Real Dentist Earning?

[hockeykspiky]

What is the real income of a dentist?

I see, on ADA, "The average net income for an independent private practitioner who owned all or part of his or her practice in 2009 was $192,680 for a general practitioner and $305,820 for a specialist."

and this "The average gross billings per owner dentist in 2009 was $727,630 for a general practitioner and $1,004,820 for a specialist."

Where do all the gross billings go to? I know you have to pay your staff, say 60k* 2 for hygienists and 30k*2 for front desk people that's like 180k.
How much is insurance? Rent? Utilities? Lab fees?

Do all the costs add up to 500k?

Or dentists just purposefully report lower incomes to avoid taxes?

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[wired202808]

What is the real income of a dentist?

I see, on ADA, "The average net income for an independent private practitioner who owned all or part of his or her practice in 2009 was $192,680 for a general practitioner and $305,820 for a specialist."

and this "The average gross billings per owner dentist in 2009 was $727,630 for a general practitioner and $1,004,820 for a specialist."

Where do all the gross billings go to? I know you have to pay your staff, say 60k* 2 for hygienists and 30k*2 for front desk people that's like 180k.
How much is insurance? Rent? Utilities? Lab fees?

Do all the costs add up to 500k?

Or dentists just purposefully report lower incomes to avoid taxes?

Every practice has different % of overhead. There's no real way to make any estimate of these numbers. Generally speaking though I suspect majority of dentists under report their income. Obv insurance payouts are one thing, but when your uninsured patient pays by cash there is a high level of morality at play and I can see how a lot of dentists would "fudge" the numbers. While I can't answer your specific Q and I dont intend on running the numbers because they'll never be completely accurate. I suspect the real income of most dentists is 10 to 20% higher than stated.

 

[bigbadaboom]

I know a dentist who brings home less than 50k a year
and a I know a GP dentist who brings home 500k a year.

one works 3 days a week and the other works 6 days and does everything including impacted 3rds, ortho, implants, RCT's, refers nothing out.

one has 3 kids and a happy marriage, the other divorced twice and a reputation of money hungry. I let you guess which the happy one and which the other.

 

[wired202808]

I know a dentist who brings home less than 50k a year
and a I know a GP dentist who brings home 500k a year.

one works 3 days a week and the other works 6 days and does everything including impacted 3rds, ortho, implants, RCT's, refers nothing out.

one has 3 kids and a happy marriage, the other divorced twice and a reputation of money hungry. I let you guess which the happy one and which the other.

A dentist that earns 50K can't be too good

 

[yappy]

Wow, 500k and a good family life? Lucky guy

I know a dentist who brings home less than 50k a year
and a I know a GP dentist who brings home 500k a year.

one works 3 days a week and the other works 6 days and does everything including impacted 3rds, ortho, implants, RCT's, refers nothing out.

one has 3 kids and a happy marriage, the other divorced twice and a reputation of money hungry. I let you guess which the happy one and which the other.

 

[Bereno]

Wow, 500k and a good family life? Lucky guy

 

[therock21]

I know a dentist that makes 350k+ and works 3 and a half days a week.

 

[stevesteve121]

I know a dentist who brings home less than 50k a year
and a I know a GP dentist who brings home 500k a year.

one works 3 days a week and the other works 6 days and does everything including impacted 3rds, ortho, implants, RCT's, refers nothing out.

one has 3 kids and a happy marriage, the other divorced twice and a reputation of money hungry. I let you guess which the happy one and which the other.

how many associates does the second guy have?

 

[bigbadaboom]

how many associates does the second guy have?

one. He's not happy with the associate.

actually he has trouble selling his practice since no one can match what he does.

 

[thewobblytooth]

Wow, 500k and a good family life? Lucky guy

 

[yappy]

So what's the real time line no BS answer here? I mean we all know people who graduated with that liberal arts degree that is now an exec making 6 figures etc. etc.

Likewise, I'm sure any of us have contact with the most active, exposed, largest practices in town who are willing to allow a predent because maybe they'll draw in more patients lol. Sure, they're making a killing. They're also most likely 40+ y/o and have developed their practice over years and possibly took risks where others did not to get where they're at.

