Greetings Pre-Dents, I wish you well. I recently had the opportunity to visit with the BYU pre-dental club with Chad and wanted to share part of that with you.
First I want to say that I LOVE being a dentist, the work is fun, challenging, rewarding and at the end of each day, you really feel like you accomplished something.
Now that last statement is one you will get from all kinds of practicing dentists, dental schools, advisors and so forth, I know I did. So for the most part I am going to assume you have had enough positive feedback about dentistry and take a different tack. I do so not to discourage you from going to school, but so that while you make the sacrifices, you know what you are really working for.
A couple days ago I ran across an article on Facebook which I shared and think I should link it here as well: http://www.waitbutwhy.com/2013/09/why-generation-y-yuppies-are-unhappy.html
The biggest thing I noticed in the article that pertains is this "Happiness = Reality – Expectations". This is a profound thought because each of us decided to go to dental school with the idea of how much it will benefit us personally, financially, socially and so on. Without realistic expectations, you could reach your dream job only to realize it isn't what you thought it would be and that there might not be a shining unicorn on top of the flowering lawn (example from previously linked article).
I want to start with finances for a minute because it is an important topic. According to MoneyNews (http://money.usnews.com/careers/best-jobs/dentist/salary) average salary is $142,740. That sounded pretty good to me too ☺ When I talk to an investment banker, I don't want to hear about his top 3-4 clients, I want to know on average how safe is my money. So $142K is pretty good as an average considering the number of baby boomers working a few days a week, female dentists working a few days a week (I don't mean to be insulting, but many girls graduate and don't work full time and as such needs to be factored into the average if I really want to know what it means to me).
What I didn't realize was that that number didn't include student loan repayment, which has dramatically changed from when whoever you are shadowing graduated. My brother graduated 10 years earlier than I did and had ~$120K in student loans from Case Western whereas graduating in 2013 from Midwestern University I have a debt of ~$450K which is only from dental school, not undergrad as well. Dentists compete in the same field for the same patients, but anyone who has been out a few years won't have the same debt as you, and not just because they paid it off, but because of rising tuition.
Loan repayment hasn't started for me yet, but it is about $4,000/month, $48,000/year… Loan repayment is not tax deductible, nor is interest as it is on home loans. Assuming you made $142,000 take out taxes:
http://www.irs.gov/pub/irs-pdf/i1040tt.pdf
$142,000 * 28% - $6539.50 = $33,220.50
Now take out student loans for the next 10 years:
$108,779.50 - $48,000 = $60,779.50
$60,779.50 isn't that bad, but it isn't $142K and there are many other jobs you can get that don't require 8 years of school, relocating your family and postponing an income for 8 years with $450,000 in debt to get. Again, I love what I do and am very happy I went to school every time I sit down with a patient and am able to help them in a way I could not have before.
Let's talk ethical practices:
While I was at school, one of the most frequent things I remember hearing (that wasn't part of the coursework) was the Dean, and faculty being very blunt and saying they worried about our ability to repay the loans while still practicing ethical dentistry because of the new high price of tuition.
I didn't fully understand what they meant during school, but I do now. I figured there was enough patients to go around who all truly needed enough work that I could choose to practice ethically and that may be true. Let me explain what it was like graduating from school and starting practice for the first time.
During school, I secured a job working 3 days a week (my choice so I could continue building Chad's videos website) and told them very clearly and specifically that I was not interested in over diagnosing, or over treating my patients. They seemed excited by that which was odd since it was a corporate job, which we had always been taught in school to be wary of them pushing us to do things we shouldn't. Things started out great, I was seeing 5-7 patients a day delivering great care with lots of cool procedures such as crowns, root canals, fillings, participating in implants and such. While performing those procedures it was also my responsibility to do patient exams on patients who were new, or returning for their 6 month cleanings. I practiced with those patients the way I had been taught, treat the things that needed to be done, leave the rest.
Let me take a break for a minute and explain something about a filling. Dentists use a light cured acrylic filled with nano particles of glass to fix a decayed tooth. These fillings shrink a little when you cure them, and then continue to shrink over time. You put something in that fills the space completely, and over 5-10 years, it has shrunk enough to let stain / bacteria in around the edges. Every time you replace a filling, you remove the old material and along with that, you remove some natural tooth structure getting it ready for a new filling. That structure could be decayed, or not, but either way the new filling is ALWAYS bigger than the old one. After a few replaced fillings, it is time for a crown to protect the tooth from fracture as it no longer is strong enough to function with just a filling.
Back to dentistry, each dentist gets to decide when looking at a filling whether it needs to be replaced. You don't have to wait for it to show up on the X-ray or hurt the patient, you just tell the patient that we need to replace it, and you do. It could be a year old or 15 years old, it could be mildly stained along the edges, or seriously decayed but each dentist will have their own comfort level of when they want to replace it.
