How Much Should Resident Doctors Save? A Realistic Guide
by Malik Amine
Key Takeaways
- Residents should save 10-15% of income even on a $60K salary. The habit matters more than the dollar amount.
- Disability insurance during residency is non-negotiable. Your health locks in your rates for life.
- Contributing even $200/month to a Roth IRA during residency can grow to $60,000+ by the time you attend. Compound interest does not wait for your attending salary.
- Student loan strategy (PSLF vs aggressive payoff) needs to be decided in residency, not after. The wrong choice costs $50K-100K+.
- The biggest physician financial planning mistake is waiting. Residents wait until they're attendings. Then attendings wait until they're "settled." Then suddenly they're 50.
I hear this from residents all the time.
"Malik, I'm making $60K, I have $250K in loans, I barely have time to sleep. I can't save anything right now."
I get it. Residency is brutal. The hours are real, the pay is low relative to what you're training for, and saving money feels like the last thing worth stressing about.
But here's the thing about physician financial planning that most people miss: the habits you build in residency follow you into your attending years. Residents who save nothing tend to become attendings who spend everything. The income goes up. The saving never starts.
So let's talk about realistic numbers. What should you actually be saving during residency?
How Do Physicians Build Wealth Differently?
Physicians have a compressed wealth-building window compared to most people.
You graduate undergrad at 22, medical school at 26, and finish residency somewhere between 29 and 34. By the time you're earning real money, your college roommate who went into finance has been investing for a decade.
That's not a criticism. That's just the timeline.
It means you can't afford to waste the years you do have. Physician financial planning that works accounts for the late start. You make it up by being more intentional, not by saving less and hoping it works out later.
A resident making $60,000 should be saving a minimum of $500-$800/month. That's roughly 10-15% of gross income. It won't feel like much. It adds up.
What Taxes Affect Doctors Most?
Physicians are, by definition, going to be in the top federal tax brackets for most of their careers. That makes tax-advantaged accounts one of the most important physician financial planning tools available.
During residency, a Roth IRA is your best option. You're in a relatively low tax bracket now (22-24%). Contributions to a Roth IRA grow tax-free and are withdrawn tax-free in retirement. When you're an attending in the 35%+ bracket, you won't be able to contribute to a Roth directly. Residency is your window.
The 2026 Roth IRA limit is $7,000/year, or about $583/month. If you can hit that during residency and your money grows at 7% annually for 30 years, that $7,000 becomes roughly $53,000 per year contributed. Across a four-year residency, you're looking at $85,000+ in tax-free retirement savings before you ever see your first attending paycheck.
That's real money.
If your hospital offers a 403(b) with an employer match, take the match. That's free money. Always take the match.
When Should Physicians Invest in Real Estate?
Not during residency. That's the short answer.
I know physicians who bought a condo during their intern year and regretted it. Real estate is a fine wealth-building tool for physicians, but it requires stability, capital, and capacity to manage it. Residency has none of those three things.
The right time to think about real estate is after you've been an attending for 2-3 years, paid down some loans, built an emergency fund, and have consistent income. Physician real estate investing works best when you're not in a position where a bad month wipes you out.
During residency, your one job financially is to not blow the window you have. Set up your accounts, build the habit, and protect your earning potential with insurance.
Why Do Many Doctors Go Broke?
This one's hard to talk about but it's real. According to the American Medical Association, physicians report higher financial stress than the general population despite higher incomes. The reasons are predictable.
Loan burden entering the career. Delayed gratification for a decade. Then a salary that feels unlimited. Then lifestyle inflation that eats the entire gap.
A doctor making $300,000 who spends like they make $300,000 builds no wealth. The income doesn't matter if the savings rate is zero.
The doctors I've worked with who build real wealth have one thing in common: they treated savings as non-negotiable. Not "if there's anything left over." Savings come first. Everything else comes after.
It sounds boring. It works.
How Much Should a Resident Doctor Save?
Here's the actual framework I use for resident physician financial planning.
Start with your take-home pay. For most PGY-1s, that's around $3,800-4,200/month after taxes and benefits.
From that, here's where the money should go:
Housing: 25-30% of take-home. That's $950-1,200/month. Realistically, in most cities, you'll need a roommate or a modest apartment. That's fine.
Student loan payments: If you're on income-driven repayment working toward PSLF, your payments may be $200-400/month. If you're not pursuing PSLF, you should be making at least the minimum.
Roth IRA: $583/month. Automate this on day one.
Emergency fund: $200-300/month until you have 3 months of expenses saved. Residents don't think they need this. Then the car breaks down.
Everything else: food, transportation, life. You'll be fine.
Is it tight? Yes. Is it doable? For most residents, yes. And the habit you're building is worth more than the money itself.
What's the Best Retirement Plan for Physicians?
During residency: Roth IRA is the priority. Low tax bracket now, tax-free growth forever.
After residency: The game changes. You'll want to max out your 401(k) or 403(b) ($23,000/year in 2026), do a backdoor Roth IRA ($7,000/year), and max an HSA if you're on a high-deductible health plan ($8,550/year for families).
That's roughly $38,550/year going into tax-advantaged accounts. At $300,000 income, that's about 13% of gross. Not as high as you'd think.
For the full breakdown of retirement accounts for attending physicians, see the attending physician money mistakes guide.
The best retirement plan for physicians is the one you actually execute. A 401(k) you never open is worth nothing. A Roth IRA you automate and ignore grows while you sleep.
FAQ: Physician Financial Planning During Residency
Can I save for retirement while paying back student loans?
Yes, and you should. At minimum, capture any employer match on your 403(b). Beyond that, contribute to a Roth IRA while your tax rate is low. The two goals are not mutually exclusive.
Should I refinance student loans during residency?
Only if you're certain you won't pursue PSLF. Refinancing federal loans converts them to private loans, which makes them permanently ineligible for PSLF. Run the PSLF numbers first. If PSLF is in your future, stay on income-driven repayment during residency.
Do I really need disability insurance as a resident?
Yes. This is not optional. Your greatest financial asset is your ability to earn income. If you become disabled and can't practice medicine, that income disappears. Disability insurance during residency costs less than after graduation because you're younger and healthier. The AAMC reports that physicians face a 1 in 4 chance of a disability during their careers. Lock in coverage now.
What if I can't save the full $583/month for a Roth IRA?
Save what you can. $200/month is better than nothing. $50/month is better than nothing. The habit and the account both matter. Increase contributions as you advance in training.
Residency is not the time to put your financial life on pause. It's the time to build the foundation the attending version of you will stand on.
Start the Roth IRA. Get the disability insurance. Have a student loan plan. The details can adjust over time. The worst thing you can do is wait.
Sources:
- American Medical Association, Physician Financial Wellness Survey
- IRS 2026 Retirement Contribution Limits (401k, Roth IRA, HSA)
- AAMC Physician Workforce Report 2024