But for the new dental grad who is 250k in debt. How does the situation look? 5 years of 90->160k as an associate then buy a practice; then take a hit in salary the first two years; then start making 200+ as everyone gets into the swing of things? Or is this pessimistic?

 

[Cold Front]

What is the real income of a dentist?

I see, on ADA, "The average net income for an independent private practitioner who owned all or part of his or her practice in 2009 was $192,680 for a general practitioner and $305,820 for a specialist."

and this "The average gross billings per owner dentist in 2009 was $727,630 for a general practitioner and $1,004,820 for a specialist."

Where do all the gross billings go to? I know you have to pay your staff, say 60k* 2 for hygienists and 30k*2 for front desk people that's like 180k.
How much is insurance? Rent? Utilities? Lab fees?

Do all the costs add up to 500k?

Or dentists just purposefully report lower incomes to avoid taxes?

Rent, lab bills, utilities, equipment financing, dental and office supplies, insurances, accountant, payroll taxes and fees, malpractice, ce courses, etc can easily add upto $300k-400k a year, on top of your $200k-250k a year payroll. At the low end, it's about $500k for all your overhead expenses, which would leave you $227k a year at best as an average ADA GP dentist.

The keyword here is "average". There are GPs who work for other GPs and make $250k, but they have a different kind of stress (employee stress).

 

[gerorsimirus]

If 99 persons in a hundred are earning £10,000 per annum.
and only one person in a hundred is earning £200,000 per annum and nothing in between, I suppose the average wage could still be said to be near £20,000 per annum, or possibly even more if they can convince you and it suits the purpose? Whatever, it is highly unlikely official figures would reflect the true mater of fact average wage figure - £10,000 per annum.
http://www.zimbio.com/member/Lucile...J/NutraScience+Diet+Review+Nutra+Science+Free

 

[Firm]

A dentist that earns 50K can't be too good

No. He/She may be a great dentist but a poor business person. They may have grossed a million and spent $950,000.
Overhead adds up fast. Payroll, rent/equipment are the two biggest expenses. Then comes your supplies and lab, lastly you advertising. It's not how much you make but how much you spend, so you need to ask about net. Also things change year to year. One year you may gross $2 million and take home $1 million. ($1million overhead). The next year you may gross $1 million, spend $1million and take home nothing. Many people look at dentistry like a regular job where you consistently make the same every years. There are wide swings in income year to year.

 

[OhioDMD]

So what's the real time line no BS answer here? I mean we all know people who graduated with that liberal arts degree that is now an exec making 6 figures etc. etc.

Likewise, I'm sure any of us have contact with the most active, exposed, largest practices in town who are willing to allow a predent because maybe they'll draw in more patients lol. Sure, they're making a killing. They're also most likely 40+ y/o and have developed their practice over years and possibly took risks where others did not to get where they're at.

But for the new dental grad who is 250k in debt. How does the situation look? 5 years of 90->160k as an associate then buy a practice; then take a hit in salary the first two years; then start making 200+ as everyone gets into the swing of things? Or is this pessimistic?

Unfortunately the no BS answer is you have to work for it. No one is going to give you
a six plus figure job just because you have a degree and a liscence to practice. You have
to hone your clinical, business and people skills to provide a valued service to your
employer and patients (assuming you are going to associate after school). Make informed,
intelligent choices as to your carreer after school and eventually you may end in the middle
to upper level of the income range.

 

[makeitrain6969]

I know a dentist that makes 350k+ and works 3 and a half days a week.

This is something a physician wont experience hehe

 

[makeitrain6969]

My friend who is a dentist works under a dentist who owns the practice... my friend said the owner brought in 4 million for 2011and 3 million in 2010. The practice is in LA...

 

[Firm]

My friend who is a dentist works under a dentist who owns the practice... my friend said the owner brought in 4 million for 2011and 3 million in 2010. The practice is in LA...

