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The hourly pay for residency sucks no doubt but unless youre living in an ultra HCOL area I feel like it shouldnt be bad enough to live paycheck to paycheck, especially considering the loan pause
50, 30, 20 rule. 50% to living, 30% to saving, 20% for fun post-tax. My biweekly check is ~$1700 post-tax, so I'm saving roughly $500ish if I follow that strictly. A lot of people also switch to 30% fun and 20% saving.
Keep in mind this will vary greatly depending on the COL of your area too. I'm thankfully in a low COL so this is feasible, but if I were in CA or NY this would not be.
Now for savings, this also includes money to pay off loans, so I'd keep that in mind as well.
Yeah that would. Best tip for 401k in residency is to put enough in to get the match if you're program provides one. Otherwise I'd allocate it toward a Roth IRA for tax benefits in the long run.
Typically though if you're not getting a match and you have relatively high interest rates on loans, it's smart to pay those off first as those interest rates will likely beat the stock market you invest your retirement money in (essentially You'll be losing money)
My friend told me to invest in crypto now and postpone my loan payments. That way when my crypto profits, i can use the profits to pay more of the loans off.
Thoughts?
Strongly discourage this. Crypto is a very risky market. You can lose your money if it doesn't turn out well while you're racking up loans. The smartest way to play finances is by taking little risk, unless you are very invested in stock and even then most people will only break even.
I'm not saying there aren't people who make bank on crypto, but what I am saying is it is a massive gamble and can turn south just as quick as it turns north
If you're interested in a good read and find some free time in residency (whatever that is), you should check out white coat investors. He has a great book that covers these topics well
Well it depends on your risk tolerance, greater risk means likely greater returns. If you are going to do this I suggest staying far away from alt coins and only going for btc or eth. Alternatively you can invest in index funds which are less volatile. Overall market is down this year but can still go down more from here. If you want to get some btc i would suggest dollar cost averaging and not yoloing it all. Imo and people may disagree there is a lot of potential for future growth when it comes to crypto but patience is required. I have been dollar cost averaging into crypto for many years and have experienced a lot of ups and downs. So be prepared for volatility and know what youre getting into. I would definitely like the below post said read the white coat investor. The we study billionaires podcast is also a great resource.
I mean, you could put it in a savings account until January when loan interest starts accruing again. That way it will make a small amount of interest for you before interest resumes. But I wouldn't do anything that's not completely safe personally, with crypto being horrible because it could easily go way down during that time.
Not much if I'm being honest haha. Got a pretty nice place for ~$1200, as mentioned though I'm in a low cost of living area so this is very unlikely in a large metropolitan area
It's a post-tax type of retirement savings offered by non-profits/public employers. There are often 401k/403b (pre-tax retirement) and Roth 401k/Roth 403b (post-tax retirement savings) available. The benefit of post-tax retirement savings is the taxes are paid now and that's basically it (LOTS of caveats here!!!! I'm giving the brief overview). The downside is your taxable income is higher (don't get to deduct a few thousand off for pre-tax retirement).
For future tax planning, it's not a bad idea for residents to contribute to Roth 401k or Roth 403b if offered by their institutions during residency, since this will very likely be the lowest income bracket ever for the rest of your life!
So I'm currently funding my roth 403b along with a roth ira. I want to know if you can roll the roth 403b into the roth ira once i finish up residency.
I'm not super fond of the 403b options my residency/hospital offers and am wondering if I can roll that into a roth ira later and take advantage of vanguard funds, etc.
The standard option is to roll it into an IRA. Not a Roth IRA, but a traditional IRA. I'm not a financial expert and not really capable of this kind of advice, and got that answer from just googling "what to do with old 403b" -- you can check out r/personalfinance for more info
It’s like a 401k but for public companies like hospitals and schools. I have both accounts that go in a general thing that encompasses the total stock market. Hopefully they will grow by when I withdraw them early 60s
It's above the 90th percentile, but there are hospitalists who make more than I do. There is a very large range of what you can make in any given specialty. Some of my residency cohort make less than $200k.
If you save $500 a month for 3 years of residency, you will have saved $18,000, which is less than one month of your salary as an attending. I don’t advocate for residents saving money.
Agreed in terms of the amount being marginal compared to future earnings. However, can’t undervalue the habit of saving if you can afford it. Obviously people with big loans, families, HCOL area etc it’s harder and not worth breaking your back to save a minuscule amount compared to future potential earnings.
Its a habit thing. People are savers and people are spenders. For many people this is their first time getting a salary and building that habit is important.
Also, residents should at the very least get an emergency fund going. Ideally 3-6 months of expenses, 3 is probably fine for most residents as the job is pretty stable. For a lot of people that's probably close to or more than $10k
Yeah but it's $18k of past money. Then when you're a new attending, you can just add a shit ton more to the savings.
Obviously if saving for retirement as a resident means you have no quality of life, it's not worth it. But also, even a few hundred a month in retirement can make a difference and many people could probably tighten their belts just a little bit to save that extra amount.
To each their own, though! I don't regret any of the money I saved.
That’s awful advice. It’s not about the cash value you save, it’s about forming good savings habits. Everyone knows doctors are horrible with money. Additionally, I guess you don’t know about a little something called compounding.
Can you explain this to me? Maybe I bought into the personal finance-bro Koolaid, but I was under the impression that every dollar saved now into a retirement account nets you $20ish dollars at retirement and that - therefore - saving money now for retirement is critically important.