Every day I performed previously diagnosed work and wasn't entirely convinced it needed to be done and performed exams diagnosing work I felt did need to be done. Starting out remember I had 5-7 patients a day, within a month I was down to 2 patients a day, then one and when I turned in notice, I had 3 patients scheduled for the next 30 days. I finally understood what my Dean and faculty were saying about fearing what types of dentists we would have to be to pay the loans. It isn't their fault that tuition is so expensive, it is a national trend and it is a very expensive profession to be part of so while it isn't their fault, it does have an impact on graduating students.
Please realize, I fall outside the norm and I know it, I see many of my classmates reporting doing amazing procedures while in their GPR / AEGD residencies, and even those who didn't, but chose somewhere other than Utah to practice who are doing great and even some in Utah I have heard of. It was a tough market to be in, I knew it going into it but I also have never considered myself "average" and so thought if I used my business savy, personality, hand skills, ethical behavior I would do above average. So even though it was a tough market in order to grow my website I chose the Salt Lake valley because of the programmers, it may be one of the most over saturated markets in the country for dentists and it is hard to earn an "average" income here, but this is where the programmers were so we could grow our other business and so we came. So far, there is no flowering lawn with a shining unicorn. I didn't expect one, so I am still happy with my choices.
Lets talk debt:
Tuition goes up each year, if you are applying now, expect $500-$600K in loans. Inflation also goes up, so your salary will increase as well, but maybe not at the same rate as tuition increases.
There are tons of programs to eliminate or reduce that debt. Some of those options are military, Indian health services, state specific sponsored programs and such. The Army for example will pay a $20K sign on bonus, pay for ALL of school, books, equipment required by school and just over $2K a month to live on while in school. After school they will give you a job where you can practice ethical dentistry all day every day, set salary, respect from fellow soldiers and such. They have tons of opportunities for advanced training with the AEGD which will increase your payback from 4 years to 5 but you will leave ready to rock and roll in the market doing procedures that other general dentists wouldn't touch. Air Force fills their spots early, early, early (around Oct) don't offer the sign on bonus but have a great program as well. I don't know off the top of my head the Navy programs details.
If you choose to go into private practice, there are many loan repayment programs, there is a new one that Obama put in called the Income Based Loan Repayment (http://studentaid.ed.gov/repay-loans/understand/plans/income-based) Under this plan if you earned $142K, your payments would be about $1,200/month for 25 years at which point the rest is "forgiven" (it means they count the remaining balance as income and you pay taxes on it). This program may or not be around when you graduate with the way the government funding is going, I wouldn't count on it nor do I hope it is as it only helps drive up the tuition prices to make the loans more affordable.
Some states will sponsor you at school if you come back to their state. AK AZ HI MT NM ND WY (http://www.wiche.edu/psep/dent) offer a scholarship since they don't have a state funded school which can reduce your graduating debt.
Buying a practice:
A practice sells for ~1.5X the dentists annual salary. You might have a practice doing a million dollars a year, but if it is 80% overhead it is going to sell for about $300K. Right now there is a practice selling in Provo right across the street from BYU for $90K which puts his take home around $60K a year. (http://www.uda.org/classifieds.php)
Banks will loan up to $300,000 for fresh grads, more if you have been out longer, the other options are to do owner financing, become an associate first and then when you qualify you can purchase it in a couple years.
You can also just get a job, mine paid 30% of production. An average dentist with the right patients could produce $2000-$4000/day but you have to have the patients, and hopefully your patients actually need dental work and not just cleanings.
Most schools will teach minimum business classes, perhaps as short as a single day. At Midwestern we lucked out and got a few semesters which really prepares us to manage our own business as it makes you think about how you will attack different problems. I would certainly suggest asking any school you are interviewing whether they teach a course, if they don't, maybe they will start once a bunch of people start asking for one.
Wrapping it up:
I really don't mean to be discouraging, I want everyone to do well, get into school if they want and succeed. In today's economic climate, so many people push and push you to get an education regardless of the cost and say don't worry about it, it will work out. The cost can't be forgotten, nor ignored when choosing your path. There will be significant personal sacrifices, financial sacrifices that you will pay, I only want you to have the opportunity to see it from a different point of view than the one the dental schools, and your advisers paint and when you graduate maybe it will seem like there is a flowering lawn, with a bright shining unicorn on top for you because of your expectations.
Dr. Alan Halls D.M.D.
Edit: I forgot to mention that some schools are much cheaper than my own, Baylor was at the presentation and said their average debt was around $180K. Public schools in general will be a bit cheaper but hard to get in as many of them accept 90% from their home states. Also my brother is one of the more frugal people I know and did a work study program through school which also reduced his debt somewhat, but my point was that many of us shadowed people who graduated with significantly less debt than they would now and you might ask them how they would do with an extra $4K loan payment if they needed to do that now.
