Psychiatrists and other mental health professionals tend to have mixed sentiments about retiring. While they would love to have more time to spend outside of work, many still love their jobs. Here are our tips for what a psychiatrist should do ten years out of retirement to take a step back gradually while still enjoying being a part of their practice.
Before we get into the blog, we are a financial planner for therapists and mental health professionals. If you are interested, it may be a good idea to check out the following blogs about finance for therapists:
Retiring as a private practice psychiatrist
Financial tips for therapists starting a private practice!
How does a therapist decide on a fee structure?
How to expand your therapy practice to another state
When do therapists retire (and how?)
Cold turkey or just a cut back?
From what we’ve seen, it’s not common for a psychiatrist, psychologist, or therapist to quit their job or terminate their practice cold turkey. Many simply wish to cut back the number of hours they are working.
If you are a mental health professional in your mid 50’s thinking about the best way to phase out of your practice, here is what we suggest. Start by running the numbers. Meet with a financial planner and get clarity on the following questions:
- How much money do I need to retire?
- If I am selling my practice, what do I expect as the proceeds? (hyperlink)
- What income do I anticipate earning for the next 10-15 years?
- What are my expenses in retirement going to be?
- If I were to semi-retire, what amount of income would make it worthwhile to still get up and go to work, even in a reduced capacity?
Look at the total picture
Private practice psychiatrists, psychologists, and therapists tend to have a multi-faceted way of engaging with the community. For most, it’s not just a job – it’s a passion that they are very committed to. It’s almost as if their profession is a part of them.
We commonly see them very involved with their professional mental health community, teaching classes at the local college, and engaging with the public in a variety of other ways. It’s a good strategy to look at all of your pursuits, and estimate the time, income, and cost associated with each.
For many, the time drain is non-clinical hours. For example, if you are teaching classes at the local college you will be following the school schedule. You may have to commute a certain amount each week, instead of spending the whole day in your office seeing clients. You are grading, writing exams, and liaising with the school when you are not teaching. All of this should be factored in. Non-clinical time is usually where we see psychiatrists and other mental health professionals cut back when they are preparing for retirement.
Get a financial plan
There are many paths you can take when you are a psychiatrist or therapist 10 years away from retirement. It’s useful to go through the exercise of mapping it all out from a financial perspective. A financial plan can give you the clarity you may need as you scale back your practice before retiring.
As financial advisors for therapists, psychologists, psychiatrists, and private practice owners, we believe that mental health is a noble profession, and we are proud to serve those who help others in this capacity, no matter where you are: starting out, mid-career, or terminating a private therapy practice.
If you are a psychiatrist looking for financial advice, scaling back your hours, or thinking about retirement, contact us for a chat.