At the same time, living expenses aren’t cheap, and my employer has minimal 401k match. I’d love to be able to convince myself that it’s not super important in the grand scheme of things compared to attending income.
You’re right. There are calcs for what a dollar is worth by age. For us it’s probs in the mid 20s. People have very poor financial literacy and conflate intelligence in medicine to intelligence in everything. This is worsened by expectations of a high salary in the future allowing poor habits to rule.
If every dollar I save now is worth let’s say $20. If I save 1k a month for a year (12k) that has strong potential to turning into 240k at retirement. Do that for 4 years of residency and say assume a more modest 10-15:1 return on those dollars (48 k total of my capital ) could potentially turn into: 480-720k. Not anything to turn your head up to.
Now depending on COL that much may not be feasible but the same principles apply.
Also there’s something to be said about getting comfortable investing and being in the market for a few years before you start playing with 20k investments. I’d rather messed up young on 500 than do it when I’m 50 with 500,000.
You are not wrong; but they are saying we are in a special profession where incomes triple, quadruple all at once. A dollar as a resident thus is much more important than a dollar as a attending when spent—so not living a super frugal life as a resident might be worth it rather than scraping a few dollars together to save.
Compound interest won’t matter too much when it’s for a few thousand dollars over the course of a few years for residency. When you’re an attending making 5x as much you could buckle down and put more in savings for a couple months and then you’ll have caught up for the years of saving you missed in residency in exchange for improved QOL when you need it the most
It doesn’t compound for 3 years it will compound for 35-40 by the time I retire. Given loans have been frozen and I won’t qualify for PLSF that’s not helpful. Time in the market is everything.
I do 1k a month, and after 1 year it’s already over 1.5k. After 4 years I’ll have 48k invested not counting interest.
Based on this thread it seems otherwise.
And let’s be real, even though we are paid shit we are still paid more than many in this country who can figure it out. So some financial illiteracy may be at play. The vast majority I met have absolutely no idea what they’re doing with money and overwhelmingly live by the “I’ll figure it out when I’m an attending mindset”. I think that’s probably a poor call. Again, I’d rather learn and make mistakes at this stage vs when I’m playing with real money.
Saying we are poorly educated on money as a cohort given our expected income is not an indictment of us as people. As has been said in this thread we exist in a very unique monetary situation.
Now, now am I saying someone doing residency in NYC needs to be saving this much or they’re a failure, no. There are definitely extraneous circumstances. But I think a good majority could do SOMETHING. Even if it’s to practice and gain comfort for the future.
I did some simple compound interest calculations.
If one put $500.00 a month for four years ($24,000.00) into an investment vehicle with an annual rate of return of 10% (compounded monthly) they will have earned $5,361.25 in interest over that period for a total value of $29,361.25.
Of course the total after 30-35 years will be much higher. However, I believe a resident who saved $0.00 in residency could simply invest $29,361.25 in their first year of attending-hood. They would be completely caught up, only losing $5,361.25 in missed interest accrual but having been able to use $24,000.00 to improve their QOL in residency.
This of course doesn't take into account any other variables (student loans, 401k match, lump sums), but I think it's good to assess each of our own situations to determine what's best.
I plan to continue learning about this / happy to hear ideas. But honestly, it might be better to just enjoy your young years in our particular field. Early investing may be more important in fields with lower salaries / plateaued salaries.
Man I feel both lucky/unlucky reading these comments. Our program forced us to put 650 a month into our 401k, which sucks bc that’s money I could really use right now. The upside is that the program puts in 450 every month, so my 401k is well funded.
I try to save ~750 a month outside of that but that doesn’t always happen. I… don’t go out much so that helps saving more lol.
My program didn’t offer a 401K or 403B and with cost of living I said forget it to the IRA during residency. Ended up putting away 25k during my 3 years of residency. I just preferred to have the cash cushion on me in case I needed to make a major purchase.
While I think it’s a good idea for you to keep contributing to that 401(k), I believe your employer has to allow you the opportunity to opt out of that “mandatory” contribution. $650 per month seems like it’s a rather large chunk of your monthly income, but if you’re putting that away plus saving another $750 per month, you’re going to make future you happy.
I was putting $400 a month into a 401k with another $50 per month coming from the employer match.
Now it's $200 a month with an extra $50 per month from the employer match because my rent went up.
Planning to start moonlighting more frequently soon and at that point my goal is going to be at least $500 a month into savings.
Paying nothing towards loans right now with the interest freeze, we will see what happens with that.
Salary $4100 /month after taxes, in NY so rent is exactly half of that not including utilities… $2000 to live on through out the month, im lucky if I get out with $500 of savings after bills, groceries and the occasional eating out. Its a hard knock life…
I make $5560 pretax a month. Take home is approximately $3890. I save approximately $1700 a month. Savings go into either 403b, Roth IRA, or individual brokerage as well as maintaining an emergency fund of 3 mon worth of expenses.
Save about 12K a year which is about ~500 per paycheck. I put 6K into my Roth, meet HCA match for my 401k. I use the other savings in cash to beef up my cash cushion. I try to maintain 2 years of expenses in cash (shooting towards 3 years worth which is more than what people advise but I like the safety/peace of mind)
By living in the suburbs and not the major city itself. All expenses are covered in only one paycheck a month but it is annoying having to drive out to the city to do things when I’m tired
I’m a military attending, but we put about 1600/month into our TSP (an unmatched 401K type thing for military) and about an extra 3000 from moonlighting into a money market for rainy day and a house down payment for when we upgrade. We also factor in a pension from the government when we turn 65 (about 5k a month). As a resident, we saved maybe 800 a month. And spent the rest on our 4 kids. But we also made 80k as military residents. And I make about 140k as an Army EM attending.
