Hey, Sharon, how are you today? I'm good. How are you doing today, Jeremy? I'm doing well. You know, the temperature has changed around here. Yesterday, 83 degrees. Tonight, 29. I know, right? Who knows about this weather anymore, you know? Yeah, if you don't like our weather in North Carolina, just wait an hour or a day, and it'll be different. That's right, it's pretty interesting. You know, it's kind of like saving for retirement. Did you like that segue? I like that. I like that. And of course, considering that I'm on the right side of the bell curve with my career in anesthesia, this is going to be a good topic. Yeah, and you know what? You actually might be living this topic. So today, you know, we're going to kind of be really in one of the wheelhouses that I operate in a lot in my business. And that is helping CRNAs save more for retirement by transitioning to 1099. And Sharon, this is a really big deal. We're going to go through some case studies today. Hopefully, I won't put everybody to sleep like CRNAs typically do. Hopefully, we'll be able to get through all these numbers, and you'll still be awake as well. Well, that's going to be pushing it. So we better go ahead and get started. Yeah, so as we kind of transition here into this, I went too far. Well, hey, happens to the best of us. But the first thing is, why do people fall behind on saving for retirement? And there is a multitude of reasons. And a lot of times, what I find is people have a lot of debt that is outstanding, and they've really been trying to pay that off. But if they've got a lot of debt, a lot of times it's indicative of other things, Sharon. Well, true. And I mean, you've got school debt. And that could be you going to school or sending your children to school. And like I've said many times, they tell you to save for college. They don't tell you to save for weddings if you've got two girls. So there can be a lot of debt, I understand. Yes, I mean, that's one of the reasons. But I've worked with CRNAs, and I'm thinking of several right now who persistently accumulate debt. And they are living well beyond their means. And that's usually what that means. And what happens is they work with someone like me who finally sheds light on the picture and says, hey, guys, if you don't get it together, you're not going to be able to retire, and at least not be able to retire in the lifestyle that you'd like to live. And that takes some fiscal conservativeness to make that happen. And so sometimes that's an eye-opening call for people. And in fact, this can be one of the reasons that people actually transition to 1099 is because they put other priorities in front of saving and getting ready for retirement. And what I find is as people get a little older, you start to think about this a little more. Through that. Yeah. So the other thing that I see a lot of times that goes on is along the way, they just truthfully haven't saved enough in retirement. They didn't know how much to save. They didn't put an emphasis on it. Maybe part of it was debt. Maybe part of it was lifestyle creep. And you know what that is, Sharon? Oh, boy. Yes, I do. You know what? It is a big issue in the CRNA community. Sure it is. And for those of you who don't know what lifestyle creep is, you get out of school. You start making money. You buy a really nice car. You buy a nice house. You start to be poor. Tired of being poor. You're dropping $1,000 at the clothing store. You bought a $500 bag. Is that a lot these days, Sharon, $500 for a purse? I don't know. I don't carry one. But for some CRNAs, that's not a lot for a bag. Yeah, yeah. So not saving enough, not doing the right things along the way. And then you wake up one day, and you're behind the eight ball. And you know what I also find is that intuitively, CRNAs know this. But they bury their head in the sand. And I can give you an example after example after example of folks that have come to us, and they're really behind the eight ball. Maybe they don't have all that debt paid off. And they want to start to supercharge their retirement plan. Then the other part of that is the markets and volatility can also play a role in retirement savings. Obviously, we all live through 2008. We're living through right now. But no, the burying the head in the sand, I just don't look at mine. That's my part of burying my head in the sand instead of being really anxious about it because the market's extremely volatile with all the wars going on right now. Yeah, yeah. Well, let's say there's a bunch of culmination of things. But anyway, so people fall behind in retirement savings. And one day, they wake up and say, uh-oh, what do I do? So when we look at the types of plans available for freelancers, really, it's pretty simplistic in my world. But there really are three main players. One is a solo 401k. And just as the name implies, Sharon, it is a 401k. By the way, do you know what 401k is, Sharon? We've had this discussion, but you're going to have to refresh my memory. Simply stated, it's really funny to me that everybody knows that name because that is actually a section of the Internal Revenues Tax Code. The 401k piece. Yes. The majority of people would have no idea if we started