The Shocking Truth About Wealth Building for High Earners—And Why Some Doctors Refuse to Follow It
For over a decade, the phrase "Live Like a Resident" (LLAR) has been a cornerstone of financial advice for physicians—but not everyone agrees with it. In fact, it’s one of the most debated topics in the White Coat Investor community. Younger generations argue it’s unrealistic in today’s economy, while older professionals insist it’s the golden ticket to financial freedom. So, who’s right? And more importantly, who doesn’t need to follow this rule?
What Does "Live Like a Resident" Really Mean?
LLAR isn’t about depriving yourself or mimicking every detail of a resident’s budget. It’s a mindset—a recognition that the earliest years of your attending salary are the most powerful for building wealth. Think of it this way: if you’re used to living on $60,000 as a resident, and suddenly you’re earning $360,000, where does the extra $300,000 go? Without a plan, it vanishes into lifestyle inflation—bigger houses, fancier cars, and monthly payments that lock you into a cycle of spending. But if you redirect even half of that surplus toward debt, investments, or savings, you’ll achieve financial milestones decades faster.
Here’s why LLAR works:
- Compound interest loves time: The first dollar you invest is worth far more than the last, thanks to decades of growth.
- Medical school debt isn’t a life sentence: With disciplined spending, you can erase six-figure loans in just a few years.
- Half of America lives on less than a resident’s salary: LLAR isn’t poverty; it’s perspective.
But here’s where it gets controversial... Some argue LLAR is outdated, especially for younger doctors facing skyrocketing home prices and stagnant wages in certain specialties. Others counter that skipping LLAR is why 25% of doctors retire without even $1 million saved. So, who’s exempt?
Who Doesn’t Need to Live Like a Resident?
- Those with a head start: If your parents paid for med school or you inherited wealth, you’re already ahead. A short (or even nonexistent) LLAR period might suffice.
- High earners in low-cost areas: A $800,000 salary in Indiana goes much further than $250,000 in San Francisco. Adjust your timeline accordingly.
- Spouses with significant income: Dual earners can accelerate debt payoff without strict austerity.
- PSLF candidates: If you qualify for Public Service Loan Forgiveness, aggressive repayment may not make sense.
And this is the part most people miss... LLAR isn’t all-or-nothing. Even a moderate approach—like increasing your spending by 50% instead of 500%—can set you up for success. The goal isn’t suffering; it’s avoiding the "lifestyle explosion" that leaves even $500K earners paycheck-to-paycheck.
How Long Should You LLAR?
Most doctors need 2–5 years to:
- Wipe out student debt
- Build a $250K nest egg
- Upgrade to a "doctor house" (whatever that means to you).
But here’s the secret: Your LLAR period should reflect your unique circumstances. A pediatrician with $400K in loans might need five years; a dermatologist in a low-cost area with no debt could be done in one. The key is to ask: Where do I want to be when this phase ends?
The Controversy: Is LLAR Even Necessary?
Critics say:
- "Boomers had it easier! Homes cost peanuts back then."
- "Delaying gratification forever is unhealthy."
- "What’s the point of earning big if you can’t enjoy it?"
Defenders fire back:
- "75% of doctors don’t become pentamillionaires—often because they overspend early."
- "LLAR isn’t about deprivation; it’s about intentional spending."
- "You can’t outearn bad habits."
So, what do you think? Did you live like a resident? Was it worth it? Or do you believe the system is stacked against younger docs? Drop your hot takes in the comments—let’s debate!
