Setting Yourself Up For Success After Dental School

Congratulations!  You've officially graduated from Dental school…. Now what?

First and foremost you will likely have huge amounts of student debit/loans and your main focus will be finding a career in your professional field.  There are many options which may involve working for an existing dental clinic, establishing your own dental practice, or working in rural communities as there seems to be a never ending shortage of work.

Once you've secured employment here are the other top areas to consider after graduation:

Banking:

Most institutions have some type of banking offer for Dentists providing you with free banking/preferred rates, so don't forget to take advantage of these as you've earned it.  Don't pay more than you have to.

You will also need to eventually convert your Student Line of Credit into a Professional Line of Credit.  Every institution is different, but typically within 1-2 years post graduation your Student Line of Credit will be forced into "repayment only" mode leaving you with no longer having access to funds within your line of credit. 

Institutions also programs available that can assist you with the financing of buying into an existing dental practise or starting your own clinic with 100% acquisition financing.  They will take your future income into consideration when underwriting the loan.

Paying Down Debt:

Paying down your debt starts by creating a budget for yourself as this will show you the key areas of which you are spending.  Print your bank/credit card statements and review each item adding them together into their respective categories.  Your spending might be just as what you expected, or you may be caught off-guard on what you spend your money on each month.  Here is a link to the budgeting calculator that I use.

Once you have your budget in place you can start allocating funds towards paying down your debts.  Typically you'll want to start paying down your debts with the highest interest rates first (i.e. credit cards), but this can also vary depending factors like tax deductibility and tax credits.

Insurance:

There's no greater asset than your ability to earn an income.  Having the right insurance policy in place is very important because if you were to become disabled, how would you afford to pay your debts/expenses?  Are you the sole income earner in your family?  Are there other people who rely on your income?  These are important questions to ask yourself as life altering events can be catastrophic.  No one ever plans on these events happening, but having a plan in place is important. 

Common insurances types to consider may be Life, Disability and Critical Illness.

Incorporating:

While incorporating may be highly beneficial to some, don’t get sucked into the trap of thinking you need to incorporate immediately.  Costs and complexity can outweigh the benefits early on.  If you still have $400k in student debt and are spending everything you make, then this option likely doesn’t quite make sense for you yet.  It's important to seek the guidance of your Financial Advisor as well as the legal and tax considerations when deciding whether or not to incorporate.

Here are some of the costs you'll be faced with when incorporating:

• Opening your Corporation
• Shareholder Agreement (if multiple shareholders)
• Annual Corporate Filings
• Annual Tax Filings

Emergency Fund:

In my opinion, one of the first things to look at even before starting to invest would be to build out your emergency fund which is 3-6 months of your expenses.  Make sure these funds are easily accessible as this will provide you with a cushion in case of emergencies.  It's also good to think ahead of time what an "emergency" would be considered so you don't end up depleting the account for non-emergency related items. 

Putting it all Together:

Connect with an advisor to create your own personal financial plan given your own unique situation that focuses on the areas that are most important to you.  They will be able to make recommendations specific to your own personal circumstances.  One persons goal may be to buy a house while the other may be to save for their children's education.  Their plans and recommendations would be completely different.

If you're looking for an advisor I'd love to work with you and help you meet your goals.  I'm always open to chatting and you can book a call with me by clicking the link below.