Incoming D1. Student loans??

[adidaby]

Hey guys! I’m an incoming D1 and have been conflicted on a few things in terms of finances.

Long story short, I will be taking out 350k in loans (420k post interest). This would have been much more but I have lots of financial support from family in terms of living expenses. Anyways, I crunched some numbers and tried looking at worst possible case scenarios. If I were to avg 150k salary (hopefully I’m low balling) for my first 10 years, and aggressively pay ~60k per year, that leaves me with ~50k take home (post taxes) per year for 10 years.

After those 10 years, I understand that the grass is probably much greener. Additionally, I am close to and have support from my parents, and theoretically, I will always stay with them as long as I’m able to find work close by.

Idk what do you guys think? Im conflicted but im leaning towards thinking it’s worth it. After all, I was barely making 50k before taxes right now. Let me know if im wrong or missing something!!

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[Thehighwind87]

How much will living expenses be? For example- when I went to school it was 2k for a studio. 1k for living expenses food etc. 3k a month- 144k over 4 years.

Today- that same studio is about 3-4k and living expenses 1k, on average 3.5k which is 168k over 4 years compounded at x interest.

Will you parents really fork over 30-40k a year for your rent and food? If so that pretty generous.

Regardless, your average salary projections- I wouldn't worry about. It's about getting experience 1-3 years in and then multiplying your income to 200-400k by purchasing a practice- when you are "ready" to buy. It's the 1-3 years of experience that gets you up to speed- then you will be ready for practice purchase.

Regardless, the debt load is a big factor but it's not that bad to have 350k as there are others coming out with much more debt. If you were coming out with 700k or something bigger I would be like woah dude, thats alot of debt.

 

[adidaby]

How much will living expenses be? For example- when I went to school it was 2k for a studio. 1k for living expenses food etc. 3k a month- 144k over 4 years.

Today- that same studio is about 3-4k and living expenses 1k, on average 3.5k which is 168k over 4 years compounded at x interest.

Will you parents really fork over 30-40k a year for your rent and food? If so that pretty generous.

Regardless, your average salary projections- I wouldn't worry about. It's about getting experience 1-3 years in and then multiplying your income to 200-400k by purchasing a practice- when you are "ready" to buy. It's the 1-3 years of experience that gets you up to speed- then you will be ready for practice purchase.

Regardless, the debt load is a big factor but it's not that bad to have 350k as there are others coming out with much more debt. If you were coming out with 700k or something bigger I would be like woah dude, thats alot of debt.

I would be living with family (who refuse to take rent from me), so living expenses would be minimal to none for the 4 years of dental school. I guess I would have to worry about smaller expenses such as food, commute, etc. In that sense, I’m very lucky. That leaves ~400k of tuition. 50k is paid for by my savings, leaving ~350k. After school, the plan would be to move back in with my mom and dad, as I would help take care of them and the house. My family and I are very close, so that would be something that we all want.

As for purchasing a practice, I’m on the fence. In the worst case scenario, I don’t ever own a practice and continue work as an associate. Just planning for worst possible financial outcomes and contemplating whether or not it works out.

 

[Thehighwind87]

I would be living with family (who refuse to take rent from me), so living expenses would be minimal to none for the 4 years of dental school. I guess I would have to worry about smaller expenses such as food, commute, etc. In that sense, I’m very lucky. That leaves ~400k of tuition. 50k is paid for by my savings, leaving ~350k. After school, the plan would be to move back in with my mom and dad, as I would help take care of them and the house. My family and I are very close, so that would be something that we all want.

As for purchasing a practice, I’m on the fence. In the worst case scenario, I don’t ever own a practice and continue work as an associate. Just planning for worst possible financial outcomes and contemplating whether or not it works out.

The biggest benefit of dentistry is the ownership route. I would not go into dentistry if you are planning on being an employee. It is a hard world out there for "associates" and employee dentists. It's hard to get a good gig, lots of bad gigs out there.