First I want to say that I LOVE being a dentist, the work is fun, challenging, rewarding and at the end of each day, you really feel like you accomplished something.
Now that last statement is one you will get from all kinds of practicing dentists, dental schools, advisors and so forth, I know I did. So for the most part I am going to assume you have had enough positive feedback about dentistry and take a different tack. I do so not to discourage you from going to school, but so that while you make the sacrifices, you know what you are really working for.
A couple days ago I ran across an article on Facebook which I shared and think I should link it here as well: http://www.waitbutwhy.com/2013/09/why-generation-y-yuppies-are-unhappy.html
The biggest thing I noticed in the article that pertains is this "Happiness = Reality – Expectations". This is a profound thought because each of us decided to go to dental school with the idea of how much it will benefit us personally, financially, socially and so on. Without realistic expectations, you could reach your dream job only to realize it isn't what you thought it would be and that there might not be a shining unicorn on top of the flowering lawn (example from previously linked article).
I want to start with finances for a minute because it is an important topic. According to MoneyNews (http://money.usnews.com/careers/best-jobs/dentist/salary) average salary is $142,740. That sounded pretty good to me too ☺ When I talk to an investment banker, I don't want to hear about his top 3-4 clients, I want to know on average how safe is my money. So $142K is pretty good as an average considering the number of baby boomers working a few days a week, female dentists working a few days a week (I don't mean to be insulting, but many girls graduate and don't work full time and as such needs to be factored into the average if I really want to know what it means to me).
What I didn't realize was that that number didn't include student loan repayment, which has dramatically changed from when whoever you are shadowing graduated. My brother graduated 10 years earlier than I did and had ~$120K in student loans from Case Western whereas graduating in 2013 from Midwestern University I have a debt of ~$450K which is only from dental school, not undergrad as well. Dentists compete in the same field for the same patients, but anyone who has been out a few years won't have the same debt as you, and not just because they paid it off, but because of rising tuition.
Loan repayment hasn't started for me yet, but it is about $4,000/month, $48,000/year… Loan repayment is not tax deductible, nor is interest as it is on home loans. Assuming you made $142,000 take out taxes:
http://www.irs.gov/pub/irs-pdf/i1040tt.pdf
$142,000 * 28% - $6539.50 = $33,220.50
Now take out student loans for the next 10 years:
$108,779.50 - $48,000 = $60,779.50
$60,779.50 isn't that bad, but it isn't $142K and there are many other jobs you can get that don't require 8 years of school, relocating your family and postponing an income for 8 years with $450,000 in debt to get. Again, I love what I do and am very happy I went to school every time I sit down with a patient and am able to help them in a way I could not have before.
Let's talk ethical practices:
While I was at school, one of the most frequent things I remember hearing (that wasn't part of the coursework) was the Dean, and faculty being very blunt and saying they worried about our ability to repay the loans while still practicing ethical dentistry because of the new high price of tuition.
I didn't fully understand what they meant during school, but I do now. I figured there was enough patients to go around who all truly needed enough work that I could choose to practice ethically and that may be true. Let me explain what it was like graduating from school and starting practice for the first time.
During school, I secured a job working 3 days a week (my choice so I could continue building Chad's videos website) and told them very clearly and specifically that I was not interested in over diagnosing, or over treating my patients. They seemed excited by that which was odd since it was a corporate job, which we had always been taught in school to be wary of them pushing us to do things we shouldn't. Things started out great, I was seeing 5-7 patients a day delivering great care with lots of cool procedures such as crowns, root canals, fillings, participating in implants and such. While performing those procedures it was also my responsibility to do patient exams on patients who were new, or returning for their 6 month cleanings. I practiced with those patients the way I had been taught, treat the things that needed to be done, leave the rest.
Let me take a break for a minute and explain something about a filling. Dentists use a light cured acrylic filled with nano particles of glass to fix a decayed tooth. These fillings shrink a little when you cure them, and then continue to shrink over time. You put something in that fills the space completely, and over 5-10 years, it has shrunk enough to let stain / bacteria in around the edges. Every time you replace a filling, you remove the old material and along with that, you remove some natural tooth structure getting it ready for a new filling. That structure could be decayed, or not, but either way the new filling is ALWAYS bigger than the old one. After a few replaced fillings, it is time for a crown to protect the tooth from fracture as it no longer is strong enough to function with just a filling.
Back to dentistry, each dentist gets to decide when looking at a filling whether it needs to be replaced. You don't have to wait for it to show up on the X-ray or hurt the patient, you just tell the patient that we need to replace it, and you do. It could be a year old or 15 years old, it could be mildly stained along the edges, or seriously decayed but each dentist will have their own comfort level of when they want to replace it.
