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Discussion in 'General Residency Issues' started by prominence, Mar 20, 2004.
In what specialties, can you realistically make at least $200k?
Depends; are you talking straight out of residency, or after a few years of practice?
Just a caveat...don't go into medicine for the money. You'll be miserable
Business is where the money is.
This is true to an extent, but medicine still offers a guarantee of a solidly good, secure income. In business you either make it, or you don't. Perhaps most importantly, you either have the skills necessary for one of these fields, or you don't. Some people make great successful doctors, but would be horrible businessmen - and of course vice versa.
Definitely. And money, of course, has to be an issue with an investment as large as medicine (in both time, and personal life given up for it...oh, and getting sued every 5 minutes ). Just saying to be mindful of what you're getting in to.. it's a hard life
Rewarding, but hard.
Anyone watch Flatliners recently? It's on now. Damn it's scary
Not counting fellowships there are many straight out of residency where you are probably more likely than not to make 200K plus:
Possibly some Gen Surg. jobs
That's off the top of my head. I'm sure there are others. The ones I think you would be hard pressed to find a 200K plus job out of residency (and possible for ever) are probably:
practically every specialty except family practice, internal medicine, and a few others. The question should be which specialty will allow me to make >300k.
Family practice...I know this for a fact.
The question is, like with radiology, is this the norm, or the exception. Cuts, we know you think radiology is the be-all-and-end-all, but admit that their are far more radiologists out there making <500K than there are making >500K.
I know of ophthos, interventional cards, and plastic surgeons who make more than 1 million and one who makes close to 2 million a year. However, these are the exceptions rather than the rule. You should be looking at average salaries.
See these links:
This one is the most uptodate one:
I know of several DOs who specialize in OMT and make $300,000+. I know of one over $1,500,000.
Again, those 500K jobs are the exception, not the norm. Probably 90-95% of radiologists are going to start between 200K and 300K. I don't think there is a specialty out there where the majority of those practicing will start out making more the 500K a year. The potential is there if you land in the right practice, but 90%+ of your fellow rads grads will be making around 200-300 when they start...I guess they will just have to be satisfied with taking home more every two months than they gross in a year now.
I am willing to bet that there is a family doc or two out there that started out >500K a year. Someone that is the only doctor within several hundred miles that has c-section and appy priveledges, who also happen to be playing dermatologist, urologist, and gastroenterologist in their office. The potential is there, but most will be starting around 90-120K.
I know an ortho guy his 2nd year out that grossed 1.2 mil last year, but I can tell you that I am not looking for that. If I make 250K my first year out, I will be happy to be paid accordingly with my peers.
No offense, but this topic is a little irrelevant.
Pay scale is highly dependent not only on specialty, but also on demand. I have heard of Family Practioners (yes, that's what I said) making >$300K if they practice in underserved areas and do Ob-Gyn procedures. Is that the average? No. Is it in a big city, where a lot of people like to be? No. But can you make a lot of money doing it? Yes.
A specialty is what you make of it. You worked hard in med school and in residency. If you work hard during practice, you can REALISTICALLY (key word) make quite a good living doing ANYTHING. People have the misconception that Orthopods sit around drunkenly passed out 23 hours a day, then wake up during hour 24 to collect a $5 billion pay check. Or that a Psychiatrist works 52 hours a day to make enough money to go to Wendy's. Not true.
I'm not naive or stupid enough to say forget the money. We're all human and only the jerks pretend that 'I don't care about money ...I would practice even if I had to do it naked and filthy in the streets just because I love people sooooo much.' (Then they all try to match into Derm.) But it is true that money should not be the PRIME determinant of what you do. Trust me, things can get pretty miserable pretty fast if you don't love what you are doing.
By the way, you will always ALWAYS hear of people making more than you. If you made $1.5 million, someone would walk by and say that they heard someone made $6 million. I'm getting sick of people telling me that they 'know people (it's always some anonymous person) who are in business making $600K straight out of college'. Even if it's true, what are you gonna do? Focus on yourself, not on others. You'll be happier.
