Saving During Training

[BB Cream]

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Hi everyone, I am grateful to have received an MSTP acceptance for the upcoming year. I am starting to plan ahead for this life adjustment, and was wondering if it is common for MD/PhD students to allocate part of their stipend for investments/saving for retirement.

My understanding is that stipends are not considered taxable income and can therefore not be put into a 401(k) account/Roth IRA. Is that correct? For those farther along in their training, do you recommend I should try to save, or not worry about it?

 

[reveries]

I haven't really figured out the tax stuff yet, but we do have to pay taxes on the stipend.

Without accounting for that, I save a little less than half my stipend each month, but I'm probably going to be putting it towards a house instead of another kind of investment.

 

[ValentinNarcisse]

It is taxable, pay them. Max out your Roth IRA every year, you will be in training a long time.


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[moggat]

It is taxable (and you should pay them), but not every program has a 401K program, so ask older students in your program what they do. If not, you can still get a Roth IRA/403B and contribute to that. I would recommend saving. I live in the most expensive city in the country, and still manage to put a little bit away every month, so it's definitely doable--even if just for a rainy day fund.