using sections of the IRS tax code. But everybody knows 401k. They do. And it's a section of the tax code. So all those people out there who say they don't like tax stuff, well, you know a little bit about it. It's free, right? But the solo 401k, we'll get into that and how it works. You can put money in there on a tax-deferred basis, let it grow for retirement. The other type of retirement plan is a SEP, or a Simplified Employee Pension, IRA. And again, there's some drawbacks to the SEP, and we'll get into that today. But it is another type of retirement plan that we see used by seniorities a lot. Yes, I had one of those at one point. Yeah, now you've got a 401k. Solo 401k, because why do we call it solo? Because it's just me. That's right. You're the only employee. Not really. I mean, you have Pearson as an employee. Well, he's been on the payroll for 40 years, so it's different. Well, a solo 401k can work for married folks. And then the third type of plan is something that I bet a lot of people don't know a lot about. Have you ever heard of this, defined benefit pension? I have. We used to have one through the AANA that covered our employees, but we voted to get rid of a defined benefit pension plan many years ago, because there's not many of these out here anymore. There used to be a lot back in my parents' time. Yeah, absolutely, absolutely. But as a small business, CRNAs can actually set up their own private pension plan. And the sizzle behind that, Sharon, is that you can save extremely large amounts of money on these things. Can you have a 401k and a defined pension, or do you have to do one or the other? You actually can have both. Oh, well, I'm sure you're going to talk more about that. Yes. So just as a basis and a precursor, these are really the three plans that we see out there for the majority of folks. So we'll break it down. And with the SEP, we'll start here. And I alluded to a little while ago that I see a lot of accountants out there recommending SEPs for CRNAs. And let me just explain this. So in a SEP, only the employer, only your business, can contribute to it. Sharon, as the employee, cannot put money in herself. But the business can put money in. OK. OK. So in for 2023, it is the lesser of 25% of your total compensation, or $66,000. So the maximum you can get into the SEP is $66,000. But you notice what it says. It is the lesser of 25% of your total compensation. So no disbursements. Right. No disbursements. That's right. So it's got to be just what you take as a salary if you're an S Corp or your tax doesn't S Corp. OK. I could see where there could be downfalls to this. Yep. And we're going to go through an example here in just a minute. But that is the key difference. And remember, like I said, there's no employee contributions allow. The Solar 401k is a little bit different. Because over here, you can have employer contributions and employee deferrals. That means Sharon can defer into the plan. And oh, by the way, the company can also do a profit sharing match in the plan. And for 2023, that total employer plus employee limit is $66,000. Sounds familiar to the SEP, right? If you're over age 50, you also have a makeup provision where you can get in up to $73,500. And the employee contribution limits is $22,500. That is if you're under age 50. If you're over age 50, Sharon, how much can you get in? You can, well, if you would add that up really quickly, what is that? $30,000? Yes, that was really good. You did great. So if you're over age 50, you can make $30,000 and put it into the plan. OK. And as I get into the next slide, you're going to see why this makes a big difference. So the big difference between the SEP and the SOLO 401k is the fact that with the SEP, it's all employer contributed and it's subjected to 25% of compensation. The SOLO 401k, employees can contribute as well. Let's get to the SISL, because you know I got some SISL. I know, I'm waiting. So let's use an example of $150,000 salary. Let's say, Sharon, like you're set up, you have your PLLC. It's being taxed as an S-corp. And as an S-corp, guess what? You have to have a salary. True. So let's say you set a reasonable salary. Reasonable is the key. Most CRNAs are not going to get away with a $50,000 salary. Right, Sharon? Right. That's right. So let's say we set $150,000. And any time you set a salary, you have to have a reason for doing that. So let's use $150,000. So here, with the SEP IRA, remember, 25% of compensation would be $3,705,000. So you get $3,705,000 in the SEP, right? Yes. Now, on the SOLO 401k, remember, employee deferral is $2,205,000. That means, Sharon, if you only made $30,000, you could still put $2,205,000 in. OK. That's 70-some percent of what you made is a lot better than the 25% of the SEP, right? Exactly. Right. Plus the employer contribution. So the employer contribution is 25% of what we paid you as a salary for a total of $3,705,000. So in this scenario, if you're under age 50, you could get $60,000 in. If you're over age 50, Sharon, how much could you get in? Well, do the math for me. I've been working all day. $60,500. Yes. So if your goal, Sharon, is to save more for retirement, which one would you choose? Well, obviously, the SOLO 