It would be much easier to go into PA/NP school and get a job with a hospital with overtime, night shifts, fully paid benefits, 401k, 2x holiday pay, health care insurance etc.

Employee dentists literally get screwed every which way you go. Hired as independent contractor on low collections. Hired as W2 but with no benefits. Etc etc etc.

If you have zero interest in ownership- then I would not go into dentistry.

 

[adidaby]

The biggest benefit of dentistry is the ownership route. I would not go into dentistry if you are planning on being an employee. It is a hard world out there for "associates" and employee dentists. It's hard to get a good gig, lots of bad gigs out there.

It would be much easier to go into PA/NP school and get a job with a hospital with overtime, night shifts, fully paid benefits, 401k, 2x holiday pay, health care insurance etc.

Employee dentists literally get screwed every which way you go. Hired as independent contractor on low collections. Hired as W2 but with no benefits. Etc etc etc.

If you have zero interest in ownership- then I would not go into dentistry.

Thank you for the insight! It’s not that I’m completely against ownership, but I just wonder in the case that, for some reason, I enjoy being an associate and don’t want the added pressure of ownership. In that case, that would be the worst financial outcome/scenario (which is what I want to consider before making this decision). If that were to be, would it not make sense financially? I care a lot about taking care of my family financially in the future. Would bring an associate prevent me from doing so?

 

[Thehighwind87]

Thank you for the insight! It’s not that I’m completely against ownership, but I just wonder in the case that, for some reason, I enjoy being an associate and don’t want the added pressure of ownership. In that case, that would be the worst financial outcome/scenario (which is what I want to consider before making this decision). If that were to be, would it not make sense financially? I care a lot about taking care of my family financially in the future. Would bring an associate prevent me from doing so?

There is alot of variables so I cannot make an accurate statement. However, the majority of associateships suck. Not gonna sugar coat it. Yes you might hear of 1 that is great and the associate loves their job, but the majority suck. That's why everyone eventually gets pushed into ownership.

That's why I would rather go to another profession if you are against ownership-because chances are if you stick with associating w2 employee dentist- you will not enjoy your profession.

 

[adidaby]

There is alot of variables so I cannot make an accurate statement. However, the majority of associateships suck. Not gonna sugar coat it. Yes you might hear of 1 that is great and the associate loves their job, but the majority suck. That's why everyone eventually gets pushed into ownership.

That's why I would rather go to another profession if you are against ownership-because chances are if you stick with associating w2 employee dentist- you will not enjoy your profession.

This gives me something to think about, thanks!

 

[charlestweed]

Hey guys! I’m an incoming D1 and have been conflicted on a few things in terms of finances.

Long story short, I will be taking out 350k in loans (420k post interest). This would have been much more but I have lots of financial support from family in terms of living expenses. Anyways, I crunched some numbers and tried looking at worst possible case scenarios. If I were to avg 150k salary (hopefully I’m low balling) for my first 10 years, and aggressively pay ~60k per year, that leaves me with ~50k take home (post taxes) per year for 10 years.

After those 10 years, I understand that the grass is probably much greener. Additionally, I am close to and have support from my parents, and theoretically, I will always stay with them as long as I’m able to find work close by.

Idk what do you guys think? Im conflicted but im leaning towards thinking it’s worth it. After all, I was barely making 50k before taxes right now. Let me know if im wrong or missing something!!

Do you plan to get married and have kids? If yes, then your spouse will also need to work full time. It’ll help a lot if your spouse is ok with living at your parents’ house for the first few years to save money. With the much higher living cost now (in comparison to 10-15 yrs ago), having dual income is a must. But if you plan to stay single for the rest of your life and you only need to support yourself, then having a net earning of $50k (for the first 10 years) should be fine. If you go with the conventional 10 yr debt repayment plan, you should be debt free by your mid 30s. When you are debt-free, your greatest asset is your income.

