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WEALTH ADVISORY SERVICES
FOR MEDICAL DOCTORS AND
THEIR PRACTICES

Legend Financial Advisors, Inc.® (Legend) with its headquarters located in Pittsburgh, Pennsylvania, provides a number of Wealth Advisory Services to affluent and wealthy medical doctors, their families as well as their medical practices.  Our Wealth Advisory Services are tailored to meet the specialized needs of doctors.  These services include the following:

 
  • Personal Financial Planning
  • Investment Management
  • Investment Consulting
  • Retirement Plan Distribution Planning
  • Estate Planning, Trust Services, and Philanthropic Planning
 

Furthermore, we provide medical practices with Retirement Plan Services.
These services include:

 
  • Plan Establishment Consulting
  • Investment Policy Statement Development and/or Review
  • Investment Management
  • Investment Consulting
  • Investment Education Workshops
  • Plan Audits and Plan Administration
 

Legend also offers business consulting services to doctors who are shareholders or partners in medical practices.  With Legend’s vast nationwide network of contacts as well as its own experience in servicing medical professionals through the years, we are able to offer these specialized services to help ease the administrative burden of the medical practice. Some of the services that we offer include:

 
    • Business Entity and Structure Analysis
    • Banking Arrangement and Loan Financing Analysis
    • Medical Practice Continuity/Succession Planning
    • Legal Documentation and Requirements
    • Insurance Analysis
    • Employee Benefits Analysis
    • Analysis and/or creation of Doctor and/or Key Person Compensation Benefit Arrangements
    • Personal Financial Planning Services for Medical Doctor Owners and Key Employees
    • Financial Planning Workshops for Staff Employees
 
TABLE OF CONTENTS
 
  1. FINANCIAL ADVISORY SERVICES FOR MEDICAL DOCTORS
  2. INVESTMENT MANAGEMENT
  3. MEDICAL PRACTICE BUSINESS CONSULTING
  4. RETIREMENT PLANNING
  5. EDUCATIONAL SERVICES
 

FINANCIAL ADVISORY SERVICES FOR MEDICAL DOCTORS

 

Legend provides a number of services to individual medical doctors and/or medical practices as well as employees who are key to the success of their practice.  For employers, these services can be provided to doctor employers in their entirety or on a selective basis.  When necessary, we will confer with outside experts or subcontract certain aspects of our service to deliver the highest quality advice to our clients.  The services are as follows:

 

Personal Financial Planning Services:

Legend develops a personal financial plan for each individual doctor or key employee (clients) that a practice designates.  The process begins with each client completing an extensive data questionnaire and delivering all relevant financial documents for Legend to analyze.  The areas addressed in the service are as follows:

 
    • Preparation of financial statements including, federal and state income tax projections
    • We can coordinate any tax information with the client's accountant  
    • Basic finance issues, such as debt structure, liquidity and cash flow issues
    • Development of Investment Strategies, including hedging and tax-sensitive strategies
    • Income tax strategy optimization, including providing alternative financial and legal structures
    • Education funding
    • Retirement planning as well as accumulation and distribution strategization
    • Estate tax reduction analysis and philanthropic decision-making
    • Trust Services through one of our independent trust company strategic alliances, if applicable
    • Survivor needs analysis
    • Risk Management/Asset Protection, including analysis of all insurance coverages
    • Retirement plan compliance, if applicable
    • Business planning, if applicable
 

As part of the financial planning process, Legend develops specific recommendations addressing each of the above-listed areas.  During the first part of the process, the doctor will meet with a Legend advisor approximately four to seven times, typically within the first six-month period of the client relationship.  Each meeting will vary between two and four hours, depending upon the complexity of the situation.

Once the recommendations are made, Legend will assist in the implementation of the recommendations where possible.  A few examples include:

 
    • Arranging loans, including mortgages and personal loans with private banking departments of banks and, when necessary, introducing a client with commercial loan needs to an appropriate banking officer
    • Providing a banker with appropriate financial information to arrange or renew a loan for the client
    • Sending financial information to attorneys so they can prepare the necessary estate documents, including wills, trusts, powers of attorney, health care proxy, and living wills
    • Sending tax information to accountants, such as bonus payments and gain and loss information on the sale of securities, etc., in order to make appropriate estimated tax payments
    • Requesting information on the policy status of life insurance and annuity policies on behalf of the client (This information would include such items as death benefits, cash values, surrender charges, beneficiaries, tax basis, investment return, etc.)
    • Calculating the tax basis of securities on behalf of the client
    • Requesting insurance quotes on behalf of the client
 

Our objective is not necessarily to reduce the complexity of the client’s financial situation, because sometimes it does make sense to utilize trusts and other strategies to reduce taxes and achieve family friendly objectives.  Rather, our goal is to save our clients the time and the energy that it takes to manage his/her complex situation so that they are free to focus more closely on matters that mean the most to them.

