At some point in a doctor’s career, the career should come to a glorious end.  I think the goal with any Healthcare professional is to be able to enjoy retirement and to still live a comfortable and rewarding lifestyle.  Getting to that point where a doctor can step away from their practice with the assurance that they have enough assets to enjoy this type of retirement takes planning.  As Benjamin Franklin once said, “By failing to prepare, you are preparing to fail.”  This can be a devastating realization for doctors who fail to plan for retirement.

One of the main retirement assets that a doctor has is their ownership in their practice.  Upon retiring, they are typically bought out of their ownership in the practice by their successors.  The amount of money generated from their buyout ranges from practice to practice depending on a variety of things, including specialty and size of the practice.  Typically the value of the company is a product of the hard work put into the practice during a doctor’s career.

However, another valuable retirement asset is an IRA, SIMPLE, 401(k) or similar retirement plan.  There are a wide range of possible retirement plans that work well for doctors and the options are best discussed with your CPA and/or financial planner.  Some of the key considerations are:

• How much money do you want to have in your retirement account by the end of your career?
• At what age do you want to retire?
• How much money do you want to put away each year to build up your account value?
• What are the different contribution limits that each type of plan has and can those limits help you reach your goal?
• Do you want your withdrawals during retirement to be tax-free (Roth)? Or do you want to save taxes during your income-earning years (traditional)?

Another key consideration is whether or not you are an owner of your business or an employee.  If you are an employee, then you will need your retirement account to have a higher balance at retirement because you won’t have a buy-out from a practice.

Getting a retirement plan in place is key, and the sooner you can get that plan in place the easier it will be for you to achieve that goal.  HintonBurdick helps Healthcare professionals evaluate their retirement goals and works closely with financial advisors to create a team for you to help you get on the path you want to be on for retirement.

If you have any questions about retirement, please give us a call.