How much does a starting dentist make as an associate?

[prettymean]

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Hey folks I have a rather sobering question to ask, how much does a starting dentist make who is just a lowly associate? This is important because considering the kind of loan I will borrow as well as the expenses of starting on life will both take toll on the financial well-being of anyone.

I think this is an important question that we should know.

Thank you

 

[ItsGavinC]

prettymean,

Excellent question! There are several answers to the question, and each depends on contract that is entered into.

Many associates enter into a contract which pays out a percentage of their earnings. The short answer to your question would be between $60,000 - $110,000 a year. The average for an entering associate would be about $75,000 a year.

 

[JonR]

$75,000 is a good estimate.

 

[Hysteria24]

So after taxes, that $75,000 will be around $58,000 not inculding social security and those extras. On the other hand, you may get some back depending on any deductions you have. Might want to take that into consideration if working out finacials.

 

[jam21]

Those figures are lower than I thought. How do they all pay off the loans?? Basically, a half of your monthly earnings will go out to pay off the loans (if paying like 2000/month ) ?

 

[cwisa]

It all depends on where you work and what contract you get. I know of associates that earn as much as $200,000 per year here in Washington. Those are not first year figures but not far from it. If you get a decent percentage in your contract and are proficient with clinical skills you should make at least 100,000 in a decent area. That is of course if you work 5 days a week.

CA

 

[JonR]

I'm going to have to call BS on the 200K/year comment. Think about that for a second. Let us give the ultimate "perfect scenario" dental office. Lets say its a 2-3 dentist office with 50% overhead and a total gross production of $1 million/yr. If an associate was making 200K/yr, they would be making more than even an equal share of the profit, which itself is obviously not the case with a new associate.

Even finding an office with the above scenario (ie low overhead, high production) isn't easy most of the time anyway. In your average healthy solo practice that has just taken on a new associate, you'll see production around 500-600K or less and 55-60% overhead, meaning that there is only about $200K of profit to go between the two dentists. The owner will make $125K or more, and the associate $75K or less. This is average. Many associates make even less their first couple of years because they just can't produce $300K/yr. after being used to doing 2hr Class II amalgams. Pick up a copy of Dental Economics and see for yourself.

As far as loans, it all depends on how much debt you have. If you went to a state school, you may be talking about 130-150K with living expenses, which if paid over 20 yrs. is less than 1K/month or if paid over 10 yrs. is around $1500/month. If you went to a private school in a high cost of living area, you could easily be at $250K, which would mean paying $2700/month for a ten year payoff or $1700/month for a 20 yr. payoff. These numbers are all based on a very modest 5% interest rate, which will probably NOT be what we will all be paying.

So, there is a big difference, and with private schools, it IS quite a struggle to pay off these loans as a fledgling associate, especially with all of the other stresses you will have at this time such as maybe marriage and/or kids, place to sleep, car, etc.

Below are some sample figures all at 5% interest:

1)10 year payoff:

Debt amount: $100K Monthly Payment: $1100
Debt amount: $150K Monthly Payment: $1600
Debt amount: $200K Monthly Payment: $2100
Debt amount: $250K Monthly Payment: $2700

2)20 year payoff:

Debt amount: $100K Monthly Payment: $700
Debt amount: $150K Monthly Payment: $1000
Debt amount: $200K Monthly Payment: $1300
Debt amount: $250K Monthly Payment: $1700

Compounding interest is just great...you can pay off $150K in ten years with less of a monthly payment for those 10 years than it takes to pay off $250K in 20 years!!

 

[ItsGavinC]

Jon,

As an initial argument against your claims, I would venture to say that 3 dentists with a yearly gross production of $1 million is quite low. I only mention this because you stated a "perfect scenario" dental office. That $1 million may be the perfect scenario, but only if the dentists are working 3 days a week. An extra day or two added to that could quite easily up that to 1.5 million or higher.

It is not impossible for an associate to make $200,000 a year, however numbers such as that are not typical.

Typically the 200k mark would be a minimum of 5 years after graduation.

Once again, such figures depend on location of practice, type of practice, work hours, etc.

 

[JonR]

When I say 2-3 I mean a 2 dentist office that has just taken on an associate. 2 dentists with a gross of 1 million is not unusual, though that actually may be a bit low if they are working 5 days a week.

I agree, the 200,000 mark can be attained if you are moving into partnership after a few years, and as you say, it is quite variable.

 

[freedyx3]

These figures you guys are throwing out there ie, 75000 or 100000, are these salaries before taxes are calc in?

