In our fantasies, retirement can seem like a never-ending vacation—one day you’re working and the next, you’re on an Italian yacht sipping Bellinis while you FaceTime the grandkids.
In reality, it’s more complicated than that. People are retiring later, with the over-65 crowd becoming the fastest-growing slice of the American workforce, according to NPR. Medical Economics notes that this is especially the case for physicians, who retire an average of five years after everyone else. Even then, they may pursue a “step-down retirement” rather than a clean break from medicine.
Should you join them? Whether you’re just at the beginning of your career or nearing what could be the finish line, it’s important to think about your departure ahead of time.
What is a step-down retirement?
For most physicians, a step-down retirement involves working part time while they scale back their practice. By doing so, providers can ease themselves into a retirement arrangement that generates revenue but also allows them to venture into new hobbies, passion projects or travel.
The idea has broad appeal. In a 2017 survey by locum tenens agency CompHealth, 51% of physicians said that the ideal retirement would involve part-time work in some way. A similar report in 2018 from the American Medical Association (AMA) found that a gradual transition was one of the best ways to have a satisfying retirement.
As a bonus, there’s a great deal of flexibility built into “soft retirement,” so physicians can make it work for them. One attending described to The DO how she scaled her presence at a behavioral health hospital from all day to mornings only. Another physician who worked in emergency medicine started doing telehealth to stay connected with the practice from afar, as OrthoLive notes.
If you talk to your colleagues, you’ll find that these experiences aren’t uncommon. In fact, a soft retirement has increasingly become the norm for physicians so that they can adjust to life after the clinic.
The benefits of a gradual retirement
The obvious reason to delay retirement—at least for most Americans—is the money. But for physicians, there’s more to the story. According to CompHealth’s survey, 58% of doctors said they wanted to keep working past 65 simply because they loved what they did.
That’s not to say that a part-time retirement can’t help you stretch your retirement dollars so that you can maintain your lifestyle well into your golden years: It certainly can. But even if you feel you’ve taken steps to prepare financially for retirement, as 83% of doctors do, there are other benefits to stepping down slowly.
Mental health is a big one. Last year, endocrinologist Dr. Richard Plotzker wrote in KevinMD about how retirement can feel socially isolating for physicians. It makes sense: After years spent in practice, developing a lifetime of social and professional currency, it’s probably difficult to imagine it being over for good.
That’s especially the case for careers that have involved burnout or trauma. As one retired physician wrote in the AMA’s 2018 report, they couldn’t fathom a hard exit. After all they’d seen and done, it was just out of the question to leave “cold turkey.”
Gradually approaching retirement, by contrast, enables physicians to connect with their purpose and identity outside of medicine while slowly leaving the rigors of their job behind. Perhaps more importantly, it gives doctors time to build a life apart from medicine that they will feel is worth transitioning into. You’ll be able to slowly add new hobbies or activities into your downtime, trying new things at your own pace.
How to scale back your practice
If you’re considering a step-down model for your retirement, you’ve already got a big advantage: all the advice that’s available from others who did it first. Asking fully or semiretired colleagues about their experiences can help you learn which option is best for you.
Beyond that, try the following three techniques to dip your toe into retirement.
1. Adjust your hours
Explore new schedules like mornings only or three days a week to see how a different schedule works for you and the practice. If you own your own practice, consider hiring a part- or full-time clinician to support the hours reduction; if you work in a larger practice, request the adjustment in a way that makes the added value your part-time role can bring clear to your colleagues. For example, part-timers can boost profitability, according to the American College of Physicians.
2. Consider alternative paths
Look into leaving your home clinic but still working in medicine, for example via telehealth or as a locum tenens doctor. Teaching or working as a consultant for healthcare groups or companies can be another way to ease into retirement while still making money and doing so in a less stressful line of work. (And if you don’t need the money, volunteering with the American Red Cross or a free clinic is an option as well.)
3. Fund passion projects with passive income
Find ways to generate passive income from your career and then invest those funds in postretirement passion projects, like inventing a new medical device or joining a nonprofit as a medical advisor. For example, if you own a medical practice but have been wanting to sell it, consider keeping the real estate but selling the practice. That way, you can continue to generate income from the practice, but the book of patients is no longer your responsibility. (For these and other complex financial moves, always check with a financial adviser first.)
Above all, know that retirement looks different for everyone—and that’s OK. As one physician advised in Medical Economics, the most important thing to realize is that there’s meaning after medicine for everyone. Just because you were a doctor once doesn’t mean that’s all you are or will ever be. Yacht or not, a good departure from medicine is one that leaves you feeling satisfied and fulfilled.