Real Life Examples of Physician Budgets — From the Frugal to the … – The White Coat Investor

Real Life Examples of Physician Budgets — From the Frugal to the … – The White Coat Investor

By Dr. Disha Spath, WCI Ambassador
Do you know the story of Diderot? Diderot was a storied 18th-century French philosopher who once purchased the finest of robes after he came into a large sum of money. He delighted in the robe’s beauty. But, as he put it on, he realized how out of place the fine scarlet robe seemed amidst the rest of his humble surroundings—with his straw chair and tired, old paintings. He succumbed to the urge to upgrade his surroundings to match the luxury of his robe. He upgraded his straw chair to one of leather and bought new paintings, new vases, and mirrors. His one upgrade turned into many, many upgrades. Diderot didn’t have the money to buy all these upgrades outright (after all, he was only a philosopher) so he took out loans to do it. Soon, his windfall of money turned into a mountain of debt.
“My friends, fear the touch of wealth,” Diderot writes. “Let my example teach you a lesson. Poverty has its freedoms; opulence has its obstacles.”
I’m sure we have all felt the same pull to constantly upgrade our lives. The entire advertising industry is hard at work making us feel the need for the next greatest thing. Everyone has the potential for succumbing to Diderot’s effect. But the effect is most dangerous to new attendings. A sudden increase in pay from residency or fellowship to attendinghood may lead one to upgrade to a nicer house, which lends itself to be filled with nice things. But these lifestyle upgrades have a consequence for wealth-building, and they delay progress toward financial independence.
Let’s take a practical look at how this goes down by considering the example of a physician family making $20,000 per month after taxes. For ease of calculation, they freshly graduated from residency at the age of 30, they have no student loans, and they do not have any kids yet.
Let’s assume this physician family wisely decides to max out all of their available retirement accounts, including the $20,500 limit (2022) for his and her 401(k)s, the $6,000 a piece for their Roth IRAs, and the $7,300 for their family HSA. (Note: those retirement contribution limits increase to $22,500, $6,500, and $7,750, respectively, for 2023.)
Let’s see what happens when they adopt different spending identities: the Frugalistas, the Moderates, or the High Rollers.
real life examples of physician budgets

Now, let’s explain what each of those spending identities means.
The Frugalistas live in a moderately sized house with paid-off older Hondas (in true WCI style!). They laugh about how often they get ticketed for parking in the hospital physician’s lot. Their home maintenance costs are lower due to the smaller size of their house. They use a low-cost carrier for their phones. They shop around for car insurance often and take defensive driving courses to lower their payment. They cut the cord with cable and stream instead. They watch their restaurant and shopping budgets, but are still careful to allot for saving for travel, entertainment, donations, and fun funds for each of the spouses. They do not belong to a country club. In this way, they live a full life but also save an additional $7,000 per month that they can put toward investing (or debt paydown). Assuming they have no student loans, their investments earn an average of 7% returns (and are compounded monthly), and if they keep up this lifestyle, they can race to financial independence in 10.5 years. That means they will be work-optional at 40 years old!
More information here:
10 Frugal Hacks to Automatically Save Money for Busy Professionals
The Moderates decide to upgrade their lives a bit after residency. They buy a bigger house than the Frugalistas and join a country club. They are a little less diligent about hunting for good rates on phones and insurance, but they still cap their restaurant and monthly shopping budgets to $500 and $750, respectively. They spend a little more on special occasions and travel. They make room for donations and for fun funds for each of the spouses. They end up with about $3,000 at the end of the month that they put toward additional investing. Given that their lifestyle is a little bigger than the Frugalistas, they will need an additional $1 million to be financially independent. However, they will still reach financial independence in an enviable 17.5 years and will be early retirees in their late 40s.
physician budgets

More information here:
How to Avoid the Traps of Lifestyle Creep
The High Rollers decide to buy a large house. They lease cars that require premium gas. They join a country club and go out often. They spend more on travel and restaurants. They have the highest cable package and don’t shop for insurance rates often. They still try to donate, but with all their expenses, they are living on the edge monthly and are spending everything they are making (aside from maxing out their tax-advantaged accounts). They don’t really have room for fun funds. Since they are living on the upper limit of their income but are still maxing out their retirement, they will be financially independent in their late 50s.
More information here:
Going from Broke to Financially Fit in Just 5 Years
Now, what if these families end up having kids, putting them in private schools, and investing in 529s for their college? This would likely slow down the FI progress for all three spending identities to closer to the traditional retirement age. Here I have added a completely arbitrary $2,000 a month for expenditure on kids’ daycare or private school or anything else (we all know kids are expensive). This moves the High Roller’s FI age to 64, the Moderates to 52, and the Frugalistas to 43.5 years old.
real life examples of physician budgets kids

As you can see, $20,000 in after-tax income is plenty to save a nice nest egg for retirement and to live a good life. However, lifestyle inflation and seemingly small increases in spending can really add up and can greatly impact the pace at which physicians achieve financial independence.
Remember Diderot. You can have your nice robe but try to keep everything else in check. Trying to temper lifestyle inflation’s draw to constantly upgrade can really pay off in earlier financial freedom and more breathing room in our monthly budgets. In the words of Paula Pant, you can have anything, but not everything. So, choose wisely.
Are you more of a Frugalista, a Moderate, or a High Earner? Has your spending identity shifted during your career? Would you trade off a frugal lifestyle for an earlier retirement? Comment below!