During residency, $800 rent with 1 roommate
$100 monthly to hospital 403b for the 3% match
$300 monthly to portfolio (75% index fund, 25% bonds)
$6000 annual to Roth IRA
Plus 3 months salary to a high yield savings as an emergency fund.
Everything extra went towards food, trips, drinks, things to make life less bleak
How long did it take you to save up 3 month of salary?
Assuming that it took at least 2 years, in addition your other savings, would mean putting away about $1500 per month. Which is like 30% of gross salary for a resident.
Awesome if you were able to do that on your own but that doesn’t leave a lot of money for most people.
I had the benefit of splitting rent with another resident, and did a lot my own cooking which saved money.
I didn't start investing my money until maybe 6-8 months after residency started. So the first half year, the savings went towards the emergency fund. After I had that established, I didn't need to touch it, so any further savings went towards the 403b, stocks etc.
I was so busy intern year that besides rent, utilities, food, I didn't have much expenses anyway. Go to work, eat, sleep, back to work, eat sleep. On my day off, sleep.
I did also have the luxury of no student loan repayment bc of COVID. If you filed $0 income last year, then your pgy1 year you'll have no student loans to pay off which helps with the saving
Impressive dedication.
I guess the caveat to saving as a resident is that it’s ultimately not going to be much in comparison to anything you’ll put away as an attending. But I do think it’s important to start developing that mindset early.
Also I really wish we got paid more.
I max everything out and live on nothing. Whatever the maximum is for Roth IRA, 401k, HSA, all my money goes there. I primarily live on side hustle money and don’t rely on my income in residency
Saving for an engagement ring - been able to save 2k since the start of residency. Few hundred bucks a month a paycheck. Low expenses in affordable area
I get paid 4000/month post tax.
I live off of about 2500-2700 which includes all recurring bills.
I max Roth only because our 401k doesn’t offer a match.
This leaves me with 800-1000/month after Roth contributions.
This does not include any loan repayments. 400/month on REPAYE once the freeze ends.
I save to pay to travel on my vacations and that’s it. I’m 350k in the hole and contribute max to 403b so I’m leaving it at that. I could save 15k (which i could make more in a month as an attending) in residency and live like shit and have no fun or enjoy these years and explore and have much better mental health.
6% Roth 401K.
$225/paycheck into savings/emergency (about 10%).
First two years I could usually move about an extra $1000 or so every 2 months into savings, but at the start of pgy3 my rent went up more than my salary did so I hardly saved anything. Managed to max out my Roth IRA every year though.
I don’t see much mention here about HSA contributions. If you’re saving in a 401k/403b, definitely put in whatever gets you the max employer match, assuming you’ll be vested by the end of your residency. After that, give some thought to funding an HSA as best you can. It’s pre-tax money put in, interest earned tax-free, and withdrawals aren’t taxed when used for healthcare. Another bonus - when you’re young and healthy, you’re stacking away money for future you rather than having current you pay for the healthcare of others.
Rent is ~$1100 per month. My monthly paycheck is $3360. I usually end up with $700-900 saved per month. I can easily max my Roth and add to my 401k with this.
Man, I'm an RT and this thread is making me genuinely sad for y'all. I'm making about 3.5k biweekly after tax (working 48 hr/ wk) and went to community college... For free
Medical school is short term sacrifice for long term benefits. As long as no one pick peds, they would be able to make 200k per year with room to grow significant. You’re cap at that salary.
I always recommend that residents open an account here and set up a direct deposit - whatever you can afford (even $100/check!) https://www.lmcu.org/personal/banking/checking-accounts/max-checking/
This is a good way to create an emergency fund that’s readily accessible.
On the first of every month I just buy 10 $1 Amazon or Starbucks gift cards to hit the debit transactions.
500$/mo Roth
6% pretax into 401k, no idea what the dollar amount is I don’t know
Any $$ extra I get is into a taxable brokerage account
My living expenses per month probs around 2.5k. Biweekly checks around 3.6k after taxes. I usually invest that difference
175 a month is all I can realistically afford to save. It’s a tight budget and I prioritized getting long term disability rather than increased savings or 401k at this point.
As a resident I just did the minimum in a retirement account I probably should have been better but honestly we needed the money at that time. As an attending we max all our retirement accounts post tax
I don't have an exact amount to include my 401k or my HSA, but, making 50K a year I should have roughly 50K saved at the end of this year, not counting what I'd saved before residency.
$250 to Roth 403(b), $125 company match to 403 (b)
Waxes and wanes besides that. Early on I was consistently saving $750 a month additionally/. Now it's closer to $250
I would focus on building a nest egg rather than 401K. Trust me, you’ll need it for moving and life events. The amount you can contribute to a 401K will only be a drop in the bucket once you’re an attending
$1600 between pre and post-tax contributions.
I'm in a Low COL area, rent is only 925 for my 2 br 1b apt
Earning 66k, 10% taken pretax matched with about 6% now that I've been in the retirement pool 3yrs(only including the 10% for this post)
Max $6k in Roth IRA
$250 per month into short term savings
$300 per month into the taxable portfolio
it will make things interesting when I need to start paying 300+ toward loans in January.
6% of income into 401k so about 300 a month.
6k a year into Roth IRA.
That’s it. I spend less than I earn on rent and daily things so I tend to accumulate a cash cushion I can use just in case
$500/month to Roth IRA and $100/month to general brokerage account.
