Posted on Aug 5, 2017
Image Credit: © Dreamstime.com
Posted on Aug 5, 2017
In 2014, the average dental salary was $166,000, making it one of the top ten earning professions in the country. Those statistics mean that dentists have a great base when it comes to planning for retirement. However, as with any entrepreneur, owning a practice usually means you have a large list of tasks and priorities that you need to address on a daily basis.
It may have been your dream to sell your dental practice and move to another country to live out the rest of your days, but if you haven’t got all your affairs in order, the dream can quickly become very stressful.
Here are some mistakes to avoid when planning for retirement
A successful retirement requires you to establish concrete goals. Do you want to buy a house on the beach? Do you want to pass on $20,000 to each of your children? At what age do you want to stop working completely? Do you want to travel? These are all important questions to ask when setting goals.
Make sure you have a detailed plan in play in order to ensure that your transition into retirement is as stress-free as possible.
A lot of dentists spend their time re-investing everything they earn into a practice for years in order to ensure growth, but it’s important to consider other means of income. If you haven’t done so already, setting up an automated savings program is important to consider when you’re planning for retirement. Remember that the earlier you start saving the better, as it takes years for compound interest to provide rewards.
When you run a busy practice it’s easy to fall into the habit of avoiding or overlooking pressing debt issues. This, however, is a huge pitfall. Make sure all your personal debts are taken care of before you consider retirement, whether they are related to the business, your property or vehicles.
Earning a comfortable living as a young dentist can create some unhealthy spending habits. Over time you may chip away at your income and end up with a lot less money for retirement than you otherwise would have expected. Habits are very difficult to break, so the sooner you get started making sure all your spending is in check, the better.
Consider hiring a transition expert to help prepare you and your practice for retirement.