Stay on Track with Retirement Savings Even When Grad School Limits Your Earnings

Many of those with doctorates land their first full-time job with an unsettling realization: you’re pushing 30 or older and have little to no retirement savings.

Anxiety about playing catch-up often surfaces in personal finance forums, including Reddit. A biomedical Ph.D. graduate recently described on the platform “panicking” about being 27 with no money set aside for retirement, a home, or family. The poster is set to begin work as a biotech scientist earning $80,000 a year, but notes that student loans, $1,500 rent, and other expenses limit how much they can save.

Concerns about delayed career starts are understandable—but often overstated. If you’re in your late 20s or early 30s, there’s still ample time to benefit from compounding, and Ph.D. graduates, in particular, are often better placed to offset lost time with higher contributions.

Why Those With Doctorates Aren’t Often as Far Behind as They Feel

Those with doctoral degrees have several advantages that can help narrow the retirement gap. Your qualifications typically, but not always, lead to higher long-term earnings. Early-career salaries may lag behind those of peers who entered the job market sooner, but income growth tends to speed up in the years that follow.

Job stability is often better—though that depends on the field. With specialized expertise, doctorate holders are more likely to be in demand for as long as they wish, extending the window for saving and investing. Higher wages and job stability are particularly common in STEM fields.

Doctoral graduates also tend to be strong budgeters. Years of living on modest stipends often instill frugal habits that make it easier to redirect higher income toward savings later on.

Doctorate holders can compensate for a late start.. Time is a powerful force in investing, and contributions made in one’s 20s do have an outsized impact. But time isn’t the only variable that matters. How much and how consistently you save might matter just as much as when you start.

How To Catch Up on Retirement Savings After a Ph.D.

You can close the retirement gap by acting once your first paychecks arrive. Try to save aggressively but sustainably.

Here’s a checklist:

• Prioritize employer retirement plans. Enroll as soon as you’re eligible and contribute enough to capture your employer’s entire match.
• Save more than the average. Standard advice is to save 10% to 15% of income. Because you’re starting later, aim for 20% or more. Also consider directing raises, bonuses, and equity compensation to your retirement account.
• Use Roth and traditional accounts strategically. When you’re younger, consider a Roth 401(k) or Roth IRA. As your income rises, you might want to shift some savings to traditional pretax accounts to improve tax efficiency.
• Delay lifestyle inflation. If you maintain your graduate-school-level spending for the first few years of your career, you’ll free up more income for retirement savings.
• Invest for growth. Even if you have a later start, you’ll still have a long time horizon until retirement. This makes equities attractive. Diversification is essential. One effective strategy is buying a small number of low-cost index funds that track broad market indexes with minimal overlap.

Common Mistakes To Avoid

Starting later can lead to a few common mistakes:

• Taking excessive investment risks to try to catch up.
• Comparing your progress to peers who started earlier. Comparisons can distort decision-making. What matters is aligning your savings strategy with your own income trajectory and goals.
• Delaying saving because it feels like it’s “too late.” If you contribute regularly, even small amounts compound over decades.

It’s fine to start small. At a minimum, contribute at least enough to capture your full employer match. (The median employer match is 4.0%, and the average is 4.6%.)

The Bottom Line

A delayed career start doesn’t doom your retirement outcomes—it just reshapes your strategy. With significant, consistent contributions—say, 20% of your salary every month—you can build a solid retirement fund, even if you’re in your late 20s or early 30s.