I love this blog. But these budgets are unrealistic. Have you seen how much groceries cost? What about child care expenses? Childcare for two children alone as an expense is over $2000. $12-1500 for groceries in an urban area for a family of four is about spot on. Unless you’re buying cheap crap to eat. Donating only $100/month? When you make $20,000/month? $75 for utilities? Completely unrealistic. Saving on your water bill? $100/month on water makes you a high roller? $80 for car insurance?! We have basic insurance on two older used cars and it’s $200/month. When were these budgets made?
Having a more modest home, driving used cars, limiting eating out, more modest vacations- all good things. The others really missed the mark in my opinion.
Truly most of your posts are super helpful but I was really baffled here.
I agree with Kacie here. I’m in an urban area in Texas, not even on the coast, and I pay way more than listed for real estate and childcare. I can’t fathom that much on shopping, restaurants, and certainly don’t belong to a country club. Can we update these figures for the realities of 2 full time working parents with children?
I’ve got a better idea. Let’s have you and Kacie actually post your actual budgets here as a comment. Then we have even more real life examples of physician budgets for the post. Don’t be surprised if others think you spend too much on some stuff and too little on other stuff.
First, both responses from the author are defensive which I find surprising and off putting.
You said I should post my budget and give you examples. I gave several examples that come from my budget. I didn’t mention anything about judging someone for spending more or less. Other than the donations category, I am talking about the more practical line items (water, childcare, groceries, car insurance) that I think were under estimated. You may have met a physician with a budget that lines up with these numbers – but in general- on average- that’s not the norm.
Also, I find it totally believable that many high income earners give away $100 or less- but is that the example we should be following? I really hope not.
I don’t think the author has responded. She’s in clinic seeing patients right now as far as I know.
I’m serious though. Post your budget and in a few hours someone else will be along saying “I can’t believe Kacie spends that much on new tires every year. Does she peel out at every stoplight?” and someone else will be saying “I don’t see how she can possibly spend less than $100 on her cell phone. That’s just not realistic.” Yet it will be your true budget and what you actually spend.
Thanks for covering for me while I was working Jim! Kacie, I’ve addressed most of your comments below, but I want to address the judgment on the giving piece. I put in a line item for monthly giving but I tend to give in a lump sum at the end of the year. The frugalistas with EOM savings of $7k can certainly afford to give a lot more should they choose to. Or, they can invest the money and give via a DAF. Or they can make a generous donation at the end of their lives via a charitable annuity or trust. There are many ways to give based on a person’s personal and religious beliefs and tithing is just one of them. Check out the podcast that Jim and I just released for more.
Happy New Year! Take a deep breath! These folks were just simply giving some feedback. These are not hateful or mean-spirited comments, but rather a different viewpoint from what the author presented. It’s OK!
You can’t have it both ways. You want the feedback and interaction from the WCI readers but get defensive if someone has the audacity to make a comment, other than praise, which contains a different viewpoint or opinion.
Of course it is hard to write a post for your blog and open yourself up to further scrutiny. Your staff and guest writers know this bit of information. Your usual comeback of telling readers who disagree with posts to submit their own article again shows some defensiveness. This comeback quite effectively ends any different ideas or discussion. Not sure that is what you really want.
If you don’t want comments, then take away the option to provide them. Simply make the posts read-only.
There will always be different opinions and ideas.
Always great to hear from you Bev.
This isn’t even my post. But I’ve seen this reaction EVERY time I’ve posted a budget, including this one on a different website many years ago:
The invitation is very serious and I extend it to you too. Post your budget. Everyone critique’s everyone else’s budget because their situation and values are different. That’s my whole point. Sorry if it came across as defensive. It was meant to come across as educational and as an invitation.
Bev, I love the engagement and the conversation- that’s the whole goal of communities such as WCI! But, when people post things with words like you must be eating crap, you can’t be surprised that we have something to say back. We are people too and don’t expect to not have any emotion at all and respond like robots when you post feedback. We are here to provide real-life white coat investors with our real-life opinions and experiences and can continue to do so for more people by making sure we keep this forum civilized, friendly, and respectful.
Thanks for getting this discussion going, I enjoyed it more than the article itself!
For water in particular there are many variables. My neighbor is on sewer, and his bill is 3x mine since I am on septic (our local sewer system is defunct and filed bankruptcy a few years ago). Lawn irrigation is a huge variable. A few years ago I watered my lawn a few times a week, it was green and lush, the envy of the street, but did have a pricey water bill (high roller) with a bill well over $100 per month. The following year I just watered during droughts, the yard looked like everyone else’s, my bill was back under $50 a month.
John, thanks for chiming in! We totally made the same decision with our lawn as well. It’s amazing how much over-watering will make your water bill go up! Plus using less water is better for the environment.
There’s an old Chinese proverb saying, “Man who say it cannot be done should not interrupt man doing it.” So I kind of find your response to a post titled “Real Life Examples…..” kind of funny. Clearly, some doctor is living on this amount, so it can be done. Now, can it be done in your state and your city with your size property and family etc.? Maybe not. Every budget is individual and we can all criticize any budget saying “that person spends too much on this and not enough on that etc.” A budget is very personal and reveals what a person values. For example, you’d look at what I spend on cars and think I’m a tightwad. Then you’d look at what I spend on travel and outdoor gear and think I’m a spendthrift. Be generally frugal and selectively extravagant on what you value most.
Every figure you balk at I’ve met a physician who spends that amount on that item, and yes, in recent years. Take the water for instance. We spend less than that on water from October to April and starting soon will spend less than that even in the summer after buying a share of a local reservoir. And there are plenty of doctors who don’t even give away $100 a month.
