The Challenge of Un-Expected [Physician] Retirement

Just a Word -or- Much More?

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By Rick Kahler; MS ChFC CCIM CFP®

Retirement is a word I’ve tried to purge from my professional vocabulary. Few people – even physicians and medical professionals – really know what it means anymore.

Instead, I like to think of retirement as being a stage in life where you get to choose what you want to do, when you want to do it, and with whom. It can also be that time when you attain financial independence and no longer intend or need to earn an income to support your lifestyle.

Early Retirement

Sometimes, however, “early retirement” can throw us a curve ball before we’re prepared for it or ready to become financially independent.

This often comes in the form of a job layoff, termination, or health issues that require we no longer work for an income. So, here are some action steps for an unexpected early retirement [applicable to doctors and laymen, alike]:

Some Tips

1. Immediately become aware of your monthly expenses. If you don’t track expenses, now would be a good time to go back over the last 12 months of expenditures and set up a cash flow tracking program like or

2. Create a spending plan for the next 12 months. Don’t forget to include savings for large purchases (cars, repairs, travel, Christmas, etc.) as a part of your annual expenses. Make sure you reduce or eliminate past expenses related to your work life and add expenses that come as a part of retirement, like increased travel or health care.

3. Estimate your sources of income. Include Social Security, employer pensions or severance packages, and your personal investments. For personal investments, use an income estimate of 4% of the principal. One million in investments will give you $40,000 a year in income.

4. Match your estimated annual retirement income with your spending plan expenses. If the expenses exceed your income, begin deciding where you can cut your spending. It is often helpful to enroll another person to help with ideas on reducing expenses. This is an area where we all have “blinders” on, and others can suggest creative cost savings we would never have thought of ourselves.

5. Don’t give up on finding part time employment [public clinics, part-time private offices, locum tenens, substitutes, hospitals, or even pro-bono work, etc].  There are many opportunities to create some income in retirement, and even a little paycheck can go a long way to preserving your investment savings. Check your ego at the door—this is not the time to let false pride keep you from taking a part-time job that’s less “professional” than what you’ve been doing.

6. Consider reducing monthly expenses by using savings or investments to pay off debts like car loans or credit card bills. Often your best investment is paying off debt. This can be especially true when your savings is earning 0.5% and your credit card is charging you 15% on the outstanding balance.

7. Consider downsizing by selling your house. This can be an especially good move if you have enough equity to pay cash for something smaller or at least end up with no mortgage or a smaller mortgage payment.

8. For couples, talk seriously about what both of you want, separately and together, in the next few years. Brainstorm creative ways—volunteering at state parks, for example—to carry out retirement plans inexpensively.

9. Take time to deal with the emotional side—anger, fear, depression, etc. It’s especially important to surround your-self with supportive friends and family and to talk about what’s going on.


Unexpected retirement can be a life-changing blow, both emotionally and financially. Coping with it will require resiliency, courage, persistence, creativity, and support. You’ll be most successful when you take advantage of not just your financial resources, but all the resources at your disposal.

The Author

Rick Kahler, Certified Financial Planner®, MS, ChFC, CCIM, is the founder and president of Kahler Financial Group in Rapid City, South Dakota. In 2009 his firm was named by Wealth Manager as the largest financial planning firm in a seven-state area. A pioneer in the evolution of integrating financial psychology with traditional financial planning profession, Rick is a co-founder of the five-day intensive Healing Money Issues Workshop offered by Onsite Workshops of Nashville, Tennessee. He is one of only a handful of planners nationwide who partner with professional coaches and financial therapists to deliver financial coaching and therapy to his clients. Learn more at


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5 Responses

  1. “Help Wanted”

    Unemployed professionals can improve their odds of landing in a good position before their money runs out if they make the right moves.

    Here are some suggestions by financial advisers who work with the unemployed.



  2. 11 retirement changes for 2012

    Social Security recipients are finally getting a raise. Retirees — and anyone planning to retire — should also be aware of 10 other changes to expect in the new year.



  3. More on Financial Calamity

    In my post above, I offered nine ways to prepare for inevitable financial calamities by building a financial shield against disaster. Now, I’ll add three more strategies that are as much about medical professionals and physicians, as about money.

