Kids cost more in physician households

I’m always impressed at how resourceful my parents were in providing opportunities for me given the limited resources that were available to them.  Most parents understandably wish to provide as much opportunity for their children, and it’s clear that this comes at the cost of money and time.  

Did you ever think that anyone would need this? Neither did I.

It’s natural to think that every successive generation strives to achieve a better quality of life, and certainly that comes at a price.  I certainly enjoyed luxuries that my parents never imagined for themselves, and our children likewise experience an upgraded childhood compared to my own.  This progression is only possible when earning power increases with subsequent generations.  Physician households, along with those from other high-income professions, generally have greater spending capacity compared to the average household.  Having a greater income doesn’t necessarily mean that you are obligated to spend more, but it certainly positions you to have more options.

To each her own

Personal finance is obviously a personal matter, and everyone has her own threshold for risk or choices that can impact their retirement, health, and working career.  Physicians can probably afford a nice home, a fancy car, and a few luxurious vacations, but if you choose to own everything that you might want, you might have to work forever.  There are plenty of physicians who know better to be spendthrift, and physicians with intelligent financial discipline leverage their earning potential to achieve their life goals sooner.  Anyone with children can attest that there is no limit to how much you can spend on them, and how much of your resources you direct to your children has a clear impact on your financial future.

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Kids are expensive for physicians on day one

Two factors come to mind when we think of characteristics of professions that are more likely to spend more to raise their children include: (1) higher income/wealth/educated parents, and (2) less free time.  You obviously have to have the means, and you are more likely to spend if you value your purchases.   If you have less time on your hands, then you are more likely to pay someone or something to accomplish something that you aren’t able to do yourself.
Medicine is a profession that ticks all of these boxes.  Some medical specialties are busier than others, but most physicians are busy when the clock is running.  And indeed the physician clock runs long hours.  The stress goes with us everywhere—while we’re eating dinner, exercising, and trying to sleep.  Children obviously makes juggling the profession even more difficult.  Physicians don’t often have the luxury of maternity or paternity leave, and are dragged back to work much too soon.  In dual working households, this typically means sending kids to daycare or having stay-at-home care.  Some professional nannies command a salary upwards beyond $50,000 a year (some can be 6-figure expenses in the metropolitan areas!).  

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I remember reading somewhere recently that collectively parents in the U.S. spend $42 billion annually for their children up until age five.  This averages out to roughly $500 a month per child.  Any household needing childcare will easily exceed that amount.  If you include all of the early childhood development activities, specialty foods, and other necessary (or discretionary) child needs, the costs add up. Doctors are likely to spend more on their kids straight from day one than the average person.  

It is not uncommon for doctors or other career-oriented households to opt for meal preparation services, housekeepers, and anything else that could possibly make their lives easier, all because they don’t have enough time to do everything and take care of their kids.  Who knows if doctors would outsource some of the services they do if their occupations weren’t as demanding or if they had alternatives.  

Self-inflicted chaos is common for the modern household

The costs often do not decrease after children become school-aged.  There is no shortage of activities that school-aged children can participate in, and there is practically no ceiling to how much time and money one can spend on them.  Baseball, lacrosse, soccer, basketball, judo, tae kwon do, Kumon, football, robotic club…there is an activity for anything your kids want to do.  All of this costs money, and getting them to their activities will cost you time.  The desire for parents to have their children dabble at everything is not limited to physician families either—we see this behavior in families (anecdotally) with both higher levels of education, income, and living on either of the coasts.  

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Case in point: One of my physician friends living in another city had recently agonized on finding a home in a highly rated school district even though she intended to keep her children enrolled in private school!  Her rationale for doing so was simply to keep options open for her kids.  What’s her trade-off for this decision? Her retirement date will probably be delayed, but there’s unlikely any crystal ball to say for certain.  Are there more financially conservative alternatives? Absolutely, but we get to choose what is important to us.

Crafting the rat race

Most physician households are going to fall somewhere in the middle of the child-rearing cost scale.  I would venture to argue that having the means to spend is the greatest factor that determines how much you spend on your children.  It is an interesting thought exercise to consider how much environment and peer pressure (or lack of it) influences one to become an outlier on either end of the scale.  For instance, what causes parents to ramp up expenditures on their children aside from personal beliefs?  Is it your coworkers or neighbors, or simply living in a city where it seems like everyone does it? Conversely, what factors cause us to jump out of the rat race and help us justify that we’re providing adequate care for our children’s futures?

