Physicians start saving a decade late and finish in the top tax brackets. The fix is mechanical: know your limits, exploit the 457(b), and fill the accounts in the right order.
The average physician starts attending-level saving around age 32 with a negative net worth, then spends a career in tax brackets where every sheltered dollar matters. The compensating advantage: hospital-employed and academic physicians often have access to more tax-advantaged space than almost any other profession - if they know where it is.
| Account | 2026 limit | Notes |
|---|---|---|
| 401(k)/403(b) employee deferral | $24,500 | One combined limit across both |
| Catch-up (age 50+) | $8,000 | Added to the deferral limit |
| Total additions (employee + employer) | $72,000 | Per employer plan |
| 457(b) | $24,500 | Separate from the 401(k)/403(b) limit |
| IRA (backdoor Roth) | $7,500 | Per spouse |
| HSA | $4,400 / $8,750 | Self-only / family, HDHP required |
Limits are set by the IRS annually - verify against current IRS tables before you set deferral percentages.
Academic and hospital physicians frequently get a 403(b) and a 457(b). Because the 457(b) carries its own deferral limit, that is roughly $49,000 of employee deferrals available in 2026 before any employer match - double what a private-sector peer can shelter.
One critical check first: governmental 457(b) plans can be rolled to an IRA and are held in trust for you. Non-governmental (most private hospital) 457(b) assets legally remain your employer's property until paid, exposed to its creditors, with rigid distribution elections that can force a lump-sum payout - taxed all at once - when you change jobs. Max a governmental 457(b) enthusiastically; read a non-governmental plan document before committing a dollar.
Attending incomes generally sit above the Roth IRA phase-out, so physicians use the backdoor: contribute to a nondeductible traditional IRA, then convert to Roth. The catch is the pro-rata rule - if you hold pre-tax money in any traditional, SEP, or SIMPLE IRA on December 31, the conversion is partially taxable. The standard fix is rolling pre-tax IRA balances into your employer 401(k)/403(b) first. If your plan allows after-tax contributions with in-plan Roth conversion, the mega backdoor Roth can shelter tens of thousands more up to the $72,000 total-additions ceiling.
Two more notes for high earners: pre-tax deferrals save at your top marginal rate today, while Roth dollars buy tax diversification for a future of unknown brackets - most attendings reasonably hold both. And the limits reset every January: a year of unfilled 457(b) space never comes back.
Physicians with 1099 moonlighting income get one more lever: a solo 401(k) opens a second employer bucket. That interacts with the deferral limit, so see the tax deductions guide and locum tenens guide before opening one.
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