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FINANCIAL

PLAN
FOR
YOUR
FUTURE:

RETIREMENT SAVINGS
FOR MEDICAL PRACTICES

By Gil Castillo, CRPC

Owning a medical practice allows you the freedom to plan your 401(k)
own future. While planning, don’t forget the importance of building With many large companies offering a 401(k) profit-sharing plan,
your personal wealth, such as through retirement savings plans. Not
surprisingly, retirement plans are often underutilized by owners and current and prospective employees are likely to welcome saving in
employees of small businesses when compared to benefits bestowed such a recognized plan. These are some of the highlights:
by large companies. • Employees can contribute up to $18,000 per year ($24,000 for

With everything else required for your practice, you may be those ages 50+) in pre-tax and Roth (after tax) money.
under-saving or have put off setting up a retirement plan entirely. • Deferred money goes into a separate account for each employee
Fortunately, there are a number of options that can jump-start your
savings, with minimal fees. In addition to providing for your own and is not taxed until employees withdraw funds.
retirement needs, many of these plans provide an easy way for you • As the employer, your practice can match employee contributions
and your employees to contribute to retirement, which will help
your practice hire and retain employees. or make discretionary profit-sharing contributions to employee
accounts.
Options for you and employees
Offering retirement plans and company contributions on behalf Simplified employee pension (SEP)
A SEP offers an easy and low-fee way to provide retirement plans
of your employees is a great way to attract and retain quality em-
ployees. Here are some options designed to make retirement account to employees of your practice. Here are the basics:
creation and funding easy for small businesses. • You set up a SEP with a trustee or financial institution, which

will open accounts for you and all other eligible employees. The
trustee or bank takes care of financial and reporting details.
• Your practice contributes to each employee's account. The con-

32 San Antonio Medicine • March 2017