire to improve it. For some that will always be to pay an advisor, but for more and more people it’s going to be to take charge of it and own the situation.
The only reason more people don’t do more of this on their own is they still don’t get that the highest price advice (investment management) is actually the easiest and cheapest. As more and more people are TAUGHT this in medical school and training and via the internet, this group will grow.
The Larson’s I believe are well aware of this and way ahead of the curve. It’s why they try to sign up people in residency/fellowship with the sweet teaser rate of $1,500 for all of training when they have NO investments, then once their attending’s with real savings charge high AUM fees. They put in a lot of hard work upfront to reap rewards (fees)later. My best advice for trainees is to take that $1500 and maximize it, then leave Larson after training when the fees pile up.
FYI I don’t think the Larson’s are sorry about my feelings towards them, and I am not sorry about my views either. I don’t go around yelling profanities about them and I don’t think I’ve ever convinced someone not to use them. I do caution people against them because of their AUM fees and tell them about the good and bad experience I had with the Larson’s. I also encourage people not to pay for any advisor they don’t need.
I certainly agree that it is silly to pay fees if you do not feel the value is there. I also agree that most financial advisor firms are in the asset-gathering game, even if it takes a loss leader early on to get those assets eventually. I hope you’re right about newer docs being more interested in finances than their predecessors and perhaps even more capable of managing their own assets or doing it for a low price. But I don’t see a lot of evidence that any more than perhaps 1 out of 5 are.
I also think you underestimate your ability to influence the thoughts of other doctors about a firm. I have no doubt a comment like yours on a site like this drives business away from a firm. That’s why it is important to make sure your comments are fact-based and not libelous in any way. Companies read them and are more than willing to sue you and I for false comments because there is a real value to them lost there.
However, consider this- You state you paid $1500 for 3-5 years worth of financial advice. You state you were getting that advice from 2 of the 3 owners of a national firm with dozens of advisors. How much time were you expecting for $1500? The going hourly rate for financial advice is $250-500 an hour from a run of the mill planner. If they told you 15 minutes quarterly for 5 years that works out to $300 an hour, and that doesn’t include any paraplanner or preparation time. How much of your time can be bought for $1500? Financial advice is expensive stuff. You can’t expect much for $1500. That’s why when I find someone who has figured out how to do a lot for that price that I try to bring them on as advertisers.
You have some erroneous and irrelevant assumptions here which I address below. Regarding the libel — this is your blog, you can delete any comment you want. I am not being libelous — I have a chain of emails (Gmail!) documenting everything, and I have not written anything beyond facts and my interpretation of their treatment towards me, which is largely substantiated by the emails. I have actually written that I have received good advice from them and it wasn’t the advice that was the problem.
I have a problem with the company namesake/founder and his brother setting such a poor example with their client management. Based on your words they have advisors who provide far better service, but it’s a sad state of affairs if the are unable to do so themselves. I am not commenting on anything other than the advice *I* received. Others experiences have been different and I have not generalized my experience to others. I know many people who have had good experiences with them. I still tell them the AUM fees are too high and they can do a lot of the work for a lot less money and without much more time investment — which is all true.
Now the erroneous parts:
1) I was already paying AUM fees to Larson for investment management, which already covered the “15 minutes per quarter.” The amount I was paying based on the $ of assets I had and % AUM worked out to more than $1000/hour for the “15 minutes per quarter” Jeff offered.
2) The $1500 fee is explicit in that it is intended to cover all the advice (outside of actually doing the AUM) given during the ENTIRE time period covered by the fee. There is no implied or explicit statement that there is a limit on the # of hours of advice given. If they need to do additional work (such as prepare trust documents) that would be extra, however that is completely separate from the advice itself.
3) I signed up with 1.5 years to go in fellowship. It was stated in the documentation that the $1500 would cover my time in training and my first year AFTER training. I paid that $1500 when I finished training (as agreed) with the expectation I would get advice without more fees for that next year. A few months out of training they claimed I was mistaken in that I should expect ongoing advice without paying more fees. That’s when Jeff and Paul claimed that the $1500 was not meant to cover anything outside of training and that’s when we terminated our relationship. It wasn’t until several weeks LATER when after finding the contract (I actually couldn’t find a copy when this happened) and gave it to them and asked for a partial refund that they gave it to me (without any apology or acknowledgment of their own error or violation of contract). I told them if they refunded me partially I wouldn’t contact the Better Business Bureau. They gave me a refund within 2 business days without any acknowledgment of any kind and I never reported a complaint as I just wanted to be done with them.