Re: car insurance – are you insuring against catastrophe only? What does “basic” insurance mean to you? Obviously, YMV but $200/mo seems pricy for basic coverage. If your “basic” insurance includes comprehensive coverage, you might want to drop it and focus on having good property and bodily injury liability while self insuring damage to your vehicle instead as WCI has advised before. I have a Honda and a Kia with the premiums ~$78/mo with Nationwide with great coverage for liability but minimal coverage for the vehicles. Perhaps shop around and see if you can get a better deal? A quick Google search shows you are paying close to the average premium in your state despite having a “basic” policy.
78/month for both cars or a piece? We have a 2012 Jetta and a 2015 pathfinder. No accidents reported. We’ve had liberty mutual for 10 years. Just recently they had a $500 increase annually due to inflation. I got a quote to go down to collision coverage only and it was barely any different. I’ve shopped around in years past with not much change in costs. Maybe I’ll check w nationwide although we bundle our home and car insurance with LM and they have had excellent customer service historically.
$78/mo for both cars. There are numerous insurance quote aggregators out there like compare, zebra, and insurify to quickly compare quotes. Again, big caveat of YMV.
Also, not sure why you would get a quote to collision only. Auto insurance is generally made of three main components – liability, collision, and comprehensive. Collision should only cover your vehicle in an accident/collision; your liability coverage is for the other party. May want to consider decreasing your collision coverage (or raising deductible) and self-insuring if you can. Would needing to replace/repair a car be a financial catastrophe? If not, why are you paying a premium for something you can self-insure since insurance on average has to be a losing proposition to the insuree?
As per policygenius, you can double your liability coverage with an average premium increase of 6%, yet getting a full comprehensive and collision coverage results in a 176% premium increase on average.
Kacie, similar to you I was a longtime LM customer that had my premium go up significantly 2-3 years ago without a change in car, location or driving record. I would shop around and found that I could save a little elsewhere but it was usually for less coverage. I eventually switched to Amica as they offered me comparable coverage to LM for a lot less. You might want to check them out too if they cover your state. LM customer service is excellent, but I’ve been happy with Amica so far too.
Great discussion here! Agree with many points made here to lower insurance costs.
Sorry for the multiple duplicate responses. Captcha issues.
Article at WCI re: insurance. ChooseFI and a bunch of other financial independence blogs also have virtual ink devoted to auto insurance.
One thing I differ from Jim in his article – I see no need to get significant collision coverage for car rental purposes while traveling. My kids also aren’t old enough to drive yet – maybe I’d feel differently if I felt our risk of collision was higher.
For our lifestyle (our leisure dollars are spent on travel), I choose to allocate the dollars that might have gone to a premium for collision coverage to the annual (and very hefty) fee for Chase Sapphire Reserve which offers primary rental care coverage to $75k (which I’ve utilized without too much of a hassle other than resubmitting a document) in addition to slew of other benefits that we value, like global entry, lounge access, using Ultimate Rewards portal, etc.
I just put a 16 year old on my insurance (which already has an 18 year old). I have a new frame of reference for expensive insurance.
Haha! I bet that was painful! How much did that raise your rates?
A LOT. The average is apparently over $200 a month. We’re not quite that, but it’s not that far away.
“They laugh about how often they get ticketed for parking in the hospital physician’s lot.”
I had to chuckle at this line. I have been flagged 3 times in the last 6 years for parking my 2009 Toyota Corolla in the Physicians’ Parking. Apparently, doctors are too wealthy to drive such a cheap car.
As far as the budgets being unrealistic, everyone is going to have something different. My family of 5 spends much less than $1,000 monthly on groceries, and we certainly don’t eat “crap food.”
Crap food was the wrong word to use! Sorry. I’d love to hear how you keep your grocery budget low!
DoctErk, thanks for sharing! lol, yeah I used to get mad when I got those tickets but now I regard it as a point of pride. 🙂 #WCIwayoflife
Kacie, I’m responding to your comments from bottom up. Great question here about how to lower grocery costs. There are so many ways to lower food costs! This is one of my favorite topics to talk about. Of course, costs are dependent on where you live, but they can be brought down. You’d be surprised how much prices are marked up at standard grocery stores and how many savings can be had by switching to a lower-cost grocery store like Aldi. You don’t have to spend a fortune on organic vegetables. We are lucky to participate in a farm share with a local farm so we can support them and get big boxes of fresh organic veggies weekly during the warm months here in upstate New York. We use misfits market in the winter to help reduce food waste. Shopping at local ethnic stores instead of the whole foods type stores for more exotic ingredients can also lower costs significantly. Combine that with batch cooking and meal planning and there are some real savings there!
I can’t take all the credit for the low monthly grocery bill; my wife is the one who makes it possible. Here are a few things we have done to limit the grocery budget:
1. Shopping with coupons at the local “Kroger”: stock up on groceries that are 30% off, buy several months of groceries that are 50% off and store them in the freezer (cheese, butter, brown sugar, even milk). We buy the cheaper store brand unless it’s disgusting, which many of their products are.
2. Shopping at Walmart/Aldi: buy items that aren’t often on sale at “Kroger” (spices, paper plates, meats, etc).
3. Using meal prep services: local produce providers like bountiful baskets provide new meal ideas, meal services like hello fresh give new recipes. Once we’ve tried several meals, we unsubscribe from the service and make the meals on our own, which greatly lowers the cost.
4. Make large meals and serve 2-3 nights of leftovers.
5. Bring dinner home from the hospital cafeteria.
6. Make inexpensive meals for the picky kids: my youngest would only eat macaroni and cheese for a while. It’s carb-a-licious, but cheap. If we made him anything healthy, he wouldn’t touch it. Later in the evening, we’d catch him sneaking snacks from the pantry.
