Dentistry Uncensored with Howard Farran
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1468 Wes Read, CPA, CFP, of PracticeCFO on Running a Financially Independent Practice : Dentistry Uncensored with Howard Farran

1468 Wes Read, CPA, CFP, of PracticeCFO on Running a Financially Independent Practice : Dentistry Uncensored with Howard Farran

9/25/2020 3:00:00 AM   |   Comments: 0   |   Views: 219
Wes Read is has been working exclusively with dentists for 15 years as a dental CPA and financial advisor. He also has the Certified Financial Planner designation. After graduating from BYU in 2005 with a Masters in Accounting, he worked for Ernst and Young, a big four accounting firm. Eventually he left there and began working with dentists on a one-on-one basis. He formed PracticeCFO in 2013 and his firm currently works with 300 dentists in 16 different states. His team of 22 people include financial advisors, tax CPAs, accountants, and investment specialists. Together, they oversee global financial systems for their dentists. That integrated system propels their dentists more rapidly toward financial independence. 

VIDEO - DUwHF #1468 - Wes Read

AUDIO - DUwHF #1468 - Wes Read

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It is just a huge honor for me today to be podcast interviewing Wes Reid CPA CFP that certified public accountant certified financial planner and CEO chief executive officer of practice CFO has been working exclusively with dentists for 15 years as a dental cpa and financial advisor he also has a certified financial planner designation after graduating from BYU in 2005 with a masters in accounting he worked for Ernst and young a big for accounting form eventually he left there and began working with dentists on a one-on-one basis he formed practice cfo in 2013 and his firm currently works with 300 dentists in 16 different states his team of 22 people include financial advisors tax cpas accountants and investment specialists together they oversee global financial systems for their dentist that integrated system propels their dentist more rapidly toward financial independence dude I could talk to you all day long this has been this has been well you know obviously if you tell people what they want to hear and all that kind of stuff they love it but um if you really love your homies you're going to try to point them in the direction that you go and now that I’m 58 and my four boys turned into six grandkids I’m worried about the next generation and I’m trying to transfer knowledge of them and I think we've made some progress since uh I released a 30-day dental MBA you know two decades ago um mainly you know they go to school eight years because they want to work with their hands and get people out of pain and I love them for it but it's like a chef man they want to cook lasagna they don't want to do their numbers and everything that you spend your whole life on is the weakest part of the of the equation they just do not know their numbers I mean I have dennis tell me all the time do you think I should add another hygienist and I say well how long have you had your first hygienist I say five years and I said so she does a cleaning exam and x-rays eight hours a day five days a week for five years how much money do you net after a cleaning exam and actually do you make seven dollars and eighteen cents after taxes or do you lose twenty bucks and they don't know and I’m like you gotta know that so you know so my um my uh first questions to you is um I know you're a cpa i know you're a certified financial planner cfp um you're a series 65 certified explain to um about a quarter of our viewers are still in dental school so explain what a series 65 certified means so one of the segments of our business our goal is to help dentists become financially independent and all of the tax all the accounting all that sort of cpa stuff is just the engine that gives us our data or our x-ray to then kind of diagnose or treatment plan what they need financially well in that path toward financial independence one of the most important elements of your strategy is investing and setting aside money today for your future self to take care of you when you can no longer do dentistry or shift into something else or call it retirement call it financial independence whatever so we end up setting up a lot of retirement plans a lot of 401ks a lot of profit share plans a lot of what are called defined benefit plans and we manage those for our clients they're rather complicated 401ks are very different than a brokerage account where you're trading on robinhood or very different than an individual retirement account in ira a 401k has all of these rules from the department of labor and the irs and they really bog dentists down and so what we do is we basically come in and we say hey you don't have to blink we'll set it up at the right time in the right design we'll do all the back end work we'll educate your staff we'll invest it in a way that's prudent reduce your fiduciary sort of help you be a fiduciary on that 401k plan and so we've had to become licensed as investment professionals in our pursuit of helping dentists become financially independent and the series 65 to get back to your question more directly the series 65 allows us to be compensated for giving the advice on investments for our clients it's a mandate from the security regulators we'll talk about um the fiduciary again that's a term they probably don't understand what the word means um it seemed to get a lot