During the first twelve months of service, as well as all ensuing years that Legend is retained, the client is entitled to unlimited phone calls, meetings, and advice for their retainer fee.  For the second and all subsequent years, financial planning retainer fees will be mutually agreed upon each year by the individual doctor and their spouse, or in the event of a group contract, by the employing practice and Legend.
 
To view additional information on the Personal Financial Planning Services Legend provides, please see our of Personal Financial Planning Services.
 

Investment Management:

Individual doctors can contract directly with Legend or the medical practice can provide, as an employee benefit to doctor and key employees, Investment Management Services offered by Legend.  Fees paid by the practice can be negotiated on a group basis subject to minimums.  The doctor can select one or more investment strategies from Legend’s Investment Management Service offerings.  See the Investment Management section on this Website for further details.

 

Investment Consulting:

Individual doctors can contract directly, or the medical practice can contract directly with Legend to consult each doctor and/or key employee on a one-time basis or an ongoing basis about their personal investments.  Under this service, Legend does not manage any investments.  The individual receiving advice will make all final decisions relating to the purchase or sale of a particular security.  It will also be the individual’s responsibility to implement investment decisions.  An employer can contract for this on a group basis or an allowance can be provided for each eligible employee.

 

Estate Planning Document Preparation:

If individual doctors or the practice on behalf of their employees contract with Legend for its personal financial planning and business financial planning services, they can also be provided with estate document preparation services.  Legend has negotiated arrangements with various regional law firms on behalf of their clients.  Alternatively, the employer may want to provide individual allowances for each of his/her employees to take advantage of this arrangement or negotiate a group rate.  Estate documents that could be included in this arrangement are as follows:

 
    • Wills
    • A/B Trust Arrangements
    • Residual Trusts
    • Irrevocable Life Insurance Trusts
    • Revocable (Living) Trusts
    • General Powers of Attorney
    • Healthcare Powers of Attorney
    • Living Wills
 

Additionally, more advanced documents can be provided for special fees depending on the individual’s needs.

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INVESTMENT MANAGEMENT

 
Legend offers personalized Investment Management Services to individuals and institutions.  Investment portfolios are developed to match the client’s return and risk requirements, which are determined by the clients’ completion of a Risk Comfort Zone Questionnaire, with the guidance of a Legend advisor.  Each type of investment portfolio is managed to achieve both the short and long-term investment objectives of the client.
 
 
INVESTMENT PROCESS
 

Investment Portfolios:

For a description of our investment portfolios, please see our Risk Spectrum chart.

Investment Research:
Legend performs extensive research as to how to structure investment portfolios.  Emphasis is placed on developing portfolios that have historically achieved high returns, but with lower-than-normal risk.
 
Sources of Current and Historic Worldwide Financial Market and Economic Data include:
  • Investment newsletters, newspapers, periodicals, research publications, and professional journals
  • Portfolio Managers (Legend interviews in excess of 75 portfolio managers per year)
 
Client Education:
 
Education is very important to us.  Legend is dedicated to educating each client about the different investment portfolio types and how they relate to market volatility, time horizons, and investment returns.  It is our goal to ensure that the client understands and agrees with our investment philosophy.  Furthermore, we assist each client in selecting a risk comfort zone with which they are comfortable.  Ultimately, an investment portfolio is designed to meet the client’s objectives.
 
 
PERFORMANCE REPORTS
 
Investment Management clients receive quarterly performance reports.  The report details the portfolio performance during the client’s fiscal quarter and provides a comparison against a number of indices.  While providing detailed information, these performance reports are easy to read and understand.
 
 
To view additional information on the Investment Management Services Legend provides, please see our Summary of Investment Management Services.

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MEDICAL PRACTICE BUSINESS CONSULTING

 

Legend consults for medical practices in several different areas.  Also, a Legend advisor may confer with outside experts or subcontract certain aspects of our service to deliver the highest quality advice to our clients.  Our consulting services include, but are not limited to, the following:

 

Analysis of Forms of Business Entity:

This service includes an analysis of which form of business entity best fits the medical practice being consulted.  The different forms include:

 
    • Sole Proprietorship
    • General Partnership
    • Limited Partnership
    • C Corporation
    • S Corporation
    • Limited Liability Company
 

Analysis of Banking Arrangements:

An extensive analysis of loan arrangements, borrowing rates, cash management and service costs for deposit accounts, including checking, escrow accounts and certificates of deposit is conducted.  Also included is the determination whether or not to provide personal guarantees on loans, especially joint and several liability.

