What Can a Retirement Program Specialist Do for You?

September 28, 2023
Learn how working with a financial professional can make retirement plans easy.
Envelope with thank you note

Many ODs have misconceptions around saving for retirement—practice owners may worry about the costs associated with starting a retirement plan for their practice, while employed doctors whose employers don’t offer a plan may feel stuck. But whether you’re a practice owner, employee, or independent contractor, it’s never been easier to start planning for retirement. We talked with Nathanael Kelley, Retirement Program Specialist for Equitable Financial, an AOAExcel-endorsed business partner, to find out how a financial professional can make retirement planning simple for AOA members.

What does Equitable offer to AOA members?

AOA members can receive a complimentary consultation from an Equitable Retirement Program Specialist (RPS) who will help explore your Retirement Plan options. Our financial professionals will get to know you, your business, and your staff to help educate you on the options available and walk through the process of starting a retirement plan. If you already have a retirement plan, we’re happy to review your current plan to see if there are any amendments we could suggest to ensure you’re maximizing your contributions and that your plan is still meeting your needs.

What is a Retirement Program Specialist?

An RPS is a licensed financial professional with Equitable Financial who is specially trained and versed in employer-sponsored retirement plans. When meeting with an RPS, you’re getting the knowledge and experience of someone whose work focuses solely on retirement savings and employer-sponsored plans, not a generalist who works with all financial service products.

What are the benefits of starting a retirement plan?

There are three main reasons to start a retirement savings plan for your practice. In no particular order, they are:

  1. Saving for your retirement—This goes without saying! Getting started in saving for your retirement and building your nest egg is essential.
  2. Lowering your taxable income—Salary Deferral contributions reduce taxable income, which makes offering a retirement plan very important for ODs looking to reduce their tax liability. As your practice and income grow, you run into what we call “a good problem to have.” Deferring your Salary into a 401(k) plan can be a great way to lower your tax burden. For 2023, the Salary Deferral limit is up to $22,500 or up to $30,000 for those 50 or older.
  3. As a staff benefit to attract and retain employees—More important than ever! A retirement savings plan can set your practice apart and make working for your practice more attractive to quality applicants, as well as help retain your valuable employees.

If you’re an employed OD whose employer doesn’t offer a retirement plan, where do you start?

If your employer doesn’t offer a retirement plan, Individual Retirement Accounts are an option. Keep in mind that the contribution limits are lower— $6,500 for anyone under 50, and $7,500 for anyone 50 or older. There are two types of IRAs:

  1. Traditional IRA—Contributions are made pretax and can lower your taxable income. Talk with your accountant because there is an income limit for taking a deduction, and this can make Traditional IRAs less attractive to high income earners. However, even if you are not eligible for a deduction, earnings do still grow tax-deferred until withdrawn.
  2. Roth IRA—With a Roth IRA, you’re making contributions “after tax.” While there are annual compensation limits, eligible participants in a Roth IRA also have their savings grow tax-deferred, and withdrawals are tax-free as long as the funds are invested for at least 5 years and you are over age 59.5 when withdrawing.

You’ll want to talk to your tax advisor to see if an IRA is suitable for you.

What if you’re an independent contractor?

Independent Contractors are in a unique position when it comes to Retirement Plans. Since they do not (typically) have any employees, there is a lot of freedom when it comes to Retirement Plans. The plans most utilized by these doctors are:

  1. Owners Only Traditional 401(k) plan—Owners 401(k) plans allow for a great deal of flexibility and permit you to contribute as little or (depending on your income) as much as you’d like up to the IRS limit.
  2. Cash Balance—Cash Balance plans allow for very large annual contributions and reduction of your tax burden.

What’s one piece of advice you have for doctors who haven’t started saving for retirement?

The best time to start saving for retirement is 20 years ago. The second-best time is today! There are many options and levels of contributions. Reach out to a Retirement Plan Specialist today to schedule a complimentary consultation to explore your options.

AOA members can receive a complimentary consultation and savings plan review with Equitable. Learn more at aoa.org/retirementsavings.

The retirement program is funded by an annuity contract issued and distributed by Equitable Financial Life Insurance Company (Equitable Financial), New York, NY. Annuities contain restrictions and limitations. For costs and complete details, contact a Retirement Program Specialist. Equitable is the brand name of Equitable Holdings, Inc. and its family of companies, including Equitable Financial Life Insurance Company (Equitable Financial) (NY, NY); Equitable Advisors, LLC (member FINRA, SIPC) (Equitable Financial Advisors in MI & TN); and Equitable Distributors, LLC. The obligations of Equitable Financial and Equitable America are backed solely by their claims-paying abilities. Equitable Financial and its affiliates and associates do not provide tax or legal advice and are not affiliated with the American Optometric Association (AOA) . GE- 5465420.1 (2/23) (Exp. 2/25)

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