401k. Yes. So let me tell you why this is important. Remember, and I know we've gone through this in other parts of these modules, but remember that you pay self-employment tax based upon what you pay yourself as a salary. So the higher the salary, the more self-employment tax. Yes. So if your goal was to only save $37,500, if that's your goal, then potentially, if you had a lower salary, you could save on self-employment taxes. Right. You have to have a reason for doing that. But you definitely could do that. So in this scenario, Sharon, let's just kind of calculate. So if you say 22,500 minus 37,500, you get $15,000, right? Right. So then I would have to pay you a salary of $60,000. You could still get in $37,500 because you get $22,500 from you. You would get another how much from your profit, Sharon? Oh, goodness, please. $15,000. $15,000. $37,500. So then that would mean that I could potentially pay you a salary of $60,000, right? Mm-hmm. You still get the same amount. What does that save you in self-employment taxes, then? A lot. Remember, 15.3% up to $160,000. So 15.3% times the difference of $90,000 is a big number. 13,500 bucks or so? Yes. Saving self-employment. Now, again, I'm not telling anybody to do this. I just want you to understand the math. You've got to work with your specific account at your situation. You've got to understand why we're doing what we're doing, OK? Exactly. Well, this could apply to me because I've got real estate. So we've set my goals to what we think we will need monthly when I retire, if I ever retire. So I have been trying to get my passive income from my real estate to meet that number for me. Right. And that's a great one. So I don't have to try and catch up or have a certain amount of money because I've got the passive income. Yeah, and it also helps if you're in real estate that your husband is a master contractor. He can fix anything in this world and can go fix anything for you without you having to pay somebody. So isn't that the truth? He helped me on a project when I did a refurb on a condo we bought for my mom. And I'm telling you, he put chair rail and crown molding and all this. And it's the nicest one in the whole complex where she lives because Pierce did that for me. Yeah, that's helpful. So yes, so that is the difference between the two. OK. Got it. It can make a big difference in the amount of tax that you pay, how much you pay yourself, and so forth. The other part to this is remember, Sharon, even in your situation, remember that if we have a spouse that is an employee of the business, we can do this exact same thing for them. And that we've got to go through here pretty soon with my review. Yes. So let me give you an example here. So low 401k. Sharon, we're paying you $150. You drop in because you've reached that illustrious age of 50. You can drop in $675. And let's say Pierce doesn't have a retirement plan and we decide that we want him to have one. We're really trying to sock some money away. Remember that Pierce, because he's over age 50, we pay him, let's call it $35,000. We could defer $30,000 of that $35,000 into the plan for him. So he got in $30,000. You got in $675,000. You effectively saved $107,500. Wow, nice. And you see how this can accumulate very, very quickly. OK. So I know that people do 1099 for different reasons. This is one of the reasons that I see a lot. Either they're wanting to retire earlier and they want to sock money away. Either they're making a lot of money and they really want to save more money. They're really behind or somewhat behind for retirement. These are all reasons to understand this stuff, OK? Got it. Now, I alluded to this earlier as well. Defined benefit pension plans. And this is, remember in your case, Sharon, we could have got $107,500 if we put you in Pierce on there. I have some CRNAs that own groups that employ other CRNAs that are making a lot of money. They're doing it 1099. So they're 1099ing the other CRNAs. And they're saying, OK, well, we can save this amount in our 401k. But we want to do more than that. We're making a lot of money. We want to capitalize on this. And oh, by the way, we want a big tax deduction, OK? So we can set up these defined benefit pension plans. And traditionally, like you said, maybe your parents, maybe your grandparents worked for a company. And then when they retired, they were there for 30 years and they paid them this amount for the rest of their life. I don't know about you Sharon, but I don't see those hardly at all anymore. No, well, you carry the risk as somebody who provides the pension plans. And that's the reason why the AANA, we had to get out of it because we carried the risk, whereas a 401k is a shared risk. So if the market tanks, I lose out with a 401k, the pension plan, the employer loses out. And we had a liability within the AANA. And so, I was president and we needed to get out of this. We needed to fully fund that pension plan, which we were putting a million dollars into a year. So we hired somebody to get us a glide path to tell us how much we had to pay into it several years. So it took up until Gary Bridges was president, he finished paying off the pension plan through the AANA for the people that we