of media this year john oliver did a whole deal on the fiduciary basically um what he was showing is that if you had an index fund uh for 30 years you made more money than if you were paying a broker because even if you only got one or two percent less um the how that harmed the growth so talk about um john oliver just really beat up fiduciary responsibility did you see all that on uh no I didn't see that yeah and um so what is that what is the word a little bit 401ks are well they're unique because the doctor is a trustee on that 401k and as a trustee the doctor has a responsibility to make sure that number one it's abiding by the department of labor rules around what's called discrimination which simply means that the doctor can't go pocket a bunch of money as a tax-deductible employer contribution to themselves and not fund something for the staff that's one requirement among many and they do annual testing to make sure that it's compliant and doctors don't want to learn about that and you know they don't have time to learn about that uh all of those rules and so we help them with that together with what's called a third party administrator but the other thing is how they invest the money inside of the 401k or what options they give to their employees is a an important responsibility that they don't want to get wrong and I have met with doctors who had put all of their investments in a will say an investment vehicle that wasn't appropriate for a 401k for example if you put all of your 401k in a piece of real estate that you choose and your staff don't have a choice and something goes south well you're going to be held accountable for that or if you do some opaque sort of hedge fund style investment that goes south and your staff had no say in the matter then you could be held legally liable to make your staff whole for that so one of the things we do is we hold all of our money either at charles schwab or vanguard depending if it's on what called a pooled 401k or if it's a participant directed 401k and we can talk about that if you want and then we sort of make sure that it meets all of those obligations so that the doctor can basically do their dentistry and not worry about having to meet these obligations from the staff and potential litigations that could come up from doing that wrong and um I thought john oliver he did that and oh god it was a long time ago june of 2016. I’m sorry my mind is uh when you get older just time goes faster but that thing had 15 million views on youtube it was a uh it was a big deal um so um you know what is your bread and butter I mean if I go to McDonald’s I’m a health food fanatic so when I go to McDonald’s I always get a big mac fry and a coke large fry but medium coke there's the nutrition advisor came to me what is your big mac frying a coke I mean if you're the McDonald’s and let me just say one other things again the best game that I think we've made in the last 32 years talking to dennis that you know 32 years ago everybody thought they made the best choice finding their cpa because you know they went to church or their temple and they got a referral of a really good guy and I’m sure he's a really good guy they didn't have any experience in in dentistry and look at medicine we had zero specialties at 1900 and by 2020 the mds have 58 and the dentists have 12. hell they only had nine in 2000 so now there are so many dentists that at least get step one which was admit that your cpa doesn't know about dentistry and to go find someone who specializes in dentistry um you have what do you say you have 200 clients about 300 dentists we work with 300 dentists so my first question to you is I want you to call your cpa and ask him how many dentists um he takes care of and he probably takes care of two you and your partner or you and the other guy you referred and you just I mean my gosh if you're if your retina is detaching and you want to go to an oral surgeon knock yourself out but you need to go to a specialist so please get someone who only does dentistry because I mean it's just really hard to figure out especially when half your information is on um quicken and QuickBooks pro and then the other half of your information is on Dentrix so you're already set up with a bipolar um kind of like the flat earthers have you ever seen the flat earthers map of the globe it's really bipolar I mean because they have the north pole in the south pole kind of in the middle which I guess an eclipse means that the I don't know how it would work but I guess the um for the shadowing the sun would have to move massively close to the earth so you could have the proper shadows I just want if one flat earther could explain to me how an eclipse of the moon works I would really be uh happy but dentists are like that bipolar I mean they got you know in the north pole they have their dentrix and the south pole they have their quicken and every business that I go into like I was born and raised I cut my teeth in sonic drive-ins for 10 years my dad had nine of them and I swear to god his cash register had a better complete picture of what the hell was going on with sales and overhead and profitability and labor at the end of the day on one of those little roll tapers we at the end we'd print out the roll taper and here I am 32 years later my dad's been dead 21 years and dentrix and eagle soft and your average dentist has less than what my old man had when I was 10 years old so how do they get a good grasp on the numbers I see a lot of um dashboards coming out