6 Retirement Tips for Dermatologists: Essentials for a Successful Exit

You’ve spent years building a successful dermatology practice, earning the trust of your patients, and creating financial stability for your family. But what happens when you’re ready to scale back or walk away altogether?

Retirement doesn’t happen automatically. For dermatologists, it takes strategic planning to preserve income, reduce taxes, and transition out of practice on your terms.

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Here are six retirement tips to help dermatologists prepare for a smooth, confident, and financially secure next chapter.

1. Start Retirement Planning Early — and Revisit Often

Retirement isn’t a one-time decision. It’s a process that can take years to execute well. The earlier you start planning, the more flexibility you’ll have.

A few things to keep in mind when planning:

• Setting retirement savings goals beyond just your 401(k)

• Thinking through when and how you want to exit the practice

• Reviewing your plan annually as income, expenses, and goals evolve

Even if retirement feels far off, decisions you make today, like entity structure, compensation strategy, and investment planning, will shape your retirement timeline and outcome.

2. Diversify Your Income Streams Beyond the Practice

Many dermatologists rely heavily on practice income, which can become risky when it’s time to retire. If the practice slows down, or selling becomes difficult, you may feel stuck.

Smart retirement planning involves building alternative income streams such as:

• Tax-advantaged investment accounts (brokerage, Roth IRA, etc.)

• Real estate or passive business investments

• Structured annuities or pension-style income strategies

• Private banking strategies or cash-value life insurance

The more diversified your retirement income, the less dependent you are on selling your practice to fund your lifestyle.

3. Build an Exit Plan for Your Practice

Whether you own a solo practice, a cosmetic clinic, or are part of a larger group, planning for exit in dermatology is one of the most complex, and financially important, steps in your career.

Questions to consider:

• Will you sell to a partner, associate, or third party?

• How will the practice be valued?

• What happens to staff, lease obligations, and patient records?

• Do you want a full sale or phased transition?

An experienced advisor and attorney can help structure a sale that meets your financial goals, minimizes taxes, and protects your legacy.

4. Maximize Tax-Efficient Retirement Savings

You likely already contribute to a 401(k) or SEP IRA, but there may be more sophisticated strategies available to help you reduce taxes and save faster.

Consider:

• Cash balance plans (great for high-income earners nearing retirement)

• Defined benefit pension plans

• Backdoor Roth IRAs

• Tax-efficient portfolio rebalancing in non-qualified accounts

When coordinated properly, these tools help you lower your current tax bill and grow your retirement assets faster.

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5. Protect Your Assets Before You Retire

Before you step away from clinical work, it’s critical to shield the wealth you’ve built. Asset protection isn’t just for worst-case scenarios — it’s for peace of mind.

Strategies may include:

• Irrevocable trusts or family limited partnerships

• Moving real estate or practice equity into holding companies

• Reviewing liability insurance, umbrella coverage, and estate plans

• Ensuring your personal and business liabilities are legally separate

You’ve worked hard to accumulate your wealth. Retirement is when you finally get to enjoy it — don’t leave it exposed.

6. Define What Retirement Actually Looks Like for You

Not every dermatologist wants to stop working completely. Some envision:

• Part-time cosmetic procedures or consulting

• Teaching, mentoring, or writing

• Volunteering in underserved areas

• Managing a med spa or aesthetic brand

Your retirement plan should reflect your vision — not just your numbers. Once you’ve defined your “ideal week” post-retirement, you can reverse-engineer a plan that supports it.

Your Future Starts with a Retirement Plan that Gives you Confidence.

As a dermatologist, you've built a career rooted in care, precision, and long-term thinking. Your retirement should reflect the same.

Whether you're five years out or just starting to think about life after practice, our advisors help dermatologists:

• Create strategic retirement plans

• Maximize income and minimize tax

• Prepare their practice for sale or transition

• Protect their wealth for the next generation

→ Plan With Intention, Get Started Here

Let’s build the roadmap that takes you from successful career to successful exit — with clarity and confidence.

FAQ: Dermatologist Retirement Planning

When should dermatologists start retirement planning?
Ideally, 10–15 years before your planned retirement. But it’s never too late to start optimizing your financial, tax, and exit strategies.

What’s the biggest financial mistake dermatologists make before retiring?
Relying too heavily on the sale of the practice to fund retirement, without diversifying investments or planning for taxes.

How do I sell my dermatology practice?
You’ll need a valuation, a legal structure for the sale, and a transition plan. Work with advisors experienced in medical practice sales to protect your interests.

What happens to my patients and staff when I retire?
That depends on your exit structure. A phased transition or sale to an associate can help preserve relationships and continuity.

Is part-time work in retirement common for dermatologists?
Yes. Many choose to continue working part-time in aesthetics or consulting to stay engaged and supplement income.

Planning ahead for retirement is one of the smartest things dermatologists can do for their career, their legacy, and their future. Start planning today.