still had left in that plan. Right. I know you understand that. Absolutely. It took a little bit of work for me to understand it, but we had to get rid of those pension plans because if the market tanked, we were still on the hook for all of that. Even if the amount in there was half what it used to be, we had to come up with the rest of it. Right. I know a lot of pension plans are invest conservatively just for that reason. Right. But this would be your own little pension plan. So there are some things you would have to do. It is a plan that's approved by the IRS. It's a qualified plan, just like 401Ks or 403Bs. There is a required annual deferral, meaning every year there is an amount Okay. that you have to put in. But what happens, Sharon, is you say, all right, by the time I'm 65, I'd like for this plan to kick me off an income of $100,000 a year. All right. And then what happens is they take your age at the time and they take the net present value of that stream of income that you want at 65 for the rest of your life. And they calculate how much that you can put in. It's an actuarial computation that is beyond what most people ever want to see. But you have to have an actuary involved in this. So it costs a little bit to do that, but you can get massive, massive benefit from it. The investments grow tax deferred, just like in your 401K or 403B. Okay. So you don't, every time you buy, sell and trade, there's no taxes. And at the end of this thing, you can take it and roll it over into an IRA if you would like. Okay. Okay. The end can be whenever you retire, or let's say that you get rid of the business for some reason, or you stop doing 1099 or whatever the situation might be. Now, if you set one of these up, you really want to go into it with it, saying I'm going to fund this for at least five years. Because if not, the IRS could have some say so in this. So these are more five years or longer type claims. But there are some things that it also must comply with, and that's ERISA. ERISA is the Employee Retirement and Income Security Act, which is a massive piece of legislation. There's all kinds of rules in there. And it also must adhere to IRS regulations. So a little more complicated than a 401K or a SEP. But if you really want to sock away big money, this is the way. Do you have very many CRNAs that do that, or are they usually owners of businesses, I would suspect, that are making bank? We have some that are doing it, for sure. I would say a lot of the ones that I see putting a lot of money in these are business owners to a certain extent. So they're employing other CRNAs, and they have ASCs set up or whatever, but they're making a pretty good amount of money, and they want to defer it. So we looked at that. So defined benefit. Okay, so let's give an example. This is somebody who says, hey, you know what? I want to put in enough money so that I can accumulate $3.4 million by the time I'm age 62, okay? And that's 10 years, okay? So let's say over that time period, let's say you were 50. Okay. You know that you could put in $250,000 a year over a five-year time horizon with a 5% rate of return. So these things are contingent upon one, your age, two, what your real rate of return that you get, because remember, you want to get to a certain point by a certain age. If your rate of return is higher, it lessens the amount that you can put in. If your rate of return is lower, it increases the amount that you can put in. Make sense? Right. So how many, are there a lot of CRNAs that are this conscientious? I know a few who are. Yes, there are a lot. Okay. A lot of them are there. You think about what CRNAs are making right now, 1099, close to $400,000 if you're just working regular. If you're really, really working a lot, which I know plenty that are, they can be making 600,000 plus. Think about a married couple as we get down to the bottom down here. I was talking to one the other day, they're both CRNAs, they're both doing 1099, they're making about 800,000 a year. Good for Dan. Yeah. And they're really wanting to sock things away. So if you've got a spouse in that scenario, then you can potentially double that contribution depending upon what the age differences are. So if you're a very similar age, then in this scenario, you'd be able to sock away about 500,000 a year. A lot of money in a short time horizon. So there are a lot of CRNAs making really good money right now. There are a lot of CRNAs who say, I don't wanna work like this forever, but I'm willing to do it now. But in 10 years, I wanna be retired. How do I sock the most away? And the defined benefit allows you to do that and get a tax deduction. You know, again, I just wonder about this because I know CRNAs love what they do. And a lot of CRNAs work into their 70s. I know if I can count on one hand, how many CRNAs I've ever known to retire early. It must be the crowd you run around with. Must be, must be, I'm sure that your perspective is different than mine. Yeah, I mean, you know, I think most CRNAs love what they do. And it's really funny, I was actually doing a class for a group of SRNAs this week, actually yesterday. And, you know, it came up again about, you know, what they actually wanted out of