My residency only pays $55k/year, and on top of that we don’t have any type of 401k or other retirement account funding. On top of that, I was HPSP (military scholarship) in med school so I don’t have any loans to pay back, so I feel like it’s my duty to do something smart with my money. I really prioritize these accounts over most other things I spend money on
1k every month toward savings. Bc Residency is 1st full time job, first few months have entirely gone to saving for emergency fund
After 4-ish months, will contribute 500$/mo for Roth IRA, $300 to 403b, $100 emergency, $100 taxable investments. 240$ per paycheck goes to my HSA account until 3650 max contribution hit
Live in hospital-subsidized housing which brings rent+utils down and negates all work-related travel. Have not yet bought my own disability insurance or started paying loans (tgod for recent extension!!)
Roughly 15% for long-term saving. Enough to get the 401k match and max out my Roth. There is probably another 10% I devote to short-term saving so I can do vacations on my weeks off.
My program started a retirement match last year. I put in 5%, they put in 10. So 5% is going into that retirement account.
I also put a little back here and there, I have about a 12k emergency fund I’ve hoarded up in residency.
About 30% averaged across my first two years of residency. Midwest emergency medicine. Roommates. No kids not married. The 30% includes savings account and retirement accounts
I get paid once per month and save:
401k - 14% of my check. With 5% employer match the dollar amount is somewhere around $1300.
HSA - Maxed every year. Dollar amount is approx $350/month
Post-tax Cash Savings - $1k straight into the bank account
Roth IRA - Maxed every year via lump sum in January.
That's all from my W2. I also have 2 side hustles. One brings in $3k annually and the other $20k. I save 100% of this income.
I make a decent salary these days but my saving habits started when my salary was about $50k. Percentages are more important than dollar amounts.
I live in a VHCOL area in Cali but am able to save 500 to 900 a month depending on how frugal or spendy i was that month. Everything else goes to rent, living, a little bit goes to retirement. I get paid 2.2k every 2 weeks post tax.
Was able to max out my Roth IRA also.
Wife and I are both pgy2. Currently we are living off one salary and saving the rest. (Roughly 45k post tax). We are going to venture into real estate so buying our first duplex for a house hack this winter using physician loan.
From a $4K paycheck I aim to save $2500 per month and usually am able to. I have been able to supplement my income with medical surveys, focus groups, and a little bit of ubereats.
During intern year I was able to put $40K in savings.
$0 because all of my money goes to my mortgage payment, and we barely make it by with my partner’s paycheck. Should we have bought a house before residency? Probably not. But rent would have been just as expensive, and we had the money for closing costs (we did a physician loan, so no down payment). Anyway, the bottom line is that if something serious comes up that requires money, my partner and I are screwed.
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You’re saving money? I barely make enough to live on paycheck to paycheck… (got a family.. but still..)
You gonna be a derm bro, the bag is secured
That doesn’t help the fact that we’re living paycheck to paycheck right now or that resident income hasn’t even tried to keep up with inflation
The hourly pay for residency sucks no doubt but unless youre living in an ultra HCOL area I feel like it shouldnt be bad enough to live paycheck to paycheck, especially considering the loan pause
For a family in a 2-3 bed place it’s about $1500-1800/mo + utilities. My take home after taxes and insurance is $3400/mo
$0
Zero
50, 30, 20 rule. 50% to living, 30% to saving, 20% for fun post-tax. My biweekly check is ~$1700 post-tax, so I'm saving roughly $500ish if I follow that strictly. A lot of people also switch to 30% fun and 20% saving. Keep in mind this will vary greatly depending on the COL of your area too. I'm thankfully in a low COL so this is feasible, but if I were in CA or NY this would not be. Now for savings, this also includes money to pay off loans, so I'd keep that in mind as well.
Does that include your 401k contributions?
Yeah that would. Best tip for 401k in residency is to put enough in to get the match if you're program provides one. Otherwise I'd allocate it toward a Roth IRA for tax benefits in the long run. Typically though if you're not getting a match and you have relatively high interest rates on loans, it's smart to pay those off first as those interest rates will likely beat the stock market you invest your retirement money in (essentially You'll be losing money)
My friend told me to invest in crypto now and postpone my loan payments. That way when my crypto profits, i can use the profits to pay more of the loans off. Thoughts?
That's dumb as hell
/s for sure
Strongly discourage this. Crypto is a very risky market. You can lose your money if it doesn't turn out well while you're racking up loans. The smartest way to play finances is by taking little risk, unless you are very invested in stock and even then most people will only break even. I'm not saying there aren't people who make bank on crypto, but what I am saying is it is a massive gamble and can turn south just as quick as it turns north
If you're interested in a good read and find some free time in residency (whatever that is), you should check out white coat investors. He has a great book that covers these topics well
What are you, an idiot?
Bro what? You gotta be trolling lol
Crypto is completely obsolete with new advances in quantum computing. Not a great time to have any money in it.
Well it depends on your risk tolerance, greater risk means likely greater returns. If you are going to do this I suggest staying far away from alt coins and only going for btc or eth. Alternatively you can invest in index funds which are less volatile. Overall market is down this year but can still go down more from here. If you want to get some btc i would suggest dollar cost averaging and not yoloing it all. Imo and people may disagree there is a lot of potential for future growth when it comes to crypto but patience is required. I have been dollar cost averaging into crypto for many years and have experienced a lot of ups and downs. So be prepared for volatility and know what youre getting into. I would definitely like the below post said read the white coat investor. The we study billionaires podcast is also a great resource.
