ADA Reports That Only 4% of Dentists Can Afford to Retire ...



That’s right, most of those nice little old dentists over 65 are not still practicing dentistry because “they love it so much.” They are still plugging away every day because they have to do it to survive financially. I hate to burst bubbles, but one of the biggest farces propagated in this profession is that dentists keep practicing because they love it.

Granted, there are dentists who are exceptions to this rule, but they are the exceptions, not the rule. Those exceptions are going to take exception to this article, but as one dentist once told me, “After my 10,982nd MOD, it just wasn’t the same anymore.” I’ve consulted with thousands of dentists over the past thirty years, and they tell me things they would not share with their colleagues. Their most common complaint is they do not have enough money set aside to retire. They think they will have to practice until they die.

What is the one common denominator for all these doctors? Every one of them employed lawyers and accountants as advisors during their entire 30 to 40 years of practice. Think about it, a 96% failure rate, and lawyers and accountants are the leading advisors for all those doctors! These are ADA figures, not mine. By the way, the AMA reports that only 8% of physicians can afford to retire at 65, so they are not doing a whole lot better.

Would you hire a lawyer if you knew he/she had a 4% success rate with lawsuits? Would you hire an accountant that 96% of his/her clients went bankrupt? I think not. So why is it that so few dentists can afford to retire at 65? Because their lawyers and accountants are not any better at making business decisions than the dentists they represent.

They don’t teach business courses in law school, nor do they require business courses to become a CPA. Accountants learn to count, and lawyers learn to litigate and interpret the law. Their advice is needed for taxes, contract reviews and lawsuits, but not for the business of dentistry. A lot of lawyers and accountants think they know more than they do about business and are ready (for a fee of course) to provide you with advice on issues they know nothing about. Unfortunately the doctors don’t seem to know any better, and that is why you have the high failure rate when it comes to retirement.

Another issue to consider is that, the longer you have to stay in practice, the more money they make. If you pay your accountant $3,000 to $4,000 a year, when you retire, the accountant has to go out and find another client to replace that fee. As long as you are practicing dentistry, there is always a possibility of a lawsuit from which your attorney will make money representing you. Neither one of them has the motivation to help you retire. The longer you practice the more money they can make.

Some of you will say, “no way,” it’s not that way at all. But look at the ADA statistics, only 4% of dentists can afford to retire at 65. Lawyers and accountants do not know or understand the practice and business of dentistry. They are not informed on issues such as practice philosophy and treatment methods, patient care, practice merger economics, goodwill and other considerations that can make the difference of achieving economic success or not. These issues are better handled by practice consultants, and yes, there is a considerable difference in the level of their competency as well. There are competent advisors in almost every area of business, including dentistry. However, you should recognize both the extent and the limitations of their advice and deal with them accordingly.

The economic and practice related issues are too numerous to try to include in any one article, but suffice to say that they will make a difference on whether or not you will be one of the fortunate 4% that can afford to retire at 65. You need the services of attorneys and accountants; just use them in their respective area of competence. The choice is yours. Let them make all your decisions and hope for the best, or keep an open mind and get the advice you need that will enable you to retire and enjoy those “golden years.”

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