Retirement planning starts the day we start our careers. Whenever we start any project, it is always worthwhile to learn how the project works, what we want to pursue and achieve with the project, how to exit the project, and when is the right time to exit.
As physicians, gastroenterologists go through several years of vigorous training, years spent studying, researching, practicing, and juggling between work and life, trying to lead a well-balanced life. With all the years of medical training, we do not get the same level of education in financial planning in order to attain financial stability, financial empowerment, or resources that we need to put in place for a successful retirement.
Dr. Appalaneni
Dr. Vasu Appalaneni
Many physicians like to work and provide services as long as they can, provided the physical and mental capacity permits. Retirement planning should start as early as possible — at your first job, with the first paycheck. Having a strategic plan and understanding several personal factors can help one make this journey successful.
Financial Planning
Financial planning starts with investments in 401k, IRA, defined benefit, and defined contribution plans, as early as possible and to the maximum extent possible. It is beneficial to contribute at the first opportunity and contribute enough to the employer retirement plan to earn the full employer match. Also consider capital investment opportunities that match your risk appetite and returns, as these compound and grow over time. This can be done by adjusting personal expenses and lifestyle, giving priority to savings and future wealth management, and auto-escalation of permitted retirement contributions annually.
Assessing your financial situation periodically to determine retirement needs based on how long you intend to work and preferred lifestyle post retirement (travel, leisurely activities, etc.) is important. It is also pertinent to align revenue earned, expenses made, and wealth saved to support post-retirement life. Consider hiring a financial advisor who has the best interests in your personal wealth management. These are usually found with reputable institutions at a fixed percentage cost. Finding a trustworthy knowledgeable advisor is the key. Learning from your colleagues, networking, and learning from friends in and out of healthcare are good resources to find the right financial advisor.
Healthcare expenses should be planned as well as part of financial planning. Short-term and long-term disability and long-term care expenses should be investigated when planning for healthcare needs.
Transition Planning
Timing of retirement is based on factors such as age, financial status, personal health and preferences. The transition can be facilitated by better communication with colleagues, partners, employer, staff, and patients. Identifying a successor and planning for continuity of care of the patients, such as transitioning patients to another provider, is important as well. This may involve hiring a new associate, merging with another practice, or selling the practice.