That sounds good but the more you make, the more pressure there is to keep making more. It's gotten harder with so many chains opening. I guarantee that his overhead went up in 2011, so now he must make $4 million again in 2012 just to keep up. Chains and young hungry dentists see this and want a piece. They will open up next door cutting into those numbers.

 

[djeffreyt]

A couple things here:

If a dentist is solo practitioner and doesn't have an LLC or PC set up through which he pays himself, then it's simple math:
Collected $ - expenses = gross income.

The average dental office will have between 50-60% overhead for all those things mentioned before: (Salaries and wages, Payroll taxes, Employee benefits, Rent, Property taxes, Insurances, Electricity, Lab Fees, Materials, Etc). It will depend on # of employees, how much you pay them, how good your benefits are, if you use brand name materials versus copycat materials, how wasteful are you with materials, how expensive is your lab, how much is your rent (do you work in Manhattan or Nebraska?), and how much you charge for your services.

Now if you have an LLC or PC set up, the equation isn't so simple. Lots of dentists are set up as PCs and LLCs in order to protect their assests from lawsuits that could otherwise ruin them. How much you get paid through one of these situations is more complicated and often has many tax benefits.

As for specialists, depending on the specialty, overhead varies a lot. Used to be Endo had almost no materials and definitely no lab overhead, but with the advent of disposable rotary files, things are more expensive now.

Finally, how much you make depends on where you go and what you want to do. Want to work in a boutique dental office seeing 6-8 patients a day, 4 days a week? Well, if you aren't good at selling yourself and your confidence, you won't make crap and most patients at practices like that would probably walk down the street to a guy with 20 years experience on you for the work. If you are a good salesman, you can make a lot doing this. If you wanna work medicaid seeing 20-30 patients a day and drilling and filling and crowning and extracting for 5.5 days a week...well, you might go home with a backache every day but you might do pretty good.

Most of my friends are in their 2nd, 3rd, 4th years out of school. Some own their own practices now and others are associates in private practice, large groups, etc. The range of pay for associates is anywhere from $120,000 to $250,000 gross a year. Those who own also vary greatly. One guy owns a single private practice and sees patients 3 days a week and does admin on the fourth day. He's grossing about $150,000 a year right now. Then there is the other extreme, multiple practice owner, hires lots of associates, see mass patients and probably grossing well over a million at this point.

 

[Daurang]

One guy owns a single private practice and sees patients 3 days a week and does admin on the fourth day. He's grossing about $150,000 a year right now.

If he gross $150k yearly, how much does he net and then how much is left after student loan and taxes? Practically nothing. How does he survive in the SFO Bay Area? Sounds like a miserable life unless he's married to a sugar mama.

 

[djeffreyt]

If he gross $150k yearly, how much does he net and then how much is left after student loan and taxes? Practically nothing. How does he survive in the SFO Bay Area? Sounds like a miserable life unless he's married to a sugar mama.

I'm sorry. What I mean to say is that after paying his expenses and overhead but before he pays taxes he grosses $150,000. I suppose to some that is "net" but I only consider "net" what you make after federal and state taxes. So I also mean that the other guy who grosses over a million is taking a million or so home and paying taxes on that after his overhead.

 

[stevesteve121]

I'm sorry. What I mean to say is that after paying his expenses and overhead but before he pays taxes he grosses $150,000. I suppose to some that is "net" but I only consider "net" what you make after federal and state taxes. So I also mean that the other guy who grosses over a million is taking a million or so home and paying taxes on that after his overhead.

you can easily do 150K as an associate 3 years out of school no?

so why bother with the hassle/risk of running a practice?

 

[yappy]

No one will ever remember your name.

you can easily do 150K as an associate 3 years out of school no?

so why bother with the hassle/risk of running a practice?[/QUOTE]

 

[omaralt]

you can easily do 150K as an associate 3 years out of school no?

so why bother with the hassle/risk of running a practice?

i hear this a lot; but what you need to realize is that he makes $150K/yr working 3 days a week; very tough to impossible to do this as an associate. think about it; most dental offices have 50-60% overhead; so he's grossing ~$300K/yr. most associates earn ~30% of gross so to earn $150K as an associate you have to collect $500K. so to earn the same as an associate you have to work almost twice as hard.

also he can never get fired; even if the economy dips and his practice falters; he can still easily earn a similar income by lowering overhead (firing staff, removing benefits, etc).

