This post is the first in a series of five posts that lay out the PFG Investment Philosophy. Through these posts, we try and lay the foundation of knowledge around investments that clients should know, and answer the most commonly asked questions.
Question #1: Why Should Dentists Invest?
The wealthiest people in the world, and the wealthiest doctors, are good investors. Why? They want their money to work for them. If you’re going to last 30+ years in retirement, you’ll need your money to work for you long after you’ve stopped working for yourself.
Investing is not gambling. We don’t “put our money in” and cross our fingers hoping that on some magical day it will all come back to us. Just like you expect a profit in your own dental practice, we fully expect a return on our investments. We advise investing in real companies with real people working to create real products to sell in effort to make the real world a better place.
You have seen these principles with your own dental practice. You have been the beneficiary of someone else’s investment. In order for you to start or buy your practice, you needed an investor (the bank) to loan you money (a “bond” in investing jargon). There was risk but the bank was not gambling. They trusted in you, your skills and the demand for your services and they expected to be paid back, with interest (profit).
Without the bank, your dental dreams would have remained that – dreams (not to mention you wouldn’t have been able to pay for dental school). In this way, investors not only reap the profits of the global economy, by supplying the needed capital for growth they help create the global economy.
Again, why should dentists invest? Hard work is just that – hard. And there is only so much hard work one dentist can do using his or her own body. But for those who can use their work to create a profit, and who are disciplined enough to put those profits to work in their behalf (investing), they can be the beneficiaries of “work” that extends beyond them in time and magnitude.