How do you think your expenses for your children compare to those of your coworkers?

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30 thoughts on “Kids cost more in physician households

  1. Totally get the point on self inflicted chaos and we’re living it in my house. I do think as a physician household you spend more than the non physician household. I think it’s easy to gravitate to some of the higher paid options since you have income. Activities like soccer cost a few hundred a year. Tennis? Maybe 2000 a year. However, some of the more intensivist stuff (piano violin) you’re looking at a 100 bucks a week for private lessons.

    1. Yup. It’s all intentional yet unintentional. The take-away that we need to conclude on is that if it’s needed in the household, it’s needed. There are a lot of Internet police out there who believe otherwise and are very vocal against these sorts of spending, even if you’re a doctor.

  2. I am my husband’s (physician) wife responding to this. There is a lot that schools can offer. We didn’t have the luxury of unlimited resources due to being in Family Practice and also doing OB. I ran the office. Our sons were involved in Boy Scouts and 2 of our 3 sons achieved the rank of Eagle Scout. Our 3rd son has Down Syndrome so he went along with activities. I did the bulk because of the OB obligations. Our sons also participated in various school activities such as band, chorus, and sports. One son now works for the US Supreme Court in IT and the other is in an Endodontic program after serving 6 years in the US Army. Of course, our third son is forever involved in our family activities. You can make it work and it doesn’t necessarily involve big bucks.

    1. Thanks for sharing your experience! It’s inspiring to hear about how resourceful your family has been with working with your budget. I’m sure that your children are all the more appreciative that you empowered them to succeed.


      Do you think that you would have raised them differently if your budget had been, say, twice the amount it was?

      1. Probably not. We did the best we could. My husband was a farm boy who worked his way through medical school and I was a medical technologist who was able to help with tuition once we married. We had his private practice and he also was an associate director of the family medicine program in our town. We have the work ethic in our family and our boys always worked.

  3. I think retirement would be rather miserable if I knew that I had deprived my kids of growth opportunities for a more luxurious and lengthy retirement.

    “No club soccer for you Kiddo, I want to save it so I can quit working sooner.”

    “But Dad, don’t you always say that learning to work hard will make it more likely that I will be successful and have more satisfaction out of life. So why are placing so much emphasis on you not working?”

    “Yes, son. I emphasize work for you, but for me satisfaction comes from not working anymore.”

    “Ok Dad, whatever?”

    I think I will lead my kids by example and give them all the opportunities for growth that I can afford.

    1. I’d agree too. I’m usually the one in the household pushing for the activities, experiences, and an occasional splurge because I don’t want to regret missing the opportunity. But we also can’t hide from the financial impact these experiences incur.

      Thanks for stopping by!

    2. Without question, we spent more on our kids than many others, but without feeling that we cheated on retirement. Like a lot of parents, we did some things well and some things not so well. What do I think that we did well? We traveled the world together, took part in athletics including multi state travel, paid for occasional tutors, sent them to camps, bought them a home that was decent to entertain friends in. But we also did something that is missing from this article. We intentionally didn’t spend money on some things. My spouse and I worked with them in the yard, went on inexpensive camping trips, cooked and cleaned with them, worked together on minor home repairs, helped our neighbors together. My sons never watched someone else mow our lawn or kill weeds or fix a sprinkler. Soon, they were doing it. They hated a lot of those things then, but not so much now. I had a blast, despite a very busy schedule, with my kids. And along with my enjoyment, I don’t need to worry much about supporting them as adults. They will all likely make far more than me. I can spend my retirement to the last dime without worrying about helping them along. Interestingly, looking back now, spending time with my kids and spending on experiences seems to make financial sense.

  4. Probably about on par for physician households; spend more than the U.S. average I imagine. We like to take a cruise most years, and sometimes the wife and kid to on my scuba diving trips. About $6,000/year for a private school.

    Some expenses will scale back as I recently retired at age 51. On the issue of example you set…I want to show that to achieve the great blessing of financial independence, you have to invest in building your human capital (e.g.: marketable degree, good job), then convert that into wealth-building and shepherding over many years (can be pension, 401-k, 457, etc…) to reach the point where you don’t have to work if you don’t want to. You can work but don’t have to…which is something not many people can say.