Here are some non-randomly selected data that may be of interest.
Making 500K+ as radiologist would put one in the top 15% of the 2002 U.S. diagnostic radiologist compensation distrubution, and the top quarter of the 2002 interventional radiologist compensation distribution. To make 500K+ in DR during the first 1 to 2 years of practice would put one in the top 5%. So, it is possible to make 500K+ within the first 2 years of finishing a rads residency, even without an invtervention fellowship, but it is not very common.
To make 500K+ in derm would place one in the top 5% of all practicing dermatologists irrespective of number of years spent practicing. This does not include dermatologists who have been fellowship trained in MOHS surgery.
The only surgeons with a median income (50%ile)of greater than 500K are ortho-spine specialists, although surgeons specializing in neuro, ct, ortho-hand, and ortho-hip have a median greater than 400K. It is not unreasonable for a spine surgeon to expect 500K within 1 to 2 years of completing fellowship although still less than half of those who have recently completed fellowhsip make this amount currently.
These numbers change quite dramatically with geography. Do not expect to make 500K in any field in the LA, San Francisco, Boston or NYC metropolitan areas immediately (first 2 years) out of residency. Many of the most highly paid physicians are located in less desirable regions where the supplyemand ratio is often incredibly strained. In general, physicians make significantly more money in the midwest and the south. This is particularly true for specialists for whom a 30% premium is not uncommon. The trend is less well preserved for women in the south.
Do a search in JAMA on salaries; There is a story (would get the link, but I'm busy) about a newly minted rads grad that was offered 600k a year and 26 weeks vacation..and turned it down.
Now, of course, I call serious @$)(@#)(^@)^(@#)^(@ on this one, but hey, it's in JAMA, and the guy talking about it actually said that the guy had a BETTER OFFER.
As far as $$...
GI (int med res + 3 year fellowship): heavy on the procedures, you can make as much or as little, I know of a guy about to get out of fellowship (read: in june he grads) that will bank over 300k his first year out.
Cards (int med res + 3 year? card fellow): bank
These are all 200k+ guys. Definitely not right out of residency by any stretch (for all, but some!), but with some good business sense and a work ethic..Remember: the real money you make isn't from your salary, but from the money you save and make work for you. Example...
Let's say you are a 34 year old newly minted orthopod, starting at 225k a year, and up to 400k within 3-5. If you, on average, put at least 100-200k a year (obviously towards the upper end when you get into the 400 range) into decent investments, within ten years, those investments should be drawing you a passive income that is equal to or greater your salary as an orthopod.
When you make your money, DONT START PAYING OFF YOUR LOAN IN A BIG CHUNK. The interest rates you have now are great. Save, live frugally a little bit longer (but still much much better than your buddies that are making 50-80k as business grads), invest wisely, and you will be in wonderful shape.
Thanks for listening to my study induced monologue
P.S. Dr. Cuts is the man, and I think he should name his gulfstream 5 "X-Rayted"
just remember that 40% of your income will go directly back to the government, and probably more if Kerry is elected. Next, you better not think too big with investing. The Stock market dropped 20% in 2002. Greater return on investment = Greater risk. You would have to have 2million invested to make 200000/yr on a 10% gain (more reasonable on average). It will take more than a few years to match your income with investment gains, but you're right that it's a good idea to invest when you're young. Just like medical school, delayed gratification.
You need to fire your accountant if you're paying 40%, and the stock market has averaged 12% annual yield over the last 50 years.
Federal income tax is 35% for a single earning >$300K
State income tax varies but is usually ~6%
FICA is 7.65% if your employer is paying half
So you are looking at ~48.65% in taxes if you are single earning >300K/year.
This does not include personal property taxes, capital gains taxes, etc.
Only if you're paying every cent of calculated taxes on every cent you earn, by not using any shelters or write-offs; in which case, once again, you need to fire your accountant.
