Residency Salary--Clarification Please

[weezer230]

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Hey everyone,
If someone knows the answer to the following question, please let me know. I was discussing loan repayment options with my friend (who is in law school) when he told me that med students always complain about how in debt they are and will be when they begin practicing (which is true but with valid merit). He told me that if someone wants to do inter. cardiology for instance, (which is about a 3 year IM residency and one or two cardio fellowships ranging from 1-3 years (total of about 5 more years on top of the 3) that you will be making a general physician salary after 3 years and then a interventional cardiology salary after you are done with the fellowships.
In other words, after your first 3 years as an IM resident (during which you make about $40K) you will make the average general practitioner salary of $125K. Then when you do your cardio fellowships you still make the $125K until you complete the fellowships and then make the $220 that the cardio guys get. I told him he was wrong and a resident makes $40K a year with roughly a 1-2K increase each year. There is no way he is right, is there?

Thanks for the help.

 

[Pinkertinkle]

Nah fellows make more than residents but not 125k a year thats for sure. Morel ike 70kish.

 

[Law2Doc]

Hey everyone,
If someone knows the answer to the following question, please let me know. I was discussing loan repayment options with my friend (who is in law school) when he told me that med students always complain about how in debt they are and will be when they begin practicing (which is true but with valid merit). He told me that if someone wants to do inter. cardiology for instance, (which is about a 3 year IM residency and one or two cardio fellowships ranging from 1-3 years (total of about 5 more years on top of the 3) that you will be making a general physician salary after 3 years and then a interventional cardiology salary after you are done with the fellowships.
In other words, after your first 3 years as an IM resident (during which you make about $40K) you will make the average general practitioner salary of $125K. Then when you do your cardio fellowships you still make the $125K until you complete the fellowships and then make the $220 that the cardio guys get. I told him he was wrong and a resident makes $40K a year with roughly a 1-2K increase each year. There is no way he is right, is there?

Thanks for the help.

Agree with the prior poster. From what I've heard. You start out at 35-45k as a resident, and it increases a few thousand per year of seniority through residency and fellowship, to a max of around 70k. It's only when you leave your training (and go into the real world) that you break 6 digits.

Edit: SDN member saradoor, on another thread, posted a link to the Beth Israel Deaconess residency salaries which she excerpted:

"Residents' *Salary Schedule for AY 05-06 and Proposed Salary for AY 06-07
PGY Salary 2005-2006 Salary 2006-2007
1 $45,148.30 $48,082.94
2 $47,271.28 $50,343.92
3 $49,393.19 $52,603.74
4 $51,975.81 $55,354.24
5 $55,187.86 $58,775.07
6 $58,630.28 $62,441.25
7 $62,072.69 $66,107.42
*Fellowship salaries are determined by the individual Division."

I have heard of residency salaries that start as low as 35k as a first year resident, but the rate of progression is about the same (just subtract about 10k across the board).

 

[tncekm]

I've never seen fellows making more than $45k/yr. they don't make much (if anything) more than residents from what I've read.

http://www.aamc.org/newsroom/reporter/jan02/medschooldebt.htm ($40k/yr in this article)

 

[Law2Doc]

I've never seen fellows making more than $45k/yr. they don't make much (if anything) more than residents from what I've read.

http://www.aamc.org/newsroom/reporter/jan02/medschooldebt.htm ($40k/yr in this article)

That article is from 1/02, so it's not quite current numbers. There was a thread a few weeks ago which showed the salary progression from resident through fellowship at one of the CA hospitals, I believe. Increases were small but annual so that if you did a long enough track, the money does exceeed the 45k you suggest by the time you are a fellow.

 

[vwhan]

.....He told me that if someone wants to do inter. cardiology for instance, (which is about a 3 year IM residency and one or two cardio fellowships ranging from 1-3 years (total of about 5 more years on top of the 3)

Keep in mind that you make somewhere in the 40's for the first 3 years (IM residency) and then a little more than that for Cards fellowship, which is at least another 3 years after IM residency.

