The Weight of Debt!

Is your debt making you feel like you’re losing a weightlifting contest? 

Here’s what they didn’t tell you when you signed up! 

Most dentists I speak with have debt.  It could be personal debt or business debt or most likely, it’s both.  It’s so easy to get sucked into yet another loan. Dental equipment is expensive. The equipment will produce income.  Well, maybe. 

Production and collection are good so you say, yes, let’s do it.  But you already have a practice loan and another equipment loan or two.  Those loan payments come around all too soon every month! 

Debt incurred that actually does produce income is ‘good debt.’ Do you know if the debt you have is good or bad debt?  Credit card debt is bad debt.  Sometimes even a Line of Credit is bad debt.  These types of debt are typically related to overspending.  Meaning, more cash went out of the practice than came in for a period of time.  Paying interest on that bad debt just adds to the overspending problem. 

What’s really crazy is at the end of the year, your accountant says you made money and you owe taxes.  What!?  How does this happen?  You’re not seeing a bunch of cash sitting in the account. 

A little known fact of the IRS is that when you pay down the principle on your loan, the government counts that as an asset to you and you are taxed on it.  Yes, there are some ‘tools’ like depreciation to help offset this but over time the depreciation is used up and there are taxes due. 

If you haven’t planned for these taxes, you may be caught off guard.  You may find yourself borrowing money to pay the taxes.  If this is you, listen up!  There is a better way. 

The Profit First for Dentists system is a solid plan that once implemented will ensure this never happens to you again.  Debt is factored into the system with a structure in place to eradicate it sooner rather than later, and at the same time you set aside your profit first.  You can actually do both and prosper at the same time! 

If you want to learn more, check out my website and feel free to reach out to me via email.  [email protected]