Don’t feel pressured in opening a practice. With such huge amount of debt, you can’t afford to open one anyway. You will need to learn and gain more experience from your associate job first. I didn’t think I was good enough to open up my own office when I was a student like you. I had worked for someone else for 4 years before I finally had the courage to open one. Never say never. A lot of dentists opened their own offices because they were unhappy with their associate jobs.

 

[adidaby]

Do you plan to get married and have kids? If yes, then your spouse will also need to work full time. It’ll help a lot if your spouse is ok with living at your parents’ house for the first few years to save money. With the much higher living cost now (in comparison to 10-15 yrs ago), having dual income is a must. But if you plan to stay single for the rest of your life and you only need to support yourself, then having a net earning of $50k (for the first 10 years) should be fine. If you go with the conventional 10 yr debt repayment plan, you should be debt free by your mid 30s. When you are debt-free, your greatest asset is your income.

Don’t feel pressured in opening a practice. With such huge amount of debt, you can’t afford to open one anyway. You will need to learn and gain more experience from your associate job first. I didn’t think I was good enough to open up my own office when I was a student like you. I had worked for someone else for 4 years before I finally had the courage to open one. Never say never. A lot of dentists opened their own offices because they were unhappy with their associate jobs.

How long is too long before you open a practice? What if I waited till 40 to open one up for some reason (I.e. maybe I’m very satisfied with pay and lifestyle without ownership for a bit)? Is there a specific timetable that I should use?

 

[Thehighwind87]

How long is too long before you open a practice? What if I waited till 40 to open one up for some reason (I.e. maybe I’m very satisfied with pay and lifestyle without ownership for a bit)? Is there a specific timetable that I should use?

Way too many variables to know. This is like me saying I’m gonna own 20 practices by the time I’m 40. A lot can change in 1-2 years

 

[PerioDont]

Honestly I don't think 420k is worth it, esp if you aren't planning for ownership.

one thing I've heard said although not a rule for sure is people who don't own in the first 5yr after graduation usually never end up owning

 

[Ryxndek]

Honestly I don't think 420k is worth it, esp if you aren't planning for ownership.

one thing I've heard said although not a rule for sure is people who don't own in the first 5yr after graduation usually never end up owning

by own do you mean at least being a partner in a practice, or owning your own solo practice?

 

[charlestweed]

How long is too long before you open a practice? What if I waited till 40 to open one up for some reason (I.e. maybe I’m very satisfied with pay and lifestyle without ownership for a bit)? Is there a specific timetable that I should use?

I think you can safely start an office (either from scratch or buy an existing one) when you have at least 6 months of emergency funds in your saving account. This saving amount should help cover the living expenses + monthly student loan repayment amount + all the fixed expenses for your new business for at least 6 months. You need to have a written budget…and try to stick to it.

One of the biggest fears that deterred me from opening my own office was the loss of the comfortable lifestyle that I enjoyed. That’s why it took me 4 years. That’s why I started a small low overhead office….and then I slowly expanded my business by adding more satellite offices. To make sure I could maintain the comfortable lifestyle, I kept my full time associate job at the corp and I worked at my new office on Saturdays and Sundays. And when my office got busier, I cut down my associate days at the corp. My sister did the same thing. When she first started, she worked 3 days/wk at her own office and 4 days/wk at the corp office. She had lived at our parents’ house for about 3 years to save money. Our parents helped babysit her 2 kids and cooked. My sister helped our parents pay the monthly home mortgage + food. She had driven the same Toyota Sienna minivan for 10+ years. Now, she drives a Tesla Model S and owns 7 properties, including her dental office building.

 

[PerioDont]

by own do you mean at least being a partner in a practice, or owning your own solo practice?

either. many end up life long employees, either as associates in PP, corps, public health gigs, academics etc.

which is fine, but not with 420k in loans.

 

[Thehighwind87]

either. many end up life long employees, either as associates in PP, corps, public health gigs, academics etc.

which is fine, but not with 420k in loans.

