How much should doctors save after starting late at age 40?

What does your month cost now?

Start with the spending your savings must eventually support. Pull your card and bank statements for the most recent quarter, add regular bills, and remove one-time medical or practice expenses. We build from a monthly spending plan because the money in your accounts is there to pay for that spending. A salary percentage tells you nothing about what your household actually costs.

Then subtract income the portfolio will not have to supply. Use the spouse's pension estimate from the benefits letter and the Social Security estimate at age 67. The remaining monthly gap is the number your accounts must cover.

Before changing a deferral, list every account and match it to your year-end statements. Most late-saving physicians find something that was missed: a 457(b) nobody funded, an old residency rollover IRA, or a 10% pay-stub deferral that put less cash in the 403(b) than expected.

• Last three months of card statements
• Year-end 403(b), 457(b) and IRA statements
• Deferral percentage on latest pay stub
• Spouse's pension estimate from benefits letter
• Social Security estimate at age 67
• Whether the 457(b) is governmental

Run the five lines at your current age

The calculation starts with five lines: monthly gap × 12 × 25 equals the target; today's savings × a growth factor equals future savings; target minus future savings equals the shortfall; shortfall divided by the yearly-deposit factor equals annual saving; annual saving divided by 12 equals the monthly number.

At 5% a year for illustration, the growth factor is about 1.63 over 10 years, 2.08 over 15 years and 2.65 over 20 years. The yearly-deposit factor is about 12.6, 21.6 and 33.1 for those same periods. The 25-times multiple comes from the 4% rule of thumb, a rough guide rather than a promise. Investments can lose value, so the account could end up smaller than the amount put in.

Age 38: Reena's monthly number

Reena, hypothetical, is 38 and works as a hospital-employed anesthesiologist. Her husband teaches in a public school. She wants $14,000 each month at age 60, with an assumed $5,000 from his pension and their Social Security. Her portfolio must cover the remaining $9,000.

Step one: $9,000 × 12 × 25 = $2.7 million. That is the target at age 60 under the 25-times rule. Step two: her $520,000 in a 403(b) and 457(b) grows for 22 years. Using 5% a year after inflation for illustration, $520,000 × 2.93 = about $1.52 million.

Step three: $2.7 million − $1.52 million = about $1.18 million still needed. Step four: divide $1.18 million by the 22-year deposit factor of 38.5, producing about $30,600 each year. Step five: $30,600 ÷ 12 = about $2,550 each month. That is Reena's starting savings number, before taxes and account limits.

Find the age-38 row first if you already have savings. The age-42 row shows the cost of a pause, while the zero-balance rows show how quickly monthly saving rises as the deadline shortens. A 40-year-old starting from zero needs about $6,800 each month; a 50-year-old needs about $17,900. Reena's existing balance does much of the work.

The $5,000 pension and Social Security figure is an assumption, not a benefit promise. Every $1,000 less in monthly outside income adds $300,000 to the portfolio target under this rule. Annex Wealth Management would check the $5,000 against the husband's pension benefits letter and both Social Security estimates before building Reena's plan on it.

Ages 38 to 42: what does pausing savings cost?

Pausing retirement saving for four years to clear loans first raises Reena's required savings from about $2,550 to about $3,500 each month for the remaining 18 years. Her $520,000 grows to about $632,000 on its own, but the same shortfall must then be funded with a shorter deposit period. Four years of two $24,500 deferrals would also use $196,000 of 403(b) and 457(b) room under the 2026 limits, and unused room cannot be recovered later.

The loan decision has its own math, but if Reena pays loans quickly, she should keep at least the deferral that earns the full employer match. Annex Wealth Management sets the order first: match, then loan payments, then the rest of the $2,550. That order goes into the monthly calculation from the first meeting.

Age 50, then 60 to 63: catch-ups and Roth savings

At age 50, the 2026 IRS catch-up contribution is $8,000 in a 403(b) or governmental 457(b), making $32,500 total per plan. At ages 60 through 63, the higher catch-up is $11,250. A non-governmental 457(b) at a tax-exempt hospital does not offer the age-50 catch-up, so the plan type matters before you count it.

The IRS also requires catch-up contributions to be Roth for workers whose prior-year FICA wages exceeded $150,000. A late-start plan written years ago that counted on pre-tax catch-ups to lower the tax bill at age 50 overstated the deduction. Pre-tax deferrals lower taxable wages now but create taxable income draws later, so $1 in a pre-tax account does not buy the same spending as $1 in a Roth account.

Age 73 or 75: when do required income draws affect the target?

Required minimum distributions begin at age 75 for people born in 1960 or later, and at age 73 for people born earlier. A physician Reena's age with mostly pre-tax savings would eventually face taxable income draws, even if work income has stopped. Those draws can push married modified adjusted gross income above $218,000, the first 2026 Medicare IRMAA tier for Part B, so some monthly saving may belong in Roth or taxable accounts.

A $2.7 million balance that sits mostly in a 403(b) buys less spending than the same balance split across Roth and taxable accounts. Part of every pre-tax draw goes to income tax, and a higher IRMAA tier can add to Part B premiums. Annex Wealth Management estimates Reena's likely account mix before turning her gross target into a monthly spending number.

Does the number change if you're single or plan to stop at 55?

Yes. A single doctor usually has no second Social Security check or spouse's pension, so the portfolio covers more of the same spending each month. Stopping at age 55 also creates more years of income draws and health insurance before Medicare at age 65; many planners use 28 to 30 times spending instead of 25. Working to age 65 shortens the gap before Social Security at age 67.

A large existing balance changes the arithmetic. Reena's $520,000 at age 38 lets growth carry much of the target. Someone with $100,000 at age 45 has fewer years and less compounding, so deposits may exceed what workplace plans can hold. Annex Wealth Management compares the account balance, deadline and spending gap before choosing the monthly amount.

Each January, recheck the number against year-end statements

A market drop in the first years of income draws, a disability that ends earnings at age 50, or a new contribution limit can change the shortfall. The five-line method stays the same. Leave about 10% above the target when possible: a $2.7 million target becomes about $2.97 million.

Redo the calculation each January when the W-2 and year-end statements arrive. If the monthly amount exceeds one 403(b) at the 2026 limit, about $2,040 each month under age 50, send the rest automatically to a taxable account. Waiting for a bonus or for loans to end turns a monthly decision into a missed year.

The first statements Annex Wealth Management reads for a late saver

Annex Wealth Management would first compare the last three months of spending with the deferrals on the latest pay stub, then read the year-end statements for the 403(b), 457(b) and any residency rollover IRA. That shows whether the monthly deposits match the spending plan before account changes are discussed.

The review also needs the benefits letter, Social Security estimate and the 457(b) plan type. Annex Wealth Management sets the savings number around cash flow, account rules and the date the physician expects to stop working, while fees are set out in a written agreement before work starts.