 

[tncekm]

http://www.umm.edu/gme/salary_benefits.html
http://www2.marshfieldclinic.org/education/residency/residency_fellow/general_surgery/benefits.htm
http://www.ucihs.uci.edu/som/radiosci/fellowships.html

*** UCSF http://medschool.ucsf.edu/gme/pdf/SalaryScale.pdf

Whattday know! I was wrong (to my delight). There are some who will offer pretty good damn pay 😀

But, San Fran is ridiculously expensive, and most fellowships offered are closer to the $50k range.

 

[GoBroncos!]

40k doesnt seem so bad, not enough for loan repayment but enough to live decently, any1 able to make some loan repayments during this time?

 

[ANCAdoc]

One fellow in a surgical subspecialty told me he took a small paycut to go from a senior resident to first year fellow (different schools). I don't think fellows make alot more than senior residents.

 

[joe6102]

40k doesnt seem so bad, not enough for loan repayment but enough to live decently, any1 able to make some loan repayments during this time?

40k is probably at or below average for a college graduate. After 4 years of post-graduate training + huge debt that needs to be repaid, it is really, really low.

 

[sscooterguy]

40k is probably at or below average for a college graduate. After 4 years of post-graduate training + huge debt that needs to be repaid, it is really, really low.

Its VERY low. I envision most people finishing residency/going into fellowship have additional costs of budding families too. I know I'll be doing fellowship no matter what though. Like every other decision about going into medicine, it's an investment. Does anyone know if you can again defer loans in fellowship? Do people generally do that, or is it just getting too expensive to have interest continue to compile?

sscooterguy

 

[deuist]

The AAMC's Careers in Medicine website lists the national averages for resident salaries as:

Year 1 $42,070
Year 2 $43,782
Year 3 $45,727
Year 4 $47,719
Year 5 $49,543
Year 6 $51,284
Year 7 $53,436

 

[Wee Free Woman]

So then how are you supposed to start repaying loans after medical school? Is residency considered being a "full time student", such that you can defer your repayments until after residency?

I don't understand how one can really live off of that salary PLUS pay back loans monthly.

 

[Law2Doc]

So then how are you supposed to start repaying loans after medical school? Is residency considered being a "full time student", such that you can defer your repayments until after residency?

I don't understand how one can really live off of that salary PLUS pay back loans monthly.

You are not a full time student as a resident. I think there is the ability to defer some loan payments during this period though. Lots of americans scrape by on salaries similar to those. You won't be rich, but on a budget you will get by.

 

[skypilot]

So then how are you supposed to start repaying loans after medical school? Is residency considered being a "full time student", such that you can defer your repayments until after residency?

I don't understand how one can really live off of that salary PLUS pay back loans monthly.

You can defer (not pay) the loan through residency and fellowship. It might be a good idea to try to pay the interest every year though. That way the balance will not increase. 🙂

 

[deuist]

$42,000 is pretty decent compared to what most medical students live off of. So long as you avoid the temptation to run out and buy a car or rent a ritzy apartment while in residency, you should be able to start making (small) payments on your loans. You might also want to consider starting a retirement fund---yes, at the age of 27. Even if you put as little as $5,000 a year into a mutual fund for four years during residency and the fund has a return rate of 10%, you'll retire with more than $400,000.

 

[cicatrix]

So then how are you supposed to start repaying loans after medical school? Is residency considered being a "full time student", such that you can defer your repayments until after residency?

I don't understand how one can really live off of that salary PLUS pay back loans monthly.

Unless you have a very small loan total, your residency/fellowship salary will be low enough for you to qualify for deferment or forbearance.

As mentioned before, if you can swing it it isn't a bad idea to pay off the accruing interest while in residency so that your total doesn't continue to grow.

 

[Law2Doc]

$42,000 is pretty decent compared to what most medical students live off of. So long as you avoid the temptation to run out and buy a car or rent a ritzy apartment while in residency, you should be able to start making (small) payments on your loans. You might also want to consider starting a retirement fund---yes, at the age of 27. Even if you put as little as $5,000 a year into a mutual fund for four years during residency and the fund has a return rate of 10%, you'll retire with more than $400,000.