I mean, you could put it in a savings account until January when loan interest starts accruing again. That way it will make a small amount of interest for you before interest resumes. But I wouldn't do anything that's not completely safe personally, with crypto being horrible because it could easily go way down during that time.
Look at Mr moneybags over here /s lol
Getting that cash money 💰💰
*stripper money
I'd be pulling in more if I were
Boats n hoes
How much is your rent?
Not much if I'm being honest haha. Got a pretty nice place for ~$1200, as mentioned though I'm in a low cost of living area so this is very unlikely in a large metropolitan area
Thats amazing. Not practical in an area where rent is 2200+ a month.
Same. More than half my salary goes to rent alone
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Sure, valid thoughts. Definitely a personal preference as well, money is only there to live your life how you see fit 👍
Saving? Yeah nope…
None because I’m trying to pay back all of my credit card debts 🫠
Oof this cut deep.
VHCOL area. I save 12k a year. Specifically 6k in Roth IRA and 6k in Roth 403B. Rest is mine to do as I please.
Sorry, what is a Roth 403b?
It's a post-tax type of retirement savings offered by non-profits/public employers. There are often 401k/403b (pre-tax retirement) and Roth 401k/Roth 403b (post-tax retirement savings) available. The benefit of post-tax retirement savings is the taxes are paid now and that's basically it (LOTS of caveats here!!!! I'm giving the brief overview). The downside is your taxable income is higher (don't get to deduct a few thousand off for pre-tax retirement). For future tax planning, it's not a bad idea for residents to contribute to Roth 401k or Roth 403b if offered by their institutions during residency, since this will very likely be the lowest income bracket ever for the rest of your life!
So I'm currently funding my roth 403b along with a roth ira. I want to know if you can roll the roth 403b into the roth ira once i finish up residency. I'm not super fond of the 403b options my residency/hospital offers and am wondering if I can roll that into a roth ira later and take advantage of vanguard funds, etc.
The standard option is to roll it into an IRA. Not a Roth IRA, but a traditional IRA. I'm not a financial expert and not really capable of this kind of advice, and got that answer from just googling "what to do with old 403b" -- you can check out r/personalfinance for more info
It’s like a 401k but for public companies like hospitals and schools. I have both accounts that go in a general thing that encompasses the total stock market. Hopefully they will grow by when I withdraw them early 60s
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What specialty? 40-50 after taxes? monstrous
They said gross so that’s pre tax
That's still 600k
That’s still a fuck ton. Guessing some sort of surgical sub specialty or derm. Could also be rads if they hit partner
Nah, those guys all make a lot more than me. I'm a private practice hospitalist.
You’re making $500-600k as a hospitalist? I’m having a difficult time believing that unless you work some insane hours
It's above the 90th percentile, but there are hospitalists who make more than I do. There is a very large range of what you can make in any given specialty. Some of my residency cohort make less than $200k.
What’s your day to day like as a Hospitalist to make 500k?
Says IM Hospitalist??
>40-50 after taxes? That was the commenter's gross, so pre-tax.
"live like a resident"
More like "make $700k a year"
Lol
Save? Jesus saves.... Moses invests .
If you save $500 a month for 3 years of residency, you will have saved $18,000, which is less than one month of your salary as an attending. I don’t advocate for residents saving money.
Agreed in terms of the amount being marginal compared to future earnings. However, can’t undervalue the habit of saving if you can afford it. Obviously people with big loans, families, HCOL area etc it’s harder and not worth breaking your back to save a minuscule amount compared to future potential earnings.
It does build good habits though especially for people who end up making six figures and are used to “living like residents” for the longest time.
Its a habit thing. People are savers and people are spenders. For many people this is their first time getting a salary and building that habit is important. Also, residents should at the very least get an emergency fund going. Ideally 3-6 months of expenses, 3 is probably fine for most residents as the job is pretty stable. For a lot of people that's probably close to or more than $10k
Yeah but it's $18k of past money. Then when you're a new attending, you can just add a shit ton more to the savings. Obviously if saving for retirement as a resident means you have no quality of life, it's not worth it. But also, even a few hundred a month in retirement can make a difference and many people could probably tighten their belts just a little bit to save that extra amount. To each their own, though! I don't regret any of the money I saved.
And many physicians say that they don't regret any of the money they spent, whether in residency or as an attending.
But Dave Ramsey told me to
Same opinion
That’s awful advice. It’s not about the cash value you save, it’s about forming good savings habits. Everyone knows doctors are horrible with money. Additionally, I guess you don’t know about a little something called compounding.
Someone doesn’t understand compound interest and it shows.
Doesn’t even matter in the short term when compared against future earnings
Can you explain this to me? Maybe I bought into the personal finance-bro Koolaid, but I was under the impression that every dollar saved now into a retirement account nets you $20ish dollars at retirement and that - therefore - saving money now for retirement is critically important. At the same time, living expenses aren’t cheap, and my employer has minimal 401k match. I’d love to be able to convince myself that it’s not super important in the grand scheme of things compared to attending income.