420k loans as lifelong dental associate is a terrible gig. You can easily do a middle of the road- pa- nurse- ot- work in the hospital/govt, have wayyyyy better benefits, never worry about ownership, have a pension, 401k matched 4-6%+, healthcare insurance, and have way less loans etc etc.
Heck even dental hygiene employee makes more sense. Recent ad on craiglist in my area- paying 100 an hour for a 2 year associates degree for 40-50k with benefits. It boggled my mind when I saw that- but it is in a more remote location. But regardless- that position is paying a guarantee higher then a new grad dentist.

Versus a 420k associate with 30% collections paid on I9. Very rarely do employee dentists get benefits- and if they do- the benefits are extremely poor. Stuff like holiday pay only on the day it lands off, no extra overtime, no extra "time" on holiday, lucky if you get a 401k- even more so if there is a match, healthcare is pisspoor- like catastrophic insurance kind of thing, pension? yeah I haven't heard of that one.

I'm not gonna number crunch to see how much you get paid "more" in the long run when you calculate the benefits/debt load of a np/pa/ot versus an associate dentist, but I just know most likely the middle of the road route pa/nurse/ot makes more sense. In addition the "stress" of not having a boatload of loans- you can't put a number on that.


The biggest benefit of dentistry is ownership. Period. 4 days a week making 200-400k. But I would say the ownership route of solo private practice is slowly fading- however, it is still a viable option. And if you get to that point of a 4 day workweek with that kind of income- dentistry is a very attractive gig.

 

[PerioDont]

420k loans as lifelong dental associate is a terrible gig. You can easily do a middle of the road- pa- nurse- ot- work in the hospital/govt, have wayyyyy better benefits, never worry about ownership, have a pension, 401k matched 4-6%+, healthcare insurance, and have way less loans etc etc.
Heck even dental hygiene employee makes more sense. Recent ad on craiglist in my area- paying 100 an hour for a 2 year associates degree for 40-50k with benefits. It boggled my mind when I saw that- but it is in a more remote location. But regardless- that position is paying a guarantee higher then a new grad dentist.

Versus a 420k associate with 30% collections paid on I9. Very rarely do employee dentists get benefits- and if they do- the benefits are extremely poor. Stuff like holiday pay only on the day it lands off, no extra overtime, no extra "time" on holiday, lucky if you get a 401k- even more so if there is a match, healthcare is pisspoor- like catastrophic insurance kind of thing, pension? yeah I haven't heard of that one.

I'm not gonna number crunch to see how much you get paid "more" in the long run when you calculate the benefits/debt load of a np/pa/ot versus an associate dentist, but I just know most likely the middle of the road route pa/nurse/ot makes more sense. In addition the "stress" of not having a boatload of loans- you can't put a number on that.


The biggest benefit of dentistry is ownership. Period. 4 days a week making 200-400k. But I would say the ownership route of solo private practice is slowly fading- however, it is still a viable option. And if you get to that point of a 4 day workweek with that kind of income- dentistry is a very attractive gig.

I've seen HYG ads for 500$/day, some even with 1-5k bonuses. Which is just about the same as many GP associates

 

[Thehighwind87]

I've seen HYG ads for 500$/day, some even with 1-5k bonuses. Which is just about the same as many GP associates

100% my accountant says it’s cheaper to hire a new grad dentist to do cleanings as you can pay on collections. Heck give them the exam to- you will still come out ahead. But then again- you will prob have a revolving door of associates which isn’t good. Better to have long term employees.

 

[orthowins]

I think you can safely start an office (either from scratch or buy an existing one) when you have at least 6 months of emergency funds in your saving account. This saving amount should help cover the living expenses + monthly student loan repayment amount + all the fixed expenses for your new business for at least 6 months. You need to have a written budget…and try to stick to it.

