Veterinarian Financial Advisors NetworkVeterinarian Financial Advisors NetworkThe end of the year is one of the best times for veterinarians to pause, review their finances, and make a few smart moves that can set up a stronger year ahead. Whether you own a practice, work as an associate, or do relief work, these practical steps can help you finish the year feeling more organized and better prepared for the next.
Veterinarians often have irregular income patterns. Before the year wraps up, take time to look back at how money flowed in and out.
A simple way to review the past year is to break your cash flow into three parts
• total income
• fixed expenses
• discretionary spending
For example, a small animal associate bringing home around $10,000 monthly might have $6,000 in fixed bills. Ideally the remaining $4,000 goes toward savings or lifestyle choices. If only $5,000 was saved all year, most of that leftover monthly money disappeared unintentionally. Reviewing the numbers removes guesswork and gives you clarity.
Your goal is not perfection. It is simply understanding where your money went so you can make adjustments next year.
A great tool to try is Monarch Money, where you can review all of your cash flow and create budgets and reports to stay on track.
Year end is the final chance to make sure you are taking full advantage of retirement accounts.
For associates
• check your year to date 401k contributions
• increase contributions on your last few paychecks if you want to get closer to the annual limit
• review your employer match so you are not leaving free money on the table
For practice owners and relief veterinarians with Solo 401k plans
• employee contributions usually must be made by December 31
• employer profit sharing and after-tax contributions can wait until taxes are filed
• if income ended higher than expected, consider raising your employee contribution before the deadline
One equine practice owner in Texas realized in early December that her higher than expected year allowed her to max out her employee contribution, lowering her taxable income. Waiting until January would have been too late.
Student loans remain a major factor for many veterinarians. Use year end to review your repayment plan.
Things to evaluate
• whether your income driven payment will change next year or is being eliminated
• when your recertification deadline is
• whether filing taxes separately or jointly makes more sense in your situation (especially important for those in a community property state!)
• how expected changes in income might impact your monthly payment
For example, two spouses who are veterinarians might find filing separately reduces their monthly payments by hundreds of dollars because their incomes are split under community property rules. This difference adds up over the course of a year.
If you plan to switch jobs or transition to relief work, run next year’s numbers now instead of waiting until recertification.
There are several meaningful tax steps you can take before December 31.
For practice owners
• review your profit for the year
• consider accelerating January or February supply purchases into December
• review equipment needs that might qualify for Section 179 expensing
• Coordinate a meeting with your CPA
For associates
• check whether you are eligible for a deductible IRA contribution
• adjust your withholding if you expect a large bill or refund
• make charitable donations before December 31 if you intend to deduct them
Tax planning is something that can and should be done throughout the year, so plan to get a head start for tax year 2026 with early planning today.
Veterinarians rely heavily on their ability to work. An emergency fund protects against unexpected events.
General guidelines
• three months of expenses for employees
• four to six months for relief veterinarians or practice owners
• revisit your savings balance after receiving bonuses, profit distributions, or tax refunds
Utilizing a high-yield savings account instead of a traditional bank can allow for much higher interest while still maintaining FDIC insurance, liquidity, and safety of principal.
Insurance needs often change as your personal life and career evolve.
Review
• life insurance if you had children or bought a home
• disability insurance if your income increased
• whether your practice coverage such as malpractice, business interruption, or liability matches your current situation
Many veterinarians purchased disability insurance right after graduation. If your income is now significantly higher, updating your coverage ensures the policy still protects your current lifestyle.
December is a natural time to tidy up and make next year easier.
Ways to streamline
• consolidate old accounts and close ones you no longer use
• set up automatic transfers to savings or investment accounts
• outline two or three financial goals for next year
• review subscriptions and recurring charges you may no longer need
These simple steps can save time, mental energy, and money throughout the year.
Year end financial planning does not need to be overwhelming. Small, intentional steps can make a big difference. Reviewing your cash flow, maximizing retirement contributions, planning your student loans, evaluating taxes, strengthening your emergency fund, and simplifying your financial life creates momentum and confidence.
Andrew Langdon. CFP®, CSLP®, EA, MBA
Financial Planner