You just finished your last night float in family medicine. The residency office hands you a smooth exit survey and a recruiter's card. A local health system offers $200,000 a year, full benefits, four weeks PTO. Another agency dangles $130 an hour for locum tenens in rural clinics. On paper, the locum route looks like a bigger paycheck: 48 weeks of 40 hours hits $249,600 gross. Run the same math on a post-it note and you're already dreaming of paying off loans in two years.
Then you blink. After expenses, taxes, and the benefits you're leaving behind, the net numbers often flip. I've seen attendings who thought locum was a goldmine realize they were netting less than the employed doc next door, and working weekends to do it.
Disclaimer: This article is for educational purposes only. It is not financial advice, not legal advice, and not tax advice. Figures vary based on location, employer, and individual circumstances. Consult a qualified professional before making employment or tax decisions.
The Financial Crossroads: A New Attending in Family Medicine
You're staring at two real paths, and both feel like a trap. The full-time offer: $200,000 base, 401k match, health insurance, CME money, paid parental leave, and a predictable schedule. The locum offer: $130 an hour, paid by the shift, no benefits, but you can work anywhere, and the gross income looks $49,000 higher.
Quick-and-dirty math: $130 × 40 hours × 48 weeks = $249,600. That's $49,600 more than the salaried gig. You figure you'll pocket the difference and call it financial freedom.
But gross income is not take-home pay. The full-time doc also gets $15,000-$20,000 in employer-paid benefits, a retirement match that adds $8,000-$12,000, and malpractice tail coverage baked into the employment contract. The locum doc pays self-employment tax on every dollar, buys her own health insurance, and covers travel, housing, licensing, and CME out of pocket. Suddenly that $49k cushion evaporates.
This article won't just compare hourly rates. I'll walk you through the net income calculation that actually matters, and show you exactly when locum wins, when full-time wins, and when a hybrid approach smokes both.
Crunching the Numbers: Hourly Rate vs. Total Compensation
Low-paid specialties, family medicine, pediatrics, psychiatry, internal medicine, have a tight spread. Full-time salaries cluster in the $220,000-$260,000 range. Locum hourly rates run $115-$135 an hour. The raw difference looks like this:
But you can't just multiply the hourly locum rate by 2,080 hours. Locum assignments aren't guaranteed 40 hours a week every week. You might lose a week between contracts, or get sent home early on a slow Tuesday. Assume 1,920 hours a year (48 weeks × 40 hours) to be realistic. That's $249,600 at $130/hr. Add in productivity bonuses for high-volume shifts, overtime differentials (nights, weekends, holidays), and you can push it to $260,000-$270,000 gross. I've seen psychiatrists pull $150/hour for emergency department coverage and $175/hour for holiday shifts. That's the upside.
Now compare total compensation for a full-time employed doc. In family medicine, the median salary is $240,000 according to the 2024 MGMA data. That's before benefits. Add 401k match (3-5% of salary), health insurance for a family ($15,000-$18,000 a year), CME allowance ($3,000-$5,000), malpractice coverage including tail ($10,000-$15,000 value), and the number jumps to $275,000-$290,000 in total economic value. Plus, you get paid time off, something locum docs can't bill for.
The raw hourly rate comparison is seductive. The total compensation comparison is the sobering truth.
The Hidden Tax: Expenses That Eat into Your Locum Income
Locum work is a 1099 business. You're the CEO of a tiny company, and every expense comes out of your gross. Here's what that looks like in real numbers.
Start with $249,600 gross. Self-employment tax is 15.3% on the first $168,600 of net income (2024) and 2.9% Medicare on the rest. That's roughly $19,000 in Social Security and Medicare taxes, compared to an employed doc who pays 7.65% (the employer covers the other half) and saves about $9,500. Right there, a chunk of that $49k gap disappears.
Health insurance. A family plan on the marketplace runs $500-$800 a month for a high-deductible plan, or $6,000-$9,600 a year. Add out-of-pocket costs and you're at $10,000 easily. An employed doc pays perhaps $200-$400 a month in premiums, with lower deductibles, so the benefit difference is $8,000-$12,000.
Travel and housing. If you take assignments more than an hour from home, you'll need lodging. Assume $150/night for a short-term rental, 4 nights a week, 48 weeks. That's $28,800. You can cut that by staying with family, driving home on off days, or using agency-provided housing, but many locums pay their own way. I'll use $25,000 as a realistic average.
Malpractice tail. Some agencies cover it, some don't. If you're hopping assignments, you need occurrence-based or tail coverage for each state. Budget $5,000-$10,000 a year unless you're meticulous about negotiating it into the contract.
Continued medical education, state licenses, DEA registration, and board fees: another $3,000-$5,000. No employer reimbursement.
No paid time off. Every sick day, holiday, or gap between contracts costs you. A full-time doc with 4 weeks PTO and 7 holidays gets 27 paid days off. That's roughly $20,000 worth of salary for free. The locum doc pays herself zero for those days.
Punch line: after all expenses and self-employment tax, that $249,600 locum gross can net $185,000-$195,000. Meanwhile, a full-time family med doc with a $240,000 salary, $15,000 in benefits, and $10,000 retirement match, after employee-side taxes, might net $190,000-$200,000. The numbers are shockingly close. In some cases, the full-time job pays more.