 

Arrangement of Loan Financing:

Legend assists medical practices with their commercial financing needs, including lines of credit, term loans, commercial real estate loans, equipment loans and leasing.  Legend seeks out the best financing arrangements among multiple lenders and reviews all loan documents.

 

Medical Practice Continuity/Succession:

Legend advises medical practices on continuity issues involving the transition of ownership interests among partners or shareholders.  Reviews of buy-sell agreements, funding arrangements and valuation issues, including insurance analysis are conducted.  Furthermore, recommendations and assistance with implementation are provided.

 

Legal Documents and Requirements:

Legend provides a complete review of legal documents, such as articles of incorporation, shareholder agreements, partnership agreements, employment contracts, non-compete and non-solicitation agreements and corporate by-laws.  Board meeting minutes are reviewed to determine if they are in good form, up-to-date and appropriate for the practice’s needs.  Should changes need made and/or documents added, Legend arranges and coordinates their creation and implementation.

 

Insurance Analysis:

Legend identifies all areas where insurance coverage is needed, evaluates existing policies for appropriateness of coverages and cost competitiveness, makes recommendations for additional coverages or alternative solutions, if needed, and assists in the selection of the policies.  Legend does not sell insurance of any type, but rather works with an extensive network of insurance providers.  Insurance coverages reviewed include, but are not limited to, the following:

 
    • Commercial Property and Casualty
    • Worker’s Compensation
    • Healthcare Programs
    • Executive Life
    • Split-Dollar Life
    • Key Person Life
    • Group Life
    • Disability
    • Disability Buy-Sell
    • Disability Overhead
    • Group Long-Term Care
    • Employment Practices
    • Professional Liability (Malpractice)
    • Officers and Directors Liability
 

Employee Benefits:

Extensive evaluations are made of all of the practice’s employee benefits.  Each evaluation attempts to achieve cost reductions and/or other improvements.  If suitable, new benefits are recommended.  Benefits considered include:

 
    • Group Life Insurance
    • Group or Individual Disability Insurance
    • Medical Insurance
    • Dental Insurance
    • Prescription Drugs
    • Vision Insurance
    • Group Long-Term Care Insurance
    • Pre-tax Dependent Care and Medical Reimbursement Plans (Flexible Spending Accounts)
    • Cafeteria Plans
    • Day Care Assistance
    • Education Assistance
    • Qualified Retirement Plans
    • Legal Aid Plans
 

Compensation Benefit Arrangements:

A review is provided for all doctor compensation benefit arrangements.  These arrangements are reviewed for compliance with federal and state laws, appropriateness and cost effectiveness.  Additionally, new benefits are proposed, if suitable.  Legend coordinates the implementation, which includes:

 
    • Phantom Stock Agreements
    • Non-Qualified Deferred Compensation Agreements
    • Personally-Owned Disability and Life Insurance
    • Split-Dollar and Reverse Split-Dollar Life Insurance

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RETIREMENT PLANNING

 

Legend offers a host of services to medical practices concerning retirement plan issues.  A Legend advisor may consult with outside experts or subcontract certain aspects of its service to deliver the highest quality advice to its clients.  The areas include, but are not limited, to the following:

 

Investment Management:

Legend provides Investment Management Services on a No Commission, Fee-Only basis to all types of retirement plans.  These include self-directed type accounts such as 401(k), 403(b), SEP, SIMPLE, defined contribution profit-sharing and money purchase pension plans and pooled asset plans, which can also be 401(k) plans as well as defined benefit plans.  To view Legend’s investment capabilities please see the Investment Management section of this booklet.

 

Investment Consulting:

Legend consults retirement plans in three primary areas, which are:

 
    • Selecting individual mutual funds and/or the creation of individually-designed investment pools for 401(k) and other self-directed plans
    • Conducting manager searches to replace existing portfolio manager(s) in the retirement plan’s overall allocation
    • Conducting extensive reviews of existing portfolio managers within a retirement plan to determine if their performance is competitive and within the guidelines set by the Investment Policy Statement
 

Investment Policy Statement Review and/or Development:

Legend reviews a retirement plan’s existing Investment Policy Statement for its compliance with the Employment and Retirement Income and Security Act of 1974 (ERISA) and appropriateness given the trustee’s current desires.  If the existing Investment Policy Statement needs rewritten or is non-existent, Legend develops a new Investment Policy Statement that is current with regard to the retirement plan’s investment practices and is also compliant with ERISA.

