59 y/o physician retiring the end of this year—happy to join this community

[Love This Community]

Thanks again for the warm welcome.

I'm wondering...where's the best place to share my current financial plan and seek input? I see some folks doing that here, but maybe the FIRE and Money section would make more sense...?

DD

Feel free to post them here or open a new thread under FIRE and money. Btw, welcome to this wonderful forum!

 

[swakyaby]

Welcome DangerDad,
I went from busy hospital-based group practice to full retirement in December 2017, and it felt really good to do so. When several colleagues in my group inquired whether I would consider part-time, it did kinda stroke my ego a little, but in the end it was not what I wanted. But your plan to ease out of practice is a popular one, especially in a profession which can be as emotionally rewarding as medicine.

As for your question about where to post about your financial plan and seek advice, it wouldn’t be inappropriate to post this in your introductory thread, I think. There are lots of people here who give really thoughtful answers (and a few who can be pretty abrasive, sometimes).

 

[vrijheid]

59 y/o physician retiring the end of this year—happy to join this community

Hi folks..I’m excited to be retiring at the end of this year and eager to learn from and contribute to this community.



I have one daughter, one son and one DW. Kids are teenagers in high school. I enjoy mountain biking, fitness, finance/investing and reading/learning.



I’m pretty confident re our FI and yet the upcoming transition from earning/accumulation to distribution feels momentous and a bit unnerving.



I’ve enjoyed my career very much—I love taking care of my patients and everything that involves. But it’s also demanding and stressful. After many years of education and training and coming up on 26 years in practice—I’m just so ready for a new phase.



Most of my investment decisions have been made and I’m comfortable with them—but I’m open minded and would welcome any input and advice. I’ll share details another time in a different thread...perhaps in the FIRE and Money section..?



The main decision that’s still pending is whether to retire fully versus continue as a Partner Emeritus working something like 15-20 hours/week—and I’m leaning toward the latter. I imagine doing this for 1-2 years as a transition to full retirement.



Even if I continue part time, it’s still officially considered a retirement with my “last day” of work being 12/31/21–I can’t wait!



Sincerely



DangerDad

Welcome! I retired at 58....I started transitioning from 5 days a week to 4 and then 3 days a week for several years before pulling the plug. It worked out well for me. My days now are as full as I want them to be with things I enjoy doing. FIRE is a beautiful thing. Enjoy your well earned retirement and don’t look back!

 

[pb4uski]

.... The main decision that’s still pending is whether to retire fully versus continue as a Partner Emeritus working something like 15-20 hours/week—and I’m leaning toward the latter. I imagine doing this for 1-2 years as a transition to full retirement.

Even if I continue part time, it’s still officially considered a retirement with my “last day” of work being 12/31/21–I can’t wait!

Sincerely

DangerDad

Give it a try. If you aren't satisfied then you can always then fully retire.

I worked 50% for many years before I hung it up entirely and enjoyed it.

 

[DangerDad]

Okay, I'll go ahead and share my plan here as suggested.

Financial Plan

Ages: 59 and 50 (DW)
Kids: son 18 and daughter 16
Location: Southern California

Annual income = $820K
Total Net Worth = $9.7M
Investable Assets (excluding home equity) = $7.5M
Home value = $3M
Debt = $800K (mortgage) at 2.69%

I'll be getting a generous pension.
Annual expenses - pension = $37K/year
Pension is not COLA so this number will increase steadily

Investments:
Bucket #1
401(K): $1.5M
Vanguard Target Retirement Income (VTINX)
[30% stocks 70% bonds]

Bucket #2
Keogh (and DW's IRA): $2.5M
Vanguard Target Retirement 2040 (VFORX)
[80% stocks 20% bonds]

Bucket #3
Taxable Vanguard Brokerage: $2.5M
Vanguard Tax-Managed Capital Appreciation (VTCLX)
Vanguard Small-Cap Growth Index (VSGAX)
AAPL
TSLA
PYPL

Other Assets:
Emergency fund (HYSA): $100K
My IRA = VITAX + VHCIX: $290K
529 plans (overfunded) = Vanguard Aggressive Growth Track: total $600K
Social Security: mine: $48K/year at age 70; DW: $16K/year at age 66

PLAN:
Begin with Bucket #1
Utilize Bucket #2 if/when needed--should last for our lifetimes.
Watch Bucket #3 grow---donate and pass on to our kids.

 

[RetireeRobert]

You said you were confident in your finances, and you have every right to be. You look to be in very good shape.

College for two kids looming looks to be taken care of with your 529's

Your annual expenses "not" covered by pensions you say is $37k, but you have two "buckets" to cover them totaling $4m.

Using a very conservative 3% withdrawal rate from buckets, you could take $45k annually from bucket 1's $1.5m---more than enough to cover expenses your pension won't. In reserve you have bucket 2 from which you could take $75 annually at the very conservative 3% withdrawal rule.

