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Physicians and medical practice owners can save $100,000 to $300,000+ a year pre-tax by adding a cash balance plan to their 401(k).
We design it around your practice, not a template.
A free, custom illustration for your practice
A cash balance plan is a type of defined benefit plan that works like a supercharged 401(k). Your practice makes a tax-deductible contribution each year, credited to an individual account in your name, and the limit is based on your age instead of a flat dollar cap.
For physicians in their 40s, 50s, and 60s, that often means $100,000 to $300,000+ a year in additional pre-tax savings, on top of a 401(k) and profit sharing plan. It is one of the most powerful tax strategies available to high-income practice owners, and most physicians have never had it explained to them.
Cash balance limits are age-based. The closer you are to retirement, the more you can put away each year. Here are illustrative 2026 figures for a physician earning at least $360,000 (the 2026 IRS compensation limit):
| Age | Cash balance plan | Total with 401(k) and profit sharing |
|---|---|---|
| 40 | About $120,000 | About $166,000 |
| 50 | About $197,000 | About $252,000 |
| 55 | About $290,000 | About $344,000 |
| 60 | About $325,000 | About $382,000 |
| 62 | About $359,000 | About $416,000 |
Illustrative only. Actual contribution limits are calculated by the plan’s actuary and depend on your age, compensation, plan design, interest crediting rate, and years until retirement. Totals assume a 401(k) with a 6% profit sharing contribution alongside the cash balance plan.
At Life, Inc. Retirement Services, we don’t sell a single product. We design a Retirement Plan Stack, layering plans so each one does what it does best:
Most practices stop at Layer 1 or 2. High-income physicians usually leave the most money on the table at Layer 3.
From first call to first contribution, we handle the design, the math, and the compliance.
1
We look at your income, age, staff census, and current plan to see what’s possible.
We layer your 401(k), profit sharing, and cash balance plan around your tax goals.
You get a clear illustration of your deduction, your savings, and your staff cost before you commit.
Plan documents, annual actuarial work, testing, and filings, handled every year.
Every cash balance plan has to include eligible employees, so the real question isn’t whether staff are covered. It’s how efficiently. With the right design, the large majority of contributions go to you.
On physician plans, our goal is for 90% or more of total contributions to go to the owners, with staff receiving a meaningful but efficient benefit. Tools like new comparability profit sharing, eligibility rules, and vesting schedules all play a role. That is the difference between a custom design and a template plan from a large provider.
We’ll tell you honestly if a cash balance plan doesn’t make sense for you.
Michael, a successful business owner with no employees, wanted to maximize his retirement savings while minimizing taxes.
Through a custom-designed retirement plan stack, he and his wife were able to contribute over $575,000 across multiple plans in a single year.
This strategy not only helped secure their financial future but also generated over $222,000 in immediate tax savings, significantly increasing their cash flow and long-term wealth-building potential!
James runs a construction company with high employee turnover and wanted a way to protect cash flow while maximizing retirement contributions.
Through a custom 401(k) and profit-sharing plan design, we used strategic eligibility and vesting schedules to limit costs from short-term employees while allowing ownership to maximize contributions.
This strategy protected company assets, controlled expenses, and helped James build significant retirement wealth.
Eileen, a small business owner, needed a low-cost retirement plan that would meet state mandate requirements while helping her recruit and retain high-quality employees.
Eileen used a customized 401(k) solution focused on minimizing expenses, giving Eileen a competitive edge in hiring without pulling resources away from reinvesting in her growing business.
By using tax credits, her design allowed her to stay compliant, attract top talent, and keep her financial priorities aligned.
*These are hypothetical clients with hypothetical situations and plan designs.
Learn more: About Us | Cash Balance Plans | Group Retirement Plans | FAQ
It depends mostly on age and income. In 2026, physicians in their 40s can often contribute around $120,000 to $160,000 a year, and physicians in their 50s and early 60s can often contribute $200,000 to $350,000 or more, on top of their 401(k). Your exact limit is calculated by the plan actuary.
Yes. Most cash balance plans are paired with an existing 401(k) and profit sharing plan. In many cases you can keep your current 401(k) provider, and we design the two plans to work together and pass IRS testing.
Cash balance plans are meant to be ongoing, and the IRS expects them to be permanent, generally for at least three to five years. The design can include some flexibility, and future contribution levels can be adjusted if your situation changes.
A new cash balance plan can generally be adopted as late as your business tax filing deadline, including extensions, for that tax year. Starting earlier gives you more flexibility, so the best time to look is before year end.
Cash balance assets are usually invested conservatively, because the plan credits a set interest rate to each account. The goal is steady growth that keeps pace with that crediting rate, not big swings.
Yes. Cash balance plans work very well for multi-physician groups, and each physician can have a different contribution level based on age, income, and goals.
Costs depend on the size and design of the plan and include actuarial and administration fees. For most physician practices, the tax savings are many times the cost. We show you both before you decide.
Life, Inc. Retirement Services does not offer tax advice. Please always consult your tax professional about your eligibility for tax credits.
Life, Inc. Retirement Services is a Registered Investment Advisory Firm of the state of Ohio and licensed in Florida and Maryland. All emails and communication are meant to be informative and educational and should not be considered a sale of security until proper notification and disclosures are given.