How long do you plan on practicing dentistry? Although we haven’t officially started our careers as licensed dentists yet, it is never too early to plan ahead for retirement. Saving your hard-earned money as a dentist after graduation doesn’t seem as glamorous as treating yourself, but saving and investing will allow you to have more control and freedom later in life. The futures of Social Security, tax rates, inflation, and the economy are uncertain, but the one thing you can control is your savings.
When NOT to put money into a retirement account
You’ve probably heard that you need to start early when it comes to saving for retirement. I often get asked by dental residents (some of which have $450k of outstanding debt) if they should save for retirement while in residency. For your average resident and recent grad, there are some very good reasons NOT to put money into a retirement account. Here are a few…
How to manage your first 401K
When you get your first job, there is a good chance that you are going to have to make some decisions about participating in a retirement plan right away. In some cases that decision will be made for you. If you go to work for a corporate dental office, there is a pretty good chance you will end up with the option of a 401k. 401k Retirement plans are less common in smaller and private practices, but it would still be beneficial to have a basic understanding as one will likely be recommended to you at some point in your career. One other thing to keep in mind is that you could also end up working as an independent contractor, in which case you would not be able to participate in the employer’s retirement plan although you could set up your own. There are other types of retirement plans but for the sake of brevity, we will focus on the 401k. Here are some things you need to know.
How to save for the future while in dental school
It has been awhile since we talked about savings and how to save while incurring large amounts of debt in dental school. Typically, it is recommended that everyone has an “emergency fund” to cover at least 3-6 months of their fixed costs in case they are unable to work or have an immediate family need. How can you make this happen while still in dental school? Read on…
There is no such thing as a free lunch
One of the most well-known ideas in the business world is: “There is no such thing as a free lunch.” What this really means is that when you decide to do something, there is always something that you could have done instead, but chose not to. The “thing you could have done” is a lost opportunity. You gave up something to do or get something else. This idea is known as “opportunity cost.” Read on to find out how opportunity cost can effect your financial future.