 

[yosemitesam]

'Fraid these figures are before Uncle Sam grabs his half. Finding a good accountant is half the battle to running a profitable practice. 😉

 

[freedyx3]

so considering tax is prob arond 40%, your final take home income is around $45,000. Wow that is not much at all considering the loans you have to pay alone. How the heck to new dentists pull it off???

 

[prettymean]

I think this is an important topic. Can anyone answer Fred's question?

 

[prettymean]

When I interviewed at Penn, the Assistant Dean of Admission told me that it wil be no problem to pay off the loan in 5 or 6 years because dentists make a lot of money these days. He even went on to say that dentists in some cases make more than physicians do because of managed health care. I kind of doubt that because, I, thinking like Fred, have a hard time understand how we can pay off the massive loans as a low pay associates. Can someone shed some light on this?

 

[JonR]

The answer is that you simply CANNOT pay off your loan in 5-6 years. Just run the numbers...if you borrow a total of 300K in your 4 years at Penn, you will be paying $5K/month with an optimistically low 5% interest rate!! That's right...60K/yr. And you have to actually live too...oh, and move, oh and maybe get married and have kids. Only the very privileged can do things like this.

According to the ADA (see the thread entitled "way off" for the address), the average net income of ALL general dentists in the country as of 1999 was $158K/yr (which IS higher than the average primary care MD, thanks to the fact that the money aspect of medicine is going down the tube). The average dental specialist makes 240K/yr net.

The average associate makes 100K/yr AVERAGE in the first 10 years out of school. Think about these incomes. If you think you can pay off that debt in 5-6 years, you are just simply wrong. How do they do it? By paying the loans off in a longer term. Dentistry will provide a great income and you WILL get those loans paid off, but it will definitely take longer than 5-6 years...especially if you go to a school like Penn. Doesn't make Penn a bad school, but just consider the facts.

If this guy told you that it will be "easy" to pay off your loan in 5-6 years, you should call him on it and watch him squirm. Admissions people should be more honest about these areas, I think.

 

[ewsmith1]

Ok, JonR...

I have been waiting patiently and now I must respond to your comments.

Please do not use 99' figures, use the 2002 figures from a recent JADA and Dental Economics...again 170k/year....the is NET

About 40% of my classmates, who are not specializing, have already commited (not signed) to assoc. over 100k to start with commision; maybe your dad does not want to pay you that much when you get out....

Also...a student loan of 165k is 1826.00/month for 10 years, or 700.00/month for 30 years....therfore, 300k over 30 years would be about 1500.00/month and over 10 would be about 3700.00/month.

How do I know this? The money is deducted out of my checking account every month....

 

[Deuce 007 MD]

Dude, I should of applied to dental school. No residency, more pay then primary care, better hours.

 

[yosemitesam]

And in addition to that, Deuce, dentistry has got to be a heck of lot funner than primary care.🙂

 

[JonR]

I am not sure why you are posting those numbers...yes, you are correct sir...300K over 30 years @5% is 1600/month and over 10 years is 3200/month. If you reread the post the number I talked about was if one tried to pay off that 300K in 5 years, which is what Penn tells its students is possible. THAT number is $5700/month, which I am saying is unreasonable for anyone to pay no matter what their income. Just use an amortization calculator.

Sure, 170K is net for the latest figure, but of course you take 1999 data with a grain of salt knowing that the numbers go up. The reason I use that data is because the 1999 data for salary, overhead, patient visits, etc. is used in the complete study for entering dentists on the ADA site.

Extrapolating the new data would give you roughly an 8% increase in GP salary since 1999. If we figure the same amount of increase in associate pay (which is a considerable guess), we would get an average of 108K for associates who are 10 years or less out of school. Now at which point do you think most of the money is made to get that average...the first year out of school or the 9th? Obviously, the numbers that will bring the average up are at the latter years...most people that are in their 10th year of associateship are going to be making considerably more money than they did when they started...in fact, if you know anything about production, you know that the numbers will skyrocket as your patient base is increased by the senior doctor and you actually learn how to be efficient.

So, if we know that you are much more productive after 10 years of practice and we are guessing that the average is 108K/yr for all associates, someone has to be bringing the values down, and I can guarantee you that it is the brand spanking new associates. If everyone started at 100K, the average for associates with ten years or less experience would be much higher...either that or the average associate only increases their net 8K after 10 YEARS of practice. 🙄

Once again, I am sure that there are people who will get out and immediately be making 100K-net...make sure you are talking net, not gross (and of course remember fees are much higher in certain areas ie northeast), but to say this is the norm is just ignoring the facts. The point of all this isn't that dentistry sucks or something...it is one of the most economically rewarding professions around. The point is more to make people think about exactly how much money they will have and NOT have when they get out of school.

