Darrell Bryant Retirement Blog

Tuesday, April 6, 2021

5 Things Physicians Must Know To Plan For Retirement Income Needs

By Darrell Bryant

As a physician, you’ve dedicated your life to providing healing and helping others experience a better quality of life. Your days have likely been filled, patient by patient, by making a difference in others’ lives. Saying goodbye to such a fulfilling career and transitioning to retirement can be challenging on many levels. 

The last thing you need in this new stage of life is financial uncertainty. The good news is you don’t have to be a master at financial planning or investing—you just have to know what questions to ask and who to turn to for help. Here are five questions that will help you think strategically about your retirement income. 

1. What Is Your Real Need?

This question seems so simple, yet it is often overlooked. Do you know how much income you will need in retirement? Before you can develop a plan for your retirement income needs, you need to have a goal and settle on the destination to which your plan will lead you. You can do this by creating a clear picture of what you want in retirement and tracking your spending so that you have a ballpark estimate of what your retirement will cost. Be sure to analyze both your mandatory and discretionary spending and take into account any changes you expect to experience in retirement, such as downsizing your home or increased travel. 

2. What Income Sources Do You Have?

Once you know your goal, you need to take stock of the tools available to get you there. What income sources do you have? This could be anything from Social Security and pensions to annuities, rental income, or taxable brokerage accounts. It is important to analyze your alternative income strategies and review the cost benefits of each choice of potential income elections. 

3. What Are The Tax Implications?

Having clarified the different income sources available to you, it is important to understand the tax implications of each one. You may have some accounts that are pre-tax and others that are post-tax, and then there is Social Security, which is taxed based on how much total taxable income you have. It is critical to review the tax status of your accumulated assets in order to develop a tax-efficient income strategy and maximize the longevity of your funds. 

4. How Should The Money Flow?

Your cash flow is simply the flow of money into and out of your hands. A cash flow plan, commonly called a budget, is simply a written document showing where your money is coming from and where it is going to go. 

While you are working, cash flow planning is simplified in that you usually only have one or two sources of income that are fairly fixed. All of your planning goes into the outflow, not the inflow, of resources. In retirement, it gets more complicated. You now have multiple streams of income and can sometimes turn them on or off at will. You need to do a more in-depth cash flow planning analysis to determine the best route to turn your assets into income. 

5. What Do You Want Retirement To Look Like?

You didn’t reach this milestone of retirement without years of hard work and diligent saving. Now that it’s time to begin drawing from your hard-earned resources, it’s critical to have a plan in place to protect it in the coming years. A disciplined process can help reduce the impact of short-term market volatility on your income and preserve your wealth for the rest of your life as well as for the generations to come. 

Retirement is a rewarding and fulfilling season of life to spend with family and friends and invest in the things you love. We at D. Bryant Retirement Strategies would love to partner with you, answer your questions, and help you retire with confidence that your funds will last as long as you do. Reach out to us to schedule a complimentary consultation by calling at (402) 932-2141 or emailing contact@dbretirement.com.

About Darrell

Darrell Bryant, CFS®, CAS® is Omaha’s Retirement Strategist. As the founder of D. Bryant Retirement Strategies, he focuses on helping individuals and couples nearing retirement do so successfully. Along with more than 30 years of experience, he received the Certified Fund Specialist (CFS®) designation and a Certified Annuity Specialist (CAS®) designation from the Institute of Business & Finance. Passionate about helping as many people as possible in his community, he hosts Retirement Strategies Radio, heard Saturday mornings at 7:00 a.m. on 1110 KFAB. He has also written articles on financial planning that have been featured on Fortune.com, FoxBusiness.com, Money.com, and in the Midland Business Journal. To learn more, visit his blog, his website, or connect with him on LinkedIn.