A Retirement Guide for Physicians from the Northwest Permanente Medical Group (NWPMG) Ages 55-65 who plan to retire in the next 5 years

For physicians at Northwest Permanente Medical Group who are planning to retire withing 5 years - here are the 5 most common questions that we get asked by our NWPMG clients or that we see come up the most.

1. What retirement benefits have I earned from the Northwest Permanente Medical Group, and what might they be worth if I retire in the next one to five years?

The retirement benefits at NWPMG for those who began working there before 2015 usually include a pension.

For those who began later the benefits include your 401(k), money purchase plan and cash balance plan. This combined with social security and whatever other money you've saved in IRAs, other retirement accounts and taxable accounts makes up the basis for your retirement income.

The pension at NWPMG is immensely valuable but fewer and fewer physicians are earnings those benefits at NWPMG and so the key is to convert your investment assets into a viable retirement income plan. If you feel like you have a high degree of financial sophisitication yourself you can of course create this plan without professional input. If you aren't an expert on what investment options exist in the market today it can benefit you to speak with or work with a professional fiduciary financial advisor in the year or two before you retire to create a viable retirement income plan.

2. What happens to my retirement benefits and health coverage if I reduce my clinical schedule before retiring?

NWPMG is fairly leninent on retirement benefits to our knowledge. Outside of the pension where hours worked and salary can influence your payouts to our knowledge, in the money purchase plan and cash balance plan we believe that you only need to work about 1,000 hours a year to get full benefits. That amounts to about 20 hours a week or .50 FTE. This is fairly standard in the retirement industry.

For the health insurance you want to check with HR to know what the minimum amount of clinical work you must do to maintain your health insurance.

3. What are my options for receiving retirement benefits, andwhat should I understand about the trade-offs between them?

Retirement benefits are not always simply a choice between “taking the money” and “leaving the money invested.” Depending on the particular benefit, there may be different ways to receive or use retirement assets.

For example in the NWPMG cash balance plan you may have the option to take a lump sum payment, roll it over or take an annuity.

A lump sum payment usually results in a high tax bill in a lot of cases.

Rolling it over can be a viable option and check your plan document for eligibility for Rollovers.

The most important thing to understand about annuities is that they are really a concentrated investment (similar to putting a lot of your net worth in a single company stock). The reason is that the contract behind an annuity basically says I insurance company A agree to pay you x for the rest of your life if I stay in business. If i go out of business, you get the state guaranty and that's it. In the case of some group plans, the Pension Benefit Guaranty Corporation which does have maximum limits on insurance which are shown here: https://www.pbgc.gov/workers-retirees/learn/guaranteed-benefits/monthly-maximum

This is not a hypothetical thing. In my 16 years of advising physicians and higher income professionals I have personally witnessed people lose hundreds of thousands of dollars when insurance companies went under and the amount that was given to the insurance company was just lost - minus the amount of the state guaranty.

The reason why this matters is that different retirement-income choices solve different problems. A lifetime income stream can provide predictability and protection against outliving one's assets (up to the PBGC guarantees), while retaining assets in an investment account may provide greaterflexibility and potential access to the remaining balance. The right comparison is therefore not simply “Which pays more?” but rather “What risks and needs does each option address?”

4. What should I understand about the tax consequences of taking my retirement benefits?

The tax treatment of retirement benefits can have a meaningful effect on how much of a physician's retirement income is ultimately available for spending.

Retirement assets can be subject to different tax rules depending on the type of account, the form in which benefits are received, the timing of distributions, andthe physician's circumstances at retirement. A distribution that looks attractive on a gross basis may produce a very different after-tax result.

Taxes can also affect the timing of retirement-income decisions. The issue isn't necessarily about finding a way to “avoid” taxes; rather, it is about understanding when taxes may arise, what portion of a benefit may be taxable, and how differentsources of retirement income may interact with one another.

The reason why this matters is that physicians often enter retirement with multiple sources of income—retirement plans, Social Security, investment accounts, real estate, employment or consulting income, and potentially other assets. The tax treatment of eachsource can influence the overall retirement-income picture.

This is one area where understanding the what and why is particularly important before deciding on the mechanics of a distribution or rollover.

When the Paycheck Stops, What Replaces It?

For years, your work as a Northwest Permanente physician has provided a predictable paycheck. Retirement changes that—and it’s natural to wonder whether your retirement benefits and savings can create the same sense of financial security. If you’re planning to retire within the next five years, we can help you understand what you have, what you may need, and how those resources could work together to create a reliable retirement income stream.

Click here to schedule an introductory call with us. We’ll start by learning about your situation, your concerns, and the retirement you envision—so you can hopefully move toward retirement with greater clarity and confidence.

Meet Daniel Harris. Learn about his background and experience working with physicians to help turn the retirement they’ve built into a dependable source of income.

Disclaimer: This article is written for educational and entertainment purposes only. Neither Daniel Harris nor D.R. Harris & Co. are your financial advisor unless you have a signed written advisory agreement with us. While we believe the information in thi article is correct, to the best of our knowledge, at the time it was written, you shoul do your own independent research and talk to your own professional advisors or NWPMG before acting on any information you learned about in this article. We make no warranties as to the accuracy of the information in this article and we do not anticipate updating this article after it was written on 9/20/26, so it could become outdated over time. For these reasons why highly encourage you to do your own indendent research or talk to your own professional advisors before acting on any information disucssed in this article.