7. Use “Kroger’s” pick up service. It’s not always cheaper (sometimes we get a coupon for free pick up), but it saves at least an hour for every shopping trip. We probably buy more unnecessary items when we pick out groceries ourselves.
Agree about that budget. We spend even less – budget $800/month for a family of 3 (essentially 3 adults) – includes pet food AND alcohol. We don’t eat crap food – we eat pretty well. Lots of Costco shopping, avoid Whole Foods and other pricier places (Sprouts, Trader Joe’s, etc.). Supplement with Target/Walmart. No Aldi’s near us.
I do think the childcare budget of $2000/month is unrealistic though….Daycare can easily run $1000 minimum. Likely at least $1500. Physicians often need nannies due to long working hours, expect $25/hour x 45/week, ~ $5000/month…even more with payroll taxes, insurance, etc.
The thing about childcare is that it is generally either a lot….or it’s nothing. So maybe $2,000 is the average but seems weird to anyone who actually buys it!
I guess it’s just a cost of doing business for two professional families. Many one professional families make the decision that it isn’t worth the lower earner working at all if you’re paying child care. Katie stayed home with the kid(s) for many years starting in my PGY2 year. It really didn’t make sense for her to go out and earn a teacher salary and then pay child care. Now of course she makes more than doctors so our plan and focus on my career early on really paid off for us, but there’s no guarantee of that happening.
The people who are really in a fix are single parents who not only don’t have a second income, but still have the childcare costs. They end up making less and spending more generally and thus have to live more frugally and/or take longer to reach the same financial goals.
This point is spot on! In 2018 our childcare was $4500/month and by 2021 it was $0.
I actually think Disha’s budgets are spot on. I was definitely on the Frugalista side as a resident with my then girlfriend now wife as residents in NYC. amazing how much your food/grocery budget can be $0/month when you find free food after every meeting at NYU. but also in NYC everybody eats out as well so that side of the budget went up.
I now sit more on the High Roller side because of the Diderot effect/Parkinson’s Law/lifestyle inflation but defiitely my expenses are even more High Roller than Disha’s example. I just copy and pasted the budget of me and my wife and yes, seems like Disha’s example of the High Roller’s are not inflated enough, but as a resident me and my wife were living on combined income of $120k per year. As you might notice too the groceries are $400 for this particular month, and we are a family of 4 living in NJ, but at least for us it is so variable given if we go on vacation for a week, if there are leftovers from potluck dinners, and my nanny is Greek and loves to cook so she will cook food for us with money out of her own pocket. Point is these things are so variable it is hard to get a number that is “realistic”.
His paycheck $17,150.00
His surveys $2,500.00
Her paycheck $20,750.00
Savings Accounts interest $60.00
Total Income $40,460.00
Fixed Expenses
Escrow (mortgage, property tax, home insurance) $6,650.00
Car Insurance $400.00
Car payment $0.00
Cell phones $150.00
Cable/Internet $75.00
Electricity $500.00
Gas $50.00
Water Delivery $40.00
Life/Disability insurance (sinking fund) $735.00
Nanny $5,600.00
Gym Membership $0.00
Mia and Jackson swim $150.00
Jackson Karate $150.00
Mia Little Gym $150.00
Landsacpe (includes R and S) (sinking fund) $350.00
Jackson summer camp (sinking fund) $250.00
Mia School/summer camp (sinking fund) $1,250.00
ABC mouse $5.00
ADT $70.00
Home Warranty $100.00
Erlich $55.00
Netflix/disney plus $30.00
Barry Loan ($50 is sinking fund) $550.00
Minimum Student loan Payments $2,325.00
Total Fixed Expenses $19,635.00
Variable Expenses
Groceries $400.00
Restaurants $1,000.00
Gasoline $250.00
Clothing $150.00
Entertainment $1,000.00
Household needs/Amazon $500.00
Personal Care $250.00
Children’s expenses $250.00
Total Variable Expenses $3,800.00
Wealth Building
Student loan extra payments $0.00
Retirement in taxable $10,000.00
Retirement (sinking fund for Roth and solo 401K) $1,500.00
College 529 $2,400.00
Total Wealth Building $13,900.00
Sinking Funds
Major purchases $1,000.00
Vacation $1,000.00
Total Sinking Funds $2,000.00
Total Income $40,460.00
Total Expenses $39,335.00
Difference $1,125.00
Yes, you spend more than Disha’s “high roller” example, but it’s a “high roller on $240K a year” example, not a “high roller on a well paid neurologist income” example. You make twice as much as the example.
A plastic surgeon making $1.2 million scoffs at all of the numbers in this budget. But it’s a $240K budget, not a $1.2M budget.
ha- it’s actually a “high roller neurologist who married a hard working anesthesiologist” budget 🙂
A lot of financial stuff and in life is luck, and in that sense I am pretty lucky I found my wife 🙂
(btw if somebody knows my wife could you point her to this comment so I can score some brownie points!)
I love this! I wish I knew how to tag your wife here. Thank you for sharing your numbers, Rikki.
“His surveys $2,500.00” — $30k / year from filling out surveys. Any more details on that?
dude go for it Greg! fun and easy side gig if you are in a specialty that qualifies for these. as the article Josh mentioned shows, I am a little obsessed with them but are amazingly therapeutic and easy. When the kids are asleep, I put on some 80’s music and bang a bunch out. also any downtime that I have. I don’t really consider it work.
I actually don’t think I mentioned it in my article but watching baseball is a great time to do surveys! 90% of baseball watching is pretty slow so great time do them. i am on the east coast and am a Yankee fan, and some late night west coast games I do a bunch of surveys, and if I miss something I just rewind live TV.
