It wouldn’t seem that a good opening for this new column would be to suggest that you determine how to take home less money by year’s end, would it?

Well, surprise! That’s what I’m doing with this column’s maiden voyage. But don’t worry — my intent is to steer your money to a safer harbor, so it can protect you. In the current economic environment, ophthalmologists shouldn’t consider bringing home more income when those funds will be exposed to liability as physicians try to increase personal investments.

Instead, when looking at the routes your dollar could travel, starting with net collections, consider shifting it from income to investment within your practice. You will shore up the practice’s foundation while waiting for the current economic headwinds to pass.

THE USUAL PATHS

Of course, there are many strategies for expanding your economic portfolio. The most common (and easiest) way is to invest in the stock market via individual stocks or mutual funds. However, over the last several years, a perceived condition of high risk and low reward has caused some to balk at this route. In response, many are putting their dollars into very low yield sectors with no risk, like savings accounts or certificates of deposit — and earning less than 2% interest. But, these earnings are then taxed and yield a net often less than 1%.

KNOW YOUR LIMITS

Other opportunities, such as investing in a start-up company or joining a large investment group, sometimes present themselves. A word of caution here: A physician needs to be careful when considering ventures into unfamiliar areas. While we are used to being an authority in our specialty, we can pay a price if we permit this confidence to transfer to subjects outside of medicine. “Shark tank” ideas are exciting, but perhaps those investments should be left to the celebrities on the show.

DON’T BE AFRAID OF LESS

Instead of the high-risk/uncertain reward path or the low-risk/even-lower reward path, consider increasing your dollars used in your practice’s revenue stream.

This is counter-intuitive, as the goal in business is to generate profit — the last thing you want to see is a lower number on your W-2 or 1099 each year, particularly when health care is changing and may not be as profitable or predictable in future years. However, consider strategically sacrificing W-2 income and using these dollars to grow your practice in hopes of yielding increased future earnings. The combination of pre-tax dollars and accelerated depreciation makes for a powerful investment.

This incorporates a broad view of today’s economic landscape to help leverage the value of your dollar. Current tax incentives with high limits on depreciation aim to stimulate economic growth and comprise a big part of this plan. Additionally, the zero-interest rate policy implemented by the U.S. Federal Reserve has kept rates at an all-time low, so you can leverage your investments with low bank interest rates.

Future columns will explore more specific strategies an ophthalmology practice might consider. These include acquiring new technology to better treat your patients, buying your office space instead of renting and expanding with a new office or satellite location.

Investing in yourself can positively impact your long-term economic portfolio as well as your overall professional satisfaction. OM

Scott LaBorwit, MD Scott LaBorwit, MD, is a principal at Select Eye Care, with locations in Towson and Elkridge, Md., and is an assistant professor, part-time faculty, at Wilmer Eye Clinic of Johns Hopkins Hospital, Baltimore. His e-mail is Sel104@me.com. Disclosures: Dr. LaBorwit is a consultant to and speaker for Alcon.