Mission Financial Planning Recommends Specialized Financial Planning for Dentists

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Mission Financial Planning traveled to Florida last week to address the unique needs of the dental practice owner.

We coordinate the expertise of various independent professionals who understand the intricacies of the dental practice; this tends to produce better recommendations. That means better decisions for the practice and your family.

While dentists can certainly benefit from general financial planning, there are compelling reasons for dentists to seek financial planners whose expertise is specific to helping dentists reach their financial goals. This was the message conveyed by Sharon Weaver, president of Mission Financial Planning, as she attended the Great Plains Trust / Kornitzer Capital Management Investment Meeting in Sarasota, Florida last week.

The dental office is a combination of small business and professional practice; necessarily labor intensive for the business owner but rewarding, on both a professional and personal level, when efficiently run. Mission Financial Planning, Inc. understands the complexities of running a dental practice as well as the personal financial planning needs of higher earners.

The experienced dental-focused financial planning firm will orchestrate services with other specialists who focus on dental clients; synergies are gained and a deeper level of customer service is achieved.    With the dental environment always changing, the interaction of dental-focused CPA’s, lawyers, insurance providers, retirement administrators and others, will help create a thorough and customized financial solution. “We coordinate the expertise of various independent professionals who understand the intricacies of the dental practice; this tends to produce better recommendations,” says Sharon Weaver, President of Mission Financial Planning. “That means better decisions for the practice and your family.”

Sharon adds, “Often, the spouse works in the practice. When that is the case, the practice is the sole source of support. The practice feeds the family, pays living expenses, provides employee benefits and funds both college and retirement.” Recommendations are made that integrate the business and personal finances with the interpersonal realities. “We understand the challenges and benefits of working with a spouse and the intensity of the family run practice. Part of our planning is to help the practice owner become intentional about personal and business priorities.”

Specialized financial planning can help in a number of areas, for instance when dentists have significant debt. According to the ADA, graduating seniors in 2010 revealed that their average debt load was $177,144 overall, with an average high of $207,824 for graduates of private and private state-related dental schools, and a low of $157,564, on average, for graduates of public dental schools. Furthermore, the average debt to buy a practice was $450,000, with facility costs above and beyond that. With all of the exciting new technological changes in dentistry, there are frequent opportunities to acquire new equipment or upgrade existing equipment leading to even more debt, often financed through the dental vendor providing ease of financing but perhaps not the best available terms. Debt management decisions have to be carefully weighed to ensure the most efficient use of available funds, lenders, timing and tax benefits.

When debt levels are significant, it puts pressure on the office to reach certain production and collection levels, practice prudent cost containment, and have a sound cash flow. As a dental-focused financial planner, Mission Financial Planning can track financial benchmarks and assess where a practice ought to be relative to those metrics, adjusting based on practice specifics. The recognition of misaligned practice ratios and the subsequent guidance from a knowledgeable financial planning firm and its network of subject matter experts can be invaluable.

The dental marketplace is changing; the pressure on independent dentists to survive let alone thrive is considerable. There has been a significant increase in group practices, according to the ADA Health Policy Resources Center, in just two years the number of large dental group practices has risen 25 percent. Mission Financial Planning understands this trend and how it can impact a client during his practicing years and upon practice transition. Succession planning is relevant and must start well before the actual time the doctor wants to “move-on” from the dental business. Transition planning is complicated in a solo dentist environment and even more so in a group setting. Using dental specific practice transition strategies and agreements are some tools a financial planner may recommend to protect and meet the needs of the purchaser and the goals of the seller.

Mission Financial Planning is an independent, fee-only financial advisory firm working with dentists and dental practices across the U.S. The firm takes a comprehensive approach, consulting on personal and small business financial planning. For more information call 913-948-9694 or visit http://www.missionfinancialplanning.com.

Fee-only financial advisors are compensated solely by the client with neither the advisor nor any related party receiving compensation that is contingent on referrals or the purchase or sale of a financial product.

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Sharon Weaver, CFP, AWMA
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