 

[Firm]

A couple things here:

If a dentist is solo practitioner and doesn't have an LLC or PC set up through which he pays himself, then it's simple math:
Collected $ - expenses = gross income.

The average dental office will have between 50-60% overhead for all those things mentioned before: (Salaries and wages, Payroll taxes, Employee benefits, Rent, Property taxes, Insurances, Electricity, Lab Fees, Materials, Etc). It will depend on # of employees, how much you pay them, how good your benefits are, if you use brand name materials versus copycat materials, how wasteful are you with materials, how expensive is your lab, how much is your rent (do you work in Manhattan or Nebraska?), and how much you charge for your services.

Now if you have an LLC or PC set up, the equation isn't so simple. Lots of dentists are set up as PCs and LLCs in order to protect their assests from lawsuits that could otherwise ruin them. How much you get paid through one of these situations is more complicated and often has many tax benefits.

As for specialists, depending on the specialty, overhead varies a lot. Used to be Endo had almost no materials and definitely no lab overhead, but with the advent of disposable rotary files, things are more expensive now.

Finally, how much you make depends on where you go and what you want to do. Want to work in a boutique dental office seeing 6-8 patients a day, 4 days a week? Well, if you aren't good at selling yourself and your confidence, you won't make crap and most patients at practices like that would probably walk down the street to a guy with 20 years experience on you for the work. If you are a good salesman, you can make a lot doing this. If you wanna work medicaid seeing 20-30 patients a day and drilling and filling and crowning and extracting for 5.5 days a week...well, you might go home with a backache every day but you might do pretty good.

Most of my friends are in their 2nd, 3rd, 4th years out of school. Some own their own practices now and others are associates in private practice, large groups, etc. The range of pay for associates is anywhere from $120,000 to $250,000 gross a year. Those who own also vary greatly. One guy owns a single private practice and sees patients 3 days a week and does admin on the fourth day. He's grossing about $150,000 a year right now. Then there is the other extreme, multiple practice owner, hires lots of associates, see mass patients and probably grossing well over a million at this point.

This is very well written. The only thing that I would add is that it is not easy to maintain 50-60% overhead. Many people take this for granted.

 

[Firm]

i hear this a lot; but what you need to realize is that he makes $150K/yr working 3 days a week; very tough to impossible to do this as an associate. think about it; most dental offices have 50-60% overhead; so he's grossing ~$300K/yr. most associates earn ~30% of gross so to earn $150K as an associate you have to collect $500K. so to earn the same as an associate you have to work almost twice as hard.

also he can never get fired; even if the economy dips and his practice falters; he can still easily earn a similar income by lowering overhead (firing staff, removing benefits, etc).

Bingo. Never getting fired, setting the rules, and a retirement vehicle in the form of your practice are very nice perks.

 

[djeffreyt]

This is very well written. The only thing that I would add is that it is not easy to maintain 50-60% overhead. Many people take this for granted.

Good Point. Initially I have lots of friends who start off saying how they only have 45% overhead, but as wages, CE, Malpractice, Insurance increase, and as you have to stay competitive with new and fancier materials and equipment, that overhead starts going up fast. Hopefully your billings also continue to increase to offset some of this.

 

[djeffreyt]

you can easily do 150K as an associate 3 years out of school no?

so why bother with the hassle/risk of running a practice?

Yeah, others pointed it out already.
- Can't be fired
- Full control of work and life practices (when I want to take a vacation, I have to ask someone. My boss also doesn't want me to use oral sedatives even though I'm fully certified. In order to reduce overhead, my boss wants us to use hand mixed IRM and Ketac whereas I would prefer to use automixed carpules - I've actually bought these for personal use with my own money but that's cause I like the effeiciency)
- Building equity (he's building his practice and equity for the future)

It's also the personality of the guy. He bought this practice from day one out of dental school. All of us knew this guy would never be happy working for someone else, in fact it would probably be pretty confrontational. The only person he ever worked for was off and on for a couple months while the loans and closing was going through he worked part time at his dad's office.