If you have a mutual fund that continuously is making 10% rate after fees you are beating the market pretty handilly. Be happy with less than this.

 

[Pinkertinkle]

$42,000 is pretty decent compared to what most medical students live off of. So long as you avoid the temptation to run out and buy a car or rent a ritzy apartment while in residency, you should be able to start making (small) payments on your loans. You might also want to consider starting a retirement fund---yes, at the age of 27. Even if you put as little as $5,000 a year into a mutual fund for four years during residency and the fund has a return rate of 10%, you'll retire with more than $400,000.

Good luck getting 10% return in todays market. LOL.

 

[tncekm]

Good luck getting 10% return in todays market. LOL.

Well, the average person who just expects to place their money somewhere and watch it grow will never get 10%. You've got to be very active.

For "normal people" their best bet is to give their money to someone who only charges commission off of profits so they have no incentive to do anything other than make you money. Better ones will give you 10%--which is reallly closer to 4-6% after inflation.

 

[njbmd]

Unless you have a very small loan total, your residency/fellowship salary will be low enough for you to qualify for deferment or forbearance.

As mentioned before, if you can swing it it isn't a bad idea to pay off the accruing interest while in residency so that your total doesn't continue to grow.

Hi there,
My total from undergraduate, graduate and medical school is $40K and I chose to pay the interest only while in residency. With the extremely low rate that I got when consolidating, it didn't make sense to pay this one off.

njbmd 🙂

 

[Dunce]

Hi there,
My total from undergraduate, graduate and medical school is $40K and I chose to pay the interest only while in residency. With the extremely low rate that I got when consolidating, it didn't make sense to pay this one off.

njbmd 🙂

sounds like somebody must have scored a lot of scholarships
nice!

 

[jbar]

40k is probably at or below average for a college graduate. After 4 years of post-graduate training + huge debt that needs to be repaid, it is really, really low.

It's all about perspective. Last year I was working full time on an ambulance and made $24k for the year. I know I can live on that and be pretty happy, so 35-45k doesn't sound so bad. (given, I'm single with no kids. But still)

 

[tncekm]

Hi there,
My total from undergraduate, graduate and medical school is $40K and I chose to pay the interest only while in residency. With the extremely low rate that I got when consolidating, it didn't make sense to pay this one off.

njbmd 🙂

Your interest only monthly due is probably only 15% or so less than if you were paying into your mortgage. Unless you're going to invest your earnings right away (that would be applied tot he principal of the loan), AND turn a higher return than your rate on your loan, you'd probably be better off paying off your debt as much as you can afford each month. You'll save LOTS of money. This is all, of course, if you can afford it 🙂

 

[InfraMan]

Your interest only monthly due is probably only 15% or so less than if you were paying into your mortgage. Unless you're going to invest your earnings right away (that would be applied tot he principal of the loan), AND turn a higher return than your rate on your loan, you'd probably be better off paying off your debt as much as you can afford each month. You'll save LOTS of money. This is all, of course, if you can afford it 🙂

Not quite.

folks who consolidated last year were able to score deals in the 2-3% interest range, which is less than inflation (which averages around 4% per year over the long haul).

In that scenario, you want to pay it off as slowly as possible. because every year that passes, the debt becomes less. Not less in the number of dollars. But since those dollars are worth less (due to inflation), it actually is less.

Think about it. Say your loan payment is $500 per month, and it's financed for 30 years. In 20 years, $500 per month will be peanuts.

 

[tncekm]

Understood...I just didn't many people were getting interest that low. That's great.

 

[LauraPaz]

In that scenario, you want to pay it off as slowly as possible. because every year that passes, the debt becomes less. Not less in the number of dollars. But since those dollars are worth less (due to inflation), it actually is less.

Think about it. Say your loan payment is $500 per month, and it's financed for 30 years. In 20 years, $500 per month will be peanuts.

But if you pay more than your minimum payment every month, don't you wind up paying less interest in the long run anyways? I mean, it's awesome to have a 3% interest rate, but why pay that interest for 30 years if you can pay off everything in 15? You cut into your principle sooner, so there's less money there to charge interest on. I've always been under the impression that you want to pay things off as quickly as possible, if you can manage it. Mind you, I'm not exactly the loan-repayment whiz, but this is how I've understood things.

