Orthodontist and financial advisor Mart McClellan.
To be blunt, doctors and dentists are rated lousy investors. But here's Mart McClellan, an orthodontist who not only knows how to expertly manage his own assets but helps other health professionals manage theirs — and retire with full income replacement, as he tells ThinkAdvisor in an interview.
Co-founder of Macro Wealth Management, an RIA based in Peoria, Illinois, McClellan needed a smart FA himself when in 1997, a colleague referred him to Tim Streid, an independent advisor previously with Prudential Financial Services.
In the interview, McClellan and Streid describe how, after a fruitful seven-year client-advisor relationship, the two launched an advisory to serve health professionals. That was in 2004, the year McClellan became a licensed FA.
Macro Wealth now manages $24 million in assets from clients in 32 states. McClellan, who meets with them online — an approach in place even in pre-pandemic days — continues to run his full-time orthodontia practice in Kenilworth, Illinois, some 135 miles from Peoria, where Streid is located.
In our conversation, the advisors discuss the "financial treatment plans" they work up for clients and how they help them avoid "wealth erosion."
"Indexing-plus" is their investing strategy, wherein they employ an economic model to analyze potential significant financial decisions, Streid says. The model, which he began using in 1994, "accelerates" wealth.
ThinkAdvisor recently held a phone interview with McClellan, 56, and Streid, 57. The two co-authored an Amazon bestseller whose title bridges McClellan's two disparate, though surprisingly compatible, specialties: "Your Retirement Smile: The Treatment Plan for Pay-Cut Prevention in Your Golden Years."
Here are highlights of our conversation:
THINKADVISOR: Your advisory client niche is dentists and doctors. Health professionals are famed for being bad investors. Is that true, and if so, why?
MART MCCLELLAN: Yes. There are a couple of reasons. Two are lack of education and lack of time to figure out the best method to go about investing their assets.
What other reasons?
Many times people in financial services who figure that doctors have a lot of money [lead them into] investments they shouldn't make. Doctors don't have time to figure it out — so they just let them do it and get themselves into trouble.
How have your clients weathered the pandemic fallout thus far?
MM: In March, we went to a bear market very quickly. [In such situation], people who are positioned appropriately in their financial life can sprinkle a little money in the market — and the next thing they know, the market's recovered. Our clients that did that are very happy now.
TIM STREID: [Overall], clients haven't been negatively impacted. They were very well prepared and had strong liquidity, which we encourage them to have — at least 50% of one year's gross household income.
Have you changed your advisory practice amid the pandemic, like moving to online meetings?
TS: We'd been doing virtual meetings with clients for years. So it already had become a huge part of our business.
Mart McClellan, left, and Tim Streid.
Dr. McClellan, turning to your orthodontia practice, during the shutdown, how did you keep patients who were in Invisalign braces and needing weekly adjustments on track?
MM: They didn't skip a beat with their treatment. They took pictures [of their teeth] with cell phones and downloaded them so I could see them on a dental monitoring website and make diagnoses virtually. Every week, for about six to 10 weeks, we taped bags of Invisalign aligners [that move teeth to straighten them] to the front door of my office, and the patients would stop by and pick them up. Pretty neat!
Why did you aspire to be an orthodontist?