Wow, our budget looks like it was copied and pasted from the Frugalistas w kids. Almost down to the dollar.
Nice! I love that you know your numbers so well and I’m glad you found them “realistic” 🙂
Could this become a thing? Let’s start posting our budgets.
If enough people submitted their budgets, we could probably work that into some additional posts. Would be kind of fun to compare and contrast.
It’s hugely helpful for others to realize that it is possible to spend less when they see their peers doing it.
Yes!! Props to Josh Katzowitz for getting the ball rolling!
Maybe a more helpful approach would be to start with more specifics. Again, I already said what I spend on the items that I drew issue with. I totally understand that many categories come with a huge variation in budgets. Maybe they all do. I simply felt the averages for several categories were grossly underestimated. But maybe I am wrong and we are just totally missing the boat! I live in a 1900 Square foot home in Minneapolis, drive used paid off cars, and share a nanny with my sister in law. Maybe it would have been more beneficial to ask some frugalists to chime in on how they keep their total child expenses below $2000/month- including school, clothes, activities, childcare, etc. And would love to know how to get my car insurance payment down to $80/month. And how people are spending only $800/month on groceries in concordance with very little eating out. I truly would love some assistance here if these numbers are truly reasonable. We spend $240/month on average on gas and electricity in our small home and our water + garbage is $120/month. I’m not taking a lot of baths or leaving the lights on all day so 🤷🏼‍♀️😂
I think maybe the miscommunication here came from the idea that the budgets in the post were averages or hypotheticals, rather than somebody’s actual real-life budget.
It’s super interesting to see not only what other people are spending on typical items in their budgets, but also what expenses are included in the first place. For example, my budget doesn’t include a water or sewer bill because we have a well and septic. We no longer have any childcare costs, since our youngest is 14, but we pay over $600/mo in vehicle insurance, with coverage for multiple vehicles and two teenage drivers.
I see. Thanks for your response. I think maybe I would have preferred an average- but I think that might be impossible. I probably should have looked at this article as an exercise in how to quickly grow wealth by budgeting instead of so literally. I’m in the thick of heavy childcare expenses and live in a very expensive city so I may have taken it too literally based on my own context. We donate 10% of our budget but also eat out a lot and buy organic groceries so 🤷🏼‍♀️ this is where the rub comes in. I hope to get more advice on how to reduce certain expenses like someone offered above regarding car insurance.
On groceries, you might just need to shop around. We also live in an urban area and there are 5 great grocery stores with 15 minutes of our house. Purchase non-perishable items in bulk and when on sale. Don’t buy processed or prepared foods. Shop for perishables in season. Prep meals once or twice a week. Make enough to pack leftovers for lunch. Plan your meals so you don’t waste more than a third of your food (apparently that’s typical for an American family). If you like getting outdoors you can even do some foraging- great to share your love of the outdoors and healthy eating with the kids.
Certainly if you’re only going to the name brand store in the heart of downtown for organic produce, you’re going to pay premiums for location, branding, out of season produce etc. There are plenty of blogs about budgeting and feeding a family well at a reasonable cost.
As far as shopping around, I usually stick with Target bc the other local stores age far more expensive. We can definitely do a better job of meal prepping, I do find that difficult to consistently accomplish as a working mom with two picky eaters (5 & 3) but it’s something to work on. Not much foraging in Minneapolis but a cool idea.
Hi Kacie,
To give you some background, I’m a married primary care physician with 2 kids ages 5 and 7 and large dogs living in upstate NY. I used to blog as The Frugal Physician so cutting costs and budgeting is kind of my thing. I love that this post has caused you to start thinking more about this! The point of this post was to demonstrate how little changes here and there in the budget can add up to hugely different financial consequences. My husband and I have been tracking our expenses monthly for years now and the categories above are loosely based on that but it’s amazing how variable spend can be even on a month to month basis for one family, so the numbers above are monthly averages based on yearly spending. Have a great day!
Agree so why was it called “Real Life Examples of Physician Budgets”
I believe this comment was in response to another comment, but see above.
It’s amazing how much easier budgeting is when you don’t have:
When you start knocking off other things (child care, water, sewer etc) it makes for a very high adjustable/fixed ratio which is ideal.
We don’t have any debt payments other than our mortgage which is 2240/month. I do put an extra 200 towards the principle each month. I’d love to pay this off but it seems like not the best use of our funds considering we have a 2.4% interest rate.
We spend 2400 on our nanny and 600 private school each month. So 3000 in childcare expenses alone. over 400 in utility bills.
I appreciate all the feedback and will consider some of the suggestions on reducing costs.
If paying more isn’t a good idea, chances are paying that $200 isn’t a good idea either. Maybe run the list and see if it can be used better elsewhere (retirement accounts?, HSA?, etc.)
Nice job on getting rid of the other debt. Imagine how tough your budget would be with student loan and car payments.
Nanny and private schools are expensive ways to do childcare, there is no getting around that. You know what’s best for your kids but you can’t be surprised that’s on the highest end of what you can spend. If that’s what you choose, you’ll need to cut back on other areas to save. My family decreased costs by moving across the country to an area where we had grandparents willing to help and buying a house in a school district with excellent public schools. We still had kids in daycare but my husband and I adjusted our schedules so that they went 2-3 days out of the week instead of all 5.
