VIDEO: How dentists can battle and overcome their debt challenges

July 28, 2014

Stress is a constant enemy for many dentists today. Much of that stress is from dealing with finances, including debt, and way too many dental practitioners are letting that debt push them toward bankruptcy, divorce, and/or other events that have life-changing repercussions.

Many doctors, by their mid-40s, can have debt service of $17,000 per month or more! That is $204,000 per year.

Typical monthly debt for a mid-40s doctor:

$1,500 student loans

$5,000 home mortgage

$1,500 auto leases

$6,000 practice loan

$3,000 for two children in private K-12 school

And that doesn’t include personal living expenses of auto maintenance, clothing, food, dining out, family gifts, household maintenance, cell phones and cable, utilities, and VACATIONS.

VIDEO: See Dr. Carlsen explain your retirement number in 7 minutes

In the video below, Dr. Doug Carlsen describes a typical doctor’s cycle of debt starting with $250,000 to $450,000 of student loan debt, followed by one or two new car payments, followed by the home mortgage, then the practice loan, and on and on.

What are the two major sources of doctor debt and when do they occur?

Dr. Carlsen provides a possible solution to the upward spiral of debt many doctors in their mid-40s produce.

Unfortunately, there are many doctors in their early 60s who have the 5,000 square foot house with a mortgage and HELOC that total more than their home equity, the Lexus and the BMW (both leased), a stored RV that always is worth less than the amount owed, a practice loan of $350,000 to cover the cone beam, CAD/CAM, and upgraded computer system, and revolving credit card debt of more than $50,000. Dare I mention the 30- and 28 year-olds who can’t find jobs and are living with Mom and Dad?

These older doctors have a negative net worth and often have minimal savings less than $100,000.

The earlier the cycle of debt is stopped, the better the doctor has a chance to save for retirement.

Dr. Carlsen has written more than 55 national financial articles for dentists in the last eight years, taken from the perspective of one who was able to retire at age 53 in 2004. He will now provide weekly financial articles with videos for the dental community through Dental Products Report and Dental Practice Management. He also now writes for a physician blog, The White Coat Investor.

His methods follow those of Warren Buffet, John Bogle, Larry Swedroe, and others who follow academic research rather than sales and trader information touted on cable networks and by radio salespeople. Dr. Carlsen does not invest doctor’s money or sell any products.

To have Dr. Carlsen speak to your group, please contact at drcarlsen@gmail.com.

Click below to listen to Dr. Carlsen’s comments and advice…

Editor's Note: Photo used in this article taken by Matthew Bargo