When Full-Time Is Your Best Move: Stability and Long-Term Benefits
You have $300,000 in federal student loans and are banking on Public Service Loan Forgiveness. Full-time employment at a qualifying non-profit or government hospital is the only path. Locum work through an agency doesn't count, even if you're working 60 hours a week in a federally qualified health center. I've watched residents sign locum contracts thinking they'd still get PSLF, only to find out years later that none of their payments qualified. Don't be that person.
Full-time also brings retirement matching. A 3% match on a $240,000 salary is $7,200 a year, tax-deferred and compounding. Over 10 years, that's $72,000 in free money, not counting investment growth. Locum docs have to open their own SEP-IRA or solo 401k, but there's no match. The tax-deferred contribution limits are higher (up to $66,000 in 2024), but you're funding it entirely with pre-tax dollars you could have used elsewhere.
Partnership track in private practice is a full-time game. In pediatrics or internal medicine, a partner can double or triple income after 3-5 years by owning shares of the practice, ancillary services, and real estate. Locum work never builds equity. You're a hired gun, and when the contract ends, you walk away with nothing.
Burnout. Constant travel, new EMRs every three months, no deep relationships with patients or staff, it wears you down. I've seen capable attendings flame out of locum life in two years, while their employed colleagues found a rhythm and built a career. If you're someone who thrives on routine and collegiality, full-time is your long-term play.
When Locum Tenens Makes Sense: Flexibility and Targeted Earnings
Locum isn't the poor cousin of full-time employment. It's a tool. Use it intentionally.
You want to work six months and travel six months. A full-time job won't let you do that. Locum gives you the freedom to stack assignments in the winter and take summers off. I know a family med doc who works three months in Alaska (high rates, provided housing) and then spends the rest of the year in Costa Rica. She clears $120,000 in three months, minimal expenses, and lives on her terms.
You're geographically picky. If your local market pays $200,000 for full-time, you can drive three hours to a rural critical-access hospital and get $150 an hour for locum shifts. Stack those assignments and you'll beat the local salary even after expenses. You're not tied to a low-payer.
You negotiate hard. Nights, weekends, and holidays are your leverage. In family medicine, a Saturday inpatient shift can pay $150-$175 an hour. Psychiatry locums for crisis coverage can hit $200 an hour. Pediatrics, while lower, still pays 20-30% more for overnight nursery call. Work the undesirable hours and you'll pull ahead of the full-time pack.
You want to supplement an existing job. Many docs take a 0.5 FTE position at an academic center for the benefits and PSLF, then fill the rest of the week with locum shifts. That's the hybrid model, and it's where the real magic happens.
The Hybrid Playbook: Combining Part-Time Full-Time with Locum Shifts
This is the income strategy I see working best for low-paid specialties. You don't have to choose between stability and flexibility. You can build a schedule that grabs both.
Here's a concrete example. You take a 0.6 FTE job at a community health center. The full-time equivalent salary is $240,000, so at 0.6 you earn $144,000. That comes with full health benefits, 401k match, paid time off, and PSLF eligibility (since you're over 30 hours a week). You work Monday through Wednesday.
On Thursday and Friday, you pick up locum shifts at a regional hospital 90 minutes away. They pay $135 an hour for clinic coverage. Two 8-hour days, 48 weeks a year, grosses $103,680. Travel expenses are minimal because you drive in and out the same day, or the hospital provides a call room. Add the occasional weekend shift at $150 an hour and you're well over $110,000 in locum income.
Total gross: $144,000 + $110,000 = $254,000. That's $14,000 more than the full-time offer, but you also have benefits, loan forgiveness, and a much better lifestyle than the pure locum doc. You're not on the road every week. You have a home clinic, a team, and continuity.
This model requires a supportive employer. Some health systems explicitly allow per-diem or part-time schedules with internal moonlighting. Others forbid outside work. Check your contract. But if you can swing it, the hybrid path often delivers the highest net income in low-paid specialties while preserving the safety nets you actually need.
Your 5-Year Income Trajectory: Making the Call That Fits Your Life
Year one is a terrible way to compare. You need to look at the five-year arc.
Full-time employment with a 401k match and PSLF can wipe out $300,000 in loans tax-free. That's a $300,000 benefit that no locum gig can match. Plus, the compounding on that retirement match and the potential for partnership buy-in can vault your net worth far beyond what you'd accumulate as a 1099 contractor.
Pure locum work can front-load income. If you're aggressive, you can earn $250,000-$300,000 a year for a few years, pay off loans fast, and then cut back. But that's a grind, and you'll miss out on the long-term wealth-building mechanisms of full-time employment.
The hybrid approach sits in the middle. It generates high income, keeps benefits, and preserves PSLF. It's the best strategy for most new attendings in family medicine, pediatrics, psychiatry, and internal medicine, especially if you have debt and want geographic flexibility.
Run your own numbers. Put together a spreadsheet with your actual student loan balance, expected expenses, and desired lifestyle. Don't trust the recruiter's napkin math. You're the one living with the choice.
Re-evaluate every year. Priorities shift. You get married, have a kid, burn out on travel. The locum life that felt free at 30 might feel exhausting at 35. The full-time job that felt like a trap might become the anchor you need. The only wrong answer is staying on autopilot.