I’m in the same boat as you and spending over $3K per month for childcare right now. Like you this is more than my mortgage. It hurts a little but I feel like my childcare situation is wonderful, I love my nanny and my kids love her and I love the private preschool my oldest attends (hoping to do public school once she reached kindergarten age). My kids are happy and my spouse and I are happy. I try to focus on the positives of the situation rather than the negatives. We’re dual physician so still have plenty left over for a high-enough savings rate, and as long as that is the case I’m not going to beat myself up for buying organic groceries or NOT spending my Sunday afternoon meal prepping (I actually would love to do more meal prep in the future/have done more in the past but right now don’t see it as a priority with my limited free time). Don’t know your why behind wanting to spend less, but just a plug for focusing on the positives of a situation even if they’re expensive.
I’m not sure you’re going to get the gas much lower during a Minneapolis Winter! Kids are expensive too.
frugalista here
I enjoyed the article, always fun to compare
just tallied up our expenses on New Years Day for 2022 and chiming in
50 somethings in the Midwest, no kids (but spent plenty trying 20 years ago)
our budget for 2022 (rounded a bit)
income gross for year for 2022 between 300 and 350 K
Charity 44 K
investment (retirement, taxable) 165K
Housing (own the home; includes taxes, insurance and maintenance) 12K
Utilities–includes phones– 6K
food (dining and groceries, includes all Walmart spending so likely less) 5 K
Auto (2 15 year old crossover SUVs, gas, maintenance, insurance $3 K
Medical (HSA, PDFSA, insurance, meds, eye, dentist) 18.5 K
Personal (Amazon, gifts and financial help to loved ones, subscriptions, hobbies) 11K
vacation/entertainment 7.5 K
so if you just include spending on us, it’s about 61K for the year
husband grew a garden and freezer is full of vegetables and cooks a lot, we eat tasty healthy food and eat out 1-4 times/month. Limited time to eat out and COVID took the fun out of it, mostly get takeout,
numbers might not add up to income because we had some savings in money market and I fed the taxable account and the donor advised fund we set up, no withdrawals from DAF yet
compared to what we both had growing up, we are living high on the hog.
closing in on FI
Thank you for sharing! Freezing vegetables is definitely something I need to do more. Great to hear another WCI family is eating healthy and growing their own food!
Annual Income 510K For 2022
Taxes – Federal 86, State 20, Medicare/SS 18, Health/dental 5
Retirement – 403/457/Match -76 K, Roth 13k, Aftertax vanguard SNP 31k – Total 120 k
Kid 529-12k
Charity – 30K
Take Home 220k/12=18k/month
Mortgage 6840
BMW 575
Disability from AMA ( 12500 + 7500 hospital, total 20k/month benefit) 290, Term Life( 4 mil) 230
Car insurance 200, Property tax 150(VA taxes cars)
Gas/Electric/water/trash 300
Internet/Cell/Car Gas/Subscriptions 500
Lawn care 150
House Clean 220
Basic Monthly Credit Card 3500
Thanks for sharing!
This doesn’t seem crazy off to me. I probably on the higher side of frugal, not quite moderate.
Married early 30s 1 physician family a few years out of residency. 2 kids under two, recent vasectomy recipient. 1 decrepit old wizard of a dog living his best life. Avg 24k/mo after taxes. Maxed out 401k.
Mortgage $2050 (starter home, would like to upgrade)
Loans $0 ($180k paid off 22mo out of residency)
Car $0
Car/Home/Umbrella Coverage $55
Phone $80
Internet $115
Streaming $45
Cable $0
Life Insurance $55
Disability Insurance $90
Pets $50
Water/Waste/Energy $210
Groceries $600
Health Insurance $650 (my biggest monthly pain point but required by my partnership)
Country Club $0 (not our thing)
Gas $200
Restaurants $200
Daycare $2400 ( I feel like this is a lot yet if they told me to pay more, I absolutely would, just for the sanity it provides)
Health Costs $500 (after my obscene insurance pays for half of my kids births this probably close to what we payed divided per month over the last couple years)
I haven’t bothered to budget “fun money” but maybe I should if others are. Travel is minimal with infants at toddlers at the moment but anticipate that will increase as they get older. In general I’m left with $11-15k/month and invest 8k guaranteed (sometimes more) between 529s and basic money market accounts, ETFs, bonds. Whatever is leftover is my “fun money.” We pay with credit cards that have perks that work for us and pay them off monthly. Seems to work ok so far.
I would like to upgrade my house but somehow we still can’t compete in this market, but if I keep up the current rate of savings, I should be able to get what we want without overextending within the next year or two.
Thanks for sharing! Yeah, it’s amazing how variable perceived “normal” spending can be but ours seem to align. My husband and I started to include fun funds in our budget just so we had permission to spend on something that just makes us happy without judgment. It ensures we still enjoy today and don’t feel deprived by constantly trying to save and invest. We usually don’t use all or most of it even but it’s nice to give myself permission to do something nice for myself once in a while. I highly recommend it!
I don’t have itemized breakdown, but a general breakdown. I think we’re somewhere between frugal and high spender. Our monthly budget is about $6K(after tax). Family of 4. Income about $200K.
Midwest locale, lower cost of living.
Mortgage: $0
Cars: $0
Car insurance: $100 for 3 older used cars
House insurance: $100
Food: $600
Utilities: $275
Investments: $0
529 Plan: $0
Health insurance: $100
We don’t invest anymore and done with 529 plan contributions.
I guess the rest of the budget is eating out, clothes, entertainment, vacation.
Nice work!
If you want to see budgets (and other interesting tidbits) on millionaires, try the millionaire interviews on It isn’t often a highly detailed budget, but gives you an idea on frugality and the many other things that led many of us to multi-millionaire status without a super-high income (I was military my entire carer).
