A career in medicine is rarely a straight line. Whether you're a physician moving from residency into your first attending role, transitioning from private practice to an employed hospital position, or preparing for early retirement or a locum tenens arrangement, the financial implications of each move are significant—and often underestimated.
At Cordell, Neher & Company, we work closely with physicians in North Central Washington, including through our valued partnership with Confluence Health, to help navigate exactly these moments. Here's what you need to know when a career shift is on the horizon.
The Gap Period Nobody Warns You About
The stretch between positions (even a short one) can create a cascade of financial decisions that deserve careful attention. Health insurance coverage, retirement contribution timing, and the handling of deferred compensation or signing bonuses can all create lasting tax consequences if not planned proactively.
For physicians moving from an employed model to private practice (or vice versa), understanding when income will begin flowing and how it will be structured is critical. A tax-smart approach here isn't just about April 15th; it's about building a financial picture that works year-round.
Retirement Accounts: Know What You're Leaving (and Joining)
Many physicians transitioning out of hospital employment have access to 403(b) or 457(b) plans that operate under very different rules than the 401(k) plans common in private practice settings. Understanding rollover options, distribution timing, and ongoing contribution strategies before you sign anything can preserve tens of thousands of dollars in tax efficiency.
If you're entering or founding a private practice, the opportunity to establish your own retirement plan such as a SEP-IRA, Solo 401(k), or defined benefit plan can be one of the most powerful wealth-building tools available to you. These are decisions best made in concert with both a financial advisor and a CPA, which is exactly the kind of integrated planning our team is built to deliver.
Contract Review: More Than the Salary Line
Physician employment contracts are complex. Base salary, RVU incentives, tail coverage, non-compete clauses, and partnership tracks all carry financial weight that deserves a thorough review. While we aren't attorneys, our team can work alongside your legal counsel to help you understand the financial implications of what you're agreeing to and build your plan accordingly.
Planning for What's Next, Not Just What's Now
Whether you're five years from retirement or five months into your first attending role, the most common regret we hear from physicians isn't that they earned too little. It's that they didn't have a plan sooner.
The demands of a medical career make it easy to defer financial planning. From managing student loan strategies to building an investment portfolio, the compounding value of making informed decisions early that reflects your risk tolerance and timeline is immeasurable.
We understand that your time is finite and your financial picture is complex. That's why we bring your CPA and financial advisor together under one roof, so the advice you receive is coordinated, comprehensive, and built around your whole life, not just one piece of it.
If you're navigating a career transition and want to understand the full financial picture, we'd welcome a conversation. Reach out to our team at Cordell, Neher & Company, PLLC to schedule a complimentary consultation.