their life and their career. And, you know, we've had this conversation. Oh, yes. And theirs is very different. It's work-life balance. It's different than the baby boomers. I mean, I understand that. So- What I am seeing, especially since COVID, Sharon. Yes. Even my hard chargers, you know, the ones that are always at meetings, the ones that are always working, they're always working, they're saving more money, they're making more. I've noticed even a change in them that since COVID. Oh, yeah. Woke people up a little bit where, you know what? I might not be here to enjoy this. I better enjoy it a little bit now. That's the tough part of my job is, you know, I want people to enjoy their life. I want them to enjoy it along the way because we could die tomorrow. But the tough part is, is if you live to age 90, you don't want to run out of money at 85. Unless you've got a very benevolent daughter-in-law that'll take care of you. Or a rich uncle somewhere that will take care of you. Or a sugar daddy. Or a sugar daddy, yeah. Everybody loves a sugar daddy. But, you know, by the way, did you know there's a website called Sugar Daddy? Somebody told me about this the other day. No way. I need to get right on that. The sugar daddies will send you money. They'll send you things. Oh my goodness. All this stuff. Let me throw my profile up. Crazy. But yes, so, you know, retirement has to be something that is very, very personal. Sure. And even everything that we're talking about, you know, transitioning to 1099 retirement planning. It's funny, I look at these Facebook groups and I see these people out there giving advice to people based upon their perception and what they do. Oh, you know, I'm 50 years old and I want to retire when I'm 60. What should I do? And people rattle off, you know, oh, it'll be a string of 150 people and I'm just laughing. I'm going, you have no idea what they need to do because you don't know anything about their situation. It's all so personal. And, you know, different, you know, dynamics, different lifestyles, different ways of thinking about money, different longevity. You know, Sharon, you and I drew the short stick. You know, our families don't live quite as long as some families. You know, I've got somebody the other day and she goes, hey, you know, my great-grandmother lived to 102. My mom's still around and she's 90 something. You know, nobody in my family has died before 87. I go, you got the best genes ever. Yes. But, you know, what does that quality of life look like? Am I going to outlive my money? Or, you know, you get somebody and everybody in their family has died at 65. The likelihood is that you probably aren't going to live to 95. Right. So, things to think about. I guess we've just got to make sure my money will stretch for Pierce's 95. Yes. So, great ideas here. Great things to think about. Really the basis of that. So, Sharon, I thought we'd change gears a little bit here because, you know, it's one thing for me to talk through this and kind of tell you all this. It's another for us to actually look at it and see what it looks like in real practice. So, we're going to switch gears and we're going to actually do that now. Can you see that? Yes. Okay. So, let me- It's very small, but I can see it. Okay. Do we need to get your glasses on like that? Just go. Maybe I can make it bigger. All right. So, let me kind of tell you about this. So, this is a case that we developed. And it is a 38-year-old, okay? And the 38-year-old's planning to retire one day and they want to retire early. Okay. And they're looking at a W-2 position versus a 1099 position. And they want to know which way gives them the most flexibility and being able to meet their retirement goals. So, you can see here, I've got them retiring at 57. They had longevity in their life. So, they're going to live to age 90. Okay. Now, you have tables that give you some of this information? Yes. Okay. Yep. I don't think you've told me how long I'm going to live yet. That's what I'm kind of scared to. You can't imagine being without me. That's why. No, not at all. Not at all. So, here in this first scenario we're going to look at is we're going to assume that we've got a CRNA. They're making about $225,000 a year, W-2. And they're going to be able to save the maximum amount in their 401k or 403b at work. Remember, they want to retire. They're 38. They want to retire at 57. They basically have 19 years to meet their goals. And currently, they've got about $350,000 saved in retirement. Sharon, are they going to meet their goals? Well, we're going to see when you plug all this in. That would be one of the questions that somebody would pop out there on Facebook and somebody would answer and say, oh yes, absolutely. All right, well, let's take a look and see. They also are getting a match on their 401k of 3%. So, this report, again, this is what we call our cashflow report. Okay. This shows us, as everything goes in a straight line, what would it look like for this CRNA making 225,000 a year, maxing out their retirement contributions? 