 

[PashaJ]

JonR,
I've been reading your posts for a while and though I appreciate the effort you devote to each post (they're about 4 large paragrahs on average), I have to say you're quite the pessimist. Most of your posts begin in disagreement with others. If the numbers are wrong, let it go. No need to correct them, especially if they're overestimated: the inflated numbers may make some people happy.

 

[JonR]

Well, either I'm a pessimist or I'm a realist...the latter tends to be translated to pessimism by those who don't like what they hear.

You would rather someone not refute incorrect statements...and your reason is that it "makes some people happy" to believe that things will be better than they truly will. I, for one, would rather have someone tell me the truth flat out or clear me up when I am wrong instead of giving me false hope which will just make me more disappointed when I realize what is really going on.

In this world, people should be more realistic...there is so much BS floating around about what to expect out of any given thing. It's nice to know that you can depend on some people never to sugar-coat something because it "makes some people happy".

You're right, though...I have many more important things to do than waste my time posting on this board with my long drawn out "pessimism".

Well, if anyone wants any future advice on anything concerning dental school/dentistry/UConn/etc., email me at [email protected]. I'll help you out the best I can.

And as far as this thread...my final word will be that if you think I am wrong, you aren't arguing with me, but with the data. Go to http://www.ada.org/prof/pubs/dbguide/newdent/income.html and see for yourself.

 

[tinker bell]

In my opinion, having a bad estimate at the beginning and then have a good shock four years from now is better than falling off from cloud nine.
Hey John, I've enjoyed reading your posts. I hope you will continue to contribute in the future. I sent u a pm a few wks ago.

😀 😀

 

[sjdent]

75K?

Wow, might as well have gotten my RDH degree.

Uhhh....no.

 

[yosemitesam]

Dude, I promise you're not gonna starve making $75K a year! 🙂

 

[portlander]

These have all been great posts on what we can be expecting right out of school. I thought I might add some knowledge I have from first hand experience in the matter.

I work in the office of a 2-dentist practice. One (the owner) works 10 hours days M-W. Our associate, works 9 hour days Th and F. He just graduated last may. Now he makes 30% of all his production, which calculates out to be anywhere between $450 on a slow day and $1800 (this is what he takes home) on a high-production day. He also works an additional 2-3 days/week at another office. Assuming the pay at the other office is comparable, lets say he makes an average (a low estimate) of $500/day. This number x 4.5 days/week x 48 weeks = 108,000/year. (I am assuming 4 weeks vacation and an average of 4.5 days of work a week). On the high average estimate of production he pockets, lets say it's $700/day. This x 4.5 days/week x 48 weeks = 151,000.

So yes, as he often tells me, he is doing well. He also tells me of other classmates of his that are making well over $160,000/year. So it is not that difficult to do well your first year out.

And my office, even before we hired our associate, was grosing about 1 million with one dentist working 4 9-hour days/week. You must also consider that collections are almost never 100%. We do a good job at our office, and I think we are only at about 90%.

So much fun to look forward to, eh?

 

[DesiDentist]

Originally posted by sjdent
75K?

Wow, might as well have gotten my RDH degree.

Uhhh....no.

I was talking to a couple of RDH's the other day and they are making 80-100K a year. They said they were hitting 80k their first year out.

I really think a 75k estimate is a little too conservative for a Doctorate degree. Granted, I ain't gonna starve but still that just doesn't make sense.

DesiDentist

PS: I ain't gonna be payin' my Hygenist 80k when I'm taking home 75k.

 

[MidwestDental]

Originally posted by JonR
I am not sure why you are posting those numbers...yes, you are correct sir...300K over 30 years @5% is 1600/month and over 10 years is 3200/month. If you reread the post the number I talked about was if one tried to pay off that 300K in 5 years, which is what Penn tells its students is possible. THAT number is $5700/month, which I am saying is unreasonable for anyone to pay no matter what their income. Just use an amortization calculator.

Sure, 170K is net for the latest figure, but of course you take 1999 data with a grain of salt knowing that the numbers go up. The reason I use that data is because the 1999 data for salary, overhead, patient visits, etc. is used in the complete study for entering dentists on the ADA site.