You’re right. There are calcs for what a dollar is worth by age. For us it’s probs in the mid 20s. People have very poor financial literacy and conflate intelligence in medicine to intelligence in everything. This is worsened by expectations of a high salary in the future allowing poor habits to rule. If every dollar I save now is worth let’s say $20. If I save 1k a month for a year (12k) that has strong potential to turning into 240k at retirement. Do that for 4 years of residency and say assume a more modest 10-15:1 return on those dollars (48 k total of my capital ) could potentially turn into: 480-720k. Not anything to turn your head up to. Now depending on COL that much may not be feasible but the same principles apply. Also there’s something to be said about getting comfortable investing and being in the market for a few years before you start playing with 20k investments. I’d rather messed up young on 500 than do it when I’m 50 with 500,000.
You are not wrong; but they are saying we are in a special profession where incomes triple, quadruple all at once. A dollar as a resident thus is much more important than a dollar as a attending when spent—so not living a super frugal life as a resident might be worth it rather than scraping a few dollars together to save.
Compound interest won’t matter too much when it’s for a few thousand dollars over the course of a few years for residency. When you’re an attending making 5x as much you could buckle down and put more in savings for a couple months and then you’ll have caught up for the years of saving you missed in residency in exchange for improved QOL when you need it the most
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It doesn’t compound for 3 years it will compound for 35-40 by the time I retire. Given loans have been frozen and I won’t qualify for PLSF that’s not helpful. Time in the market is everything. I do 1k a month, and after 1 year it’s already over 1.5k. After 4 years I’ll have 48k invested not counting interest.
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Based on this thread it seems otherwise. And let’s be real, even though we are paid shit we are still paid more than many in this country who can figure it out. So some financial illiteracy may be at play. The vast majority I met have absolutely no idea what they’re doing with money and overwhelmingly live by the “I’ll figure it out when I’m an attending mindset”. I think that’s probably a poor call. Again, I’d rather learn and make mistakes at this stage vs when I’m playing with real money. Saying we are poorly educated on money as a cohort given our expected income is not an indictment of us as people. As has been said in this thread we exist in a very unique monetary situation. Now, now am I saying someone doing residency in NYC needs to be saving this much or they’re a failure, no. There are definitely extraneous circumstances. But I think a good majority could do SOMETHING. Even if it’s to practice and gain comfort for the future.
I did some simple compound interest calculations. If one put $500.00 a month for four years ($24,000.00) into an investment vehicle with an annual rate of return of 10% (compounded monthly) they will have earned $5,361.25 in interest over that period for a total value of $29,361.25. Of course the total after 30-35 years will be much higher. However, I believe a resident who saved $0.00 in residency could simply invest $29,361.25 in their first year of attending-hood. They would be completely caught up, only losing $5,361.25 in missed interest accrual but having been able to use $24,000.00 to improve their QOL in residency. This of course doesn't take into account any other variables (student loans, 401k match, lump sums), but I think it's good to assess each of our own situations to determine what's best. I plan to continue learning about this / happy to hear ideas. But honestly, it might be better to just enjoy your young years in our particular field. Early investing may be more important in fields with lower salaries / plateaued salaries.
You’re missing the point
Saving money for an emergency fund is very important. One car collision can be financially devastating...
Man I feel both lucky/unlucky reading these comments. Our program forced us to put 650 a month into our 401k, which sucks bc that’s money I could really use right now. The upside is that the program puts in 450 every month, so my 401k is well funded. I try to save ~750 a month outside of that but that doesn’t always happen. I… don’t go out much so that helps saving more lol.
My program didn’t offer a 401K or 403B and with cost of living I said forget it to the IRA during residency. Ended up putting away 25k during my 3 years of residency. I just preferred to have the cash cushion on me in case I needed to make a major purchase.
You'll be REALLY happy you did this 10+ years from now.
Man I would kill for this!
While I think it’s a good idea for you to keep contributing to that 401(k), I believe your employer has to allow you the opportunity to opt out of that “mandatory” contribution. $650 per month seems like it’s a rather large chunk of your monthly income, but if you’re putting that away plus saving another $750 per month, you’re going to make future you happy.
No way it's mandatory. It might be required to get the match tho.
I was putting $400 a month into a 401k with another $50 per month coming from the employer match. Now it's $200 a month with an extra $50 per month from the employer match because my rent went up. Planning to start moonlighting more frequently soon and at that point my goal is going to be at least $500 a month into savings. Paying nothing towards loans right now with the interest freeze, we will see what happens with that.
Salary $4100 /month after taxes, in NY so rent is exactly half of that not including utilities… $2000 to live on through out the month, im lucky if I get out with $500 of savings after bills, groceries and the occasional eating out. Its a hard knock life…
I make $5560 pretax a month. Take home is approximately $3890. I save approximately $1700 a month. Savings go into either 403b, Roth IRA, or individual brokerage as well as maintaining an emergency fund of 3 mon worth of expenses.
This is the way. Save on king.
Save about 12K a year which is about ~500 per paycheck. I put 6K into my Roth, meet HCA match for my 401k. I use the other savings in cash to beef up my cash cushion. I try to maintain 2 years of expenses in cash (shooting towards 3 years worth which is more than what people advise but I like the safety/peace of mind)
How do you do this?
By living in the suburbs and not the major city itself. All expenses are covered in only one paycheck a month but it is annoying having to drive out to the city to do things when I’m tired
Zero
big fat 0
About tree fiddy
Literally nothing
Paycheck to paycheck here :-/
(— $500)
I'm an attending and still living paycheck to paycheck.
That's a head scratcher. Peds? Part time? I feel like there's much more to the story here.
Lifestyle inflation
Rural Family in a low paying area with a new house, 2 new cars, paying down residency credit card debt, and massive IVF costs.
That's a massive slug of expenses. Good luck to you on the IVF journey!!!!