O.K., you make on average 12% in the stock market. Too bad inflation is generally at least 3%, so its looks like you get a 9% gain instead of 10%. You got me. As far as taxes go. O.K. so the government only takes 30% of your income. You can kiss 100,000 of that 300000 salary goodbye. My only point is the best way to make money is not with your salary. That's probably why someone who spends all their life in training doesn't make nearly as much as someone who started a business out of high school. Although you won't know who they are because they're smart enough not to blow their money on an $80000 car that drops in value 10% after it leaves the lot.
kinda makes me wish people would move outta buttplug, WI to cali.
Stock drop 20% in 2002, true, but if you know the trends, you can make money if it goes up or down.
I would say that if I'm making 350k pre tax I could definitely put 100-150k in investments, and within 10 years, have over 200k in passive income coming in.
By the way, you're right about Kerry getting elected. Tax cuts= economic growth and freedom, which is a *good* thing for *everyone*.
Uh...Get a new accountant, bro!
By the way, I'm a huge proponent of a flat tax of 15%. The economic numbers work on it, and I think it would be the best for America.
But really, what are legal ways of reducing the amount of taxes you have to pay? I don't understand any of this, and my greatest 1yr income to date is like $5,000, so I've never cared.
This could be a good thread if people post legit methods.
The most common ways are deductions & tax shelters. Deduction and exemptions are simply when the government agrees to reduce your tax bill, or reduce the amount of income subject to taxes at all, because you did something else with the money. Two common examples are mortgage interest and charitable contributions, both of which are 100% deductible from your taxes.
The second example, tax sheltering, means putting your money in accounts that aren't taxed. These are investments like 401(k), IRA's, etc. The idea here is that you're saving this money for retirement, and the money will be subject to lower taxes at that point. If you earn, say, $100,000, and put $20,000 in tax-sheltered investments each year, the government ignores that $20,000 until you withdraw it later on. That means you only have to pay income tax on $80,000.
Obviously it gets much more complicated than this, but that's a lo-fi introduction.
Ways to reduce taxes....
Deduct interest paid on your home or investment property mortgages.
Deduct interest paid on you student loans.
Deduct money for having dependents.
Put money tax free from you salary into a retirement fund, like a 403B or a Roth IRA.
Hell...if your making 250K per year, that's 20K per month...you don't need all of that! Put 5-10K per month into your tax free retirement fund....suddenly you are paying taxes on 60-120K less each year. You taxable salary essentially is reduced by that amount. Then, deduct interest from your student loans...there may be a maximum that you can claim, even still....say it's 10K or so. Then, deduct the interest you pay on your mortgage....we're talking big money for the first 5-10 years of you loan. Buy an investment property....deductions. Have kids....deductions. Take elaborate trips to conferences in Europe and Hawaii....deductions.
Accept cash from you patients! Pay fake employs and shunt that money into a foreign bank! Be like willie nelson and just don't pay it! And finally...the easiest way to pay less taxes....
DON'T VOTE FOR JOHN KERRY!!!!!!!!!!!!!!!
Who are the morons out there who'd actually vote for someone who has promised to do away with Bush's tax cuts??
A: The "morons" who think other issues are more important than their own personal bankroll. I for one would rather be proud to be an American (Bush is an embarrassment), have a better healthcare system (yes, ours is $hit for 50% of the population and is ranked greater than 30th in the world by the WHO), have less of our soldiers die in unnecessary wars (Iraq), achieve all major objectives in necessary wars (Afghanistan), and a host of other things. Yeah, that extra $10,000 per year that I'd save would be nice. But there are more important things than money sometimes. (not all the time, though)
Oh, and I'm a republican.
rustybruce... if you are a republican how can you use a communist/socialist view of the WHO on how they do their rankings??!! those rankings are based on how socialized the healthcare is and that is why costa rica, dominica, puerto rico, cuba, etc are ranked higher than US...