where they're trying to take numbers from your accounting and your dentrix and put them together is that what you recommend uh dashboards or because to asking dentrix and eagle soft to hook into quick and you might as well just you know I mean go talk to a unicorn riding a mermaid because they're just you know they they're just not interested at all yeah a lot of good comments and a lot of good questions there um to answer I think the biggest question what is our big mac you ask what is our uh what's at the core of our service or the why we work with dentists um dentists I think are struggling with the confluence of two challenges right now number one is that today as opposed to 20 30 years ago I believe dentists have to be good business clinicians to thrive in their practice it's an unfortunate thing perhaps that you may be the best clinician on the planet but still not and you're not able to cash flow and pay your debt and pay your bills and live a you know a modest lifestyle you probably deserve for all the years that you went to in schooling because there's a lot of pressures on the industry pressures from dental insurance companies pressure from the mass amount of consolidations that are happening in the dso space it's a lot of that pressure and the second problem is that they never got the education in dental school or anywhere other than maybe coming to say on your show for example and getting some education there but they never had a formal education on how to be a ceo how to be a business owner so when you combine those two things together there's a lot more dentists struggling today to become financially sort of organized and financially successful and eventually retire so our whole why is to help doctors to overcome the problem of not having a financial system that aggregates all the complexities around their finances into a single unified plan which they then feel good about and that is accelerating their financial growth and so there's a lot of holes in the boat of a dental financial system they might have over here an insurance person they have over here their account they might have a separate tax person then the person doing their QuickBooks they might have a financial planner over here who may do some investment work and there's this disjointedness across all of those and so what we say is doctor you need to have somebody who acts as a little the liaison between you and all of those people and we call that a cfo in fact if most of these all of the big dsos they have cfos a chief financial officer but a dental practice to 1.2 million dollars isn't going to be able to pay 10 000 a month for a cfo to come in and organize this really great financial system so what practice cfo has done our firm is to be an outsourced cfo function for dental practices which is very different than being simply a cpa and it's also very different than even being just a dental cpa because a cfo is all about finance and finance is all about the future it's all about planning it's all about saying what can I do today so that next year and two years and five years and ten years down the road I will optimize my economic benefit or a cpa even a dental cpa will basically be a historian by and large to aggregate the numbers give a few pieces of advice around depreciation maybe talk about the eidl and the ppp loan and some of these questions that come up sort of just a little bit superficially and then ultimately give the p l and file the tax return and that sort of sort of the job a cfo model is entirely different it's all about the future and it's all about the treatment planning and all the cpa stuff is simply to give the x-ray to be able to do that and to do that well so we typically meet with our clients about three to five times during the year we call them board meetings where we the cfo get together with them the ceo and we make a comprehensive plan that covers all aspects of cash flow their debt their taxes spouses are often involved to discuss personal budgets education funding retirement plan and so we're bringing it all together into this very sort of cohesive system or plan to help doctors sort of plug the hole in that financial boat that is preventing them from really getting ahead financially today with all the pressures that they have well you know the definition of an accountant is someone who solves a problem you didn't know you had in a way you don't understand and what I keep telling dentists you know when I asked him you know I got my mba from asu in 98 and i'll ask a dennis a question a simple basic accounting question and they don't know and i'll say well how long have you used your cpa they go 10 years and I go what do you think about that I mean you've been using this guy for 10 years and you don't know any of your numbers and you don't know any of your basics kind of reminds me of martin Luther um the founder of the Lutheran church I mean he just wanted to translate the bible into the common language of German and for that the catholic church tried to kill him I mean so sometimes I wonder if your accountant wants you to stay ignorant so you always just keep them I mean I really do sometimes um that or you know they are accountant so sometimes I wonder if they're suffering from depreciation I find that dentists expect their accountant to be something other than an accountant and I don't really hold the sort of standard uh definition of accountant guilty because their job as an accountant is to give a give information for the doctor do they make or for the