PGY-1 Financial Checklist: The First 30 Days of Residency (2026)

Before Anything Else: Understand What You Are Actually Taking Home

Before you can make any intelligent financial decisions, you need to know your real number — not your $68,000 salary, but what actually hits your bank account after taxes, benefits deductions, and loan payments.

A PGY-1 earning $68,000 gross in a mid-cost-of-living state typically takes home somewhere between $3,500 and $3,750 per month after federal and state income tax, Social Security, Medicare, health insurance premiums, and any retirement contributions you elect.

That is roughly $900 per week in spendable income. Everything on this checklist has to fit inside that number — or close to it. Knowing this figure before you sign a lease, buy a car, or make any other fixed financial commitment is the starting point for everything else.

Checklist Item 1: Sort Out Your Student Loans Immediately

This is the most time-sensitive item on the list and the one most residents handle too slowly.

If you have existing federal student loans, you need to decide on a repayment plan before your grace period ends — typically six months after medical school graduation, which for most incoming PGY-1s puts the deadline around December 2026.

Do not wait until December. Go to StudentAid.gov now and apply for Income-Based Repayment (IBR). Your IBR payment as a PGY-1 earning $68,000 will be somewhere between $300 and $400 per month depending on your family size and deductions — a manageable number on a resident's income. Waiting and letting loans go into standard repayment could mean payments of $1,500 to $2,500 per month on a $230,000 balance. That is not manageable on a resident salary.

The July 1, 2026 deadline matters here. The new Repayment Assistance Plan (RAP) launches July 1, 2026, replacing SAVE and other legacy plans for new borrowers. IBR remains available — but to preserve your access to IBR's payment cap as an attending, you need to enroll before you take out any new federal loans after that date. Enroll in IBR now.

If you are at a nonprofit hospital or academic medical center, you are almost certainly eligible for Public Service Loan Forgiveness. Submit your employer certification through the PSLF Help Tool at StudentAid.gov. Every month you are in IBR at a qualifying employer counts toward the 120 payments required for tax-free forgiveness. Months you do not certify are months you cannot recover later.

Do not refinance federal loans during residency. This is not a close call. Refinancing converts your federal loans to private, permanently eliminating access to IBR, RAP, and PSLF. The income-driven repayment protection during training is worth keeping until you have complete clarity on your specialty, your employer, and your post-residency career path.

Use our PSLF Calculator and Student Loan Payoff Calculator to model what your repayment looks like under different plans before making any decisions.

Checklist Item 2: Capture the Full Employer Retirement Match

Your residency program offers a 401(k) or 403(b). Somewhere in the benefits packet you were handed during orientation is information about an employer match — typically 3 to 6 percent of your salary matched dollar for dollar if you contribute the same.

This is the highest guaranteed return available anywhere in finance. A 100 percent match on the first 4 percent of your salary is a 100 percent immediate return on those dollars before they have even been invested. There is no stock market, no savings account, and no other financial product that matches it.

Contribute at least enough to capture the full match from your first paycheck. If your program matches up to 4 percent and you contribute 2 percent, you are leaving free money on the table every month.

Traditional vs. Roth contributions

As a resident in the 22 percent federal tax bracket, you are at the lowest tax rate of your career. Roth contributions — which you pay taxes on now and withdraw tax-free in retirement — are almost universally the right choice at resident income levels. You will almost certainly be in the 32 to 37 percent bracket as an attending. Paying taxes now at 22 percent rather than later at 37 percent on the same dollars is a straightforward mathematical win.

If your program offers a 457(b) plan in addition to the 401(k) or 403(b), note it but do not prioritize it over the match on the primary plan. The 457(b) becomes valuable later — it has no early withdrawal penalty, which makes it a powerful tool for physician wealth building once attending income allows you to max multiple accounts simultaneously.

Checklist Item 3: Open a Roth IRA and Fund It

A Roth IRA is the single best wealth-building account available to a resident physician, and residency is the only window in a physician's career when the income is low enough to contribute directly without workarounds.

