When can I finally retire? Doctors, where did all your money go?

Besides hearing that physicians and healthcare practitioners are always looking for the latest and greatest ways to treat their patients, one of the other things we constantly hear is the need for how to thrive in this crazy healthcare market.

Doctors no longer retire at the same age and with the same financial status that they used to. We hear from doctors that going to medical school no longer has the same luster it used to and that some actually discourage their own children from doing so. Why, if it is such a noble cause? Well, they tell us it is due to all of the financial burden/loans they can incur as well as the fact that they are not able to make up the difference after graduating like they used to with the new insurance reimbursement decreases and regulatory changes. Many argue it is not worth the liability.

A recent article was brought to our attention about an orthopedic surgeon, which hits very close to home as a lot of our members and attendees are also in the orthopedic field. This surgeon whose practice is in Tennessee had always planned to retire at 70 years old.1

In fact, a recent MDLinx survey shows that most physicians plan to retire between the ages of 65 and 70 but the majority do not have enough money saved up to maintain their lifestyle. According to this physician, most doctors choose 65-70 as retirement age because this is the age they begin to lose the steadiness in their hands or when their backs begin to get sore.

At 66, Dr. Deborah St. Clair says she is “barely hanging on” to her career and trying to save as many pennies as she can to retire. She does not believe she will be able to carry on past one more year and she fears that her “early” retirement based on her original date of 70 will end up costing her. She has only gotten to about half the savings she wishes she had achieved before having to retire from her practice.

It was a short 10 years ago that Dr. St. Clair’s practice was flourishing. She is now losing money and feels lucky to get 20 hours a week in the office. The small rural town where she lives has less than 17,000 residents which is not yielding as many patients as she was used to seeing. Unfortunately, although this rural location may differ from other doctors located elsewhere, what does add to the negative change is true for all healthcare practitioners: the changes in insurance and the regulatory issues.

The local hospital near Dr. St. Clair has had to dramatically increase its rates and has been forced to make patient stays shorter. The higher rates have caused patients with catastrophic coverage or high co-payments to have to avoid the hospital completely.

Physicians are said to have an average student debt load of $183,000, and certified financial planner Anthony Criscuolo at Palisades Hudson Financial Group explains that some physicians “get a much later start” than other professionals when trying to save for their retirement because “many of them are dealing with crippling debt when they’re fresh out of medical school.” As mentioned above, doctors are also getting squeezed by insurance reimbursement rates so they are not maintaining the incomes they expected to maintain as they approach their retirement age. “They’re really getting it at both ends,” Criscuolo explains.

Fidelity Investments studied 360 physicians and nearly half said that they can’t afford to contribute the maximum to their retirement plans at work. This article explains a lot more about reaching the right retirement savings goals as a physician, taking into account things like selling your practice and what a physician can do for financial security. All of this is very scary as we tend to think being a doctor is an amazing thing.

In an effort to keep potential doctors from getting discouraged or keeping our current doctors treating patients and doing their best, we have input some great time and energy into our new Practice Enhancement Training (PET) modules. PET was designed to help you as a healthcare practitioner “Optimize your Income” and “Exceeding your Patient’s Expectations”. PET’s goals are to help you BEFORE retirement.

If you are interested in how you can start enhancing you practice today, sign up for the next LIVE PET course in December at our 25th Annual World Congress!

1MDLinx Internal Medicine. Mindy Ligos. Managing Your Money. Real Stories from Real Doctors. Part 3-Where did all the money go? Prepping for retirement. https://www.mdlinx.com/internal-medicine/article/1152. September 2017. Accessed October 11, 2017.