When you picture a wealthy person, who do you envision? Is it a software developer working for a big tech company or a doctor in family practice or in a speciality?

If you’re thinking in terms of salary, you might be right – the doctor is probably the higher earner. However, a person’s overall wealth is more than just how much they make – it has to do with debt, how they choose to spend their money, and where their investments go.

Let’s dig into these numbers a little bit more and learn how any professional can build wealth by running some comparisons on the Wealth Meta Income and Spending Simulator.

Some Assumptions

In short, let’s assume that a person can work for 47 years – from age 18 to 65. Age 18 is where all paths begin to deviate with some people choosing to take time off before heading to school and others simply beginning to work. In this comparison, we’ll assume that a potential doctor or software developer is going to start their degrees immediately after high school.

For the sake of this comparison, let’s also assume that regardless of schooling or income that all people are living on a budget of $1,500 per month, and that over time these numbers adjust for inflation. This way, we are comparing only the differences in income and education debt for both subjects.

So, You’d Like to Be a Software Developer?

People who go to college for four years graduate with an average of $37,172 in student debt. A four year degree is typically how a software developer begins their career. Strictly speaking, a four year degree is not required to get into the field of software development. There are other alternatives like coding bootcamps and being self taught.

The average salary for a software developer in the first three years out of school is about $65,000. After 10 years of experience, the average salary increases to about $100,000 but it can go considerably higher for people with experience working for major technology companies that offer stock bonuses.

If this person works for 43 years after beginning work at age 22 or 23, their net worth at retirement will be $7.1 million.

View the Software Developer's simulation here.

So, You’d Like to Be a Doctor?

Now let’s look at how a doctor will fare. A person who goes to school for 11 years to be a family doctor will incur the same average of $37,172 in student loan debt for their bachelor’s degree but will also take on an average of $183,000 in graduate student loan debt.

After medical school, a doctor must also do a three-year residency that makes an average of $52,931 per year.

After that 11 years of training, a family care doctor can expect to make an average of $183,329 per year.

The net worth at retirement is $10.1 million.

View the Doctor’s simulation here.

Conclusion

So, yes, as a doctor, a primary care physician (among the lowest-paid doctors) will eventually earn a lot more than a software developer. However, it will be well over 30 years after turning 18 that the net worth of a doctor exceeds that of a developer. Although the difference in average pay between a doctor and a software developer is about $83,000 per year, the difference between a doctor’s net worth and a software developer’s net worth at retirement is about $3 million. It is in the late years of a doctor’s career that contributes to the extra $3 million in total net worth.

We must look at these numbers objectively. Often, the more school a person takes on, the more debt they have, so the previous numbers may not be accurate. Additionally, studies show that when a person earns more, they take on a bigger lifestyle, which means that they spend more of the money that they earn.

Each career path comes with its risks and rewards. For example, a doctor may not be able to pass their board exams and be stuck with their debt.  Or the software developer could end up in a job that rusts their skill set leaving them way behind current trends which would stagnate their income. Doctors also carry the the risk of a malpractice lawsuit.  For software developers the expectation of working until age 65 may be unrealistic due to age bias in the industry and the ever changing technology.  On the plus side for doctors there are debt forgiveness programs which would be a huge windfall, and for some lucky software developers their stock options go IPO and become worth millions.

All in all, a doctor will likely have a higher net worth at retirement than a software developer permitting that both live a frugal lifestyle and that they take on the average amount of debt in beginning their careers.

• The doctor hits $1M in net worth around year 24 of the simulation, or age 42.
• The software developer hits $1M in net worth around year 22, or age 40.
• The doctor hits $2M in net worth around year 29 or age 47.
• The software developer hits $2M in net worth around year 29 or age 47.
• From there the doctor's net worth beings to seriously out pace the software developer's.
• The software developer has a maximum debt of ~$61k (year 4 of simulation) while the doctor's is ~$390k (year 8).

It is really the latter years of the doctor’s career that contribute to the extra $3M in total net worth.

Try building your own simulation (view then save as...) to explore your own assumptions:

• View the Software Developer's simulation here.
• View the Doctor’s simulation here.

One thing this simulation does not address is relative career satisfaction, working conditions, contributions to society, etc. This is just a look at the raw numbers and how the math compares.