 

[BigLuvin]

My dad is a dentist and says taxes kill him. He's been practicing for years and still brings home $120k after it's all said and done (in a medium town with enough dentists to go around). I would like to know what other people's experiences are with taxes. I think he said they tax you on how much you gross not after payroll ect.? Anywho I know he said you get earned income credit the first 5 years your out of school where you actually get money back. Anyone who has experience with this care to chime in?

 

[Shnurek]

I know certain states are better or worse when it comes to income taxes and other tax liabilities. For example there is no state income tax in: Texas, Tennessee, Florida, Alaska and a few more. In others it might be extremely low but in most the tax is usually high. States such as California and New York really suck money out of you. Now your father should look into hiring a GOOD accountant and to maximize his deductibles so he can take home more. Now some areas you get extra reimbursement if you practice in them. I'm not sure if this is just Medicare that affects physicians, podiatrists and optometrists? Does Medicare cover dental expenses? Not too sure but in any case there is a list of zip codes where if you practice in you get 10% increase in Medicare reimbursement.

 

[djeffreyt]

My dad is a dentist and says taxes kill him. He's been practicing for years and still brings home $120k after it's all said and done (in a medium town with enough dentists to go around). I would like to know what other people's experiences are with taxes. I think he said they tax you on how much you gross not after payroll ect.? Anywho I know he said you get earned income credit the first 5 years your out of school where you actually get money back. Anyone who has experience with this care to chime in?

I'm an employee dentist, not an independent contractor. I pay an effective federal tax rate on my gross pay of about 33%. So if I am paid $100,000, I lose $33,000 to federal taxes.

If I was an Independent Contractor dentist then I would have a slightly higher tax rate cause when you are an employee, the company pays a portion of your social security tax. My tax rate as an independent contractor would probably be about 35%.

I live in a state with no personal income tax, so that's all the taxes I pay on income. If I lived in California, I'd also be paying about 7.5 to 8% (effective tax rate) to the state of California.

Your dad is in a different situation and I don't understand it fully. He is an owner of a small business. Yes, your dad probably gets "taxed" on the gross production of the office but as a small business owner a lot of his gross production isn't really taxed. You have to report your gross revenue earned, but you get to write a lot of that stuff off, like your pay to employees, money spent on the business (i.e. business operating expenses) etc. There's a lot to it. After all that is deducted, he is taxed on the rest (assuming he doesn't funnel it into other places like non-taxable retirement funds or other things).

It would be illegal to double tax all the revenue. For example, if you paid $100,000 of your revenue to your employees for wages and he was taxed on this and then the employees also had to pay income tax on those wages, that money is getting double taxed....that's illegal, that's why your dad gets to deduct those from his taxable revenue. The only time any product or service get double taxed legally in the US, that I know of, is gas for some reason, but that's all I know...I've been wrong before...actually a lot.

 

[tothepark]

I heard that many dentists who receive cash for service, do not necessarily report it.. Which leads to increased income, which is not entirely taxed. This is obviously illegal, I was just wondering if this "loophole" is widely abused.

 

[Daurang]

I heard that many dentists who receive cash for service, do not necessarily report it.. Which leads to increased income, which is not entirely taxed. This is obviously illegal, I was just wondering if this "loophole" is widely abused.

What do you think? Do you think the nail salon or chinese takeout or your haircutter report all or even half their cash earnings? What would you do?

 

[Bereno]

What do you think? Do you think the nail salon or chinese takeout or your haircutter report all or even half their cash earnings? What would you do?

When I was a server, I reported ALL my tips... every penny

 

[Firm]

All cash goes right in my pocket. DTA, shhhhh.

 

[diazteam]

What is the real income of a dentist?