I agree, ESI Money is a great website
Alternate title: A Tale of 3 Physicians: The Impact of Lifestyle on Financial Independence 😉
Consider me sincerely flattered.
And for what it’s worth, I don’t think the budgets are way off-base like so many commenters above. The precise number in each individual category doesn’t really matter, anyway. It’s the sum that determines the outcome.
Haha. Man, I didn’t even consider how similar these articles are. Thanks for chiming in PoF and for being so gracious.
I don’t know where people are making $20K AFTER TAXES. I am going to guess many physicians do not make that after taxes. Even when I worked later than I wanted to most nights I didn’t take home that much. And I’m not in one of the lower paying specialties either.
I’d like to see her write budget for monthly incomes of $13K, 15K. Also NO mention of
Paying back 6 figure medical school loan debt etc.
I think the budget is for a dual physician combined couple making 20k after taxes.
But in any case you are right, I would like to see some budgets including various student loan payment strategies (those going for PSLF, aggressive repayment, etc etc) to see how those shake out. It is also clear that none of these budgets are in a high cost of living area. $2000 for “mortgage” is laughable in my area and would not be able to get a 1 bedroom crack house.
James, you are right, the example takes into account that both spouses are making money. To account for debt payoff, just take the EOM savings and apply it to the debt that needs to be paid off. Figure out how long that will take. Then add that time to the getting to FI number. This budget is based off of a family of 4 living in upstate new york, so ixney to the high cost of living argument. We paid $2000/mo for a 4 bedroom 2 bath rental house while we were paying off my student loans. It took hard work to land this place but it was not impossible. You never know what you’ll find until you look for it with a specific goal in mind.
That’s a pretty bad combination of physician jobs that only clears $20K after tax unless one of them is a resident. The average doc in this country is making $275K. That’s a gross of something like $22,500 a month. Two of those would be $45K a month. Certainly at least $30K after tax.
Fortunately, there are many doctors making far more than $20K, even after tax. Obviously budgeting becomes trickier and trickier the lower your income.
I’m somewhere in-between.
High roller with kids means private school. 4K/mo
Plus loans can easily be 3-4K/mo
Personally we spend less on other things, much more on travel.
Former frugalista who is now a frugalsorta.
Here’s ours in my last year before retirement.
Retirement Contributions:
401k/Roth401k/Roth IRA BD/HSA $8933
Mortgage/Car/Loans/Other: 160*
[401k Roth loan (solo 401k checkbook style) used to payoff 10 yr fixed. early. Quarterly payments x 5 yr.
*Paid by moving taxable mutuals to Roth 401k and paying the LT cap gains tax from the taxables.
*Mainly this is incremental long term cap gains on sale of taxable mutual fund assets transferred to Roth 401k assets. The payment is made by moving the precise number of shares needed based on the NAV on the day of transfer to cover the $ payment due to the 401k account. This counts as a transfer of ownership, and triggers a capital gains tax of probably 15%, or zero if I’m careful. If it’s zero, the amount drops to zero.]
Health Ins: Obamacare (only thing available in my old state): $2022 (HSA PPO?EPO Family)
Health Ins: State medical society policy off exchange, better than O-care: $640
Today: Medicare A/B + Suppl G + Spouse continuation: 640 (same).
Life Ins: Life Paid up: $0
Internet/Cable: $75
Gas/Elec: $300 (it’s expensive here)
Groceries: $350*
Garden and freezer covers most of our veggies and fruits. (asparagus, broccoli, brussel sprouts, corn, beans, beets, cabbage, carrots, kale, lettuce and other weight watcher foods. Hunting land provides meat for the year. We don’t eat much beef, lake provides fish, we eat a lot of fish.
Gasoline/Fuels: $416
Lawn/garden/snowplowing diesel $25
Travel/Lodging/Camping/Rental/Ski Passes $400
Dining $150
Entertainment: $100
Car Insurance $167
Car Repair & Maint: $75 (8 year old and 4 year old high reliability)
Aircraft insurance: $50
Aircraft Inspections/Maintenance/Hangar: $200
Aircraft fuel included in above fuel costs.
Navigation and Weather subscriptions: $50
Boat Insurance $20
Subtotal non luxuries: $13881
529 Contributions: $333
Luxury: $$320
Grand Totals: $14480 or $476/day. Retirement funding is $298/day,
Net Budgeted expense is about $182/day (excluding retirement set asides.)
I didn’t include property taxes so add about $500 to the above = $15053
For retirement (now) I no longer pay into the retirement accounts except for occasional locums, filed my last 941 and W3/W2s and now am switching over to filing 1099Rs.
SS+Rental+Investments income+university annuities will likely cover all my expenses for the foreseeable future. Retirement budget is about $200/day or about $73000/year. I’ll pick up a few bucks as a flight instructor or charter pilot from time to time to buy a milkshake at the local dairy queen.
As for now, Everyday is Saturday…except for Sunday.
I’m surprised the plane is so cheap.
Depends. This one is 50 years old. I bought it in 1990 for $30k.
I’ve put 3000 hours on it over the last 30 years. The expense breakdown is
Annual Inspections: then $300 now $700.
Biannial Radio Cert: then 150 now 250; State registration $21
Engine overhaul at 2400 hours $15000 to new equipment limits (premium overhaul)
–equivalent to about 400,000 miles
Strip and repaint in 2009: $15000
Radio upgrades over the years $6000
Added electronic ignition $4000
Total Capital outlay: $30k + $15k + $15k +6k +4k = $70k / 30 years = $2333/year or $194/month. Most of this will be recovered if I ever sell it (most likely by my heirs, not me). I also get a tax deduction for proficiency since I am an FAA designated aviation medical examiner and I’ll continue to do flight physicals for the FAA, mainly because I like pilots and there’s a need in my area.