 

[tncekm]

But if you pay more than your minimum payment every month, don't you wind up paying less interest in the long run anyways? I mean, it's awesome to have a 3% interest rate, but why pay that interest for 30 years if you can pay off everything in 15? You cut into your principle sooner, so there's less money there to charge interest on. I've always been under the impression that you want to pay things off as quickly as possible, if you can manage it. Mind you, I'm not exactly the loan-repayment whiz, but this is how I've understood things.

Yeah, you save bigtime paying off loans early.

However, instead of paying into a loan bigtime to save a 3% APR from building up, you can also paythe minimum (affording yourself more money at the end of each month) and invest this money elsewhere where you can yield a high return, like 8-12%. This will make you (save you) more money than just repaying quickly.

 

[LauraPaz]

Yeah, you save bigtime paying off loans early.

However, instead of paying into a loan bigtime to save a 3% APR from building up, you can also paythe minimum (affording yourself more money at the end of each month) and invest this money elsewhere where you can yield a high return, like 8-12%. This will make you (save you) more money than just repaying quickly.

Alright, that's what I thought. It's all a game in the long run. I've just never really looked into things enough to know how to balance it all well. Perhaps when I have a real salary I'll have to work on becoming more financially savvy. And sadly, since I'm just starting med school this year, there will be no 3% APR's for me 🙁

 

[tncekm]

LOL. You're got it good. I've got another two years to go before I get in. I'll probably be paying 7%!

If you get interested in this type of thing, some people I recommend reading (based off of my fiances research, not mine...I just get info from her):

- William Bernstein (Practicing cardiologist / Financial Wiz)
- David Bach (Start with Four Pillars of Investing, and then if you're good enough with your math, move on to Allocating Assets.)

If you want some sarcasm and entertainment pickup a Ben Stein book. If you're interested in the stock market and you've finshed Bernstein and Bach'ssimple books look at Jim Cramer.

 

[Law2Doc]

and invest this money elsewhere where you can yield a high return, like 8-12%. This will make you (save you) more money than just repaying quickly.

You have to beat the market pretty significantly to make a return in that range after fees. Most people in med school only have time for more passive investments, and those tend not to be that lucrative. This was a more important analysis during the dot com era, when folks actually were making a lot more money in the market than their student loans were costing them. These days, unless your student loan is really low (well under 5%), it pays to pay it down.

 

[tncekm]

You have to beat the market pretty significantly to make a return in that range after fees. Most people in med school only have time for more passive investments, and those tend not to be that lucrative. This was a more important analysis during the dot com era, when folks actually were making a lot more money in the market than their student loans were costing them. These days, unless your student loan is really low (well under 5%), it pays to pay it down.

This was in direct reference to "after graduation" when you have to start paying down loans.

And, 10% is not THAT significant. If you want significant, look at Jim Cramer. He's average 25% returns through the stock market over the course of 30 years! Imagine doubling your money every 3.5 yrs or so...amazing.

But, I did already said it once, however. If you're not going to take the time to do your investing, you're better off paying it off as fast as possible so the interest doesn't kill you. Its better to be frugal than a half-assed investor.

However, even doctors can find time to make wise investments. Look at William Berstein. He's quickly becoming the foremost financial wiz on the planet and he's practiciing cardiologist! (Read his books 🙂 )

Heck, people can get reasonable returns with almost no time invested in their portfolio, let alone spending an hour or so per day planning for their future. E.G. There are PLENTY of market accounts, which can be used for checkings/savings accounts as well, that will actually give you around 5% just having your money in there! And sadly, people continue to leave their money in savings accounts turning 0.04% or some ridiculous number annually, so they're losing money (close to 4%/yr) due to inflation!

 

[tncekm]

Let me help put things into perspective:

DJIA over 100yrs. See that little blip we call the 2k crash? 🙂 And, the more reasonably sized blip we know as the great depression? To me, this looks very similar to human population growth over time. Even events such as the black plague did NOTHING to stunt the growth. Exponential growth is amazing.