business owner to make decisions and their job is to file a tax return they are not consultants and they don't think necessarily analytically that way they're just not trained that way nor did they really go into the profession to think that way now some do and there's some cpas who sort of naturally go into the realm of consulting and taking the numbers and actually doing something productive with it but generally speaking that's just not what they're in business to do so a doctor what I what I tell doctors is you really have to decide you want to do you want a cpa model or do you want a cfo model yeah the cfo model is going to be more money because we're meeting with you three four five times a year we have ongoing texts ongoing homework assignments we're meeting with your team we're meeting with your spouse we are your cfo the challenge that dentists have and I understand this I get it is it's hard to distinguish between what is a good investment in your practice and what's a commodity and typically accounting bean counting bookkeeping QuickBooks management whatever it's basically put in the category of this is a commodity just like my utility bill so how can I get it to a really low rate and just sort of have that done with check that box and move on to other stuff when really all good CEOs I believe big business medium-sized business they understand the value of having that financial mind to coach them to work with them to get them through those decisions as a business owner and dentists even though they're small business man they got they got they got to calculate their break even they got to know their overhead they got to understand the difference between fixed and variable costs they got to manage all their debt they got a structure payroll they're all s corp so they need to pay themselves a payroll as well do they put their family on payroll what type of retirement plan should they buy their building should they build on an op should they get a cad cam how much depreciation should they take there's all these decisions that they need to make this ecosystem of decisions and there's a way to harmonize it to do it right and there's many ways to do it wrong and so I just I feel like the cfo is what they need to get that right and that's what we basically built our business on was being that cfo style or model for them and of course we do the cpa work we do the accounting we do the tax we have a tax department we have an accounting department but then the key person though is what we call the cfo advisor who's the one that meets with the client and it goes back to our team here we're all in the same building here all 22 of us they go back and they meet with the accountant they meet with the cpa they meet with the 401k specialist they meet with the insurance specialist if there's life or disability needs and they then bring that plan together so that it's done in a very cohesive way just a very different model by the way if you're listening to us on iTunes you should switch to youtube because uh I’ve always said that um most dentists became dentists because they didn't have enough personality to become an accountant and look at you you're sitting there you got it's the first day of fall and that orange pillow probably represents the first day of fall um for the 90 of uh dentists who live in the northern hemisphere and the 10 percent of the population live in the southern hemisphere happy first day of spring um but don't you think of everything you just said explains the pretty much the only advantage of dsos um they're not um you know the owners of these dsos um it's not that they're treating the patient better they know all the business they location logistics finance marketing insurance um all the um they have a cfo they have an accounting department they have a marketing partner so white dentists are out there going to courses learning how to do better faster root canals fillings and crowns this is all they're thinking about does it make you um wonder um if uh how far uh they'll consolidate dentistry as a whole um because what you're talking about you know heartland and um Fontana’s aspen and thorns pacific I mean that that's their strong pursuit I mean that they get aid in county I remember when Steve Thorne um started pacific um he bought um he wanted to go with this accounting system I mean this dental practice management system but he told the people he says it doesn't do nearly anything I want I just want to buy a copy of it and then I’m going to get a bunch of programmers and keep programming us so thorn's dad is a dentist but he didn't go to dental school because he knew he could hire a dentist in five minutes and they're accounting a heartland's accounting I mean it's just amazing um you know what they have that an individual doesn't so do you think dsos that this what you're doing is their core competency and if a general dentist doesn't react at least at some sophisticated level they're just to get mowed over or what do you think it's a good question and in in many ways we're trying to give an edge to the small but to the private practice that they don't have by not being joined with a larger centralized business administrative unit i.e. a dso now we don't do everything that a dso does we don't do hr. we don't do legal um you know a lot a lot of granular stuff in the office we don't go into the office very much we're more strategic from that standpoint they may pair up with the practice management consulting firm who we would you know work with as a