4) Your own calculations regarding the $/hour are irrelevant to this situation as that is not the contract or arrangement Larson offers. I have many friends who have used Larson Financial (other advisors there) for SEVERAL years as trainees paying the same $1500 for all their advice. I came into the contract in good financial shape and not needing much advice, just getting disability insurance (which they profited on by selling to me) and estate planning (which I paid for elsewhere as I didn’t want Larson in control of everything). I have friends who came in with NO idea of what to do with anything in and in serious financial distress who got several years worth of advice for that $1500. That is what they promise. It is irrelevant how much advice I asked for and how much time they offered or the paraplanners time spent — that is the service they OFFER when you sign up as a trainee for that $1500 fee. They are knowingly losing money on that, presumably with the idea of making it up in AUM or other fees later. As they already had my AUM fees being paid separately, they were already making that money back, as most of my advice questions were easily answered by a couple emails. I was’t forming corporations and running private practices; I was asking about whether I should refinance my house when Jeff decided to violate the contract.
5) My own bully pulpit is small — few if any people will ever read the back and forth here in the comment section of a post reviewing some book that on the surface isn’t even related to the Larson’s. As no one else has chimed in I am guessing no one else cares (and I am not expecting they should).
6) I actually ENCOURAGE people to take advantage of the $1500 fee in training — it’s a great value for all they do. I then encourage them after training to do their own asset management and not pay huge AUM fees for “15 minutes per quarter” to Larson or anyone else. That’s just common sense and nothing against Larson or any other overpriced advisor.
Larson is in fact headquartered in my home town, so that does give me more exposure to the trainees they are after since I also work for the biggest hospital system/medical school in town. If I want to share my experiences with Larson that’s my prerogative — I have told these experiences to people here who work with them and all have continued to use them. As far as I know no one has changed their mind based on my experience, and that’s fine. I do believe that everyone has the right to truly understand the downsides of working with them or any advisor and to empower themselves to not rely on them.
As I mentioned I am helping setup a personal finance curriculum that will reach a large group of residents and fellows here. I have spoken to other residencies here and have a chance to speak to our graduating medical students. So I do in fact have an outlet for voicing these opinions on a bigger scale (and have already done so). But I’m a good academic and won’t be spending time blasting them out of emotion from a business relationship that ended 2 years ago — I was ragingly ticked off at them when it happened. Now I’m just content to tell people what happened and let them decide on their own what to do.
I tell people I got good advice (and that others may get even better advice) but I received what I consider inferior and overpriced service that can be obtained elsewhere at a better price or with better service (or both). Also I feel they violated my contract. I think that’s a fair and accurate summary and I will continue to voice that summary.
If that bothers the Larsons then they can contact me and talk to me directly. However I don’t anticipate doing so nor do I think it’s really necessary on their part.
One correction — our business relationship ended 3 years ago (not 2 years).
I’m not sure what information I have that is erroneous. Please point that out. Also, know that I’m not stating anything you have posted is libel. I’m warning you not to post anything that could be interpreted as libel to keep both you and I out of court. Factual statements are not libel. Neither are opinions so long as they are clearly identified as such. I’m not going to delete your comments unless you ask me to (as several people have in the past who posted statements they later realized were libelous.) If Paul and Jeff Larson have not yet read your comments, I’m confident they will at some point in the next week. If they wish to contact you directly, I’m sure they have your contact information.
I don’t have your contract. I don’t know what it said. I don’t know if they violated it or not. The only information I have is what you have posted. They obviously can’t ethically release your information to me so I have no way to tell if what you are writing is true or not. For the same reason (your privacy), they can’t publicly post here to defend themselves. For those reasons, it’s very important that you treat them in a fair manner in a forum readable by anyone. I think it’s a little unfair of you to have asked for a refund with a promise not to file a complaint and then file multiple complaints in a place (this website) far more likely to be checked with by potential clients than the BBB. Again, you think no one reads this stuff. I assure you lots of people do. Google “Larson Financial Review” and see what website comes up first. Google “Larson Financial Scam” and see what’s on the first page. This post was emailed to 4000+ people. This page has been visited by 2,798 people in the last 5 days.
