Navigating Baptist Health South Florida’s 403(b), 401(k) and 457(b) Retirement Plans: A Guide for Physicians and Healthcare Professionals

As a physician at Baptist Health South Florida, your dedication to patient care is matched by your focus on securing a financially stable retirement. But with so many choices to make—whether it’s navigating your 403(b), 401(k), or 457(b)—it can feel overwhelming to figure out the best way forward.

At Dr. Harris & Co., we specialize in helping physicians like you take control of their financial futures. With years of experience working with healthcare professionals, we understand the unique challenges and opportunities you face when it comes to retirement planning. Our goal is to guide you through the complexities of your retirement plans, so you can make informed decisions and build a solid financial foundation for your future.

In this post, we’ll break down everything you need to know about Baptist Health South Florida’s retirement plans, providing insight into your options and offering strategies to help you make the most of them. Let’s dive in.

1) What Are the Rules for Withdrawals in the Baptist Health South Florida Retirement Plans (according to our research)?

Knowing when and how you can withdraw from your retirement accounts is critical to planning your future. Here’s a breakdown of the withdrawal rules for the 403(b), 401(k), and 457(b) plans:

• 403(b) and 401(k) Withdrawals: You can start making penalty-free withdrawals at 59½. However, if you take funds out before that age, you’ll typically face a 10% early withdrawal penalty, unless you qualify for an exception like financial hardship or disability. After you reach a certain age, you’ll need to begin taking Required Minimum Distributions (RMDs).

  
  

• 457(b) Withdrawals: The 457(b) plan offers one major advantage over the others—it allows you to take distributions penalty-free when you leave the company, regardless of age. However, you will still be responsible for regular income taxes on these withdrawals.

Even though we believe this information is correct, you should confim any withdrawal terms with the plan or your own advisors.

At Dr. Harris & Co., we believe in a strategic approach to withdrawals, helping you minimize taxes and penalties. It’s about making sure you’re ready to access your funds at the right time—without giving up more than necessary.

2) What Are the Benefits of Utilizing These Retirement Plans?

The most significant benefit of participating in these retirement plans is the tax deferral on your contributions. By contributing to your 403(b), 401(k), or 457(b), you reduce your taxable income today, which means you can save more for the future. Your contributions grow tax-deferred, meaning you won’t pay taxes on the money until you start withdrawing it, which allows your investments to compound over time.

In addition to the tax advantages, these plans often come with employer contributions (we’ll discuss that in more detail shortly), which is essentially free money for your retirement.

At Dr. Harris & Co., we help physicians like you optimize your retirement strategy to ensure you’re not only saving effectively but also making tax-efficient decisions for long-term wealth accumulation.

3) How Does the Match and Vesting Work in This Plan?

Employer matching contributions are a key part of your retirement savings. Here’s how it works at Baptist Health:

• Employer Match: Baptist Health may match 50% of your contributions, up to 4% of your salary. This means if you contribute 4%, the hospital will contribute an additional 2% to your retirement account.

• Vesting: You are immediately vested in your own contributions and earnings. For the employer contributions, you need three years of service to become 100% vested. If you leave the company before reaching this milestone, you may lose some or all of the employer contributions.

  
  

Employer contributions and vesting can sometimes be a point of confusion or frustration, especially when it comes to timing. At Dr. Harris & Co., we work with you to understand how these features can fit into your overall retirement planning strategy. Whether you plan to stay long-term or are considering a career change, we’ll help you make the best decisions for your future.

4) What Are the Costs of This Plan?

Fees are an important part of the equation when assessing your retirement options. The fees in your 403(b), 401(k), and 457(b) plans are relatively low, but it’s important to understand exactly what you’re paying. There are some relatively high fee funds in the plan which we would generally regard to be any funds with fees over 0.30% for a plan this size.

Additionally, there’s a $13 annual recordkeeping fee per participant. While these fees are relatively low, they can add up over time. It's important to assess whether your funds are delivering the performance you expect relative to the fees you're paying.

