The Retirement Account Most Dentists Have Never Used — And Why It Matters Before You Sell

## You've maxed out your 401(k). You're doing profit sharing. You're doing everything your CPA told you to do. And you're still writing a check to the IRS every April that makes you want to reconsider the whole thing. There's a tool most dental entrepreneurs have never been introduced to — not because it's obscure, but because most advisors don't know how to set it up. It's called a Cash Balance Plan, and for the right practice owner, it can shelter $150,000 to $300,000 or more per year in pre-tax income. That's not a typo. --- ## What a Cash Balance Plan Actually Is A Cash Balance Plan is a type of defined benefit plan — a pension, technically — that behaves like a defined contribution plan. Each participant has a hypothetical account that grows annually based on two credits: a pay credit (typically a percentage of compensation) and an interest credit (either a fixed rate or a rate tied to an index like the 30-year Treasury). The key difference from a 401(k) is scale. For 2025, the maximum 401(k) employee deferral is $23,500, with a catch-up contribution of $7,500 for those 50 and older. Total defined contribution limits — employee plus employer — top out at $70,000. A Cash Balance Plan stacks on top of those limits entirely. The contribution potential scales with age: | Age | Approximate Max Cash Balance Contribution (2025) | |-----|--------------------------------------------------| | 45 | ~$130,000 | | 50 | ~$185,000 | | 55 | ~$240,000 | | 60+ | ~$300,000–$336,000 | Combined with a 401(k) and profit-sharing plan, a dentist in their late 50s can shelter $350,000 to $400,000 in a single year. All of it deductible. All of it growing tax-deferred. --- ## Why This Matters More Than Most Dentists Realize The math is straightforward. A dentist earning $800,000 in W-2 income who contributes $250,000 to a Cash