You received 1.5 years of financial planning advice for less than $1500 (you don’t mention how big your refund was.) That might not be what the deal was (again I have no idea) but it is still a pretty good deal especially since you admit the advice was good. You call the advice overpriced. I’m curious where else you think financial advice can be obtained for a retainer of less than $1K a year? You say you won’t be spending time “blasting them out of emotion from a business relationship that ended three years ago” but not only are you doing that, but you’re blasting me for talking to them/accepting advertising dollars from them. So far, in this comments section alone, you’ve written 2801 words about the whole thing. I’m not sure how fast you type, but that seems like a fair amount of time to me.
It won’t let me respond directly to your last comment for some reason.
Let me be clear. I said their AUM fees are overpriced. I paid those fees separate from the “retainer” fee. I said that retainer fee IS a good deal for many people in training. I also clearly said that I received far less advice for that fee than others I know have worked with their company.
I also said they gave me good advice for that fee but bad service. I also said I thought they violated my contract. Those are clearly my opinions — not established in the courts.
This happened 3 years ago — I don’t think I knew you existed. Also irrelevant — not reporting a restaurant to the health dept for a cleanliness violation doesn’t mean I can’t post on Yelp the restaurant was dirty (an imperfect example). The BBB was what I considered the arbiter and investigator and resolver of complaints. You and Yelp are not — this is a forum to air my views and then others can do with the information what they want. If the BBB report is less impactful that doesn’t make it less important. Also it wasn’t exactly like I threatened them — I told them before they refunded me money I thought they violated my contract and they blew it off. It wasn’t until I emailed them the document it got any action. Up until my contact with you I had never written about Larson anywhere to anyone.
You are getting very defensive. I didn’t blast you. I rightly pointed out that your conflicts of interest could be presenting an unbalanced view of them. Just because you state your conflicts (which I appreciate) doesn’t mean at times it won’t affect your writing. That’s why we want them listed — so we can decide how much skepticism to apply (to this or an RTC in NEJM).
I have a different view of Larson and feel others have a right to hear a counterpoint given how much purely positive news they get off this site. I have given them credit where it’s due but I in no way agreed or implied I would not tell my negative views in an informal way to others.
Also they aren’t idiots — they are smarter and wealthier than me and would have to know I may share my views in other ways with other people. If they cared about my view they would’ve spent more time on it when I was actively paying them money.
Despite what you think none of this is emotional for me. Ask my wife — I get into long emails and debates with people all the time because I enjoy the discourse and arguing even on things that are not relevant to me. The Larsons are not relevant to me in any direct way anymore, but that doesn’t absolve me of responsibility of ensuring others don’t make the same mistakes I made when I worked with them. This isn’t personal for me anymore, it’s professional. I have trainees and colleagues ask me for advice all the time and I owe it to them to tell my experiences. I also openly tell them when I think I am biased and let them judge for themselves. I tell people good and bad.
As I’ve said already — their retainer fee in training is a great deal. I advise people who want to take advantage of it to do so but not to get sucked into the much higher fees elsewhere. I am not blasting them or you — I made it clear why I feel the way I do and people can judge on their own and ignore me if they want to.
My feeling is this is personal for you now as you think I am attacking your credibility and financial relationships. I should be clear that you have a wonderful site that I use often and to which I regularly refer people. That doesn’t mean you don’t have conflicts or negative aspects either, but the good you provide far outweighs the negatives. You are a more credible source than me on just about anything finance related, but that doesn’t make my experience wrong or something you should be attacking. I am highlighting with a very specific conflict I perceive in your writing that I felt required a response. Even if I made up all my negative views on the Larsons I made it clear they have positives as well, so I am not sure why you still feel a need to dissect my arguments and statements unless you feel a need to defend you or them. Had you not kept replying I would not have written anything more.
You have a great business here and your personal interaction is the best part. Don’t let your annoyance with me get to you.
Also I am a fast typer.
If you want to know why I’m replying to you or why I feel attacked personally by your comments, go back to the first comment you left on this post:
This statement implies I’m hiding something purposely in an effort to get more money.
Again, this implies that I am no longer trustworthy, at least on this subject.
This statement implies I am purposely directing readers to a firm that overcharges them in order to make advertising dollars.
This statement implies that this website is somehow a media outlet/public relations front for Larson Financial rather than a trustworthy independent voice and certainly overstates the amount of money received from Larson (a relatively tiny percentage of revenue for my business.)
