By Susan Nevenhoven
As an accountant at a dental CPA firm, I have a lot of clients who are new or recent graduates. Not surprisingly, they have lots of questions about money. On average dentists graduate with close to $300,000 in student loan debt, while those going into private practice can expect to earn $100,000 – $150,000 their first year out of school. The problem is that after years of struggling to make ends meet as a student, they suddenly have money, and often don’t know where to start. They ask questions like:
- How quickly should I pay off my student loans?
- When should I start saving for retirement?
- What will it cost to buy a practice?
First Step – Look at the Big Picture
While new dentists share certain characteristics, such as debt load and income potential, the similarities often end there. My clients come with distinct personalities and unique aspirations, and that’s where we start the conversation, because I don’t see myself as someone who simply helps clients file their taxes and save for retirement. I help clients live the lives they want to live – whatever that may look like.
One of the first things I do with a new client is take them up to get the view from 30,000 feet. I ask them to tell me what the big picture looks like and what they think is their ultimate goal. We discuss things like, where they want to live, whether they like the idea of owning their own practice, how do they feel about debt. As we talk, we zero in on what’s really important and start setting goals. It may be a five-year goal or a ten-year goal, whatever works for them. The point is, we put a stake in the ground and make a plan to move forward.
Let me tell you how the process worked for one of my clients in California. This client had been out of school for about a year when he came to us. He was working as an independent contractor at a few practices, so the first thing we did was get him incorporated and assist him with the obligations that come along with business ownership.
Our client was eager to have his own practice, but his criteria limited the options for buying one. Among other considerations, he wanted to live in a certain area, and he wanted to avoid a difficult commute. We brought up the possibility of a start-up practice. Based on the success he’d had working at multiple offices, we believed he had the personality to attract new clients. The idea appealed to him, with our guidance he was able to find the perfect space, connect with a bank and work out a financial plan. As he builds his practice, we can provide guidance about what steps to take once he’s ready to open the doors of his practice, and beyond.
As a dental CPA firm, we bring a depth of knowledge and expertise that a general CPA firm can’t match. Our clients rely on us to provide crucial insights into their business, so they can focus on what they were trained to do – take care of their patients.
If you’re a new dentist who’d like to learn more about how Engage Advisors can help you address your money problems and start building a career that meets your goals, give us a call. We’ll start by seeing how things look from 30,000 feet.