E44: I’m a CRNA. How much do I need to retire?

As a CRNA, you’re earning $200,000+ annually, which puts you in a unique position. You have the income to build substantial wealth, but you also face intense career demands that can lead to burnout and earlier retirement than originally planned.

Your high income is both an advantage and a challenge. It’s an advantage because you can save substantial amounts. It’s a challenge because you might think, “How in the world do I replace this $200,000 salary?”

But here’s the thing: you don’t need to replace your entire salary. You need to replace your spending.

Contents hide

1 Step 1: Calculate Your True Retirement Expenses

2 Step 2: Subtract Your Non-Portfolio Income

3 Step 3: Calculate Your Required Portfolio Size

4 The CRNA Tax Advantage & Strategy

5 Three CRNA Retirement Scenarios

6 Action Steps You Can Take This Week

7 Where You Stand Right Now

8 The Bottom Line

9 Episode Highlights

10 Links Relevant to this Episode

10.1 Never miss a new episode! Subscribe wherever you listen to podcasts.

Step 1: Calculate Your True Retirement Expenses

Take this example. Let’s say you’re currently earning $200,000 per year. You look at that number and think, “I need to generate $200,000 annually in retirement.” But let’s break down what you’re actually spending.

First, subtract what goes away when you retire:

Payroll taxes: 7.65% on your income ($15,300 per year)
403(b) contributions: 15% to retirement accounts ($30,000 annually)
Work-related expenses: scrubs, continuing education, professional dues ($3,000 per year)
Mortgage payment: if it’s paid off by retirement ($24,000 per year)

So far, we’ve reduced your $200,000 income by $72,300 just from things that naturally go away.

But you’ll have some new expenses:

Health insurance: if you retire before age 65 ($15,000 annually for a couple)
Travel and activities: things you’ve been putting off ($10,000)

Your actual retirement spending need is around $130,000 to $140,000, not $200,000. That’s a huge difference when we start calculating how much you need saved.

Step 2: Subtract Your Non-Portfolio Income

Once you know your spending need, figure out what income you’ll have that doesn’t come from your investments. For most CRNAs, this is primarily Social Security.

Go to ssa.gov right now and get your actual Social Security statement. Don’t guess. Most CRNAs can expect between $30,000 and $42,000 annually from Social Security, depending on your earnings history and when you claim benefits.

Some of you might have pension benefits if you worked for certain hospital systems, but that’s becoming rare. You might plan to work part-time in early retirement, doing some PRN work. Include any rental income if you have investment properties.

Let’s use our example. You need $130,000 annually, and you’ll get $35,000 from Social Security. That means your investment portfolio needs to generate $95,000 per year to fill the gap.

Step 3: Calculate Your Required Portfolio Size

How large does your portfolio need to be to generate $95,000 annually for 25 to 30 years? This depends on your withdrawal rate.

The traditional 4% rule says you can withdraw 4% of your portfolio value in year one, then adjust that amount for inflation each year. Using the 4% rule, you’d need $95,000 divided by 0.04, which equals $2.375 million.

If you want to be more conservative, use 3.5%. That would require $2.7 million. If you’re comfortable being more aggressive, 5% would require $1.9 million.

Why does this matter for CRNAs specifically? Because you might retire earlier due to burnout, meaning your portfolio needs to last longer. You’ll face higher healthcare costs as you age. And if burnout forces you out earlier than planned, you might not have as much time to accumulate wealth as other professions.

I typically recommend CRNAs plan somewhere between 4% and 5% withdrawal rates, depending on their specific situation.

The CRNA Tax Advantage & Strategy

Most CRNAs have a huge opportunity that other high-income professionals don’t have, but most don’t realize it.

Right now, you’re probably in the 22% or 24% federal tax bracket. Every dollar you put in your 403(b) saves you that much in current taxes. But when you retire, especially if you retire early, your income drops significantly. You might find yourself in the 10% or 12% tax bracket during your early retirement years.

This creates an opportunity for Roth conversions. Between the time you retire and age 73, when required minimum distributions kick in, you can convert money from your traditional accounts to Roth accounts and pay taxes at these lower rates.

Say you retire at 58 and delay Social Security until age 67. During those gap years, you might be in the 12% tax bracket. You can convert $50,000 per year from your traditional 403(b) to a Roth IRA and pay 12% tax on it. If you had waited until age 73 when RMDs start, you might be paying 22% or 24% on that same money.

The tax savings over your lifetime could easily exceed $100,000. This is money you get to keep instead of sending to the IRS.

Three CRNA Retirement Scenarios

Scenario One: Comfortable Retirement You want to spend about $120,000 per year, which maintains most of your current lifestyle. You’ll need between $2.4 and $3 million in your portfolio, depending on your withdrawal rate and other income sources. This is achievable for most CRNAs who start planning seriously by age 45.

Scenario Two: Lean FIRE You’re willing to spend $80,000 per year, maybe by relocating to a lower cost area or by simplifying your lifestyle. You’d need $1.6 to $2 million. This might be attractive if you’re really burnt out and want to retire as early as possible.

Scenario Three: Fat FIRE You want to spend $200,000 or more annually. You want to maintain a premium lifestyle, potentially help your kids financially, and leave a legacy. You’re looking at $4 to $5 million or more. This is definitely achievable for CRNAs, but it requires consistent high savings rates and good investment returns.

Action Steps You Can Take This Week

Go online and get your Social Security statement
Calculate your current annual expenses by looking at your bank and credit card statements
Make a list of all your retirement accounts and their current balances
Use this three-step framework to calculate your specific retirement number
Look at your current savings rate and compare it to what you need to reach your goal

Where You Stand Right Now

If you have under $2 million saved: Focus on aggressive accumulation. Maximize your 403(b) contributions. Consider backdoor Roth IRA strategies and look at taxable investment accounts for anything above your retirement account limits.

If you have $2 to $3 million saved: You’re in the optimization phase. This is where tax strategy becomes really important. Work with a financial planner who understands CRNA-specific issues to plan your withdrawal strategy and consider advanced tax planning.

If you have over $3 million saved: Congratulations, you likely have the flexibility to retire early if you want to. Your focus should be on creating a sustainable income plan and potentially legacy planning.

The Bottom Line

Your retirement number isn’t some generic $1 million or $2 million that you read about online. It’s your calculated number based on your specific expenses, your income sources, and your goals.

As a CRNA, you have unique advantages. Your high income gives you the ability to save substantial amounts. The timing of your career often creates tax opportunities that other professionals don’t have. And your attention to detail and ability to follow protocols will serve you well in executing a retirement plan.

But you also have unique challenges. Career burnout is real and might force earlier retirement than planned. Most of your savings are probably in traditional pre-tax accounts that will create a significant tax burden in retirement if you don’t plan properly.

The key is to plan for these realities now, while you still have time and options. You’ve mastered one of the most demanding careers in healthcare. Apply that same level of precision and planning to your retirement, and you’ll have the confidence to step away on your terms.