team to help that doctor but um but the subject of ds I mean that's when I could we I’m sure you and I could talk all day on this subject and I think that the consolidation which is in full stride right now and I think it's going to stay in full stride for a period of time I don't know at what point it gets saturated to where it's got the share of the market that it's going to stay at I don't know if that's going to be 50 or 40 or 70 percent but it's going to be a lot more than it is today and being in in this space I come across a lot of people attempting to form a dso themselves there's a lot of doctors a lot of young doctors even who come out of dental school and they just want to conquer the world they want to they uh we call them empire builders they want to build their empire of dsos there's something about I want to be bigger than my single doctor practice so I’m going to get two I’m gonna get three I’m gonna get four I’m gonna get five practices and some of them are successful and many of them are not successful and the second and third and fourth office end up draining the profits from their first office and then they come to me and they want me to do work at dirt cheap prices for four practices that are really struggling and they're not willing to pay you know pay the fee for managing four separate corporations and all this complexity they need a cfo but I don't work with most of those people it just does it just doesn't fit it's not a good fit and so we primarily work with doctors who have one two maybe three practices and we focus there but I do think that um some are going to make it and some are making it but what I’m seeing most of the ones who make it are not and I this is not a negative statement against dentists who I love I talk with these people every single day they're near and dear to my heart but most of them don't have that background to become a manager of 50 offices that is an entirely different skill set and so you get people coming in from private equity people coming in with MBA’s with a lot of business management background there are some dentists who have done it but they pair themselves with really good uh business people to help them do it um but it's sort of getting past it's not just a lot of people think I need to get 10 offices and I’ve done it and i'll sell for 20 million dollars be getting even a multiple of 15 and life is great it doesn't work that way it because those offices need to prove profitability and the challenge is how do you truly centralize the functions the business management the administration into a single place if you have 10 offices and they yeah you might have centralized some ordering of supplies you might have a marketer doing some common marketing but they're still by and large 70 functioning as independent separate entities you're not operating as a service there's no service organization that's managing all that and so you're not getting the benefits of scale and dsos are all about the benefits of scale and so you got a lot of people who sort of hit two three four offices and they hit that brick wall they don't know where to go they struggle with financing to get any more practices and it just sort of flounders and I’m seeing that a lot so even though I think the consolidation is going to happen I think it's going to happen um very sort of selectively to a selective few who will figure out the formula to make that work and so how big do you think it'll be in uh this is 2020. how big do you what um Sam Bergman the ceo of shine says that dsos are buying 18 percent of supply so I trust stan's number so you know it's under 20 and then Arizona is number one since um we accept all licenses from any other state we have 18.6 of all the dennis in Arizona work for a dso so that that so 18 of the market would be um the most it is but it depends on your definition of dso if you're talking about two or three practices um that's my definition like three practices or more um but um how big do you think it'll be in 2030 in 10 years if it's eight if you buy in that it's 18 today or let's round it off to 20 for simple math where do you think it'll be in 2030 I wouldn't be surprised if it got to 40 percent okay and then the other question is you also buy um you help with buyer representation you're in the dental transaction business right we are in two ways one most of our uh in the early years most of our new business came from us representing buyers so we've represented hundreds and hundreds of buyers over the years and then we of course help them transition into ownership and then a couple years ago we opened up a brokerage arm that lists practices for some of our clients who are wanting to sell or practice so yeah on both sides we're involved in that are you listing them on the classifieds of dental town um I think we are I have a brand new john that's uh surprises me every time I look at the statistics for downtown the classified ads is far bigger than I think anybody realizes um there's but what I find bizarre about the classified ads is that from uh 99 when we started to today um there was always about 1 000 practices listed for sale and 5 000 jobs listed to want an associate now it's 2 000 people selling and only 1 000 jobs and they're all dsos so my question to you is when you're working on someone's exit strategy and you're selling their practice what percent of the practices that you're selling now are to the big dsos well we haven't sold any of the big dsos but we've sold about 30 to regional dsos which I which