22.5 this year is the amount that the employee can put in plus a 3% dollar for dollar match in there. And if they did that every year, would they meet their retirement objectives? We're also assuming that they're getting a 6% rate of return and say, why six? That is the average return for the S&P? That's a lower return because we don't want to have to do more than that. Okay. See, that's the key. Do you have to do more than that? Okay. So, looking at that, you know, we're stocking away this planned savings. You see 22.5 and it goes up to 23.5, 24. And you see this column over here, Sharon, this is their assets growing. Right. So we go all the way out down here to age 57 and they've got $2.3 million in there. Yes. Their goal for themselves was to have $9,000 a month after taxes and retirement in today's dollars. Because remember dollars today aren't the same as they're going to be in 20 years. That is true. We've got to factor in inflation. So in order to get them there, you see this 221 and 23? Yes. That is the amount of money that they're going to need to pull out of their retirement plans to meet their goals at age 57 and pay the taxes on it. There's a little bit of red there. So that red is a net cashflow. So remember at 57, you can't start Social Security. Right. You have to wait. Or 60. What you'll notice is they're pulling that out, but as we go all the way down, guess what? Look at that. You see that negative on that far right column? I do, they ran out of money. So that means one of two things. They either need to die at 74 or they're going to go back to work. Ooh, okay. Not a good scenario, right? No. Okay. So now let's change it up a little bit, all right? I'm going to go in here and do some really quick magic. Okay, I'm going to plan somebody's life before your very eyes. Okay. And we're going to take out this 401k that they have. We're going to say, oh, we set up a solo 401k with this money. And they went 1099. Now what happens? In here, what they're able to do is what we've been talking about. They're still making the same 225. We didn't change their income, but they're able to put in the maximum as the employee. And they're putting in 25% as a profit sharing contribution. Okay? Mm-hmm. Let's take a look now. Chart looks a whole lot better than it did, right? Yes, it does. So now you go down here to age 57. Remember before they had 2.3 million. Now they have 4 million. Go all the way out to age 90 and guess what happens? They still have $3.6 million left. That's by just doing that one thing, changing them to 1099 and capitalizing on what you can save in your 401k through 1099. Now this assumes everything goes in a straight line. Yeah. We know life doesn't work that way. So we back test these numbers with something called Monte Carlo simulation analysis. Say that three times. All right. So Monte Carlo is a statistical based software that we use that gives us the validity of these numbers. Will it really happen? What is statistically it telling us? So this probability of success is 97%. And you can see high as 82 to 100. I like to see it above 90. Okay. So with that, that's a pretty good probability of success. This takes into account good markets, bad markets, high inflation, low inflation, anything it can think about. And it back tests that in your plan. So it gives us a downside. And you use that bell shaped curve earlier. I'm gonna use that again. That far left tail of the bell shaped curve is an outlier. And it's your worst possible face. That's your two and a half percentile. If that happened, you would die at age 90 with $131,000 left. That's not a bad gig. But still. The antithesis of that is the 97 and a half percentile. That's that far right tail. If it didn't happen, it's pie in the sky. But if it did, you'd have 8 million bucks left to leave me. I mean, leave somebody. Or yes, or your children, if you liked them. But the likelihood is the 50th percentile and you got four and a half million dollars left. Still nothing to sneeze at as an inheritance. So remember that 97 and a half percentile. Cause I'm gonna go back and I wanna show you what it would be like if we left it under the W2 scenario, Sharon. Okay. Okay. Won't take me but just a second to change these people's lives. What do you think that percentile is gonna be? Probably half of that. The probability you mean? Right. Wow, I missed it. 4%. So that is our first scenario to look at, okay? What do you think about that? That's pretty startling. I mean, I would have thought maybe half a chance, 50% versus 97, but 4%, that's startling. Yeah, and so just by changing them from W-2 to 1099, they can meet their retirement goals. So that's a younger person starting out. Let's take a look at this person, say they're 50 years old and they have $500,000 in retirement savings, which is probably still a little behind the eight ball. Sure, I would agree. And they want to retire in 12 years at age 62, and they want that same $9,000 a month after taxes, okay? So now we're going to have to increase our retirement savings in order to get there. But let's look at that, Sharon, in that scenario and see what that looks like. Let's pop over here, I'm going to close this one back out. And here's our age 50, okay? Our age 50, we're going to do the exact same thing that we did before, okay? And we're going to look at it, exact same parameters. And here's our