The pandemic has taken a toll on doctors’ incomes, but the past year has brought some relief as practices reopened, patients returned to their doctors’ offices and doctors’ incomes picked up.
For Medscape’s 2022 Wealth and Debt Report, more than 13,000 physicians across more than 29 specialties shared details about their compensation, as well as insights into how they save and invest, manage their budget, and in what as they live within their means.
In 2021, average physician earnings overall were $339,000. Primary care physicians received $260,000, while specialists received an average of $368,000. In addition to income, doctors continued to get richer, thanks in part to the rise in the stock market. About 46% of physicians have a net worth between $1 million and $5 million. Twenty-eight percent reported a net worth of less than $500,000.
The percentage of physicians worth over $5 million was 11%, up 7% from the 2019 survey. The top specialties of those reporting a net worth over $5 million may vary From one year to another. Still, orthopedics has been in the top five and dermatology in the top 10 since the 2019 report.
The other end of the scale has also seen changes. In last year’s report, no specialty had more than 18% of its physicians reporting a net worth of less than $500,000. This year, 23 specialties did so, led by infectious diseases, pediatrics and family medicine.
On average, male doctors earn more than female doctors, which has an impact on the evolution of wealth, as does the relatively low percentage of women in the highest paying specialties. Only 6% of female physicians were in the $5 million+ club, compared to 14% of males, while 35% of women reported a net worth of less than $500,000, compared to just 22% of their male counterparts.
However, it doesn’t seem like women are chasing money. In family medicine, women earn about 16 percent less per hour than men, according to Sterling Ransone, Jr, MD, president of the American Academy of Family Physicians. “Nevertheless, the percentage of female physicians and family medicine residents has increased despite the persistent wage gap,” he said. Medscape Medical News.
The wealth gap between white and non-white doctors is also concerning. The share of white doctors with a net worth over $1 million (63%) is higher than that of Asian American doctors (57%), Latinx/Hispanic doctors (49%) and black doctors (38%). ).
Watch out for the money
Most physicians (93%) reported living within or below their means. Along with the basics – stick to a budget, be smart about luxury – one interviewee said: “We make the basic decision that it’s not important to be trendy [or] to impress others. Others go even further. “We do most of our home maintenance and repairs ourselves,” said one doctor, while others report bringing their lunch to work and keeping their car for 15 years or more.
More than half of respondents (61%) have put as much or more aside this year to save than last year, and only 9% have not regularly put money into a 401(k) retirement account or a college tax-deferred savings account. .
This comes as no surprise to Lauren Podnos, CFP, a financial planner at Wealth Care, a company that specializes in working with doctors and other healthcare professionals. “In my experience, I find doctors to be very good savers,” Podnos said. Medscape Medical News. “Maybe it’s because they spend so much time [during training] earning so little, they get used to being careful with their money.”
Podnos adds that physicians have an additional incentive to build wealth as quickly as possible. Because burnout is so high among physicians, many like to plan their finances to prepare for this eventuality.
“When we work with doctors,” she says, “we really work to get to the point where they have the freedom to do whatever they want — downsize and work part-time for another 10 to 20 years or transition into a another career, just so that if they burn out they have other options.”
Despite their overall good financial habits, many physicians carry at least some debt. While doctors owe mortgage payments on their homes at about the same rate as other Americans, 10% to 31% of doctors, depending on the specialty, work to pay off student loans. Medical school debt is very expensive. American doctors pay an average of $356,000 to $440,000 over time for their education, including $165,000 to $240,000 in interest.
“The challenges of student debt are not unique to the field of medicine,” Ransone says. “However, we know that student loan debt is a particular challenge for primary care physicians. Research has shown that loan forgiveness or loan repayment programs directly influence doctors’ choice of practice, and we need more medical students to choose primary care.
While most doctors seem good at managing their wealth, investments can be tricky. When asked about investments that went wrong, 56% reported an investment that didn’t go as they hoped.
Often these results were due to bad luck. “I invested in a medical start-up that was sued for its name,” said a doctor. Some losses, however, were just bad calls. “I bought shares of Tesla when it was founded but sold them way too soon,” said another.
Avery Hurt is a Birmingham, Alabama-based freelance science writer who often writes about the science and practice of medicine.
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