Your bucket 3 leaves an inheritance for your heirs.

Looks like you have everything covered, and if you use "only" a 3% withdrawal rate, your success rate should be about 130%! Maybe greater!

Your investment vehicles are very low cost, the Vanguard funds, and the allocations in those funds seems reasonable.

Are you sure you "really" want to work part-time? Financially, I'd say there is no real reason. But if it gives you psychic satisfaction it does allow a nice transition.

Congratulations! Enjoy your semi, or total, retirement!

 

[NW-Bound]

Okay, I'll go ahead and share my plan here as suggested.

Financial Plan

Ages: 59 and 50 (DW)
Kids: son 18 and daughter 16
Location: Southern California

Annual income = $820K
Total Net Worth = $9.7M
Investable Assets (excluding home equity) = $7.5M
Home value = $3M
Debt = $800K (mortgage) at 2.69%

I'll be getting a generous pension.
Annual expenses - pension = $37K/year
Pension is not COLA so this number will increase steadily ...

Your investable assets are way way more than needed to generate that $37k that you need to supplement your pension. And I think there's plenty there for the kids' education.

You should be able to stop work anytime you like. The part-time work is obviously more for psychological reasons than financial ones.

 

[RetireeRobert]

You don't say if you current home is intended to be your forever retirement home.

If it is and you don't plan to move, then whatever "excess" income you have in the near future, you could pay down and eliminate the remaining mortgage. Putting you into "debt free" land, and making you even more impervious to economic upheavals.

Just another thought.

 

[swakyaby]

Agree with what others have said. And I like the simplicity of your investments and their low cost. A set it and forget it plan. And if the tax code remains, your children will receive the stepped-up basis when they inherit the 3rd bucket. It looks like a reasonable plan to me.

 

[DangerDad]

Appreciate your comments.

Plan to get smaller house after youngest goes off to college.

Eliminating mortgage is definitely a goal.
Eager to be debt free.

DD

 

[Lucie]

Welcome! You said that you enjoy practicing medicine, so I would recommend part-time, at least on a trial basis. I am a pain psychologist/coach and absolutely love my work, but I wanted more personal time. I have enjoyed semi-retirement so far, as it allows me to work with my favorite patients while providing the freedom I desire. When it stops being enjoyable, you can fully retire.

 

[old medic]

Hi folks..I’m excited to be retiring at the end of this year and eager to learn from and contribute to this community.

Welcome to the forum from one Doc to another. I will call it quits on Dec 16th after nearly 35 years running on the truck as a Ditch Doctor.

 

[pacergal]

Welcome and congratulations. Your financial picture looks great. You don't need to work part time unless you wish too.
Retire and enjoy life!

 

[DangerDad]

There are two reasons I’m considering working part time following “retirement”. The first one I mentioned earlier: my attachment to the job, my patients and the great folks I work with. This attachment also includes issues of identity and sense of purpose. The other reason is financial. Despite the numbers which indicate FIRE-readiness, I really like the idea of putting off the distribution phase a bit longer and continuing to add to my 401(K), Keogh and IRA accounts. I fear this will sound greedy but really it’s more about being conservative and cautious. Maybe some of you understand..?

 

[NW-Bound]

... The other reason is financial. Despite the numbers which indicate FIRE-readiness, I really like the idea of putting off the distribution phase a bit longer and continuing to add to my 401(K), Keogh and IRA accounts. I fear this will sound greedy but really it’s more about being conservative and cautious. Maybe some of you understand..?

Looking at your numbers, I believe most posters here will agree with me that you do not have a financial obstacle to quit working. But if you need another reason to keep doing part-time work and don't mind doing it, there's nothing wrong with it.

I would like to tell this story. A few years ago, the doctor I usually saw was not part of the new ACA insurance plan that was solely available in my area, so I had to go to a new practice. It was run by two older doctors who were close to 70. I was just past 60 then, and I looked young for my age. Nobody would have thought that I already retired.

The doctor I saw was really interested in my life story, when seeing that I survived a potentially life-ending illness, and that I had been retired since the age of 56. He asked me what I was doing in my spare time (what spare time?), and what I did for fun (wandering around Europe for up to 2 months at a time, or RV trekking to Alaska or the Canadian Maritimes).

In my next visit, that doctor was not available, and I was seen by his partner. He asked me the same questions as the first doctor, and said that he had not retired because he was not sure how to spend his time. He was self-defending his still working and justifying although I never made the comparison. I tried to soothe him to say that if one enjoyed his work, then there was no reason to quit, and that if it were not for my past illness and the hassle at work, I could have continued as I also loved my work.

When I needed to see them next, I learned that both had retired and sold their practice! I would like to think that my story influenced their decision.

And then recently, I learned this story from my long-time friend since high school. He said his older brother who was a pharmacist developed a manic depression after retiring at the age of 70 and not having anything to do. It was bad enough for him to need clinical treatment.

