Personal Resident Finance Question

[[email protected]]

Hello everyone,

My overall question is whether I actively payoff student loans right now or save into a Roth IRA? I am a third year Orthopaedic resident. I have $39k in student loans. I can pay an extra $3k into student loans or invest into a Roth IRA each year. What do you all suggest?

Thank you!

[nephron]

Unless your interest rate is high, I would maximize your roth contributions as a resident. 39K is like a months salary for an ortho attending, I would probably just put it on the back burner and knock it off when you get tired of it or you are sure it's not going to be forgiven or something.

[Anne]

Invest in the Roth. You will have those loans paid back instantly when you become an attending, but you only get so much Roth space a year and the younger you start the better. I would see if you can find a way to max out the Roth (6k) each year.

[AR]

Which do you think is better and why?

Edit: I meant to post this before someone gave you the answer. But looks like I was too slow.

[Codfish]

Roth IRA. You’ll pay off that loan amount in 2-3 months as an orthopedic attending. Many of your ortho classmates will spend more than that on a car with their first paycheck (unwisely).

You’ll never have the chance in the future to back fund your IRA for this year. Prioritize that every year in training.

[Kennyt7]

ROTH-no brainer; if married do both

[Hank]

Your taxes are unlikely to be this low again at any point after residency. Roth all the way. Might want to get into the practice of doing a back door Roth so you don’t get burned the year you graduate residency.

[Hatton]

ROTH

[Main]

Roth
I am also an orthopedic resident, and I have prioritized every available Roth (IRA and 403B) during my lowest earning years. My goal is to have saved 200K worth of Roth retirement savings between my wife and I before my first attending paycheck. If we don’t add any or touch that Roth until 60yo (7% in 30y) that would give us $1.6mil worth of tax free retirement savings. Good luck!

[CordMcNally]

Nobody has mentioned this or recommended this yet but I’d do the Roth.