    People tend to prepare their kids to follow in their socioeconomic tier (e.g.: lower, middle or upper class), if not their specific career footsteps. People who value the level of educational and professional attainment to become physicians likely at least want their kids to get Bachelor degrees (a high school grad. looks like a 10th grade drop-out by comparison). So physicians invest more in developing the ‘human capital’ of their kids, to prepare them to build on that and succeed at an above-average level as adults.

    1. Great insight and summary of your experiences. We’ve all also seen colleagues who do their best to impart the value of education to their kids only to find that the kids aren’t cut out to meet those expectations. Those may be more of an outlier to professional families but the end result still stings nonetheless.

      Congratulations on the retirement! What specialty are you in? I’m sure you’ve seen the never-ending debates around early retirement for physicians arguments that it could only be done with higher-earning fields.

      Thanks for stopping by!

      1. Psychiatry; I worked all inpatient. State job with a pension that I eventually qualified for. That, and diligent deferred comp. investments, coupled with paying off the mortgage around the time of retirement, helped make this practical. I expect a lifestyle adjustment, but lifestyle is to money what stuff is to closet space; it’ll consume it all if you let it. I don’t live in an expensive part of the country. The strong drop-off in jobs with pensions coupled with the materially accustomed populace and the low wage of Social Security bode ill for the retirements of many people. Teach your kids personal financial literacy. I didn’t learn what mutual funds were till I was in residency and bought a ‘The Complete Idiot’s Guide to…’ book. Money is a big deal…but so are free time and freedom. I anticipate in retirement I will be constrained from doing more because of limited money, but when I was working, I was constrained by limited TIME.

  5. Just a different type of comment… Because I am a physician, I have had the luxury of being able to afford to work half time after my kids were born (compared to some of my patients who are working two jobs in a grocery store and as a janitor in order to support their families and never get to see them). Working half time for the last 10 years, I have given up over $100,000 per year – over $1 million that could have gone to retirement – in order to spend more time with my kids. And maybe that was the right choice or maybe it wasn’t … But anyway it was I luxury that I had as a physician to be able to make that choice.

    1. We can’t turn the clock back. Our kids are young only once, and so are we! There is no one who would argue that you made the wrong choice in going part time.

      One important observation in many medical practices is that part-time is usually not exactly part-time–the work almost always creeps over to our off days unless we are working shift work.

      Thanks for stopping by!

  6. I’ve had to support my own parents and so didn’t want to be a burden on my own children.

    I know they all wished I’d been home more, but I’ve explained that I wanted them not to have college debt and not to worry about me later; I think that is a reasonable trade off.

    1. It’s not easy for children to have to support their parents, and having to do so certainly puts them at a potential disadvantage compared to their peers. We all also hear of success stories (like yours) of kids caring for their parents and then becoming successful themselves, but I suspect that these instances are few and far between.

      I’d not want my kids to have college debt either, although we always wonder whether having college debt would help teach better financial awareness.

      Thanks for stopping by!

  7. I am glad I was able to give my children private school as I had very little time to give them the kind of attention I wanted to and of course a nanny was a life saver bless them all.

    1. Great nannies are indeed a lifesaver. There is also sticker shock to the costs of both–the two combined could very well run you a six-figure post-tax cost. Fortunately by the time they start school maybe they won’t need a full-time nanny anymore.

      What specialty are you in?

  8. How to raise the kids….having increasing responsibility/ chores to do, part time job, progressive financial responsibility (meaning an increasing allowance and parallel increasing list of items in their budget)…one of several disagreents that lead to divorce. My ex was in the ” spoil them because we can afford it “camp.
    Most people learn best by experience.

    MDs are in the small minority who can learn just from reading. My kids are not. Managing a budget is not inborn…it’s a skill to be learned. Witness the many MDs we know, bankrupt movie stars, bankrupt lottery winners. Weighing the cost / benefit of soccer practice, designer jeans, college tuition, and everything between begins when your child is old enough to get “an allowance”.

    1. Thanks for sharing! It sounds like the general consensus with this topic is that it takes effort to help our kids learn–and by doing so, we also see how much effort our parents put into our own education!