 

Retirement Plan Investment Education Workshops:

Medical practices can contract with Legend to provide investment education to their retirement plan participants.  Covered in the workshops is a historical overview of the investment markets, completion of a risk comfort zone questionnaire by each participant, a thorough overview of the retirement plan’s investment options and instruction as to how each participant can build an investment portfolio that meets their financial goals.  Under this service, Legend does not provide specific investment advice to plan participants to avoid violation of the U.S. Securities and Exchange Commission and Department of Labor laws.

 

Retirement Plan Establishment Consulting:

Medical practices can contract with Legend to combine all facets of establishing a retirement plan for their practice.  This service includes determination of what type of plan is most appropriate for the medical practice, selection of an actuarial firm, completion of plan documents, bonding, and selection of investment options.  If necessary, Legend provides consulting services relating to custodial issues, selection of plan trustees, creation of an Investment Policy Statement and compliance with ERISA.  Furthermore, Legend advisors will conduct on-site meetings to explain the plan to the participants.

 

Administration of Retirement Plans:

Legend can assist medical practices in selecting an actuarial firm for retirement plan administration.  This service includes all filings for the plan, the annual report, 5500 tax reporting forms, participant statements, actuarial reports and any retirement plan amendments.

 

Retirement Plan Audits:

Periodically, a medical practice may want its retirement plan to undergo a full-scale audit.  Legend has the capabilities to provide this new service.  Key components of the audit include compliance verification of the plan with the Internal Revenue Service, the Department of Labor and ERISA laws and rulings.  The audit, which can take one to two weeks to complete, also examines numerous aspects of the performance of each portfolio manager within preset guidelines.  The final audit book contains a complete overview of every facet of the audit and an opinion letter.

The audit reviews nine major areas:

 
  1. Documents that define investment management authority
  2. Investment professionals that currently assist with the implementation of investment decisions
  3. Investment Policy Statements
  4. Procedures that were followed in developing the asset allocation strategies used in participant education material
  5. Reviewing Investment Options
    • Due diligence procedures that are followed in selecting investment options
    • A review of the performance of each investment option
  6. Investment expenses associated with the plan
  7. Procedures for monitoring the investment options and service providers
  8. Overall investment activities for possible conflicts of interest or prohibited transactions
  9. Socially responsive investment objectives

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EDUCATIONAL SERVICES

 

Legend provides a number of different financial education workshops to employees of medical practices. These workshops are of varying length and content.  Most can be tailored to the group being addressed. Legend also offers Financial Planning Newsletters that are available on a quarterly basis.  E-mail newsletters for financial planning as well as investing are available monthly.  The workshops available are as follows:

 

Basic Investing:

Legend covers a historical overview of the investment markets, completion of a risk comfort zone questionnaire by each individual and instruction as to how each individual can build an investment portfolio that meets their financial goals.  Legend does not provide specific investment advice to individuals under this service.

 

Financial Planning:

Legend’s financial planning workshop covers most all of an individual’s financial planning needs.  The subject areas covered are as follows:

 
    • Basic finance issues – saving, emergency reserve funds, debt management
    • Insurance – homeowners, automobile, personal umbrella liability, disability, medical, health, long-term care, life insurance
    • Income tax planning
    • Education funding
    • Retirement planning
    • Estate planning
    • Investing
 

Retirement Planning:

This workshop is designed to ensure the financial security of those individuals who desire to retire.  The workshop addresses the need to accumulate funds for retirement, the tax laws associated with saving, how much they need, the potential sources of retirement income, the expenses they will incur, the taxation of retirement benefits when they are distributed from retirement plans, pre-59½ and post-70½ distribution penalty taxes, and how to avoid them.  Furthermore, the workshop also covers the need for insurance, such as long-term care and Medicare supplement policies during retirement.  Finally, the workshop addresses investing during retirement.

 

Retirement Plan Distribution Planning:

This workshop is for individuals who are retired or are within ten years of retirement.  It discusses the rules for distributions from IRAs, Roth IRAs and other retirement plans.  The workshop reviews income taxation, penalties and how to avoid them.  A discussion of IRA rollovers, IRA transfers and Roth IRA conversions, in-service distributions and plan borrowing laws will also be presented.  The workshop will cover beneficiary issues as to how to minimize income taxation to heirs and how to set up heirs for their own retirements.

 

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