I think are really on the rise of the regional dsos um and that's and when I say regional I might say somewhere around six to maybe 15 20 offices and that's where my mba brain kicks in and I agree with that I mean you know you go to any small market town I say 250 000 people and you're on the south side well all the low-cost cheap advertising like radio and tv and billboard you can't just do it for one practice on the south side you need one on the north south east west and I’m telling you radio station the cost of radio ads has gone to because of the internet and social media um television ads I mean I know perry honest that it'll have a one hour program in the middle of the night uh for like thirty dollars um because it's so it's so cheap there's all these channels so I see that first layer of flat um you can get some scale you can bring in someone full time for hr. for legal for marketing you know you can get you can get four or five people that can just really focus on the uh the non-clinical stuff and they do great where I think it breaks down is the second layer of management in another state where the CEOs and those guys want another 17 off the top I mean my lab in supplies isn't 17 what efficiency could you bring to the table that would that would be beneficial of 17 so I do think that the dsos is in a city or in a state and it's one layer of management if it's one layer of management you're not trying to go uh public on wall street and all that you're just trying to do everything more efficiently I do think group practice but I like to call that group practice because I don't really think that's what the brand dso means I mean I think dso means I’m in several states and I think I think 10 practices or less in one state I just think that's group practice um group practice two locations group practice five locations something like that as opposed to the brand dso like your Asperger heartlands um all that kind of stuff like that um but yeah they just you just have to get someone that knows your numbers um what is um I know what they they'll try to do they're saying well I know what I’m gonna do Wes I got the best idea ever you know that chick I married yeah well when we were in the back seat of the car I was asking her tell me what's the difference in a statement of income a statement of cash on a balance sheet and that's why we got married I know i'll just have my wife do it and the wife is the spouse I should say because I know women dentists or their husband there I think the definition of your of your spouse needs fired if she hates the job if she doesn't want to be there I mean some of these moms are stressed out of their mind because they got three kids at home that's where their heart is but their husband wants them to come in and be the cfo and he thinks well you own half the business you know blah blah blah but I’m telling you I mean how come you mean you can tell when the wife really wants the job and she's a dynamo and you can tell when her heart is not in it and do you run into a lot of that where the dentist just uh goes to another root canal course and just dumps all this stuff on his spouse and spouse not really into it and that's one of the big problems of the information catastrophe yeah I have the whole spectrum of involvement of a spouse I have some clients where I only meet with the spouse and the doctors just wants to do dentistry and then leave and go mountain bike riding and then I have the other end of the spectrum where I don't even know the spouse and never met the spouse and sort of everything in in between and I’ve seen it work in both ways but I’ve never seen a case where the spouse unless they really had a good background in accounting and finance really be able to play the role of a cfo strategically because they don't understand that all the complexities of taxes tax basis issues um depreciation issues they don't understand a lot of the just the nuances around cash flow management debt structuring 401k management so I would say a good spouse is like a good controller and in a business the controller is the person who's sort of working between the accounting department and the cfo but you really need somebody to orchestrate more of a high level design behind everything and that's where I love it when a spouse comes in because I can then delegate a lot of the in-office day-to-day tasks to that spouse who might be working I don't know 10 20 hours a week from home or in the office to do the stuff inside the office and we do all this stuff externally outside of the office related to their finances and in some cases it helps some cases we get spouses who are an engineer and captain dyers that happens with some frequency and the dyers usually aren't a good fit for us because they feel that they can do everything and construct everything and they're really focused on saving a penny here and saving a penny there and I say great you know go have some success and we go our ways but we really love working with clients and see the most success in people who are coachable it's like any great athlete and tom brady that guy seeks out coaching he seeks it out aggressively and that's what we love it when our clients seek out coaching from us and they take our advice on how to construct their finances because those are the ones who are increasing their net worth dramatically every year and they're willing to live on a budget and we you know we set that budget and then they you know and they go and they produce and they create a great culture in