As a busy mom myself, one of the phrases I hear most from others (and think often to myself) is “I don’t have time for this.” It is natural instinct to “push things to the back burner” if they do not require your immediate attention. However, making a financial plan while in dental school and after should receive the same attention as practicing dentistry. This can be difficult when you are prioritizing a career that you have invested so much time and money in. However, if you do not prioritize your finances along with your dental practice, you may find yourself quickly approaching an inflexible financial situation when you least expect (or least need) it. Making a financial plan may not come naturally to you, as you have focused years on dentistry and not finances. Most dental schools offer very little (or nothing) in the way of financial education, which makes it even more important for you to be financially proactive yourself.
Perhaps you are a dental school graduate with large sums of debt and you find yourself with no choice but to enroll in an income-based repayment program for your federal student loans. In many cases this could cause your payment to drop from around $5,000 a month to under $1,000. The difference in your payment typically causes unpaid interest to accumulate separate from your outstanding principal (the amount you originally borrowed).
Your annual interest is based on your outstanding principal. So if you borrowed $450,000 of student loans and your interest rate is 6.5%, your annual interest is $29,250. If five years has gone by and you accumulated $100,000 in outstanding interest, you are still only being charged based on your original principal amount.
So…you graduate from dental school and you want to buy a practice. You know what state you want to practice in, but not much else; they didn’t teach you the business side of dentistry after all! So where do you start?
I talked to a student recently who graduated dental school a few years ago with $300,000 of student debt (a figure some of you would be happy to have!). For a variety of reasons, she hadn’t worked in the last three years and spent some time overseas before that. Her outstanding debt is now closer to $450,000. In just a few years her outstanding debt increased 50 percent. What happened?
Many new dentists interview for associate positions. One of our most often asked question from newly graduated dentists is: “What should I ask a prospective employer when I interview for an associate position?” The information you gather can have a major impact on your job satisfaction and your paycheck. Below is a list of the most relevant questions that you should ask when you start the interview process.
There’s a pretty good chance that if you have student loans (and even if you don’t), you have received a flyer or some type of marketing piece describing how much interest you would save if you “refinanced” your student loans. There has been tremendous growth in the private student loan market and with that growth has come lots of marketing that has left recent grads confused and unsure about their debt. This post will discuss various aspects of refinancing your loans with a private lender and some of the potential negative consequences.
Wondering what you can do with your money even while you don’t have any? Here are some ideas of what you can do while in dental school to set yourself up for financial success.