Retirement Planning for Dentists: The Accounts Most Practice Owners Aren’t Maxing Out

Dentistry is one of the highest-earning professions in the country, yet retirement planning remains one of the most under-optimized tax strategies for dentists. Most dental practice owners are contributing to some form of retirement account, but very few are taking full advantage of the vehicles available to them. The result is a larger tax bill today and a smaller retirement nest egg tomorrow, both of which are avoidable with the right planning in place.

At DrillDown Solution, retirement plan design is one of the most impactful services we provide to dental practice owners. Our team has over 50 years of combined experience in dental tax planning and accounting, and we have helped practices across the country structure retirement plans that shelter significant income while building long-term wealth. Our goal is to help you make and keep more money — and maximizing your retirement contributions is one of the most direct ways to do exactly that. Learn more about our tax planning services.

Why Dentists Are Often Underserved in Retirement Planning

The retirement planning conversation most dentists have with a general financial advisor starts and ends with a SEP-IRA or a basic 401(k). Those are legitimate options, but they are rarely the most effective structure for a dental practice owner at a meaningful income level. The contribution limits, the interaction with employee benefits obligations, and the availability of more sophisticated plan designs are all factors that a dentist-specific advisor understands far better than a generalist.

According to the ADA Health Policy Institute, the average net income for general dentists in private practice was $215,320 in 2025. At that income level — and especially for dentists earning well above it — the difference between a well-designed retirement plan and a default one can mean tens of thousands of dollars in additional tax-deferred savings each year.

The Retirement Accounts Worth Knowing

Not all retirement accounts are created equal, and the right combination depends on your income, your practice structure, the number of employees you have, and your goals for wealth accumulation outside the practice.

The accounts most dental practice owners are not fully utilizing include the following:

• Solo 401(k): For practice owners without full-time employees other than a spouse, a solo 401(k) allows contributions of up to $69,000 per year (2024 limit), combining employee deferrals and employer profit-sharing contributions. This is significantly more than a SEP-IRA allows for many dentists.
• Defined benefit or cash balance plan: This is the most powerful tax deferral vehicle available to high-income dental practice owners. A cash balance plan can allow contributions of $100,000 to $300,000 or more per year depending on your age and income, all of which reduces your taxable income dollar for dollar.
• Backdoor Roth IRA: High-income dentists are typically ineligible to contribute directly to a Roth IRA, but a backdoor conversion strategy allows them to access Roth benefits regardless of income level. When combined with other plan designs, this adds meaningful tax-free growth to the retirement picture.
• Health savings account: For practice owners on a high-deductible health plan, the HSA is a triple-tax-advantaged account that most dentists are either not using or not maxing out. The 2024 family contribution limit is $8,300.

Choosing the right combination of these accounts requires modeling that accounts for your specific income, practice structure, and employee obligations. Our team at DrillDown Solution does this analysis as part of our year-round tax planning process.

Timing and Consistency Matter

Retirement planning is most effective when it is built into your practice’s financial structure from the start of each year — not addressed as an afterthought in December. The contribution deadlines, the plan establishment requirements, and the tax implications of different contribution levels all require advance planning to execute correctly.

Our team works with dental practice owners year-round to make sure retirement contributions are structured, timed, and maximized as part of a broader tax strategy. You can see the full range of services we provide. We also help practice owners think about retirement planning in the context of their overall wealth picture — including real estate, practice equity, and personal investment accounts — so every piece is working together toward the same goal.

Connect With DrillDown Solution

DrillDown Solution has been serving dental practice owners since 2004. We work exclusively in dentistry, and retirement plan design is one of the areas where that specialization makes a measurable difference. If you are not sure whether your current retirement plan is optimized for your income level and goals, our team can help you find out.

To schedule a free consultation, reach out through our contact form.