At Dr. Harris & Co., we believe that transparency is key. We’ll help you navigate these fees and select the best, low-cost investment options to maximize your returns.

5) Should I Pay for Advice in the Plan?

Some employees may be tempted to pay for in-plan advisory services, which come with an additional up to 0.45% fee in addition to the underlying fund fees. However, we typically advise against paying for investment advice through your employer’s retirement plan.

Instead, we encourage you to work with a fiduciary financial advisor—someone who is legally required to act in your best interest.

At Dr. Harris & Co., we are fiduciaries, meaning we are committed to helping you make decisions that benefit your financial future, without the conflicts of interest that you may be concerned about if you use in-plan advisors. Our services are tailored to your unique goals and needs, ensuring that you’re on the path to a comfortable retirement.

6) How Does the Retirement Plan Compare to Other Healthcare Retirement Plans in South Florida?

Baptist Health’s retirement plans are generally competitive compared to other healthcare employers in South Florida. However, some institutions may offer higher matching contributions or a broader range of investment options. That said, Baptist Health’s Personal Choice Retirement Account (PCRA) gives you an edge by offering more control over your investments, which is not always available with other healthcare providers.

At Dr. Harris & Co., we believe that knowing how your plan stacks up against others is a crucial part of making informed decisions. We can help you evaluate your options and create a strategy that aligns with your long-term goals.

7) Why Are Employer Matching Contributions So Low and So Delayed?

Baptist Health’s matching contributions, which are 50% of up to 4% of your salary, are considered lower than averagein the healthcare industry. Additionally, the match is delayed until March of the following year, which can cause frustration among employees.

While the delayed match might not be ideal, the important thing to remember is that it's still free money. If you're planning for the long term, those employer contributions can make a meaningful difference, even if they arrive a bit later.

At Dr. Harris & Co., we help you manage the frustrations of delayed contributions by working with you to plan your retirement strategy around these timelines.

8) Why Should I Consider Using the Personal Choice Retirement Account (PCRA)?

If you’re currently participating in a 401(k) plan and want more control over your investments, consider using the PCRA. This self-directed brokerage account allows you to choose from a wide range of investments, which may include individual stocks, bonds, and ETFs.

For those who prefer to take a more active role in their investments, the PCRA offers flexibility that can help you diversify your portfolio and potentially achieve better returns over the long term.

9) Are the Fiduciaries Doing a Good Job in This Plan in our view?

While Baptist Health could lower some of the fees in its plan, the PCRA option through Schwab is a solid feature. It provides employees with access to a self-directed brokerage account, allowing them to take control of their investments.

This flexibility is a positive sign that the fiduciaries are committed to offering employees greater control over their retirement savings. However, there is room for improvement when it comes to periodically reviewing plan fees and fund performance.

At Dr. Harris & Co., we monitor retirement plan options closely to ensure they meet the highest standards. We can help you make the most of the options available to you, including the PCRA, and provide expert guidance on how to build a diversified and tax-efficient portfolio.

10) What Do I Need to Know About the 457(b)?

One key consideration with the 457(b) plan is that it offers a significant penalty-free withdrawal advantage compared to other retirement accounts. However, it also carries some risks—specifically, that the funds in this plan could be seized by creditors if your employer goes bankrupt.

While the 457(b) plan is useful for additional savings, we recommend discussing the risks with a financial advisor before relying heavily on this option for your retirement.

Final Thoughts

At Dr. Harris & Co., we specialize in working with healthcare professionals like you to create personalized, tax-efficient retirement strategies. We’re committed to providing you with clear, actionable advice so you can confidently build a secure future for yourself and your family.

As always, we recommend consulting with HR, your benefits team at Baptist Health, or a qualified independent fiduciary financial advisor before taking any action based on this information. We’re here to help you navigate the complexities of your retirement plan and ensure your long-term financial success.

Disclaimer: The information provided in this post is for informational purposes only. Dr. Harris & Co. is not your financial advisor, and we recommend consulting your HR department, benefits team, or a qualified financial advisor before taking any action based on this content.