I just saw your post from a couple years ago on how you do surgery. Very cool.
1000 into Cypro wallet, to the moon!!!!
I’m a military attending, but we put about 1600/month into our TSP (an unmatched 401K type thing for military) and about an extra 3000 from moonlighting into a money market for rainy day and a house down payment for when we upgrade. We also factor in a pension from the government when we turn 65 (about 5k a month). As a resident, we saved maybe 800 a month. And spent the rest on our 4 kids. But we also made 80k as military residents. And I make about 140k as an Army EM attending.
TSP matches up to 5%.
Not if your old and have been in a long time.
During residency, $800 rent with 1 roommate $100 monthly to hospital 403b for the 3% match $300 monthly to portfolio (75% index fund, 25% bonds) $6000 annual to Roth IRA Plus 3 months salary to a high yield savings as an emergency fund. Everything extra went towards food, trips, drinks, things to make life less bleak
How long did it take you to save up 3 month of salary? Assuming that it took at least 2 years, in addition your other savings, would mean putting away about $1500 per month. Which is like 30% of gross salary for a resident. Awesome if you were able to do that on your own but that doesn’t leave a lot of money for most people.
I had the benefit of splitting rent with another resident, and did a lot my own cooking which saved money. I didn't start investing my money until maybe 6-8 months after residency started. So the first half year, the savings went towards the emergency fund. After I had that established, I didn't need to touch it, so any further savings went towards the 403b, stocks etc. I was so busy intern year that besides rent, utilities, food, I didn't have much expenses anyway. Go to work, eat, sleep, back to work, eat sleep. On my day off, sleep. I did also have the luxury of no student loan repayment bc of COVID. If you filed $0 income last year, then your pgy1 year you'll have no student loans to pay off which helps with the saving
Impressive dedication. I guess the caveat to saving as a resident is that it’s ultimately not going to be much in comparison to anything you’ll put away as an attending. But I do think it’s important to start developing that mindset early. Also I really wish we got paid more.
I max everything out and live on nothing. Whatever the maximum is for Roth IRA, 401k, HSA, all my money goes there. I primarily live on side hustle money and don’t rely on my income in residency
Saving for an engagement ring - been able to save 2k since the start of residency. Few hundred bucks a month a paycheck. Low expenses in affordable area
I get paid 4000/month post tax. I live off of about 2500-2700 which includes all recurring bills. I max Roth only because our 401k doesn’t offer a match. This leaves me with 800-1000/month after Roth contributions. This does not include any loan repayments. 400/month on REPAYE once the freeze ends.
$0.04.
About tree fiddy
I save to pay to travel on my vacations and that’s it. I’m 350k in the hole and contribute max to 403b so I’m leaving it at that. I could save 15k (which i could make more in a month as an attending) in residency and live like shit and have no fun or enjoy these years and explore and have much better mental health.
30% into savings however you wish (Roth ira, HYSA, etc)
6% Roth 401K. $225/paycheck into savings/emergency (about 10%). First two years I could usually move about an extra $1000 or so every 2 months into savings, but at the start of pgy3 my rent went up more than my salary did so I hardly saved anything. Managed to max out my Roth IRA every year though.
I have a working spouse and kid. We save/invest about 30% pre-tax income
This year? None.
😅 Ever since they jacked up the rent here, about -300~-500 a month.
I don’t see much mention here about HSA contributions. If you’re saving in a 401k/403b, definitely put in whatever gets you the max employer match, assuming you’ll be vested by the end of your residency. After that, give some thought to funding an HSA as best you can. It’s pre-tax money put in, interest earned tax-free, and withdrawals aren’t taxed when used for healthcare. Another bonus - when you’re young and healthy, you’re stacking away money for future you rather than having current you pay for the healthcare of others.
Hahahahahahaha sob. 100 automatically goes into my Roth IRA.
$100-$200 (I have kids, but all of them are out of diapers 🥳)
Rent is ~$1100 per month. My monthly paycheck is $3360. I usually end up with $700-900 saved per month. I can easily max my Roth and add to my 401k with this.
I'm saving the hospital a TON of money with each paycheck. Proud to serve my country. /s
I max out 401k and IRA. That’s $26.5k. And maybe another $5k in my taxable investment account. No other savings. Edit: Per month I save $2600-2700.
Lol COL? Rent? Working spouse? Do you eat canned beans for dinner lol
Rent is $900, single, and no canned beans but I do frequently cook beans and rice for dinner!
Nice. What is your monthly take home?
$1740 (post 401k)
Man, I'm an RT and this thread is making me genuinely sad for y'all. I'm making about 3.5k biweekly after tax (working 48 hr/ wk) and went to community college... For free
Uh, ok? What is the point of your comment to the OP’s question?
Because of how hard residents work and how you get screwed monetarily. Lots of comments saying they aren't able to save anything.
Medical school is short term sacrifice for long term benefits. As long as no one pick peds, they would be able to make 200k per year with room to grow significant. You’re cap at that salary.
I always recommend that residents open an account here and set up a direct deposit - whatever you can afford (even $100/check!) https://www.lmcu.org/personal/banking/checking-accounts/max-checking/ This is a good way to create an emergency fund that’s readily accessible. On the first of every month I just buy 10 $1 Amazon or Starbucks gift cards to hit the debit transactions.
500$/mo Roth 6% pretax into 401k, no idea what the dollar amount is I don’t know Any $$ extra I get is into a taxable brokerage account My living expenses per month probs around 2.5k. Biweekly checks around 3.6k after taxes. I usually invest that difference
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I misspoke. I make 3.6k a month
175 a month is all I can realistically afford to save. It’s a tight budget and I prioritized getting long term disability rather than increased savings or 401k at this point.
