For many years, the CRNA profession has been a relatively stable and financially secure career path, but the COVID-19 pandemic has wreaked havoc in countless ways all across the globe this year. As a result, many CRNAs have experienced reduced hours, furloughs, salary cuts and/or employer retirement plan changes. These consequences have forced many CRNAs to take a hard look at their finances and evaluate what changes they need to make to protect everything they’ve worked so hard for.
We had the opportunity to speak at the recent NCANA/SCANA Virtual Meeting about the effects of COVID-19 on CRNAs, which is a topic about which we are passionate. As Certified Financial Planner™ practitioners for CRNAs, we understand the concerns CRNAs are having, and we have worked with our clients to develop plans that can withstand the ups-and-downs of the market.
Here’s why this topic is so important. According to the BLS, the mean CRNA salary is $181,040 annually. Assuming no inflation or salary increases, if you work 28 years as a CRNA earning $181,040/year, you could easily earn $5 million or more over the course of your lifetime. That’s a significant amount of money which can give you the opportunity to enjoy a great lifestyle in retirement. From what we’ve seen at CRNA Financial Planning®, the average CRNA retirement nest egg ranges from $1.2 to $2+ million. That can be plenty for some CRNAs, but maybe not for others. It all depends on your lifestyle and needs.
So what’s happened in 2020?
Back in February, we were sitting at the lowest unemployment rate in our history at 3.5%, then the pandemic hit... The big jump came in April of 2020 when unemployment skyrocketed from 3.5% to close to 15%. It created a massive problem for the American economy.
There are wide-ranging effects of COVID-19 which we will continue to incur for years to come, including significant reductions in consumer spending, sky rocketing national debt and taxes. And then there’s the mental health concerns that have risen over these past six months.
All of these things impacted nearly every CRNA in one way or another. No one envisions a career that doesn’t involve being an anesthetist, but this pandemic has forced people to think about other employment avenues. That’s not a decision anyone wants to have to make, so what can you do to protect yourself the next time we have a major event like this?
It all starts with managing your income and expenses better. Be prepared and live within your means. Every day we talk with CRNAs who bring home a substantial paycheck but don’t save as much as they could. Make sure you have at least 3-6 months in an emergency fund.
The CRNAs who have really felt the financial stress from this pandemic are those already in, or nearing, retirement. If you are approaching that next chapter in life, it's even more important that you sit down and build a financial life plan with a professional. You'll need to think about cash flow, income planning, taxes, interest rates, healthcare costs, and Social Security, just to name a few. Each of these will play a vital role in your retirement and the longevity of your portfolio.
To listen to this week's podcast and learn more, click here.
With decades of experience working exclusively with CRNAs, CRNA Financial Planning® has the knowledge to help you save more of your hard earned money and determine appropriate tax minimization strategies. Schedule a free 15-minute introductory phone call to discuss your current situation and needs. You can also call our office at 855.304.3748 or email us at inquiry@crnafinancialplanning.com.