Please, please... back to tax deductions. I was actually learning something.
Tenesma, It's only socialist/communist if you view healthcare on the same plane as property. I don't think everyone deserves the same lot in life, but I put healthcare on a pedestal. As a (future?) physician, maybe you should too.
Samsoccer7, I apologize for hijacking the forum. Back to taxes.
Who are the morons out there who'd actually vote for someone who has promised to do away with Bush's tax cuts??
Um, me for one. The tax cuts have done nothing more than raise state and local taxes, up tuition (%11 per year for us), and force states to cut local services, such as libraries, trauma centers, low-cost health coverage, school hours and programs, etc...
You remind me of my grandfather, who in one breath said exactly what you did, but with "IDIOT" replacing the word "MORON", and in the next breath, complained about how awful our nation's schools are.
I think of all of the ecstatic parents who recieved their lovely "child tax credit checks" (Um, so how much in adminstrative costs did that, and the last round of checks pre-9/11, cost tax payers????), only to find out that their local schools were cutting the school year short and cancelling summer programs, so mom and dad get to put that precious money (and then some) into paying for childcare options and private remediation.
Oh, and you may select your candidate based solely on tax policy, but for me, there are other pertinent issues out there. Ever visit a national forest? (Better do it soon, because they won't be there for long) Ever work in manufacturing? (Too late, no more jobs left) Ever pay into a pension for 30 years, only to retire with nothing? Ever need a trauma surgeon or an emergency c-section, where there are no services?
Grow up and get your head out of your wallet.
Lots of tax info can be found on these websites:
can't remember if there's www before both, but think so.
The problem is, many of the tax breaks, like deducting student loan interest, are limited by income levels. So once you make over a certain amount, you're not eligible for as much of tax break anymore. So as a resident you can deduct student loan interest, but when you make more than 50K/year (or $130K for married joint filing couples), it's over. Given that most residents can't afford to pay back loans yet, and that almost all of us will hit the income limit quickly after residency, we'll never get to see that benefit.
401ks/403bs are also limited to 11000/year. Thats pretty piddly when you make >300,000/yr. Student loan interest deductions max out at 2500/yr. Piddly. I like the idea of charities. I wonder if you could create some foundation for your wife to donate money to.
Do you seriously link a federal child tax credit with the length of the school year and summer programs? Pretty loose association.
Taxes suck. When you consider state and federal income tax, sales taxes, property taxes, gas taxes, equipment taxes, capital gains taxes, cable tv taxes, phone taxes, electric and other utilities taxes and the multitude of other hidden taxes, it doesn't take a genious to realize this economy is seriously over taxed. We all should pay our fair share, but 40-50% is much more than fair. It's theft.
If you were to add all the above taxes up, they would account for approximately 50% of our GDP. It baffles me how some people out there still think the government knows how to better use our money than we do.
Pay for schools, highways, police and military like the government should. Medicaid for the poor and Medicare for the old. Once this is done, the whole system needs an overhaul.
I don't buy for a minute the socialistic elitism that many would have us swallow. The libs would have us believe our country is in for a grave future unless we give the wise, powerful, omnipotent government more of our money.
The national forrests aren't going anywhere, last I looked there were jobs to be had, especially in a recovering, evolving economy, and paying into a diversified pension for 30 years should leave you with plenty of money to retire on. Just don't put it all in one basket (Enron) or settle for a 2% annual return (social security).
Our best days are ahead of us.
Please don't drink the kool aide.
Back to the subject...
One thing that sucks for higher income earners is the alternative minimum tax. Basically this states that regardless of your deductions, charitable giving, etc, if you make over a certain amount (I think around 280K) you must pay a certain minimum amount of taxes. I can't remember the specifics but I bet one of the links above will lead you to it.
For the record, the deduction for having children doesn't apply after a certain income, either.
Just another point about taxes.
Like others have pointed out, you only pay taxes on your Adjusted Gross Income(AGI).