 

[RetMD21]

When I needed to see them next, I learned that both had retired and sold their practice! I would like to think that my story influenced their decision.

Great story although you are contributing to the shortage of physicians

 

[NW-Bound]

Great story although you are contributing to the shortage of physicians

Two old men still working in their 70s? One did not appear to be in good health.

With more ACA plans now opened in my area, I found a plan that my long-time doctor was on, and have been going back to him.

In last year's annual visit, we chatted and he asked me about my travels. He said his wife had been very interested in doing RV'ing in Alaska. I asked him how much time he could get off his practice, as one could spend a whole summer doing that trek. He said he could manage to be off for 2 weeks. And I told him that it would be doable if he flew to Anchorage or Fairbanks and rented an RV there.

This doctor is young and may be around 50, and he took over the practice from an older doctor I saw, but who retired. I don't think he can quit anytime soon. It's good, because I do not like to change doctor. He will outlive me.

 

[RetireeRobert]

T
This doctor is young and may be around 50, and he took over the practice from an older doctor I saw, but who retired. I don't think he can quit anytime soon. It's good, because I do not like to change doctor. He will outlive me.

When my second to last doctor started greying and I started wondering how long he would be around, I decided to start my own search for a young doctor. I found one and switched, fairly confident he would be in practice long enough to see me through my elder years. I had also tried that philosophy with my dentist. Unfortunately, I misjudged his age as he just retired and sold his practice. Not sure I like the replacement who is maybe "too" young, so may need to start the search for a new dentist.

 

[Retch The Grate]

Welcome to the forum, looks like your numbers are incredibly solid for a pretty fantastic retirement.

 

[DangerDad]

Thanks for the kind words.

Several folks have commented about finding another doctor after theirs retires.

I guess we're all replaceable. And yet it's those connections that matter most.

I always feel honored when patients (and their families) place their trust in me.

Whenever I decide to call it quits..that's one of the things I'll miss the most.

DD

 

[swakyaby]

There are two reasons I’m considering working part time following “retirement”. The first one I mentioned earlier: my attachment to the job, my patients and the great folks I work with. This attachment also includes issues of identity and sense of purpose. The other reason is financial. Despite the numbers which indicate FIRE-readiness, I really like the idea of putting off the distribution phase a bit longer and continuing to add to my 401(K), Keogh and IRA accounts. I fear this will sound greedy but really it’s more about being conservative and cautious. Maybe some of you understand..?

The first part I totally understand. It took a lot of effort and commitment and years to reach the professional level you are in now. There’s a great deal of satisfaction in the work you do. And you’re probably at the highest level of compensation you’ve ever received for work that you find mostly satisfying.

But the financial part is really about facing the unknown. Padding the investment accounts will likely not do much more than increase your children’s inheritance. Your pension that pays most of your living expenses should serve to provide ample sense of security, even if it is not cola’d. For me, the time demands of medicine and the weeknight calls and the weekend calls left me often yearning for more free time to do the activities I always wanted to do. Trying to squeeze it in during vacation time wasn’t enough. I wanted a better, if more serene, quality of life, on a daily basis. Even though I didn’t have a pension, at some point I realized I had saved more than enough.

 

[DangerDad]

The first part I totally understand. It took a lot of effort and commitment and years to reach the professional level you are in now. There’s a great deal of satisfaction in the work you do. And you’re probably at the highest level of compensation you’ve ever received for work that you find mostly satisfying.

But the financial part is really about facing the unknown. Padding the investment accounts will likely not do much more than increase your children’s inheritance. Your pension that pays most of your living expenses should serve to provide ample sense of security, even if it is not cola’d. For me, the time demands of medicine and the weeknight calls and the weekend calls left me often yearning for more free time to do the activities I always wanted to do. Trying to squeeze it in during vacation time wasn’t enough. I wanted a better, if more serene, quality of life, on a daily basis. Even though I didn’t have a pension, at some point I realized I had saved more than enough.

That’s actually very insightful—yes, fear of the unknown. It’s unsettling. However I think that a bit of part time work (let’s say one year..?) will actually help to demystify what lies ahead..I think it will lessen that trepidation. We shall see.

Thank you so much...

DD

 

[dirtbiker]

Welcome, from a doctor 20 years behind you. I'm also hoping to retire at 59, but have a long way to go, and a lot of saving to do. What is your specialty?

 

[P.S.]

Hello DD,
Welcome to the forum. If you can transition to very PT -> I work 1-2d/wk no call, and found it allows me to have enough time to putter and just sit doing nothing, while also giving an outlet to challenge my brain. Also found that pushing the workload to as low as it could go resulted in me really appreciating the time I spent in house. Kind of like that feeling when you first start on the wards as an MS3. Good luck on the transition! At 59, you’ve earned and deserve the time to just mountain bike and enjoy life.