The 2026 contribution limit is $7,500. Roth IRA contributions phase out for single filers with income above $150,000 and eliminate entirely above $165,000. As a PGY-1 earning $68,000, you are well below the phase-out. This window closes the moment your attending salary begins.

If you cannot fund the full $7,500 in month one, set up automatic monthly contributions of $625. At that rate you will have the full year's contribution in by December. The exact amount matters less than getting the account open and the habit in place.

What to invest in inside the Roth: low-cost total market index funds. Vanguard's VTSAX, Fidelity's FZROX, or Schwab's SWTSX are all appropriate. Forget individual stocks, sector funds, and anything your co-residents are excited about. Boring, diversified, low-fee index funds have outperformed almost every alternative for buy-and-hold investors over any meaningful time horizon.

Fidelity and Vanguard are the two most widely recommended platforms for physician Roth IRAs. Both offer zero-fee index fund options and straightforward interfaces that work well for busy residents who will check on the account approximately four times per year.

Checklist Item 4: Buy Disability Insurance — This Month, Not Next Year

This is the most financially consequential item on this checklist and the most commonly delayed. Do not delay it.

Here is the core reason residency is the optimal window to buy disability insurance: you are at peak health for underwriting, you are at the lowest premiums you will ever qualify for, and you can lock in a Future Increase Option that allows you to expand your benefit as your attending income grows — without any additional medical underwriting.

That last point is worth slowing down on. The Future Increase Option (FIO) rider means that even if you develop type 2 diabetes, a back injury, or any other health condition during residency, you can still increase your monthly disability benefit to reflect your attending salary when the time comes. The health condition is irrelevant — the option to increase is guaranteed by the original policy you purchased while healthy.

Physicians who wait until their first attending job to buy disability insurance are gambling with their underwriting health. Medicine is not a low-injury profession. Back problems, needlestick exposures, and mental health diagnoses during residency are common — and each one can make disability insurance more expensive or restrict coverage when you try to buy it as an attending.

What to buy as a resident

A true own-occupation, specialty-specific policy with a Future Increase Option rider from one of the five carriers that write physician disability insurance — Guardian, Principal, Ameritas, MassMutual, or The Standard. Ameritas has historically offered some of the most competitive resident pricing and has recently increased its issue limits for residents, allowing higher monthly benefits during training than were previously available.

Your base benefit as a resident will be modest — typically $2,500 to $5,000 per month — because carriers cap benefits at a percentage of current income. The point is not the current benefit amount. The point is locking in insurability and the FIO rider that allows the benefit to grow to $10,000 to $15,000 per month when your attending salary begins.

Work with an independent broker who represents all five major carriers rather than a captive agent tied to one company. The right policy varies by specialty, health history, and training year. Only an independent broker can run a true comparison.

For a full breakdown of the top disability insurance carriers for physicians including carrier ratings and specialty-specific recommendations, see our disability insurance review page.

Checklist Item 5: Build a Starter Emergency Fund

An emergency fund in residency serves a specific purpose: protecting you from a financial crisis that forces you to go into high-interest debt or disrupt the financial habits you are trying to build.

The standard guidance is three to six months of expenses. That is the right long-term target, but it is not necessarily the right immediate target for a PGY-1 who has just moved to a new city, paid first and last month's rent, and has $1,200 left in checking.

Build to $1,000 first. That covers most genuine emergencies — a car repair, an unexpected medical bill, an appliance failure. Once you have $1,000, build to one month of fixed expenses. Then work toward three months over the course of your first year.

Keep the emergency fund in a high-yield savings account, not a checking account. Online banks are currently paying 4 to 5 percent APY on savings accounts while most brick-and-mortar bank accounts pay less than 0.5 percent. On a $5,000 emergency fund, that difference is $225 per year in free interest. It is a small number but it costs you nothing beyond opening a second account.

For how much you specifically need based on your monthly expenses and risk tolerance, use our Emergency Fund Calculator.

Checklist Item 6: Choose the Right Health Insurance Plan — Carefully

Your residency program's benefits packet almost certainly includes multiple health insurance options. The decision between a traditional PPO and a high-deductible health plan (HDHP) has financial consequences that extend beyond your monthly premium.