I see, on ADA, "The average net income for an independent private practitioner who owned all or part of his or her practice in 2009 was $192,680 for a general practitioner and $305,820 for a specialist."

and this "The average gross billings per owner dentist in 2009 was $727,630 for a general practitioner and $1,004,820 for a specialist."

Where do all the gross billings go to? I know you have to pay your staff, say 60k* 2 for hygienists and 30k*2 for front desk people that's like 180k.
How much is insurance? Rent? Utilities? Lab fees?

Do all the costs add up to 500k?

Or dentists just purposefully report lower incomes to avoid taxes?

It's really subjective. Not every practice has 2 hygienists and 2 staff members. There are so many factors like insurance costs, number of patients, types of procedures performed, etc, etc. I'd imagine that the variance even within the dentistry field is pretty high and most dentists aren't apt to share their earnings.

 

[NileBDS]

you can easily do 150K as an associate 3 years out of school no?

so why bother with the hassle/risk of running a practice?

Why ownership?

1. Passive hygiene income - not available to most associates.
2. You don't have to break your back in order to net the same amount as an owner (associate, more likely).
3. Job security.
4. Business write offs, funding retirement, tax breaks - SEP IRA accounts.
5. Liberty to grow at your own pace, in the areas you see fitting with your philosophy and your strengths (endo, cerec, ortho, implants, ...).

6., 7., 8., 9., 10. Do not underestimate the sanity to be had from being able to hand pick pleasant people to surround you everyday at work.



On a related note. In most cases, your "business expenses" as an associate will come off of your post-tax dollars (taxed net). In my case that includes, but is not limited to:

$12,000 health
$4,000 disability
$2,000 malpractice
$3,000 specialized supplies and equipment
$2,500 loupes and light
$4,000 CE and related CE travel expenses
$5,000+ Car lease, gas, mileage, car insurance, car repairs, clothes, meals, travel, ...

$32,500+ POST-TAX dollars in associate overhead expenses alone, most of which would benefit from business ownership.

.

 

[NileBDS]

you can easily do 150K as an associate 3 years out of school no?

so why bother with the hassle/risk of running a practice?

Also, the answer is an emphatic no. Most associates can not "easily" do $150,000 on 3 days a week.

 

[8 SNAKE]

Also, the answer is an emphatic no. Most associates can not "easily" do $150,000 on 3 days a week.

Unless I missed something, he said 3 yrs out of school (not 3 days a week).

 

[djeffreyt]

Also, the answer is an emphatic no. Most associates can not "easily" do $150,000 on 3 days a week.

Ok, to clarify:

The initial post I made said I have a friend who "Nets" $150,000 a year at a practice he OWNS doing 3 days a week. He bought the practice from a dentist so it had a set clientele. He is 2 years out of school.

Later, someone mentioned easily doing $150,000 3 years out of school as an Associate. Yes, $150,000 gross and even $150,000 net is easily within reason for an associate 3 years out of school. I doubt an associate could net $150,000 doing 3 days a week, but stranger things have happened.

 

[destinedsirius]

Ok, to clarify:

The initial post I made said I have a friend who "Nets" $150,000 a year at a practice he OWNS doing 3 days a week. He bought the practice from a dentist so it had a set clientele. He is 2 years out of school.

Later, someone mentioned easily doing $150,000 3 years out of school as an Associate. Yes, $150,000 gross and even $150,000 net is easily within reason for an associate 3 years out of school. I doubt an associate could net $150,000 doing 3 days a week, but stranger things have happened.

What's the range of the cost of buying a practice? And if a dental student was to come out of dental school with 300k debt, would banks still loan you money to buy a practice? With 300k debt, is it possible to buy a practice 3 years after graduation? Obviously these are pre-dent questions so thanks in advance.

 

[OhioDMD]

What's the range of the cost of buying a practice? And if a dental student was to come out of dental school with 300k debt, would banks still loan you money to buy a practice? With 300k debt, is it possible to buy a practice 3 years after graduation? Obviously these are pre-dent questions so thanks in advance.

Roughly 60-75% of the average of the last three years collections for a purchase
price. If you can satisfactorily show a positive cash flow (after debt service) and have
sufficient equity (collateral) bank financing is possible.

