Cash Flow Planning for Burnt Out Physician

Jackie and Larry Stein

Jackie and Larry Stein are in their mid-50s. As a department chair at one of Boston’s large healthcare networks, Jackie must balance her clinical workload, administrative duties, and research goals. However, after several decades in medicine, the workload and stress has caught up with her to the point where she would like to explore her options for an early retirement (or a potential second career). She will receive deferred compensation payout for several years commencing upon her separation and she would like to see if this will be enough to avoid additional portfolio withdrawals prior to age 59½.

Larry works as a product development executive at an information services company with a goal of retiring in five years. He has been with his company for 15 years and accumulated a large position of company stock in his retirement account that he would like advice on. For the Steins, cash flow planning for an early retirement is of paramount importance.

How Artemis Helped

  • We built a detailed 5-year cash flow model culminating with Larry’s retirement. The model provided projections for each year’s cash flow surplus/deficit and the year-end portfolio balance.
  • As part of our cash flow model, Artemis illustrated how much of their expenses Jackie’s 457 plan payouts would cover and how much would come from additional portfolio withdrawals.
  • We developed a long-term Roth conversion strategy to implement after Larry fully retires and prior to receiving Social Security retirement benefits.
  • We identified an opportunity for Larry to save on taxes by rolling the employer stock in his 401(k) into a taxable account upon retirement.

How Jackie and Larry Benefited

  • Jackie is excited to have a roadmap for retirement with the insights that allows her to retire with confidence.
  • Jackie and Larry are happy to have a plan that enables them to convert more of their assets into Roth accounts, thus giving them control and predictability of their taxes in later retirement years.
  • Larry saved approximately $25,000 in taxes by rolling his employer stock into a taxable account, thereby gaining a capital gains tax treatment for the net unrealized appreciation (NUA).

Case Studies

Cash Flow Planning for Burnt Out Physician

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