Extrapolating the new data would give you roughly an 8% increase in GP salary since 1999. If we figure the same amount of increase in associate pay (which is a considerable guess), we would get an average of 108K for associates who are 10 years or less out of school. Now at which point do you think most of the money is made to get that average...the first year out of school or the 9th? Obviously, the numbers that will bring the average up are at the latter years...most people that are in their 10th year of associateship are going to be making considerably more money than they did when they started...in fact, if you know anything about production, you know that the numbers will skyrocket as your patient base is increased by the senior doctor and you actually learn how to be efficient.

So, if we know that you are much more productive after 10 years of practice and we are guessing that the average is 108K/yr for all associates, someone has to be bringing the values down, and I can guarantee you that it is the brand spanking new associates. If everyone started at 100K, the average for associates with ten years or less experience would be much higher...either that or the average associate only increases their net 8K after 10 YEARS of practice. 🙄

Once again, I am sure that there are people who will get out and immediately be making 100K-net...make sure you are talking net, not gross (and of course remember fees are much higher in certain areas ie northeast), but to say this is the norm is just ignoring the facts. The point of all this isn't that dentistry sucks or something...it is one of the most economically rewarding professions around. The point is more to make people think about exactly how much money they will have and NOT have when they get out of school.

DUUUDE, No one, and I mean no one in their right mind would stay an associate for 10 YEARS!!!!

I mean, most people only stay associates for 2 years or so to get the swing of things or to save enough money to buy a practice. Maybe this happens in parts of California or NYC, but elsewhere I don't think so.

Secondly, do not factor in taxes. I mean there isn't a single other profession where you DON'T PAY TAXES!! Think of the poor teachers who earn 40K before taxes. How do they live without starving? And taxes reach nowhere near 40%. It is progressive, 15% on your first 20-30 k or so, then 28% on the money between 40K and 75K and 31% on the money above 75K or something like that. And there are always tax shelters, too.

Thirdly, do not simply double a payment, ie, $1700/mo for 125K is NOT $3400/mo for 250K. There is something called compound interest. You pay interest on your interest!

The most accurate figure is the following ADA figure:
Dentists aged 30-34 years of age made about 100K in 1995.

Since dentists start earning money (generally speaking) at age 26-27, these are dentists with 5+ years experience. Assuming inflation over 7 years, we can assume the current figure is closer to 125K.

You also have to put things in perspective 100K a year is still a lot of money. 100K minus loans equals about 75-80K. Provided you don't live in SF or NYC, that's still plenty to live on, provided you don't have 4 kids who go to private school.

 

[yosemitesam]

Dude, My friend's cousin's old roommate just got out of LSU like two years ago and this last year as an associate he made like $800,000 and for his Christmas bonus the partnership gave him an 18 ft Bayliner skiboat. And he payed off his school debt in like the first six months. So now he's thinkin' he might retire and just do dentistry like one day a month or somethin'. And this could totally be us in just a few years.




...or maybe we should rely on published figures (like those used by JonR) when we are making financial decisions that will affect us FOR THE REST OF OUR LIVES. A personal preference I guess.

 

[DesiDentist]

Originally posted by yosemitesam
Dude, My friend's cousin's old roommate just got out of LSU like two years ago and this last year as an associate he made like $800,000 and for his Christmas bonus the partnership gave him an 18 ft Bayliner skiboat. And he payed off his school debt in like the first six months. So now he's thinkin' he might retire and just do dentistry like one day a month or somethin'. And this could totally be us in just a few years.




...or maybe we should rely on published figures (like those used by JonR) when we are making financial decisions that will affect us FOR THE REST OF OUR LIVES. A personal preference I guess.

yosemite-

Now you're talking. That is the stuff I like to hear.

DesiDentist

 

[yosemitesam]

Desi, I'm not entirely sure you got the gist of my last post; sarcasm doesn't always translate well in these posts. That was not - I repeat - not a true story. Nor even a realistic one. I was just trying to illustrate the absurdity of some of the pie-in-the-sky expectations I've seen posted here.

Some of the projections I've seen make the Clinton administration's predictions of trillion dollar plus surpluses look like just rounding up the change. I am optimistic for my future earnings potential, however I think it's important to base financial decisions (like loans, etc...) on conservative, published data - not what somebody's cousin's roommate's old girlfriend is making.

Sorry if I got you all excited and then burst your bubble. 🙂 Anyway y'all can console yourselves with the fact that fully 50% of dentists make more than the ADA's reported median income of $159,000. ...and half make less, but let's not think about that.