The airplane is a 4 place single engine fixed gear, cheap, not slow, not fast, reliable instrument airplane with an excellent safety record. I fly about 160 hours a year now, and fuel burn is 12 gal/hr, less on long trips at altitude, add about $20 for an oxygen tank refill every other month. It burns alcohol free car gas which around here is $3.40/gal to $5/gal so figure $40/flight hour operating costs for gas and oil. It has long range fuel tanks for about a thousand mile range. That will get me from Wisconsin to western Colorado. Insurance last year was $590 for full hull and liability coverage.
When I looked at the price of pickup trucks, I decided the airplane was cheaper and if I need a pickup truck I can rent it for the day from Home Depot for $20 plus mileage. I do most of my own work supervised by an aircraft mechanic. Mechanics in my area charge about $80 an hour, v. $ 75 for an auto mechanic. All work on airplanes has to be signed off by an FAA approved mechanic.
When it comes down to it, I can fly from my summer place to my retirement locums job in about 5 hours from garage to garage, instead of driving 14 hours. or flying commercially for 11 hours including airport parking, TSA, get there an hour before, 3 hour layovers and an hour drive to/from the air carrier airports, and bring three others with me for no extra cost. That trip will cost $440 round trip compared with $375 for the airlines.
There are some drawbacks: you are much more dependent on the weather and weather delays, both summer and winter unless you have some very expensive equipment. Mine has top of the line radios, but can’t fly in icing conditions. but even then a used light twin with anti-icing isn’t much more expensive to buy. The fuel costs are double as are the maintenance costs and parking costs on the road. Now that I’m retired, I can wait for the weather to get better in the hotel pub or the campground.
3000 hours huh. Well, can’t say you’re not using it. Well done.
This is either based on ~10-15 years ago after the market bottomed and interest rates were simultaneously favorable (lucky you) or based on not living in any major coastal American city.
Please find me a $2000/mo mortgage with 20% down on a house in Miami, NYC, any major urban California metro with less than a one hour commute to the city center each way in todays market conditions. First of all, even if you find one, it will be a humble starter home. Not some overindulgence.
The rental market in Miami, which is as bad, is such that $2000/month for a 2 bedroom rental (not even a house) will likely place you in a dangerous neighborhood or is in terrible condition. I would also expect much higher car insurance and home improvement costs if you found a house in Miami for under $2000 a mo with 20% down. It’s not going to be in coconut grove… let’s just leave it at that.
Big difference between living in a big city on the coast vs. small city in the Midwest.
Granted we bought our home a year before COVID. Single income family of $500k.
Mortgage was $1200/month. 3400 sq ft. home. 4.5 car garage. Half acre wooded private lot.
Commute is 15 minutes. It makes a difference where you choose to live.
A 3400 square foot house, 4.5 car garage and half acre lot as you describe at $1200 a month, with no more than 20% down, would likely not be within 1-2 hours of any major coastal city in the current market condition. It probably isn’t even available in the most highly desirable small Midwestern cities like Ann Arbor or Madison, to be honest, with interest rates north of 6% currently and prices still high.
With respect to the suburbs of big cities, you won’t find a property like that for less than $1 million in Long Beach which is over an hour from downtown LA or west Kendall over an hour from downtown Miami during weekday traffic. I expect similar distances without luck throughout the northeast city centers other than maybe Philadelphia.
The USA is the size of continental Europe. No one should have to “choose” between living thousands of miles away from loved ones with poor airport access and being considered financially responsible. I think the article isn’t really fair. The budgets are comical for most urban physicians (who are, quite frankly, the vast majority; there’s a reason rural physicians are paid a premium). The low ball budget won’t even put a roof over your head for a family of four in most big cities.
That said, I am very jealous of your house 😂
Feel free to submit your own budget (or even a guest post about budgeting in a HCOLA) and how you’re making it work to reach your financial goals.
One thing not addressed (and likely poorly understood) is the differences in loans and mortgage prices between those that are over 50 and those under 40. Housing prices in many parts of the country were once quite affordable. Since 2020, housing prices (and consequently mortgage) payments have skyrocketed. If you are unfortunate enough to have been born after 1986, these budgets aren’t realistic in the least.
Sounds like the “golden age of medicine” thing we’re always hearing about that it was so much better in the past. When you dive into it, some things are better and some things are worse. Younger people are now faced with higher house prices and larger student loan burdens. But they also start with higher salaries, investing is now free, and financial literacy is cheaper and easier than ever to obtain. Malpractice insurance has also come down over the years.
Yes, housing cost are higher. What are you going to do about it? Make more, spend less elsewhere, work longer, move to a lower COLA etc. But “this budget isn’t realistic” is too often a justification/excuse for not creating your own that is realistic and will reach your goals.
I always wonder why people live in a particularly expensive place if they’re not being paid correspondingly more there, but such is the case with many doctor jobs in HCOLAs. Obviously your budget is going to look different if you have a $7K mortgage payment.
I think i would rather see a 50,000 a year budget rather than a physicians budget. The majority of Americans don’t typically have access to that type of spending.
Well, the fifth word in the title IS “Physician”….
But it might be interesting to have a guest post showing “regular budgets.” Here are the directions:
Your email address will not be published. Required fields are marked *


The book summarizes the most important information on the blog and contains material not found on the site at all. Straighten out your financial life today! Also available on Audible!
Click to learn more!
You don’t have to wait until financial independence to be happy.


Leave a Reply

Your email address will not be published. Required fields are marked *