I graduated nursing school knowing how to start an IV, interpret an EKG, and manage a code. I had no idea how a 401(k) worked. Nobody taught me.
Twenty years later, I've learned — sometimes the hard way — what nurses need to know about retirement planning. Let me save you some of the hard lessons.
The Unique Retirement Challenges Nurses Face
Nursing has specific financial characteristics that affect retirement planning:
Physical demands limit working years. Many nurses find that their bodies can't sustain bedside nursing into their late 60s. Planning to work until 67 may not be realistic. This means you may need to retire earlier than the average worker — which means you need more savings.
Shift differentials inflate income temporarily. Night and weekend differentials can significantly boost your income during your working years. When you retire, that income disappears. Plan based on your base salary, not your total compensation.
Pension plans are disappearing. Many hospitals have moved away from defined-benefit pensions toward 401(k) plans. If you have a pension, understand exactly what it pays and when you're vested. If you don't, your retirement savings are entirely your responsibility.
Travel nursing income is irregular. If you've done travel nursing, you may have gaps in employer-sponsored retirement contributions. Make sure you're contributing to an IRA during those periods.
The Retirement Accounts Every Nurse Should Know
The Simple Path to Wealth
The clearest explanation of index fund investing and retirement planning I've ever read — required reading for every nurse.
403(b) — the hospital version of a 401(k). Most hospital employees have access to a 403(b). Contribute at least enough to get the full employer match — this is free money you cannot afford to leave on the table.
After 50, you can contribute up to $30,500 per year (2024 limit including catch-up).
Roth IRA. A Roth IRA is funded with after-tax dollars, but grows tax-free and withdrawals in retirement are tax-free. This is particularly valuable if you expect to be in a higher tax bracket in retirement, or if you want flexibility.
Contribution limit: $8,000 per year after 50 (2024).
HSA — the triple tax advantage. If you have a high-deductible health plan, an HSA offers the best tax treatment of any account: tax-deductible contributions, tax-free growth, and tax-free withdrawals for medical expenses. After 65, you can withdraw for any purpose.
Healthcare is often the largest expense in retirement. An HSA is your best tool for managing it.
How Much Do You Actually Need?
A common rule of thumb: you need 25 times your annual expenses saved to retire comfortably (based on a 4% withdrawal rate).
If you need $60,000 per year in retirement, you need approximately $1.5 million saved.
That number can feel overwhelming. But remember: Social Security will cover a portion of your income. A pension, if you have one, covers more. And your expenses in retirement may be lower than during your working years.
Run your own numbers. The Social Security Administration's website has a calculator that estimates your benefit based on your earnings history.
The Most Important Thing You Can Do Right Now
Your Money or Your Life
A transformative approach to aligning your spending with your values — essential for retirement planning.
If you're in your 50s and behind on retirement savings, the single most impactful thing you can do is maximize your catch-up contributions.
The IRS allows workers over 50 to contribute significantly more to retirement accounts than younger workers. Use this advantage aggressively.
If you can't max out immediately, increase your contribution by 1% every six months. You'll barely notice the difference in your paycheck, but the compounding effect over 10–15 years is substantial.
A Note on Social Security
You can claim Social Security as early as 62, but your benefit is permanently reduced. Waiting until your full retirement age (66–67 for most people) gives you your full benefit. Waiting until 70 increases your benefit by 8% per year.
If you're in good health and have other income sources to bridge the gap, delaying Social Security is often the highest-return "investment" available.
You've spent your career caring for others. It's time to take care of your future self.
— Amy Barry Jankowski, RN
Clever Fox Budget Planner
Track your monthly finances and retirement contributions — the foundation of any retirement plan.