    1. Build a good support team before you need one. In the middle of a financial trauma isn’t a good time to find professionals you can trust. This is best done when you are not under pressure and can take the time you need to research, interview, and analyze options. Professionals you need to vet and have on call could include an attorney, accountant, therapist, financial planner, medical management consultant, insurance broker and banker.

    2. Keep your medical career and specialty skills up to date. Most doctors don’t think of their career, or medical license, as their biggest financial asset. Yet, until you become financially independent, there is no asset more important than your ability to earn money. Most doctors neglect taking the time and money to invest in improving and refining their skills [non-medical skills, too]. This is crucial if you are in a field that’s becoming less prominent, or whose CPT® code reimbursement is shrinking. It’s also important if you put your career on hold to stay home and raise children. It’s not too soon to begin preparing to re-enter the healthcare work force several years before your children are old enough. Even if you don’t intend on going back to work, keeping your skills sharp is good insurance in case you need to reenter the work force because your spouse loses a job, dies or becomes disabled; or you divorce. Anticipating and preparing for a career change before it’s forced upon you can literally add hundreds of thousands of dollars to your future net worth.

    3. Plan ahead for college expenses. Okay, sending your child off to college really isn’t a financial calamity. However, it never ceases to amaze me how many parents wake up in horror when their child is age 17 to the fact that large tuition bills will be coming due in a year. All of a sudden college tuition becomes a financial emergency. In most cases, parents dig deep to fund their child’s education, harming both themselves and the child by suspending what they were saving toward their retirement. Studies show it’s cheaper for kids to put themselves through college than to support elderly parents who didn’t provide for themselves. If you find yourself in this situation it is imperative you shop colleges just as you would anything else. Most colleges are not a good buy for the education received. Compare the average salary of the degree you are obtaining with the cost of obtaining it. If you plan to pay part of your kids’ college expenses, start saving when they are still in diapers. Also consider other options well ahead of time, like kids working their way through college or buckling down and qualifying for scholarships.

    When it comes to coping with financial calamities, having career options, trusted advisors, and thriving family relationships are as important as building a financial cushion. All these strategies will help you and your family with the inevitable financial challenges that are sure to come your way.

    Rick Kahler; MS ChFC CCIM CFP®


  4. And Now .. The Hospital Pension Problem

    The issue of looming pension fund shortages will be the final death knell to academic medicine’s resistance to joining the 21st century’s shared-risk of the 40-3b/401-k retirement funds … from Chicago Business:

    Already caught between flattening revenues and rising costs, many hospital CEOs are confronting a looming pension fund gap.

    The University of Chicago, which includes the university and the medical center, and Resurrection Health Care Corp. were among the most underfunded pension funds for hospitals in the country, according to a study of 550 health systems by Standard & Poor’s Ratings Services, based on 2010 financials.

    While U of C’s and Resurrection’s retirement funding has improved, they are part of a group of five Chicago-area hospitals and health care networks whose pensions are less than 80 percent funded and are considered at risk of default, according to federal regulations. NorthShore University HealthSystem and Provena Health, which merged with Resurrection in 2011 to form Presence Health, also are below the threshold. The others are Northwest Community Hospital and Elmhurst Memorial Healthcare.

    The five most underfunded hospital pension funds are among 10 major hospitals and health care networks in the Chicago area that owe a total of $1.12 billion to their pension funds, according to a Crain’s analysis of the most recent financial statements.

    Dr. David Edward Marcinko MBA


  5. Med Students: Exceptionally High Rates of Alcohol Abuse

    Approximately one third of medical school students meet criteria for alcohol abuse or dependence, double the rate of their age-matched, non–med student peers with burnout and high educational debt primarily to blame, new research shows.

    “This is the first study to explore the relationship between alcohol abuse/dependence and burnout among medical students,”

    senior author Lotte N. Dyrbye, MD, professor of medicine and medical education at the Mayo Clinic College of Medicine, in Rochester, Minnesota, told Medscape Medical News.

    “In this national cohort of medical students, a third [of students] met criteria for alcohol abuse/dependence. That is a much higher prevalence than what has been previously reported in similarly aged U.S. college graduates,”

    Dr Dyrbye said. The findings are from a national survey that the investigators sent to 12,500 medical students in 2012. The study was published online March 1 in Academic Medicine.

    Nancy A. Melville, Medscape [3/24/16] via Dr. Allen Jacobs via PMNews


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