  9. The cost starts before kids are even born, during maternity leave. Those of us in private practice have to pay overhead, rent, staff, locums to cover, and malpractice. Each week you take for maternity leave is not only a week not being paid but you are literally paying not to work. If you think daycare is expensive, its nothing compared to this. -Obgyn

    1. Great point. The world is stacked against the female gender–we don’t see men doing the same thing for paternity leave.

      One immeasurable headache in addition to what you’ve mentioned is simply the potential incompatibility of a bad locums person coming into your private practice. When you realize that they’re a bad fit, it’s already too late to find alternatives.

      Stay well!

  10. We live below our means because, for us, more spending did not equate to better quality of life. This allowed us to fully fund 529plans for our 15 and 13y/o when they were young and secured our retirement goals by our mid-30s. Now in our 40s, we can enjoy the work we do (because we actually like the work we do), and still have margin to enjoy the life we have away from work. We champion versality and work ethic in our kids; both chores and allowance are in excess of their friends. They’ve been taught to invest and give as joyfully as they spend, with regular conversations about budgets, wants and needs. The challenge is not HOW MUCH do we spend on activities because we have plenty to spend, but rather how do we balance what gets scheduled, and how do we confidently say NO to activities or things that don’t fit. The best advice I’ve gotten is to communicate with your spouse early and often about your family values and goals, to include your children as they mature, and not to be distracted by comparison to others.

    1. Great work keeping your eye on what is important for you and your family!

      What specialty are you in? There’s always an ongoing debate on which specialties allow for a more rapid financial plan without having to move the goalposts in either direction.

  11. Although your perception of the costs of children for physicians is generally true, it is also true for most professional families where both parents work. Limited time, hence the need for extensive support staff. However, your comment on older childrens’ activities is prejudiced in favor of sports, which are hardly the only activities children pursue. What about music lessons, Scouting, outdoor play organizations, ice skating…? Potentially competitive sports can be productive of less than well-rounded kids, who benefit from many different kinds of activities: so they can learn what they enjoy doing.

    1. You are absolutely correct that this problem is not unique to physicians, but rather any household who is willing to spring for these activities. Some of these households are simply forced to do so simply due to the lack of time.

      There was an instance years ago where my colleague couldn’t find a viable nanny for her 6 week old and was forced to apply to a daycare that required an essay from the parents and observed play for the daycare application! 6 week old! As we all know, the sky is the limit to what we can spend for our children.

      Thanks for stopping by!

  12. I had my one and only golden child right after residency and took 4 months before getting a full time job (IM/primary care) which allowed me to stay home unpaid with my newborn
    Hubby and I continued to live within our means so behaved like I was still earning resident salary
    Put money into savings/Roth/529
    I took a salaried position so that I can go on vacation and spend time with family on weekends and holidays
    (Learned the hard way that private practice was a black hole of time/money and wasn’t worth the hassle) yes we have the means to pay for her tennis/karate lessons and Girl Scouts camp which she fully enjoys
    We also do trips as family where experiences and time together was truly priceless (overseas and also camping at local beach/park)

    1. Thanks for sharing!

      Great planning to live within your means and plan out the savings for your daughter.

      Yes, private practice can be a boon or bust. In theory it should still work, but will vary depending on your specialty.

  13. I am in a high paying specialty but have always tried to teach my kids to live below their means. I had nine children, six have finished college, one has a Masters and one is a Nurse practitioner, one a sophomore in college, all had gone to state schools. NONE have any student loans or debt. Yes, there was a lot of traveling soccer, many years of gymnastics, some USAA swimming, some years of Catholic schools, and to top it off, a divorce 20 years ago. Lots of cooking at home, used cars, some material things but mostly investment in human capital as has been mentioned earlier.
    But saving and maxing out 401ks, some wise stock investments early in Netflix, Apple and Microsoft, means they will all have a sizable nest egg when I depart. In the meantime I still work part time because it is good for me and good for the kids to see dad and grandfather still working and for the patients at the VA who need good care. And still a Navy reservist even as a senior citizen…

    1. Congratulations on a job well done with your children!

      It’s also a great that your specialty/job option has the ability to work part-time. Many physicians work in practices that don’t have the structure to do so. Hey, keep doing what you enjoy!

      Stay well, and thanks for commenting!

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