Previously we discussed a pros/cons list of a two physician household. In this article, we discuss financial considerations for a two physician household.
Doctors are busy. Most established doctors I know work at least 40 hours a week. Those running their own business tell me that their hours range from 45-55 hours a week in the office, but many of them also handle business matters after hours (in addition to taking call). Surgeons or specialists can clock 60-80 hours a week. This doesn’t even include commute time to work or the time spent between waking up and seeing the first patient of the day.
With such a hectic work life, there are limited hours left to care for errands or everything else. Traditionally, such families have a non-working spouse who can take care of bills, repairs, and kids. As family compositions have evolved over the past decade, a larger percentage of doctor households have working spouses as well.
Obviously having a working spouse (better yet, a working doctor spouse) will add to the net income. But a dual income family does introduce both financial and logistical complexities. I have a few examples of colleagues that I know and the situations that they face:
Surgeon and School Teacher
This household has two young kids. The surgeon works 50 hours a week plus call. The school teacher works in Grades 3-5. There is a constant struggle to decide whether the school teacher should be working or staying at home. A teacher who makes $35,000 a year with a spouse who makes enough to put them in the 39+% federal marginal tax bracket will essentially give half of his earnings to federal, state, and local taxes. Ouch. Try to calculate that hourly rate. It won’t look good.
If this family has to hire a nanny for childcare, then it is a financial no brainer for the school teacher spouse to stay at home and care for the kids. It doesn’t matter if you live in Omaha or San Francisco–the nanny will more than offset the teacher’s income. At this point, the school teacher spouse could even consider home schooling the kids as a way to apply her education or branch out into alternative sources of income (a la MoneySavingMom).
Neurologist and Cardiologist
This couple also has one young child and a second along the way. While the neurologist’s salary will be in the six figure range if the job is full-time, it will still likely be taxed in the top marginal tax bracket if the cardiologist has a decent practice. In this situation, the financial options can include a part-time job for the Neurologist to keep the skills sharp while having part-time daycare. Alternatively, both spouses could consider a part-time or 0.8 status equivalent to spend some time with the children.
Another caveat for a two physician household is that it becomes harder for household chores to get done. Home maintenance, yard maintenance, dishes, laundry, cleaning, grocery shopping, and other simple tasks become exceedingly difficult to be performed during free time especially if both spouses are exhausted in the evenings. They could all be outsourced at a cost but still may be practical for the busy couple. In Thomas Stanley’s Millionaire Mind, one of the characteristics of millionaires is that they are NOT DIY-er’s and outsource tasks that aren’t directly related to advancing their net worth.
This family has more flexibility than the doctor/teacher couple mainly because their higher earning potential, but the work-lifestyle arrangement options are identical in both cases. Does the family want to focus their time on their careers? How much time does each spouse wish to spend with the children, at home, or with other secondary income streams? Would it be a waste of your many years of hard work and earning potential to give up your career?
Do you have any working tips for a two physician household? Comment below!