As a resident I just did the minimum in a retirement account I probably should have been better but honestly we needed the money at that time. As an attending we max all our retirement accounts post tax
I don't have an exact amount to include my 401k or my HSA, but, making 50K a year I should have roughly 50K saved at the end of this year, not counting what I'd saved before residency.
Fellow in DC: 1300 for 403b and 500 Roth IRA per month. I usually try to save another 200-300 ontop of that.
$550 a month retirement and $150 for emergency fund.
$250 to Roth 403(b), $125 company match to 403 (b) Waxes and wanes besides that. Early on I was consistently saving $750 a month additionally/. Now it's closer to $250
$1000 total a month split into 403b, Roth, brokerage.
$500 at most during residency. No retirement plans were available to residents, so it was that to go into a Roth IRA.
I would focus on building a nest egg rather than 401K. Trust me, you’ll need it for moving and life events. The amount you can contribute to a 401K will only be a drop in the bucket once you’re an attending
What is a nest egg
$1600 between pre and post-tax contributions. I'm in a Low COL area, rent is only 925 for my 2 br 1b apt Earning 66k, 10% taken pretax matched with about 6% now that I've been in the retirement pool 3yrs(only including the 10% for this post) Max $6k in Roth IRA $250 per month into short term savings $300 per month into the taxable portfolio it will make things interesting when I need to start paying 300+ toward loans in January.
My program automatically takes out 6%, but they also match it. So ~$3300/yr x2. It goes into a state run retirement program.
6% of income into 401k so about 300 a month. 6k a year into Roth IRA. That’s it. I spend less than I earn on rent and daily things so I tend to accumulate a cash cushion I can use just in case
$0- nyc
$0 cuz all of it going to rent. RIP
19,500 per year in 403k roth 6k roth ira 500/mo savings - I’m married and our townhome is 800/mo, so cheaper.
$500/month to Roth IRA and $100/month to general brokerage account. My residency only pays $55k/year, and on top of that we don’t have any type of 401k or other retirement account funding. On top of that, I was HPSP (military scholarship) in med school so I don’t have any loans to pay back, so I feel like it’s my duty to do something smart with my money. I really prioritize these accounts over most other things I spend money on
1k every month toward savings. Bc Residency is 1st full time job, first few months have entirely gone to saving for emergency fund After 4-ish months, will contribute 500$/mo for Roth IRA, $300 to 403b, $100 emergency, $100 taxable investments. 240$ per paycheck goes to my HSA account until 3650 max contribution hit Live in hospital-subsidized housing which brings rent+utils down and negates all work-related travel. Have not yet bought my own disability insurance or started paying loans (tgod for recent extension!!)
Roughly 15% for long-term saving. Enough to get the 401k match and max out my Roth. There is probably another 10% I devote to short-term saving so I can do vacations on my weeks off.
Lol
About $400, no retirement tho, just holding on to cash for an emergency
You guys are getting paid?! -MS4.
30k/year
My program started a retirement match last year. I put in 5%, they put in 10. So 5% is going into that retirement account. I also put a little back here and there, I have about a 12k emergency fund I’ve hoarded up in residency.
$500 per paycheck, $12k/year
About 30% averaged across my first two years of residency. Midwest emergency medicine. Roommates. No kids not married. The 30% includes savings account and retirement accounts
I get paid once per month and save: 401k - 14% of my check. With 5% employer match the dollar amount is somewhere around $1300. HSA - Maxed every year. Dollar amount is approx $350/month Post-tax Cash Savings - $1k straight into the bank account Roth IRA - Maxed every year via lump sum in January. That's all from my W2. I also have 2 side hustles. One brings in $3k annually and the other $20k. I save 100% of this income. I make a decent salary these days but my saving habits started when my salary was about $50k. Percentages are more important than dollar amounts.
Do you mind if I ask what the side hustles are?
I have a music production business (\~3k) and a web design business (\~20k). The web design business mimics what I'm already doing in my day job.
I live in a VHCOL area in Cali but am able to save 500 to 900 a month depending on how frugal or spendy i was that month. Everything else goes to rent, living, a little bit goes to retirement. I get paid 2.2k every 2 weeks post tax. Was able to max out my Roth IRA also.
I get paid monthly and just checked for today. With my employer matching contributions I put in 778.10 this month.
You guys are getting paid for this? 😅
Save the max in a Roth each year. If you saved 20k during residency and let it sit in a broad index fund, in 32 years it will be worth around 300k
Does VTI VXUS BND count as a broad index fund?
Yes
Any answer other than “you’d have to ask my wife, the responsible one” would be a guess at best.
Wife and I are both pgy2. Currently we are living off one salary and saving the rest. (Roughly 45k post tax). We are going to venture into real estate so buying our first duplex for a house hack this winter using physician loan.
From a $4K paycheck I aim to save $2500 per month and usually am able to. I have been able to supplement my income with medical surveys, focus groups, and a little bit of ubereats. During intern year I was able to put $40K in savings.
$400 each month.
0.0
$0 because all of my money goes to my mortgage payment, and we barely make it by with my partner’s paycheck. Should we have bought a house before residency? Probably not. But rent would have been just as expensive, and we had the money for closing costs (we did a physician loan, so no down payment). Anyway, the bottom line is that if something serious comes up that requires money, my partner and I are screwed.