One of the biggest fears that deterred me from opening my own office was the loss of the comfortable lifestyle that I enjoyed. That’s why it took me 4 years. That’s why I started a small low overhead office….and then I slowly expanded my business by adding more satellite offices. To make sure I could maintain the comfortable lifestyle, I kept my full time associate job at the corp and I worked at my new office on Saturdays and Sundays. And when my office got busier, I cut down my associate days at the corp. My sister did the same thing. When she first started, she worked 3 days/wk at her own office and 4 days/wk at the corp office. She had lived at our parents’ house for about 3 years to save money. Our parents helped babysit her 2 kids and cooked. My sister helped our parents pay the monthly home mortgage + food. She had driven the same Toyota Sienna minivan for 10+ years. Now, she drives a Tesla Model S and owns 7 properties, including her dental office building.

Do you recommend any resources (books, podcasts, etc) that will teach you more about steps to owning your own practice?

 

[charlestweed]

Do you recommend any resources (books, podcasts, etc) that will teach you more about steps to owning your own practice?

Sorry I don’t have any recommendation for you. If you listen to most of the experts, you will have to spend a lot of money to start an office….in the $4-500k range. I must admit that I don't have great business skills. If I was good, I wouldn’t have to charge low fees to attract more patients….I wouldn’t have to travel to work at multiple offices….I wouldn’t have to work on the weekends. I am not a big risk-taker either; therefore, I started a very small office. I had to keep the overhead as low as possible in order to stay profitable. And for my 2 other satellite offices that I added a few years later, I rent the office spaces from the general dentists (my sister and my wife’s former dental classmate). I control the budget for my business the same way I control my own family’s budget….aka “spend less than you make.” I don’t let the staff order the supplies. I order all the supplies myself. My business may not be as big (nor as successful) as some of my colleagues’, but I am very happy. If I wasn't, I wouldn’t come on here very regularly and say nice things about the profession. My only regret was I didn't start it sooner.

It's basically self-teaching for me. I learned from working at busy corp offices. I learned how corp offices keep the overhead low. I learned to work with limited resource. Working at non-ideal environment at the corps (lack of experienced assistants, overbooked schedules, lack of supplies etc) taught me to work more efficiently….enabled me to come up with a lot of quick clinical tricks. I learned to multi-task. I cross-train my staff so I don’t need to hire a lot of employees. These valuable lessons, which cannot be obtained from reading books nor from attending CE classes/residency, helped me greatly when I opened my own offices. I learned from my own mistakes. I also learned from my sister and friends, who opened their practices before me.

 

[deleted1166024]

I have not seen it mentioned so I'll throw it out there.

Using an Income Driven Repayment (IDR) plan and planning for taxable forgiveness might be an option. It's not right for everyone, however it's important to know all your options. It usually makes more sense for dentists with larger loan balances. Also there are new IDR plans being discussed by the Biden admin. The future of student loan repayment/forgiveness could be even friendlier.

 

[smileystudent87]

I think you can safely start an office (either from scratch or buy an existing one) when you have at least 6 months of emergency funds in your saving account. This saving amount should help cover the living expenses + monthly student loan repayment amount + all the fixed expenses for your new business for at least 6 months. You need to have a written budget…and try to stick to it.

One of the biggest fears that deterred me from opening my own office was the loss of the comfortable lifestyle that I enjoyed. That’s why it took me 4 years. That’s why I started a small low overhead office….and then I slowly expanded my business by adding more satellite offices. To make sure I could maintain the comfortable lifestyle, I kept my full time associate job at the corp and I worked at my new office on Saturdays and Sundays. And when my office got busier, I cut down my associate days at the corp. My sister did the same thing. When she first started, she worked 3 days/wk at her own office and 4 days/wk at the corp office. She had lived at our parents’ house for about 3 years to save money. Our parents helped babysit her 2 kids and cooked. My sister helped our parents pay the monthly home mortgage + food. She had driven the same Toyota Sienna minivan for 10+ years. Now, she drives a Tesla Model S and owns 7 properties, including her dental office building.

can i pm you?

 

[charlestweed]

can i pm you?

Yes, anytime.