Secondly, AGI is taxed in a tier like fashion i.e 10% for the first 15k, 15% for the next 25k, etc.... Obviously when you are talking of a AGI of 200k+ the bulk of the tax will be calculated at the highest rate.
In addition there are some way more sophisticated techniques to reduce tax liability than have been discussed, but when you get there I am sure your tax attorney and CPA will share the info with you for a "small" fee.
An article talking about how medicare will be broke by 2019 because of our socialistic medicine system; It isn't even fully implented, it's just the prescription drug plan that will break us.
This is why we don't need Kerry. We need Bush and medical savings accounts!
Uhh, our system isn't socialistic by a long shot. And lest we forget, Bush is the one pushing for the drug benefit in such a way as to increase the profits of pharmaceuticals and insurance companies.
I also think "Bush" and "deficit" are synonyms, so of course when you try to increase services while lowering taxes you're going to have a deficit. And of course, Bush just killed the budget surplus he inherited from Clinton that would have allowed for subsidization of social security and medical care.
So if you want a warmongering, homophobic deficit spender who ignored terrorism until it hit us directly, Bush is the man.
Oh yeah, from the same article (I assume same article just different links: http://apnews.myway.com/article/20040323/D81G7NOG0.html)
Republicans pressed for the overhaul of Medicare last year to give private insurers a much larger role in the program as a way, Bush and others said, to control long-term costs.
But the government's own projections are that private managed care plans will cost taxpayers more than traditional Medicare for the foreseeable future.
Do you seriously link a federal child tax credit with the length of the school year and summer programs? Pretty loose association.
You missed the point...the tax cuts, which mean less money going from Washington to the States, plus the increased financial responsibility of the States to pay for "Homeland Security" without federal reimbursements, have forced all of the closures and downscaling. The "child tax credit" is just a ploy to gain votes....that money is not "extra" money at all...it is being paid back out in higher property, state and local taxes, etc...
The Rx plan had to do with Seniors and how many of them vote first and foremost. The AARP said they should get the freebies, they would vote against any party that wouldn't fork it over. Secondly, the profit issue may indeed weigh in.
Personally, I would much rather have my SS $$ in my control rather some bureaucratic organization. We will never see it gang. If we do, it will be much diminished in benefits. There is no other way. There are just too many boomers on the horizon for the system to support them in the current benefit level.
There is a lot of misinformation on taxes here, but find the best CPA and Tax Attorney money can buy. One of my friends does exactly this very thing. It might cost you $50K to save $500K.
Some 401x plans allow up to 25% of your earnings. Mortgage interest is only deductible on two homes simultaneously, and NOT for rental properties.
Two keys to avoiding overpaying taxes: Take your lifestyle out pretax (disguised as business deductions) and put money where the gains are not realized until you cash out (real estate and others ventures).
Just make a wad and hire good help.
SURE YOU ARE....
1. You can put about 30k per year into a Keough account which is similar to a 401k but designed for "self employed" people like doctors.
2. You can put an unlimited amount of after tax money into an annuity account where it will begin to compound free of taxes. After a couple of years you will have a substantial income from the annuity.
3. You can buy a very expensive house and get a huge tax deduction on the interest you pay on the mortgage. If you are smart and get a good deal on the house, the profit you earn when you sell the house is completely tax free up to $250k or $500k for a married couple. This is the most incredible free ride you will ever get from the government.
4. You can put an unlimited amount of after tax dollars into a tax managed index fund where it will compound with very few taxes. After a few years it will be a substantial asset.
In summary there are plenty of ways to shelter income from taxes if you consult a tax advisor. (Like a CPA) By the way I used to be a CPA
To be honest with you, almost every field of medicine would guarantee you 200K especially if you in private practice or join a group.