 

[djeffreyt]

What's the range of the cost of buying a practice? And if a dental student was to come out of dental school with 300k debt, would banks still loan you money to buy a practice? With 300k debt, is it possible to buy a practice 3 years after graduation? Obviously these are pre-dent questions so thanks in advance.

I don't have the personal experience to back this up, but since I've had many friends go through this process, here's what I've seen.

Yes, loans are still possible with debt. Student loan debt, especially dental student loan debt, isn't considered in the same way other debt is. Also, dental offices are generally a good investment as few dentists default on their bank loans and if you are purchasing a practice that has already shown a stable income, then most banks will still loan you money to buy a practice.

As a caveat I would say make sure you do your homework before hand. I had a friend who was ready to buy a practice and had already found a bank willing to loan him the money. Before he went through with it, he decided to figure the expenses again and found that his projected revenue in the first couple years would not cover the loan repayments to both his student loan lenders and the bank, so he backed out. While he had some other options, like possibly trying to defer his loans another year, etc, or changing his bank loan to a higher interest with a longer repayment, he decided to look for other options, so sometimes even if you could get the loan, it isn't always in your best interest to take it and buy a practice.

 

[Demeter]

I have around 55K overhead each month. 5K in rent. Staff costs are the highest contributor to my overhead. Overhead is difficult to bring down. Any profit I have left over, I basically hand over the BofA to knock down my loan. Often, I find out that the money was used up in interest and little actually went to paying back the principle loan. Its a long road.

 

[djeffreyt]

Hi hear you Demeter. The last time I checked, 82% of every dollar I pay back on student loans right now goes to paying off interest

 

[Demeter]

Bingo. Never getting fired, setting the rules, and a retirement vehicle in the form of your practice are very nice perks.

Another advantage to owning a practice is able to live through the practice. I am going to a CE lecture in San Diego in a few months. I will staying a nice hotel and going to have a few expensive meals. This is going to be a nice vacation. These are all CE writeoffs.

 

[charlestweed]

What's the range of the cost of buying a practice? And if a dental student was to come out of dental school with 300k debt, would banks still loan you money to buy a practice? With 300k debt, is it possible to buy a practice 3 years after graduation? Obviously these are pre-dent questions so thanks in advance.

I wife and I owed $450k in student loans. One year after graduation, we borrowed $95k from the local bank to pay for an existing perio practice. It was a really old low tech practice but we had positive cash flow on day one. We paid off that $95k business loan in less than 3 years. I later used that perio office to start my ortho practice. I only had to spend an additional $20k for a pan/ceph machine and ortho supplies.

We later got rid of that ugly perio/ortho office and moved the whole practice to a nicer building. At this new location, we only spent $35k to convert an existing OBGYN office into a 4 op perio/ortho office.

Keep the ovehead low and you will be able to keep more of your hard earned money.

 

[charlestweed]

I have around 55K overhead each month. 5K in rent. Staff costs are the highest contributor to my overhead. Overhead is difficult to bring down. Any profit I have left over, I basically hand over the BofA to knock down my loan. Often, I find out that the money was used up in interest and little actually went to paying back the principle loan. Its a long road.

Your practice must have a lot of patients because this is an insanely high overhead The combined overhead for all 3 of my offices is half as much as yours. I have 4 FT employees and 4 PT employees. I pay $6200/month in rent for all 3 of my offices.

 

[noles]

for those of you who own a practice but are tenants...what can you do to have some control over maintaining a reasonable rent? what keeps the landlord from raising your rates? i would imagine it's very difficult to move a practice once you are established (which I'm sure the landlord recognizes), leaving you at a major disadvantage while negotiating.

so what i guess i'm getting at is: what are typical terms to a lease regarding years, and what are your options once that lease expires?

 

[psiyung]

Your practice must have a lot of patients because this is an insanely high overhead The combined overhead for all 3 of my offices is half as much as yours. I have 4 FT employees and 4 PT employees. I pay $6200/month in rent for all 3 of my offices.

What city are you living in?