The New Retirement

By Dave Denniston CFA
The world is changing.
The concept of retirement is changing.
Is an early retirement even possible? Heck, is retirement by 60 or 65 even possible?
As a matter of fact, I’m seeing many folks work longer and longer- some even well into their 70’s. Truly, it’s not full time for the most part, but part time to scrape some extra dough for some of the extras that make retirement enjoyable- the hobbies, the travel, and the grandkiddos.

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In a previous post, I made a big leap and even suggested that Retirement is Dead.
For newly minted attending physicians with student debt burdens over $300,000 and rising, a traditional retirement is getting further and further out of reach. My feeling is that we will be seeing more and more physicians experience what I am coining “The New Retirement.”
Yes, I know that we currently have a physician shortage, but with more “cheaper” PAs and NPs gradually taking over the work for physicians in certain areas- we could see the landscape for physicians changing more and more.
In this post, discover the three components of the New Retirement and how that may fit into your future plans.

Component#1: House Debt Forces You To Work Longer
What are we taught about buying our first place? What matters more than anything else?
Location, location, and of course… location
When it comes to the new retirement, location is everything and I’ll change those 3 words to:
Home price, home price, and home price
For many of us that are labeled gen x, gen y, and millennials- I see time and time again the impact of the price of your home on retirement.
Consider a client in Southern California- they bought a fairly modest home for $900k.
In comparison, here in the good ol’ Midwest, our place of similar size was worth around $250k around the same time.
Can you imagine how much more quickly we’ll be out of mortgage debt and able to save more? Our friends on the coast are being FORCED to work much longer.
Ironically, not only are costs higher- particularly homes…. but the salaries are also lower!!!
This means that our physician friends on the coasts are likely to experience the new retirement- unless they do some creative investing or instead, force themselves to live like a resident for a big chunk of their careers.
And it’s awfully hard to live like a resident and when you’re paying a resident’s salary for your home…

Component#2: The Flexibility of Locums and Non-Clinical Jobs
As many of us transition our glorious crowns from brown hair to gray hair to white hair, we’re getting tired of the grind. We’re sick of the 8 to 8 that medicine requires.
Then it hits us that we haven’t saved up enough and in order to maintain our lifestyle that we have to keep on working- perhaps not full time, but part-time.  On top of the question of working longer- as we look at our finances, we may need to ask ourselves, do we own our stuff or does our stuff own us?
For many doctors, our stuff may own us more than we like and working longer is becoming a reality. Luckily, this reality can be far more flexible thanks to locums & moonlighting.
We can work 20 hours a week rather than 60 hours and that charting…. now, we get to bill for it!
On top of the flexibility, when you are doing locums exclusively- there’s quite a few tax deductions that may allow you to keep more money in your pocket.
Although… there may be some travel involved- but hey, the kids are out of the house… why not!

Component#3: Creating (or Acquiring) A Business
Can’t find that passion for medicine again? Are you eager to try something else?
For some of us… maybe you don’t want to start from scratch and you don’t want to work ‘for the man’. Wouldn’t it be great to have a business that you can get cash from immediately?
Check out what I did by buying an existing business.
I’m not going to lie. It’s not all rainbows and sunshine, BUT if you structure the acquisition right- you can protect yourself and your future while creating multiple streams of income.
As a matter of fact, I like it so much- I am planning on acquiring or starting 1 new business every year the next 2 to 3 years.
This should allow us to generate a few thousand extra dollars a month. As we develop more systems and automation, each business should be on autopilot with some course correction from time-to-time.

Final Thoughts
Doctors like you are the best and brightest that our country has to offer.
As you may explore the “New Retirement”, keep an open mind.
You have the capacity and ability to contribute so much to the world- whether you are treating patients or starting a new business.
Keep trying, keep testing, and above all else, keep pursuing the financial freedom you so richly deserve.
More Advice by Dave Denniston- Does Stuff Own You? and Finances of Business vs. Hobby

About the Author
Dave Denniston, Chartered Financial Analyst (CFA), is an author and authority for physicians providing a voice and an advocate for all of the financial issues that doctors deal with. He also has 1 wife, 2 kids, and a bunny named Black Snow (which is a lot better of a name than Yellow Snow).
If you’ve enjoyed this guest post, you can learn more about his adventures in financial planning, liquid investments, illiquid investments, & much more nonsense by finding his latest blog post and videos
*Several of the links in this article have listed 3rd party firm/individual are not affiliated with or employees of United Planners Financial Services. United Planners does not supervise this firm/individual and take no responsibility to monitor the information/services they provide to you.
The opinions expressed are those of Dave Denniston and The Capital Advisory Group and are subject to change based on market, tax, and other conditions. The information provided is general in nature. Consult your investment professional regarding your unique situation. Securities offered through United Planners Financial Services 800-966-8737, Member FINRA, SIPC. Advisory Services offered through Capital Advisory Group Advisory Services, LLC. 5270 W. 84th Street, Suite 310, Bloomington, MN 55437, 952-831-8243, United Planners and Capital Advisory Group Advisory Services LLC are not affiliated.