their practice that's what they need to do produce and create a great culture and then delegate to good people um you posted on dentaltown um addressing the financial fallout of kova 19 for your office that you're a dental cpa financial advisory firm with dennis in various states we've been researching addressing many questions our dentists have during the crisis questions related to conserving cash that's what I’ve been saying forever ever since march said in a downturn cash is king and um I mean I put my money where my mouth is I mean I was sleeping in a house with you know a mcmansion with four one ton air conditioners by myself and I’m like this probably isn't a good use of cash you know I mean I haven't sold that but what is um what is new in your job since the world health organization and declared this a pandemic back in march um what's different um with your clients now what's changed in your advice what covet 19 advice would you give and I know no one can predict the future but do you think um we're going to go into a fall with an uptick Europe is you know they were saying back in march that it would flatten out in the in the summer and we'd have a fall come back um and then you know everything is debatable um but most people agree that Europe is as having a fall um come back so where do where do you see the coven 19 dental pandemic right now well it affected this year for our business a lot not in in that practice cfo is necessarily suffered but what I mean by that is practice cfo is really called into action in a way that we haven't been in the past in the past we have a very sort of systematic rhythm of meetings and what we address in different parts of the year with our clients but this year that was all thrown off when covet happened and then the government starts providing stimulus packages to dentists and when the paychecks protection program the ppp came out in its draft form and then it came out in its final form we were completely lambasted with questions because dentists were closing down and what did it mean how much do I get how do I apply for it is it forgetting how do I give how do I get it forgiven and so we basically mobilized our firm for about three months to work about 80 percent simply on applying for the ppp for our clients and applying for the eidl the economic injury disaster loan we did probably 25 webinars on this some created ourselves some for different organizations dental societies and whatnot and try to educate them I created a 10-step program for dentists on our website where it walks them through 10 steps with a video tutorial on what they can be doing to take at full advantage of the government stimulus programs for them and answer all of their answer all at least I try to answer as many questions as I could so it was a massive amount of time we were doing global emails probably every two or three days to give updates but we applied for about 300 uh ppp applications every single one of them got it thankfully and now we're just pivoting to applying for the forgiveness on those ppp loans as well and then of course answering people's questions about should I pay off the eid loan the economic injury disaster loan which is not forgiven again you got ppp and eidl ppp's forgiven eidl is not forgiven it's a 3.75 interest rate over 30 years and there's rules around what they can use that for what they can't use that for and I won't get into all the details on that but this was just an example of how uh what if a finance firm what a firm that is focused on planning for the future is going to be they have they have to sort of stop what they're doing and address these things that came up so it really affected us and now we're going to spend probably our county department is going to spend probably two months almost full time applying for forgiveness for our clients for the ppp loan we charged 150 bucks so basically nothing to do all that work for our clients and um but you know it was according to the feedback it was it's helpful for a few people now on your website and when you just said those videos I’m um is that on your um you have two websites I’m wearing and cfos for chief financial officer but you have another one forward slash channels forward slash practice cfo are those vimeo videos all on your practice cfo website they are the vimeo videos are just where we um is just where we store our videos that we create and they're on our website if you go to I think resources and videos you'll see a number of client testimonials there but on our website if you want me to get specific about that there's a actually a covid page if you go to resources and under the resources drop down it says covet resource center for dentists and you'll see just a plethora of information here and this is the aggregate or the aggregation i'll say of all of our advice to the dental world and to our clients it has videos pdfs 10-step program alerts things like that and it was it was crazy Howard because there was one day on a Thursday we announced that we were going to do a podcast um not a podcast sorry webinar on what to do about covid and I had a limit of a thousand people and I thought there's no way we'll hit that especially in 24 hours within 24 hours we hit the thousand cap the demand was so huge for understanding you know what to do with the ppp how to get it how it's going to be forgiven when they get it what do they do on day one do they start hiring their staff or not all these questions but yeah so vimeo is where we have that we actually have a if