Every day I performed previously diagnosed work and wasn't entirely convinced it needed to be done and performed exams diagnosing work I felt did need to be done. Starting out remember I had 5-7 patients a day, within a month I was down to 2 patients a day, then one and when I turned in notice, I had 3 patients scheduled for the next 30 days. I finally understood what my Dean and faculty were saying about fearing what types of dentists we would have to be to pay the loans. It isn't their fault that tuition is so expensive, it is a national trend and it is a very expensive profession to be part of so while it isn't their fault, it does have an impact on graduating students.
Please realize, I fall outside the norm and I know it, I see many of my classmates reporting doing amazing procedures while in their GPR / AEGD residencies, and even those who didn't, but chose somewhere other than Utah to practice who are doing great and even some in Utah I have heard of. It was a tough market to be in, I knew it going into it but I also have never considered myself "average" and so thought if I used my business savy, personality, hand skills, ethical behavior I would do above average. So even though it was a tough market in order to grow my website I chose the Salt Lake valley because of the programmers, it may be one of the most over saturated markets in the country for dentists and it is hard to earn an "average" income here, but this is where the programmers were so we could grow our other business and so we came. So far, there is no flowering lawn with a shining unicorn. I didn't expect one, so I am still happy with my choices.
Lets talk debt:
Tuition goes up each year, if you are applying now, expect $500-$600K in loans. Inflation also goes up, so your salary will increase as well, but maybe not at the same rate as tuition increases.
There are tons of programs to eliminate or reduce that debt. Some of those options are military, Indian health services, state specific sponsored programs and such. The Army for example will pay a $20K sign on bonus, pay for ALL of school, books, equipment required by school and just over $2K a month to live on while in school. After school they will give you a job where you can practice ethical dentistry all day every day, set salary, respect from fellow soldiers and such. They have tons of opportunities for advanced training with the AEGD which will increase your payback from 4 years to 5 but you will leave ready to rock and roll in the market doing procedures that other general dentists wouldn't touch. Air Force fills their spots early, early, early (around Oct) don't offer the sign on bonus but have a great program as well. I don't know off the top of my head the Navy programs details.
If you choose to go into private practice, there are many loan repayment programs, there is a new one that Obama put in called the Income Based Loan Repayment (http://studentaid.ed.gov/repay-loans/understand/plans/income-based) Under this plan if you earned $142K, your payments would be about $1,200/month for 25 years at which point the rest is "forgiven" (it means they count the remaining balance as income and you pay taxes on it). This program may or not be around when you graduate with the way the government funding is going, I wouldn't count on it nor do I hope it is as it only helps drive up the tuition prices to make the loans more affordable.
Some states will sponsor you at school if you come back to their state. AK AZ HI MT NM ND WY (http://www.wiche.edu/psep/dent) offer a scholarship since they don't have a state funded school which can reduce your graduating debt.
Buying a practice:
A practice sells for ~1.5X the dentists annual salary. You might have a practice doing a million dollars a year, but if it is 80% overhead it is going to sell for about $300K. Right now there is a practice selling in Provo right across the street from BYU for $90K which puts his take home around $60K a year. (http://www.uda.org/classifieds.php)
Banks will loan up to $300,000 for fresh grads, more if you have been out longer, the other options are to do owner financing, become an associate first and then when you qualify you can purchase it in a couple years.
You can also just get a job, mine paid 30% of production. An average dentist with the right patients could produce $2000-$4000/day but you have to have the patients, and hopefully your patients actually need dental work and not just cleanings.
Most schools will teach minimum business classes, perhaps as short as a single day. At Midwestern we lucked out and got a few semesters which really prepares us to manage our own business as it makes you think about how you will attack different problems. I would certainly suggest asking any school you are interviewing whether they teach a course, if they don't, maybe they will start once a bunch of people start asking for one.
Wrapping it up:
I really don't mean to be discouraging, I want everyone to do well, get into school if they want and succeed. In today's economic climate, so many people push and push you to get an education regardless of the cost and say don't worry about it, it will work out. The cost can't be forgotten, nor ignored when choosing your path. There will be significant personal sacrifices, financial sacrifices that you will pay, I only want you to have the opportunity to see it from a different point of view than the one the dental schools, and your advisers paint and when you graduate maybe it will seem like there is a flowering lawn, with a bright shining unicorn on top for you because of your expectations.
Dr. Alan Halls D.M.D.
Edit: I forgot to mention that some schools are much cheaper than my own, Baylor was at the presentation and said their average debt was around $180K. Public schools in general will be a bit cheaper but hard to get in as many of them accept 90% from their home states. Also my brother is one of the more frugal people I know and did a work study program through school which also reduced his debt somewhat, but my point was that many of us shadowed people who graduated with significantly less debt than they would now and you might ask them how they would do with an extra $4K loan payment if they needed to do that now.
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, well lets leave it there.