So yes, this is personal to me because you are attacking my credibility. My readers’ trust in me is my greatest asset, both personally and as a business. So an attack on it is taken very personally and very seriously. Why else would I be writing thousands of words in defense of it at 3 in the morning? (I assume you like me are on a slow night shift.)
Finally, through the consulting work I’ve done with Larson, I’ve come to know them and their firm fairly well. There’s no doubt they aren’t the least expensive financial advisor I have advertising on this site. But I don’t see any ulterior motives there or some desire to fleece doctors. I’ve met all the partners in the firm and know Paul Larson and Tom Martin quite well. They are intelligent and honest. They are also businessmen and entrepreneurs and running a for-profit firm and a non-profit foundation.
It seems fairly clear to me from your comments that you had very high expectations of a financial advisor and probably would not have stuck with any financial advisor for long. You were clearly not a good match with Jeff Larson. So the relationship was severed. You then came back to them and demanded some money threatening a report to the Better Business Bureau. They gave you a few hundred bucks to go away. Three years later you’re still writing 1000 word comments on the internet about the firm and questioning the integrity of a business that posts their ads on its site, all the while claiming this isn’t “personal.” What would a personal vendetta against the firm look like if not this?
Unfortunately online emotions can’t be expressed well. I’ll reiterate — this is your blog and you can delete every comment I make. I am not an internet troll, and I am not posting this elsewhere on your site or on the internet. This is my last comment on this — you are free to have the final word if you choose. This is taking way too much of my time.
My comment re: the name change was a specific comment you made re: how Larson is a paid advertiser on the site and I specifically stated you could change your name and increase your advertisements as that’s your prerogative as you are running your own business. That’s not an insult or an insinuation of ulterior motives, it’s a statement that you can do whatever you want with the site as it belongs to you. My other comments were me highlighting what I thought was YOUR unconscious bias in your writing. Whatever bias I have is quite obvious in the experiences I share and it’s easy to ignore me if people consider me a loon because it’s clear where my views on this topic originate. Most people will see how much I wrote and skip past me and assume I have some deep personal issue.
You call it a vendetta, but you aren’t understanding that having a strong negative opinion doesn’t make it a vendetta. I’ve made it quite clear I had good and bad experiences, that at the end I have very bad experience, and that I don’t recommend them to others because of that. That doesn’t make it a vendetta, it is my sharing my personal views the same way you use the WCI as an outlet to share yours on many topics. I don’t comment on things I don’t have personal knowledge of — I have experience as a client of this company that others deserve to hear.
The fee they partially refunded was an official closure of the business relationship and nothing else. Had they not refunded me something I would have filed a formal complaint with the BBB and sought redress through them. Larson paid me back what I requested and that ended the business relationship. They do not owe me more money, they do not owe me explanations, they do not owe me ANYTHING. They did not buy silence or my happiness with their refund, what they did was provide closure to the business relationship. I will commend Paul Larson for providing the refund as he didn’t have to do so at that time. He recognized it as a way to easily end the business relationship without further hassle, however the $ amount was so tiny (for them) I honestly doubt he cared about the money at all.
Of course I am coming from a personal history, however that doesn’t make it personal to me right now. I fully admit at the time I was ragingly pissed at Larson for what I consider them breaking my contract (I’ll forward you the emails) and actually told them I would go around doing everything I can to dissuade people from working with them. That was 3 YEARS ago and until now I have not posted online about them ANYWHERE. It makes no sense to say I have a vendetta — my actions make it clear that I have NOT gone out of my way to pursue some sort of vendetta.
Yes I do tell people in person the relationship ended badly because that’s part of the story, just like your own story. I also tell them they taught me about estate planning and disability insurance which is crucial and that everyone needs those and they need help doing it right. I clearly had benefit from them — that doesn’t somehow mean I do not have the right to express negative views.
However if my negative end experience with them leads to them losing business then that’s no different than you helping them gain business based on your interactions with them. If people I know choose to work with Larson I hold no ill will towards them or Larson and just tell them to stay on top of the fees and advice they receive, I make it clear that they can give good advice but it working with them is NOT something that should be considered hands-off or assumed to be okay just because of their sterling reputation and nice offices. I am not stating they are unethical, I am making it clear when discussing all advisors that if you use one you still need to understand everything they are doing. Too many doctors use advisors as an excuse to not understand the topic, and I disagree with that approach strongly. You seem to feel differently, that it’s okay to hand things off to a “good” advisor and not be bothered anymore. That’s fine — I disagree with you.
