Why physicians make so much and still feel broke

Physicians are among the highest earners in the American workforce. They are also, by many measures, among the most financially stressed. That tension runs through Panacea Financial's 2026 survey, "The Financial Lives of Doctors," which polled 269 of the bank's customers, a mix of physicians, dentists and veterinarians, and found financial confidence barely improves as careers progress.

Medical Economics sat down with Michael Jerkins, M.D., M.Ed., president and co-founder of Panacea Financial, and Jillian Vestal, J.D., head of legal services at Panacea Legal, to talk through what's driving those numbers and what physicians at every stage can actually do about it.

Would doctors still choose medicine if student loans were capped at $200,000?

More than half of respondents (53%) said they would not choose medicine again, or weren't sure, if federal student loans were capped at $200,000. Jerkins read the figure as a confirmation of how hard the path has become, but not as cause for despair. Medical school applications and Match numbers remain strong, and he was unequivocal about the appeal of the work.

"To me, being a doctor is still the coolest job you can have," he said.

His more pointed concern was about who the cap affects and what it does to the pipeline. About 25% of medical students don't need loans at all, he noted, which means a cap lands hardest on everyone else.

"If 75% of students are more financially stressed because of the cap, then you may end up with a greater share of medical students coming from wealthier backgrounds," Jerkins said — a shift with downstream consequences for where physicians practice and who ultimately receives care.

Related content: 53% of doctors aren't sure medicine is worth it

Why do so many physicians not know whether their pay is competitive?

Nearly half of respondents (49%) said understanding whether their compensation is competitive is a top career challenge. From where Vestal sits reviewing contracts, that tracks.

"It’s extremely common," she said. Physicians coming out of training often have no reference point beyond what their peers are being offered, and little sense of how to read the contract in front of them.

The number on the page, she explained, doesn't tell the full story. Is the salary guaranteed, and for how long? Are there productivity incentives, quality bonuses, call pay — or required call that goes unpaid?

"If you have two contracts with the same salary number but one requires 10 days of call without additional pay and the other starts paying for call immediately, those contracts are not equal," Vestal said. She suspects the 49% figure understates the problem: "My guess is there are doctors who do not even know that they do not know."

Jerkins, who went through it himself, put the gap squarely on training.

"Residencies and fellowships do a great job training you to be a strong clinician, but they are not training you to make strong employment decisions right out of training," he said.

Why doesn't a bigger paycheck make doctors feel more secure?

Financial confidence in the survey rose only modestly across career stages, from 2.33 out of 5 in medical school to 3.27 among practicing physicians. Jerkins drew a distinction that explains the plateau.

"I think financial confidence is a little different from financial security," he said. A practicing physician earning four or five times their residency salary can absorb mistakes, but that doesn't mean they feel equipped to handle tax strategy, retirement planning or how to structure their finances well.

The barrier, he said, is bandwidth. Physicians spend their time and mental energy on clinical care and administrative work, leaving little room to either learn these subjects or find someone who can teach them. That guidance void is part of why he thinks the financial industry underserves the group: physicians often work at hours when traditional advisors are unavailable, and early-career doctors can look risky on paper despite being strong long-term bets.

"I think most of the time doctors are just busy and often uninformed, not irresponsible," Jerkins said.

Student debt shapes every other financial decision

Seventy percent of respondents said they struggle to balance loan repayment with other life goals. Notably, 37% of those were already in practice. Jerkins called debt "the elephant in the room in almost any financial decision a doctor makes." With balances commonly running from $200,000 to $600,000, decisions about buying a home, starting a family or saving for retirement all have to be made in the context of a loan strategy.

He flagged the psychological trap that comes with finally earning an attending salary. Physicians emerge from training watching peers who took other paths buy homes and take vacations, and the instinct to catch up is strong.

"That is also the period when doctors are most at risk of making financial mistakes," he said. Whether an extra dollar should go toward loans, other debt or investing depends entirely on the strategy — forgiveness, aggressive payoff or something else — and those shouldn't be month-to-month decisions made in a vacuum.

What makes physician compensation so hard to navigate at tax time?

Tax complexity was the single most cited career challenge, at 67%, and it was split nearly evenly between trainees and practicing physicians. Vestal pointed to a structural quirk: employers often book signing bonuses, stipends and other upfront incentives as loans, which lets them recoup the money if a physician leaves. The result is that a doctor may receive the money one way and get taxed on it later under entirely different circumstances — sometimes in a different bracket or even a different state. Relocation reimbursements carry a similar surprise, since the IRS still treats them as taxable income.

Jerkins added a growing wrinkle: 1099 work. Physicians who are otherwise W-2 employees increasingly pick up locums or short-term contracts without understanding the tax implications, then face a large bill at year's end.

"That is a totally different tax situation that people really need to understand before they take that first contract," he said.

Early-career physicians: Start here

For a first-year physician carrying significant debt and feeling behind, Jerkins offered two anchors.

First: "It is not too late to educate yourself. You are not alone, and you are not automatically behind just because you do not understand all of this yet."

Second: don't trust appearances. Physicians make enough to look like they have it together while making serious financial mistakes. His advice is to either learn the material or find a fiduciary advisor experienced with physicians — and to vet that person as rigorously as any clinical decision.

Vestal added that the contract itself can be part of that education, even after it's signed. She has reviewed agreements for practicing physicians and found money they were owed but never received.

"They took the contract back, and they got the checks," she said.

Jerkins closed with a challenge to the profession's instincts.

"Do not underestimate your worth as a physician," he said, urging doctors to seek multiple offers rather than assuming the first one is the best. "I do not think physicians do a great job, in general, of understanding their worth and then advocating for it. That is something we need to get better at."