Cite this article as:
J Can Dent Assoc 2014;80:e1
Is Your Exit Strategy
Well Crafted?
CDSPI
Reports
By Ron Haik and Susan Roberts
A Financial Planning Checklist for Dentists Gearing Up for Retirement
A
fter decades of tireless work
and diligent saving, your retirement date is finally on the horizon: in the next 3 to 5 years, you’ll be
embarking on a new, exciting stage of
your life!
However, there are some key
investment and insurance planning
issues you’ll need to carefully consider well in advance of your retirement date. Fortunately, the licensed
certified financial planners and professional insurance advisors at CDSPI
Advisory Services Inc. (in conjunction
with your other professional advisors)
can help guide you in creating a customized exit strategy. Here is a partial checklist of some issues we can
explore.
Investment Planning
Considerations
❑ Properly Structure the Sale of
Your Practice—and Manage
the Proceeds
Consult your tax professional about
the prospect of restructuring the
ownership of your practice to minimize taxes ahead of its sale (which
may involve incorporating or adding
shareholders). You’ll also need to consider how to strategically invest the
proceeds from the sale.
jcda
ca | 2014 | Vol. 80, No. 1 |
ESSENTIAL DENTAL KNOWLEDGE
Published by
The Canadian Dental Association
jcdaf
ca
❑ Revisit the Asset Allocation of
Your Retirement Investments
As you approach retirement, it may be
advisable to take on less investment
risk in your portfolio. One option to
consider when mitigating that risk
is through discretionary portfolio
management.
plans upon retirement. These may
include, but are not limited to, your
disability, office (unless you will continue to own the practice), malpractice (if surrendering your license to
practise) and office overhead insurance plans.
❑ Review Coverages You May
❑ Formulate a Retirement
Income Distribution Plan
You will need to plan the method
and timing for taking distributions
from your retirement assets (e.g., your
RRSP, non-registered investments,
and dividends from your corporation).
❑ Assess Financial Risks
It’s important to understand how
to manage financial risks that can
impact your retirement, such as a outliving your savings, withdrawing too
much income, inflation, investing too
conservatively and health care
expenses (for more on health benefits, see “Introducing CDSPI Retiree
Benefits” on p. 30).
Insurance Planning
Considerations
❑ Consider Insurance Plans You
May No Longer Need
If you plan to completely retire, you’ll
want to discontinue certain insurance
Need to Maintain
Some dentists decide to retire gradually by working reduced hours
in advance of completely retiring.
Dentists in this circumstance may
need to fully maintain certain coverages, like malpractice insurance, but
may potentially need to consider
reducing others, such as disability
insurance.
If you’ll be working as an associate in advance of retiring, consider obtaining the TripleGuard ™
Insurance Associate Package, in lieu
of cancelling your office coverage. The
Associate Package provides economically priced coverage for office contents losses, commercial liability lawsuits (e.g., a patient slip and fall) and
income loss resulting from an office
disaster.
Don’t forget to maintain your
travel coverage if your retirement
plans will involve vacationing outside
your home province.
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