How Much Does a Physician Need to Retire?

How Much Does a Physician Need to Retire?

How much is enough? It's a scary question.

Physicians spend years in college, residency, and fellowship earning comparably lower wages before they finally (FINALLY) finish their training and start earning what we call the "real" money.

Every step of the way we're warned that if you "live like a doctor" while you're training, you'll live "like you're training" when you're a doctor. This can lead to years and years of delayed gratification. When friends are celebrating milestones and buying houses, physicians-in-training are often earning near minimum wage and struggling to make ends meet.

So when the money actually starts rolling in, it can hard to be disciplined and fiscally responsible when years of pent up delayed gratification are bubbling away beneath the surface. That's to say nothing about socking away enough money to retire when the cost of medical school loans can typically run into the hundreds of thousands of dollars.

Unfortunately, 41% of male physicians and 56% percent of female physicians report symptoms of burnout according to Medscape's 2022 Physician Burnout and Depression Report.

One of the main factors cited was a lack of autonomy and too many bureaucratic tasks. One of the main solutions that physicians cited was decreasing their work hours.

The fundamental ability to do that relies on one factor alone: financial independence.

So, the question remains: how much money do physicians really need to retire comfortably? It's a scary question, and one that's often put off until it's too late. After all, physicians are trained to focus on the present, to prioritize patient care over their own well-being. But ignoring our financial future can be just as harmful as neglecting our health.

The truth is that the answer to this question depends on many factors, such as your age, your lifestyle, your debts, and your retirement goals. But as a general rule of thumb, most financial planners recommend that you aim to save at least 25 times your annual expenses to retire comfortably. For example, if a physician estimates that they will need $100,000 per year in retirement, they should aim to have saved between $2.5 million and $3 million.

For physicians, this can be a daunting figure, especially given the high cost of malpractice and overhead along with the burden of student loans. But the good news is that there are steps you can take to increase your chances of achieving financial independence.

First and foremost, start saving as early as possible. Even if you can only afford to put away a small amount each month, the power of compounding interest can work in your favor over time. Consider investing in tax-advantaged retirement accounts, such as a 401(k) or IRA, and take advantage of any employer matching contributions.

Secondly, live below your means. This doesn't mean you have to live like a monk, but it does mean being mindful of your spending habits and avoiding unnecessary expenses. And when you do splurge, do so consciously and with a clear understanding of the impact on your overall financial goals.

Finally, seek the guidance of a financial planner who specializes in working with physicians. They can help you navigate the complexities of medical school loans, tax planning, and investment strategies that are tailored to your unique needs and goals.

By taking these steps, physicians can increase their chances of achieving financial independence and avoid the stress and burnout that come with a lack of autonomy. It's never too early - or too late - to start planning for your financial future, and the peace of mind that comes with knowing you're on track to retire comfortably is priceless.

Another strategy that physicians can consider when planning for retirement is the concept of FIRE.


FIRE is an acronym that stands for "Financial Independence, Retire Early". The FIRE movement is a lifestyle and financial movement that focuses on achieving financial independence as early as possible, typically in one's 30s or 40s, and then retiring early to pursue other interests.

The basic premise of the FIRE movement is to live a frugal lifestyle, save aggressively, and invest wisely in order to accumulate enough wealth to retire early. This often involves saving a high percentage of one's income (often upwards of 50% or more), living below one's means, and investing in low-cost index funds or other passive investment vehicles.

One variation of FIRE that's particularly relevant to physicians is Coast FIRE, which involves achieving financial independence and then transitioning to a lower-paying, less demanding job that provides a better work-life balance.

Coast FIRE is the idea of achieving financial independence (having enough savings and investments to cover your expenses without needing to work) but then taking a break from actively saving for retirement while still letting the existing investments grow over time until reaching a traditional retirement age.

For example, let's say that someone has a target of $1 million for financial independence, and they've already saved $500,000. Instead of continuing to save aggressively to reach the $1 million target, they can take a break from aggressively saving and let their investments continue to grow over time until they reach traditional retirement age and only work as much as needed to cover their basic living expenses.

Coast FIRE is a more flexible approach to retirement planning, which allows individuals to achieve financial independence earlier in life while still having the flexibility to work part-time, start a business, travel, or pursue other interests without having to worry about finances.

How can I use a telemedicine job to achieve Coast Fire?

Working in a telemedicine job can be a great way to achieve Coast FIRE because it allows you to work from anywhere and have a more flexible work schedule. Here are some ways that you can use a telemedicine job to achieve Coast FIRE:

  1. Save aggressively while you are working: With the flexibility that comes with working in telemedicine, you can potentially work more hours or take on additional work to increase your income. Use this extra income to save aggressively towards your Coast FIRE goals.

  2. Invest your savings: Once you have saved enough money, invest your savings in a diversified portfolio of low-cost index funds or other investment vehicles that align with your long-term goals.

  3. Focus on reducing expenses: To achieve Coast FIRE, it's important to live below your means and reduce your expenses as much as possible. This can involve working remotely and living in a lower-cost area, downsizing your home, or being more intentional with your spending.

  4. Create a plan for your Coast FIRE: Determine how much you need to save to achieve Coast FIRE and create a plan for how you will use your time once you reach that goal. You may want to continue working part-time in telemedicine, start a business, or pursue other interests. We find this calculator particularly useful in calculating our Coast FIRE number.

Overall, a telemedicine job can be a great way to achieve Coast FIRE by providing the flexibility and income needed to save aggressively and invest for the future while still having the freedom to pursue other interests.

Ultimately, the key to achieving financial independence and retiring comfortably as a physician is to be mindful of your spending, save aggressively, invest carefully, and seek out opportunities that align with your long-term goals. By taking a proactive approach to your financial future, you can avoid the stress and burnout that come with a lack of financial freedom and enjoy the peace of mind that comes with knowing you're on track to achieve your dreams.