cash flow. This is our W-2 scenario. Mm-hmm, that's not really good. Well, our W-2 scenario. A lot of red. They run out of money, okay? And- At what age did they run out of money? They ran out here at age 90. Okay, well. So, let's see. If you got Pierce's James, you better have a benevolent daughter-in-law. All right, so here's their scenario under W-2 with the likelihood that they're at 66%, which is low. Yes. I would not feel comfortable telling you that this would work at age 50 at 66%, okay? Got it. So, all the parameters were the same. Now let's go back in and let's change this back over and say we're going to do 1099 and we're going to do the maximum amount that we can save, same as the 401k, but we're also going to do the profit sharing, 25% of our salary. Now, what we've done with this person is they're age 50 and they don't want to work quite as much as they used to. So, they're only going to make $150,000. Okay. Okay? So, now let's look at what this looks like just by doing that one change. Chart looks much better, doesn't it? Mm-hmm. You can see, and as we go out, they retire at 62. You see they've got 2.4, 2.5 million, retire here. We start taking Social Security at 65, go all the way out. And now at age 90, they have $1.2 million left. But remember, this assumes life goes in a straight line. Let's backtest all these numbers to see what the validity of these numbers are. Wait for it. Wow. Now we've moved up to 94%. And they only did, made $150,000 a year. Yes. And they're only making $150,000. Yes. What do you think about that, Sharon? That's good. Yeah. All right. So, we're going to go through one more example here, but I want people to just get a feel for what we're saying here. Okay. Get back to here. All right. Last example. We have a CRNA who is 58, and they have 1,250,000. I don't know why that says 1 million up there. It's 1,250,000. They were retired five years. Okay. So, they're going to retire at 63, and they're considering transitioning to 1099. They want to know what does it look like if I transition to 1099 and take advantage of all the savings opportunities versus staying at this W-2 position that I'm at currently. So, let's take a look at their scenario now and see which way they come out better. Let's find my information here. Now, we're going to get rid of the 50. We're going to go to our 58-year-old. Okay. And you can see here, they've got 1,250,000 in their plan. They're 58. All right. So, let's pop over here. This is the W-2 side. They want $9,000, and you can see the shape of the chart. And that's W-2. This is W-2. So, now they grow from 1,359,000 to 1,008,000 when they basically retire. Okay. Same $9,000 a month, starting Social Security at age 65. Now, let's go down, and they've got $364,000 left at age 90. Okay. Okay. Let's see what Monte Carlo says about that. Because remember, that assumes everything goes in a straight line. Hmm. Ooh. So, they're in the medium category. I would not feel comfortable with this. I want to see it above 90. Sure. You can see the worst case scenario, they're negative 644. The likely 692 and the pie in the sky 2.4. But you've got to remember, when you're looking at thousands of scenarios, you have to be worried about what if. Mm-hmm. What if? And in this scenario, it doesn't make me comfortable. So, now let's go back in, Sharon, and let's change their life for the next five years. Okay? Okay. I've changed your life, Sharon. Yes, you have. And we're just going to put back in that they now have their solo 401k. And under this solo 401k, they're going to max out what they can save. Which is? So, this year, because they're at a range 50, they can save 30,000. And we'll go down here and show you this. And you can see that they also are making $150,000 in salary. Okay. If they were making more, these numbers would look even better. But we're only showing 150. So, let's see what cash flow looks like in that scenario. Chart looks better. It does. So, now we start out at basically $2.1 million. Everything else is the same. We go all the way out to age 90, and we have $1.1 million left here compared to 364 in the other scenario. And let's back test these numbers. Monte Carlo, wait for it. I feel like we're spinning the wheel. I know. So, now we've moved up to 96% probability. So, I wanted to show this to just illustrate, Sharon. This is the power of being able to save more and take advantage of the opportunities that are out there. So, we looked at a 38-year-old. We looked at a 50-year-old. We looked at a 58. I have CRNAs that come and start doing 1099 at 60. I have them start out at 30s. And it's all over the board for all different reasons. This just focuses on retirement here is what we're looking at. But you can see that overwhelmingly, there's a lot of planning that we can do to take advantage of what they're giving us. So, with that, Sharon, I'm gonna say it's a wrap. I believe so. Have I confused you thoroughly? I'm gonna need some coffee. All right. Well, we'll get ready for our next upcoming module and talk to everyone soon.

retirement planning

Certified Registered Nurse Anesthetists

CRNAs

1099 status

retirement savings

SEP IRA

Solo 401k

defined benefit pension plans

Monte Carlo simulations