If your program offers an HDHP option and you are reasonably healthy without chronic conditions requiring frequent specialist visits, the HDHP paired with an HSA is almost always the financially superior choice for residents. Here is why:

The HDHP carries lower monthly premiums than a PPO, which frees up cash in a budget that is already tight. The HSA — which requires HDHP enrollment — gives you a triple tax-advantaged account: contributions are pre-tax, growth is tax-free, and withdrawals for qualified medical expenses are tax-free. The 2026 HSA contribution limit is $4,400 for individual coverage and $8,750 for family coverage.

Even contributing $100 to $200 per month to an HSA during residency, invested in index funds and left untouched, builds a meaningful tax-free balance by the time you finish training. For a detailed explanation of how to use the HSA as a long-term wealth-building tool rather than a spending account, see our HSA Strategy for Physicians guide.

If you or a family member has chronic conditions requiring predictable, high-cost care, a PPO may produce lower total annual costs despite the higher premium. Do the math using your realistic expected utilization before defaulting to either option.

Checklist Item 7: Set Up Direct Deposit and Automate Everything

This sounds basic. Do it anyway, because the residents who build wealth during training are almost universally the ones who automate financial decisions rather than making them manually every month.

Set up direct deposit with a primary checking account that covers fixed expenses — rent, utilities, loan payment — and a secondary account that receives your automated savings transfers.

From your primary checking, automate the following transfers on payday:

• •Emergency fund transfer to high-yield savings — whatever amount you have chosen as your monthly contribution.
• •Roth IRA contribution to your investment account — $625 per month hits the annual maximum.
• •Any 403(b) contributions above the match — handled through payroll, not a manual transfer.

Once those transfers run automatically, spend what is left without guilt. The reverse budget — save first, spend what remains — is the only budgeting system that actually works for physicians working 60 to 80 hours per week who do not have time to track every transaction.

Checklist Item 8: Know Your Benefits Package and What It Does Not Cover

The benefits packet your program handed you contains decisions with lasting financial consequences. Most residents sign whatever the default options are and move on. Read it.

Specifically: understand what disability insurance your hospital provides. Most hospital-sponsored long-term disability plans provide any-occupation coverage after 24 months — meaning you will lose benefits if you can perform any job for which your education qualifies you, regardless of whether you can practice medicine. This is precisely why the individual disability insurance in checklist item 4 is not optional — the group plan your hospital provides is not adequate as standalone coverage for a physician.

Understand your malpractice coverage. Most training programs provide occurrence-based or claims-made coverage during residency. If it is claims-made, understand whether tail coverage is automatic or requires action when you leave the program. This rarely causes problems for residents — but knowing the answer is worth 10 minutes of your time now.

Review your life insurance options. If you have a spouse, children, or anyone financially dependent on your income, term life insurance belongs on your financial checklist. Your hospital may offer a small group life insurance benefit — typically one to two times your salary — which is insufficient for anyone with meaningful financial obligations. A 20-year term life policy for a healthy 28-year-old physician costs less than your Netflix subscription.

The Order of Operations: What to Do First

If you do everything on this list simultaneously in the first 30 days, the sequence matters less. If you can only tackle one or two items before the clinical work takes over, here is the priority order based on time-sensitivity and financial impact:

• •First: student loans. The IBR enrollment and PSLF certification deadlines are real and the consequences of missing them are real. Do this within the first two weeks.
• •Second: disability insurance. Your health today is the lowest-risk it will ever be for underwriting. Every week you delay is a week during which something could change. Buy it this month.
• •Third: capture the employer retirement match. Log into your HR portal and make sure your 403(b) contribution is set at or above the match threshold. This takes 15 minutes and produces an immediate guaranteed return.
• •Fourth: open the Roth IRA. Takes 20 minutes online. Even if you can only fund it with $100 in month one, open the account and establish the habit.
• •Fifth: emergency fund. Build to $1,000 then keep adding.

Everything else — optimal HSA strategy, investment allocation, life insurance, budgeting systems — can follow in the months ahead. But these five moves, executed in the first 30 days, put you ahead of the majority of your co-residents regardless of what comes after.