Anyone have any recommendations of what books I should read to get me ready for dentistry? Any input is appreciated.
Why do you suggest this?IF you are the first "Doctor" in your family read:
Blue Collar - Blue Scrubs: The Making of a Surgeon (By Micheal Collins)
Those of us that had parents that are welders, electricians and plumbers view the professional school experience differently than our fellow students that had parents that that are doctors & lawyers.Why do you suggest this?
Got it on Audible after seeing your post and loving it so far! Takes me back to my pre-dental school/dental school odd job employment days. Great book. Thank you!IF you are the first "Doctor" in your family read:
Blue Collar - Blue Scrubs: The Making of a Surgeon (By Micheal Collins)
In regards to finances the absolute biggest killer is divorce. Don’t let it happen to you lolAnything about finances. Contrary to what you think- Alot of dentists are broke or in large amounts of negative debt.
There is positive debt- like practice loan, real estate etc.
But alot of dentists and MD's accumulate negative debt like cars, boats etc.
I'll check it out.
Honestly all debt is bad debt. Interest is interest. If I could do life over again, I would probably do things differently.Anything about finances. Contrary to what you think- Alot of dentists are broke or in large amounts of negative debt.
There is positive debt- like practice loan, real estate etc.
But alot of dentists and MD's accumulate negative debt like cars, boats etc.
This is an oddly similar argument to the argument I made in the thread:Honestly all debt is bad debt. Interest is interest. If I could do life over again, I would probably do things differently.
Imagine two people.
One person becomes a dentist and pays 1M over 10 years for a practice loan at an interest rate of 6.5% at the beginning of his career.
The other person becomes a doctor, and pays 1M over 10 years into investing in the S&P 500 earning over 12% at the beginning of his career.
Imagine they both made the same salaries and the same contributions to their investments and lived the same lifestyle.
First of all, the dentist would have to spend $1,362,575.73 dollars to have an asset worth 1M (interest working against you).
The doctor's investment ( of 1M) 25 years later would be worth $17,000,064.41
The dentist's investment 25 years later would be worth... Who knows.. But approximately 1M.
And the doctor's investment would be worth even more than that, because I didn't take into account how that money would grow as they were investing those first 10 years.
So no, no debt is good debt.
This is why becoming a dentist probably isn't the route I would choose to go if I had to do it again.
One part of the calculation that you left out is the tax benefits of owning a business vs W2. For example, what if the dentist set up a mega back door IRA and also limited their W2 income so to pay less taxes. Not all employees have that flexibility. To me the worst part of being a dentist today is how high the tuition is, even relative to medicine.Honestly all debt is bad debt. Interest is interest. If I could do life over again, I would probably do things differently.
Imagine two people.
One person becomes a dentist and pays 1M over 10 years for a practice loan at an interest rate of 6.5% at the beginning of his career.
The other person becomes a doctor, and pays 1M over 10 years into investing in the S&P 500 earning over 12% at the beginning of his career.
Imagine they both made the same salaries and the same contributions to their investments and lived the same lifestyle.
First of all, the dentist would have to spend $1,362,575.73 dollars to have an asset worth 1M (interest working against you).
The doctor's investment ( of 1M) 25 years later would be worth $17,000,064.41
The dentist's investment 25 years later would be worth... Who knows.. But approximately 1M.
And the doctor's investment would be worth even more than that, because I didn't take into account how that money would grow as they were investing those first 10 years.
So no, no debt is good debt.
This is why becoming a dentist probably isn't the route I would choose to go if I had to do it again.
This is absolutely peanuts compared to being a W2 employee with no business debt and just chucking money into the market.One part of the calculation that you left out is the tax benefits of owning a business vs W2. For example, what if the dentist set up a mega back door IRA and also limited their W2 income so to pay less taxes. Not all employees have that flexibility.
This is absolutely peanuts compared to being a W2 employee with no business debt and just chucking money into the market.
Besides, being a 1099 doesn't help you unless you have a lot of business expenses, as does a dental practice owner does. Otherwise it's better to just be a W2, because you would be responsible for yourself-employment tax (which is the employer and the employee's share of payroll taxes).
You can, but the point is that in 10 years, it's highly unlikely to be able to contribute that amount while paying off your business loan. Sure you will be able to contribute as much as the other guy with no business debt afterwards, but you will have missed all that time in the market.Why can’t owners chunk money into the market too?
Apologies to @Kingse for going off topic. You make a great point about debt is bad and I applaud you for being debt responsible. I want to politely point out some deficiencies. If having a business is not so good and being a W2 is so advantageous, who is going to write your W2 check? The gov't? My point is there has to have some incentives for business owners. Were you able to buy your first house without a mortgage? The gov't tries to encourage "good behavior" by giving tax incentives for businesses to thrive, create jobs and contribute to the community. In the past, gov't housing was a colossal failure, so they devised tax friendly incentives for landlords. If you own a home rather than renting, you are more likely to work harder at your job, improve/develop your property, and are less likely to trash your own place like the renters will. Debt needs to be handled responsibly as one can take advantage of those incentives.You can, but the point is that in 10 years, it's highly unlikely to be able to contribute that amount while paying off your business loan. Sure you will be able to contribute as much as the other guy with no business debt afterwards, but you will have missed all that time in the market.
My whole point with that comment was saying how ALL debt is bad debt. I don't see how one form of debt is good and how another isn't. Sure, with a business you can turn around and sell it, but you wouldn't get anywhere near what you would get if you put your money in the market or some other investment.
I agree. I think it's necessary to have a "set and forget" mentality in regards to investing. But there's no guarantee the market will be thriving when you are ready to retire. As to the W2 situation, I was referring to those unfortunate new grads who get employed as independent contractors (with no other choice) who are basically associates.. Then without the business expenses they aren't getting tax benefits as an owner would. Worst of both worlds. Little to no business expenses to benefit as a 1099, and don't get their employer paying their share of the taxes that they would get as a W2.Apologies to @Kingse for going off topic. You make a great point about debt is bad and I applaud you for being debt responsible. I want to politely point out some deficiencies. If having a business is not so good and being a W2 is so advantageous, who is going to write your W2 check? The gov't? My point is there has to have some incentives for business owners. Were you able to buy your first house without a mortgage? The gov't tries to encourage "good behavior" by giving tax incentives for businesses to thrive, create jobs and contribute to the community. In the past, gov't housing was a colossal failure, so they devised tax friendly incentives for landlords. If you own a home rather than renting, you are more likely to work harder at your job, improve/develop your property, and are less likely to trash your own place like the renters will. Debt needs to be handled responsibly as one can take advantage of those incentives.
I want to share that the Market is not guaranteed. You can never time the market. I graduated in '98 and lived at my parents' home to save for a place. I put into the S&P at its high. I bought a nice home (still living in it) in 2003 when the S&P lost like 25% as I needed to liquidate to pay for the down payment. I got spooked right before the Great Recession as I pulled most of it into cash savings/CDs. I missed out on the early gains before I felt more confident with the Markets.
I , I was referring to those unfortunate new grads who get employed as independent contractors (with no other choice) who are basically associates.. Then without the business expenses they aren't getting tax benefits as an owner would. Worst of both worlds. Little to no business expenses to benefit as a 1099, and don't get their employer paying their share of the taxes that they would get as a W2.