I specifically am commenting now because I DO feel I now detect bias in your writing regarding them and I do feel your readers who are going to read the strongly positive deserve to hear more of the negative. Perhaps I’m reading more into your writing than is really there and perhaps I do have a lingering unconscious bias, however I feel my actions the past 3 years (in not talking about them outside of in-person conversations with people) speaks against this being a vendetta.
Note that your review of Larson was made right before my business relationship with them ended and it actually does jog my memory that I DID read your blog at the time and I did NOT feel the need to go back and make comments on your actual review of them and even now have not gone back and posted on that comment page where it would likely generate the most traffic to my own views.
You may have already done this, but if not read some of the older comments from that review (which you’ve posted comments on within the past 2 weeks). There are quite specific negative comments re: Larson Financial. “Max Power” on 3/18/15 detailing lack of transparency and poor trust regarding fee structures as well as concern over poor knowledge. He specifically commented “I had gone into my relationship with Larson Financial with high hopes, but in the end, anything that didn’t generate a commission for them they didn’t seem interested in helping me out, which would have been fine had they not told me that was part of what I would be getting.”
That’s almost identical to my comment re: the retainer fees — you blast me for being critical of this part of our relationship but clearly I am not alone.
Also There is a comment from “Jeff” on 8/7/15 who had a bad experience that your “original blog post comes across as not quite, but maybe almost an endorsement.” You made a lengthy reply to their negative experiences including discussing your own conflict of interest. Neither of these reviews have you attacked as strongly as my own despite my taking far more time to explain my concerns.
My concerns are certainly similar to Jeff though admittedly I expressed them with stronger language, and in hindsight given the online venue I could have better expressed myself better without offending you. However my views are based on reading more comments you’ve written re: Larson over time.
You are targeting me as unreasonable with my negative views and think I have an axe to grind solely because I continue to respond to your comments. As I said, I love an exchange of ideas and debate for the spirit of it. I don’t like pissing people off and offending people, but I also will not back down if I think people are misconstruing my own views and experiences and turning them against me.
Go read comments you’ve made in your own blog about Edward Jones where you actively steer people away from them. I don’t know if you ever worked with them or not, but it’s quite clear you disapprove of them and are not shy about telling people to avoid them. I have no experience with them and so take you at your word on them. Did you work with them? Do you have a vendetta against them? I never asked those questions myself because I trust your view on them but perhaps I should have asked. I have no personal insight into them, but your comments on this blog have led to me telling people to avoid working with them, and that’s based almost entirely on what you’ve written. Your words have a powerful effect, and in this case I have personal experience that gives me more insight into a counter viewpoint so I do NOT take your experiences with Larson as the holy grail the way I do with other things.
The logical thing for me to do would be to question your other views more, however I have not done so as I have no reason to question your other stances or you overall as a source for personal finance information.
In summary: the idea that commenting on your blog on a single page about my bad experience with Larson is proof of a vendetta is just silly considering that nowhere else on the internet have I commented on them and nowhere else on your blog am I posting on this topic and I am not responding to anyone else but you. Had you never written this very particular blog post I would never have written any of these words. At this point I am actually just defending myself against you as you are trying to dissect my words to prove that I have deeper issues driving my writing. I may have deep emotional issues, but they aren’t connected to Larson specifically!
I consider you a trusted site on the internet, and I consider your comment section a way for your readers to hear counter viewpoints that inform them in more detail beyond your posts. I will continue to refer people to WCI. You are literally the first site I recommend to everyone and will continue to be — I am speaking to medical students today (if the snow here doesn’t cancel things) and will do so again.
I apologize that I’ve offended you as it isn’t my intent — we aren’t friends but I consider you a colleague and a peer and you’ve helped me personally (with your advice) and professionally (with the study). I can’t apologize for having the views I have and being willing to talk about them but I could certainly express them better.
I’ve said it before and will repeat it again — I trust WCI on just about everything. I also know Larson has good people working there. That doesn’t mean I am going to agree with all your writing or avoid giving people a counter viewpoint on the rare occasions if I think it’s necessary.
This is not correct:
If there is somewhere on this website that I have written that, please point it out and I will remove it.
Otherwise, I think there is enough information in this exchange already for an interested reader to make up their mind about your experience and how it might relate to their decision to use Larson Financial. BTW, you’re going to hate a post I have coming up on VULs. Might want to skip it. I was expecting a comment like yours after that post, but not after this one.
I’ll take the book!