Assessing the Health of Your Retirement Plan
Planning for retirement does not have to be as overwhelming as it may seem. Physicians should meet with financial advisors as soon as possible to learn about some of the saving options that are available. Many physicians miss out on opportunities simply because they don’t have the time to pursue them. By reading the tips below and speaking to a professional, you can be well on your way to maximizing your retirement savings.
Physicians Aren't Saving Enough
Contrary to what you might think, physicians are not robust when it comes to saving for the future or taking advantage of retirement savings opportunities. According to Fidelity, physicians earn an average of $300,000 per year, but their student loan debt totals around $176,000. With the burden of student loan debt, many physicians don’t think they can afford to maximize contributions to their 401k or profit-sharing plans available through their employer. Experts recommend that physicians meet with financial professionals regularly to ensure that they are taking advantage of all available options for long-term savings.
Saving Plan Options for Physicians
A lot of saving plan options are available, like 401ks and investment retirement accounts (IRAs), but those aren’t the only options. For physicians who are self-employed or who report earnings on a 1099, consider making use of a simplified employee pension IRA (SEP IRA), which allows you to contribute tax-deductible income until withdrawn. Speak with a professional about the right option for you.
Choose the Right Practice Transition
Selling your practice is an inevitable part of retirement. In addition to notifying your staff and sending letters to patients to alert them of your departure, you can take other steps during a practice transition that will help you save money. How you structure your sale can have huge tax implications, so plan wisely. Consider, for example, that if you own the building in which you practice, you may want to create an arrangement with the person buying your practice in which you lease out the office building. The buyer will have the option to purchase the building at any point during the lease, but you will continue to make money off of the rent to help you save for retirement.
To help you get on the right track for saving for retirement, contact us today and start maximizing your retirement savings.