As a healthcare professional, you’ve dedicated yourself to providing the best care possible for your patients. Now it’s time to turn your attention to your own long-term financial health. Planning for your retirement should be a top priority so you can work towards a stable and comfortable retirement. Yet a number of things have changed in the financial world that will affect what your retirement looks like and how to best plan for it.
In this blog post, we’ll discuss three considerations healthcare professionals should plan for as they approach retirement and provide some tips to help you get started on the right track.
Your Retirement Is Up to You
In prior years, healthcare professionals had access to pensions. Unfortunately for employees, that benefit has largely gone away. While some people may still receive pensions, the number of pensions offered in the U.S. has declined dramatically.
For healthcare professionals, that means saving and investing for your retirement falls on your shoulders. Right now, the two main options you have to save through work are a workplace 401(k) plan or a workplace 403(b) plan. A 401(k) plan is typically offered at for-profit companies, while the 403(b) is typically offered at non-profit organizations. Regardless of the type offered to you, the maximum you can contribute in 2023 is $22,500.
Your company may also offer a matching contribution to ramp up your retirement savings, but you need to double-check if that’s the case because some companies don’t offer one.
If you don’t have a pension to get you through retirement, you’re now on your own to choose the right amount to contribute, select the best investments, and review and tweak as needed as you get closer to your retirement goal.
When Will You Claim Social Security?
While you may not get a pension, you will likely have access to Social Security benefits, which offers you a consistent payment in retirement. The dollar amount you receive will depend on how long you worked and how much you paid into the system. If you don’t know how much you’ll receive, you can find your statement with all benefit details on the Social Security website.
It’s not as simple as claiming your benefit when you retire, however. In most cases, the earliest you can claim your benefits is at age 62, and you can delay taking them all the way until age 70. If you wait, your benefit amount will be larger, but you’ll have to find other sources of income to help you get by in the meantime. It’s also important to remember that Social Security offers a cost-of-living adjustment for this benefit every year, so as inflation continues to rise, so too will your benefit amount.
If you’re married and your spouse will also receive a Social Security benefit, you have to determine the proper time to claim these benefits for each of you, and it may make sense to claim Social Security at different times depending on your ages, expected retirement age, and other factors.
There isn’t any one-size-fits-all answer as it relates to Social Security benefits, but having a plan for what you’ll do is a key piece of your retirement plan.
How Does it All Fit Together?
The most important question to ask yourself is “What is my overall retirement plan? And how do all these pieces fit together?” In our experience, the people that map out a big-picture plan are more likely to have more confidence and less stress in their retirements than people who simply wing it or only look at one piece of the puzzle without considering other factors.
As we’ve discussed, some key questions include:
- How much do you need to save in your workplace retirement plans?
- What investments should you select while working?
- Should you change those investments at retirement?
- What age do you want to retire?
- What age can you actually afford to retire?
- When should you claim your Social Security benefit?
- What tax-planning strategies do you need to take, and what tax-planning mistakes should you avoid?
Needless to say, answering these questions and more is a challenge, and it’s essential that you get it right. The good news is that you don’t need to do this alone. At Millstone Financial, we love helping healthcare professionals plan for their retirement. We offer a Millstone Awareness Analysis that will help you understand your retirement goals, review your investments, better understand your Social Security decision, strategize for your retirement income, and more. Best of all? The entire process is complimentary.
To get started, you can call (732) 385-8544, email [email protected], or go to this page and click on the blue “Schedule Your Complimentary Review” button.
About Millstone Financial Group
Donald Albach is President and Co-Founder of Millstone Financial Group, an independent financial advisory firm helping pre-retirees and retirees pursue their retirement goals. Don has over 26 years of experience in the financial industry and focuses on retirement planning, designing retirement income planning strategies to guide his clients toward financial independence. Don graduated from Norwich University, the nation’s oldest private military college, and has worked his entire career in the financial services industry, including First Boston, MetLife, and C&A Financial Group. He co-founded Millstone Financial Group in 2012 and became an investment advisor in 2018 with Michael Russo. Don and Mike met each other while working at MetLife, and in 2003 both he and Mike were recruited to work at C&A Financial Group, where they spent the next 10 years. It was at C&A Financial Group where they decided they needed to start their own company that strictly focused on retirement income planning. They both had the desire to help people navigate the complexities of retirement and created Millstone Financial Group to do just that. Don currently lives in Monroe Township, NJ, with his wife, Tina, to whom he has been married since 1992. They have three children together: Paige, Donny, and Ally. Don’s two passions are sailing and watching college football, and he also enjoys cooking Sunday dinners for his family. To learn more about Don, connect with him on LinkedIn.
Advisory services are offered through Millstone Financial Group Limited Liability Company, an Investment Advisor in the State of New Jersey. Insurance products and services are offered through Millstone Financial Group Limited Liability Company. Millstone Financial Group Limited Liability Company is not affiliated with or endorsed by the Social Security Administration or any government agency.
All material discussed is for informational purposes only. Opinions expressed are solely those of Millstone Financial Group Limited Liability Company and staff. All topics covered are believed to be from reliable sources; however, Millstone Financial Group Limited Liability Company makes no representations as to its accuracy or completeness. Investing involves risk including the loss of principle.
This article shall in no way be construed as a solicitation to sell securities or investment advisory services to residents of any state other than New Jersey or where otherwise permitted. All information and ideas should be discussed in detail with your individual adviser prior to implementation.
This material is intended to provide general financial education and is not written or intended as tax or legal advice. Individuals are encouraged to seek advice from their own tax or legal counsel.