The better question is which physicians aren't earning at least 200K. In my experience from knowing physicians and discussing this issue with them ad nauseum, family practice, pediatrics, psychiatry and general internal medicine specialists will have a tough time earning 200K. It can be done of course. It depends on your geography. The smaller the town, the higher the demand for your services. Family docs in podunk towns can earn close to a million dollars because they essentially perform every procedure known.
If you are all about the money, then you can't go wrong with any surgical field. That will land you 200K at least. Realistically, you can expect to earn a minimum of 300K as any surgeon if you are work hard and manage your practice well.
Other safe bets are urology, derm, anasthesiology, gastroenterology, cardiology, radiation oncology and radiology. But again, with these fields, you are realistically looking ast 300K.
Remember there will be exceptions with these fields too. The more popular and saturated a city is, the less you will make unless you can beat out all of those other physicians as far as luring patients. Southern California is an anomaly. Most physicians make far less there than any other part of the country. The same applies to congested areas on the east coast like NYC and Boston.
If you want to make a reasonably good salary as a physician, stay away from the coasts and settle somewhere in the midwest or the south. That's where the money is.
I couldn't have said it better myself. Yes, I'm a Republican too but even I can't in good faith vote for a President that
1. got 600 U.S. solidiers and thousands of Iraqi citizens killed over oil. Sorry but it's just too big of a coincidence that the U.S. granted Halliburton pipeline rights. Halliburton is the same company that Vice President Dick Chaney ran for several years. Haliburton also gave a generous campaign contribution to Bush.
2. Does nothing to curtail the outsourcing of jobs overseas. This alone is the issue I'm most upset at our current administration for. When an egnineer can't find a job, you can't blame the lack of education on his unemployment.
I could be greedy or responsible. I'm choosing to be responsible by voting for Kerry.
Just to continue the digression...
Source? I can't think of any official casualty statistics that I've seen. And just to press the issue further, the former government massacred tens of thousands of its own citizens, across multiple occasions. Was the Iraq war about oil? Maybe, maybe not. But describing it as an American slaughter of Iraqi innocents is heavily misleading.
As the Bush administration does not officialy report civillian casualties, there can be no "official" source.
ok.. so here is my question..
i know medical docs make lots... but at the same time they have to pay lots back to uncle sam... but since they have money to hire accounts who are knowledgeable about tax cuts (e.g. kids, investment), i don't imagine that they actually pay say, 100,000 or 75,000 in taxes.. then there are malpractice insurances they pay...
that being said, here is my question:
how much to med docs actually take home from their typical 250k salary?
does paying malpractice insurance allow them to write things off?
i am sure some of you have parents who are med docs that make around the 200 to 250k salary, how much of that do they actually take home?
The malpractice insurance is written off as a deduction (business expense). But doctors I know making $250,000 pay just about what you would expect looking from the tax charts and factoring in social security, local, state taxes, and unemployment taxes. In the end, they pay a little over $100,000 in taxes. For doctors making, say, $400,000, they really do pay $200,000. There isn't some magical way to escape taxes other than 401Ks, etc.
I'm not well-informed on the subject, so pardon my ignorance.
If I make payments during residency on the interest on my stafford loans, how does it reduce my taxes? Does it reduce the amount of my taxable income, or am I reimbursed the full amount I pay on the loan? For example, if my salary is $40,000 and over the year I pay $2,000 on the interest on the loan, am I reimbursed the full $2,000, or am I only taxed on $38,000 of income?
It is a deduction (reduces your taxable income) not a credit (directly reduces the amount of tax you have to pay).
What I don't know is if you can take this deduction as well as your standard deduction, or if you have to itemize to get it.
It is an "Above the line" deduction: which means it affects your adjusted gross income. That means you can still take the full standard deduction (or itemize your deduction). The other important "above the line" deduction is moving expenses. Almost all other deductions are "below the line"--which means you have to itemize to take them.
BTW, when you have money refunded to you, that is a tax credit, not a deduction. (Depending on your income level, you can get some credit for 401k contributions). Which means you get a deduction (from your AGI) AND a credit. It pays to save!