If you’re a dental associate, your student loans probably look like Mount Kilimanjaro. Yeah, you’ll conquer it eventually, but that’s a heck of a climb to get there. And if you stay in an associate or employee role, that will be one tough summit.
The average dental school grad in 2022 came out of school with just shy of $294,000 in student loan debt. To put it mildly: yikes. And that’s just the average! While some have a bit less, some have twice that amount. Maybe you’re in that boat—if so you’re not alone. A quick google search shows that there are a ton of current and former students worried about how to pay all of that off.
So, how do you do it? How do you pay down those student loans as fast as possible?
How to pay off your loans fast
This one’s simple: The fastest way to pay off your dental student loans is to own your own practice.
The average associate I see has an annual income of about $200K. Sounds nice! Lots of people would see that number and wish they had that kind of income. But it’s a dangerous number. It sounds comfortable, until you do the monthly math. When you have a massive student loan to pay off, suddenly it becomes harder to afford a home, a car or two, an annual vacation, not to mention saving for kids’ college funds, retirement, and so on. That $200K gets eaten up fast, and the student loan is likely the biggest culprit.
The average practice owner takes home $340K annually—$140K more than associates. And again, that’s the average. Dentists I work with tend to find and buy better practices, ones that could net you an even better take-home number.
But let’s stick with the average numbers. Let’s say you took home that extra $140K every year and put all or most of it toward that student loan. The result is obvious.
This happened for one of the first dentists I ever helped with a practice purchase. He graduated with $458K in student loans. Again: yikes. After a year as the sole income provider, he still had $450K to go. He purchased a practice for $1M, counterintuitively adding to his debt load. But with the added income, he was able to pay off his loans in just three years.
Buying a practice seems daunting. It is daunting! It’s a lot of debt and a lot of responsibility. But it’s also the fastest way to pay off your student loans and start building real wealth. When you’re ready to hop in my gondola that takes you straight to the top of the mountain, let me know.
