@bb11 (reply 6).... You noted the incongruity between docs not being able to max out their tax-advantaged savings plans versus their salaries and said "assuming they [their] plans follow the same rules as 401ks [capped at 18k or so]." Their plans likely don't. Likely not even close to a 401k. Most docs are likely partners of a medical firm and treated as self-employed small businessmen. When you visit a doc at a hospital, the patient interaction feels like you're dealing with an employee of the hospital, but you're likely not. You're likely dealing with a partner of a medical practice that is, from the point of view of the hospital, an independent contractor leasing space, etc. from the hospital. This is why when you have a baby you get separate bills from (1) the hospital, (2) the doctors, (3) the other set of doctors, (4) etc. I am a lawyer and law firms work similarly to medical practices. If you're an associate lawyer, you are an employee, you get a W-2 and your tax-advantaged savings are basically limited to (i) 401(k), (ii) IRA and (iii) HSA. If you make partner, you are treated as an owner of a small business, you get a K-1 instead of a W-2 and your tax-advantaged savings potentially open up (depending on whether your partnership takes advantage of this stuff or not). In my case, by being a partner in my firm I am currently obligated by contractto (A) save $35,000 a year into a 401(a) profit sharing plan and (B) save $8,000 a year into a cash-balance pension plan. Because this is mandatory at my firm, those amounts are sucked straight out of my paycheck and I never see the cash. On top of that, I still can do 401(k), IRA (self and spousal) and HSA. Mandatory savings nut = $43k. Voluntary tax advantaged savings nut = $35.5k. Total tax-adv. savings opportunity = $75.5k. To take advantage of all my tax-adv. savings would be 25% of my gross income. I'm trying to do that, but am still feeling my way. Conservatively, a third of my income goes to taxes. That's a big chunk. I have to either get a different - much less profitable - job, or spend a certain amount of money on clothes and cars. I need a passable suit* and I need good shoes.** I need a decent car and need to keep it clean to be presentable.*** I don't have student loan debt because I went to lesser-ranked state schools for both undergrad and law school based purely on money (full academic scholarships at both shops, so no debt but much, much less cachet at cocktail parties). Most docs have a ton of student loan debt.
* The bar for a passable suit is pretty low. For 99% of American men, owning a well-chosen suit from Jos. A. Banks (~ $300) would serve them for a lifetime. Every suit I own is from Jos. A. Banks, except for one from a UK company that is similar. But, if you go below this level of quality the cost/benefit equation shifts pretty quick (i.e., if you're not going to buy a suit of this quality, just opt out altogether, because the clothes will make you look bad).
**If you don't have to wear dress shoes for work, please let me know if there are openings. I have to and I hate it: they're not comfortable and the whole concept bothers me. With that said, my current reality is my current reality, so.... Men's dress shoes are uncomfortable and expensive, but in certain lines of work they are required. They are required in my line of work. They are a tool. Probably shouldn't be a tool, but I'm not going to spit into the wind about how life works. If you're in a job that requires a certain kind of dress shoe, I recommend Johnston & Murphy as a good (relatively) cheap supplier of good business dress shoes that will work in 99% of situations. If you wear dress shoes ALL THE TIME, I recommend that you eventually think about buying Alden shoes and shell cordovan. Alden is a company, and they make very, very good shoes. Shell cordovan is a type of very tough and very attractive leather. If you wear dress shoes every day, you should buy two pairs of these shoes (you need to let shoes rest) and know that if your kid has the same foot size, he will be wearing them in 50 years. Great shoes.
***My decent car is a Hyundai. Give me what face-punches you will (just to rile you up, I bought the car new). But in my environment, to drive a Hyundai is an insane giant spit in the face.