I can tell you about another website do you mind if I tell you about another website real quick please so I had mentioned how one of the struggles that dentists have especially early stage dentists these days is the fact that dental school doesn't provide a whole lot of education to them financially so we are just about to launch this week maybe next week a program called associates on fire and it's a financial education program for dentists and we have a website called and it has about 12 hours of 10 minute video clips on all subjects from student loans to taxes to financial planning to buying a dental practice to stepping into ownership all of those things that they should have learned in dental school but they didn't it's all there we have podcasts as well that are coming out where we are interviewing people who have recently bought a practice in the past few years to talk about their experience and what education would do they want to share with dentists who are going to go through that experience of buying a practice we have downloadable resources checklists timelines things like that to help them as they go to buy a practice or deal with their student loans all of those things then we even have a certification where they can take a three-part test with a few multiple choice questions and become aof certified banks love it when associates can demonstrate that they understand the business side of dentistry may even help in the underwriting process as well to have a business plan that kind of thing so we are absolutely just pumped up about the associates on fire program that's about to go about to go live to give that financial education to early stage uh early stage dentists well they heard it here first right on dentistry uncensored what a beautiful one right here I mean I love it I mean that's a uh that's a hell of a the deal um amazing um and it's all ready yeah it's all free um that is uh that is fantastic so what um back to kova 19 um do how or is there profitability right now this is uh the first day of fall uh since we're in north America where 90 percent of homo sapiens live and um it's uh so it's September 22. um how does September look because there's already a threat on dentaltown said um I’m already worried about October there I don't know on dentaltown started 99 there's like a 21 year history about why does October always suck um but that's debatable but um how does September look to you um obviously you only have numbers for um august but how does September look and what are you thinking about um the last quarter of the year um October November December so I’m seeing about 80 recovery uh top-line collections across our clients interestingly the amount of ppp funding they got um and uh eidl reflects pretty well the amount of lost cash in their bank account during that period of time actually the ppp alone did a pretty good job at covering the amount of lost uh money that was in the bank account and then you throw on the e-ideal on top of that and right now my clients are the most flush with cash than I’ve ever seen them easily you know a million dollar practice easily sitting on two hundred thousand dollars right now where normally they're sitting on fifty thousand dollars or so and it's because they have that money and some are even thinking about paying back the eidl loan because they have it it's accruing interest all the while and uh but I’m basically saying I think we need to wait a few more months because I don't know what the rest of the year is going to look like there's clearly a pent-up need for dentistry after those three months or so of shutdown and so a lot of clients have bounced back but a lot of clients are expressing concern based on their schedule what October november and december are going to look like so I’m seeing that same thing myself and hearing that same thing myself from my clients and um and again cash is king I mean my gosh um I know I’m old I mean I’m actually uh eight years older than Monday night football I just found out that last night that's always nice to watch Monday night football and you find out that you're older than uh they just had their 50th anniversary but um my gosh warren Buffett used to always talk about the Buffett index where if you take uh when you go within a country and you take all their the values of their publicly traded companies like for us to be the wilshire 5000 that should be about the same as the gdp of the united states and whenever it falls down to you know like 70 you know that stocks are going to um adjust upwards hell it's at 171 Buffett I mean and this this was going on a year before the pandemic um and now I’m hearing dentists telling me how much money they're making in the stock market and I’m old I’m just like ah you need to you need to go get all your apples out of that stock market and put them in a basket and put them down in the basement and then they think you know um I’m old and frightenable and all that kind of stuff what do you think about dennis right now they are sitting on cash and why are they sitting on cash because the pandemic has taught everybody all the things you can go without like I didn't know that I could go without um eating out at a restaurant every night um you know I mean they're just they're just not spending a lot of money they're not flying around all these conventions a lot of them I think the biggest benefit that dennis had was um they didn't even reduce their staff they had about 10 or 15 percent of their staff that didn't want to come back I mean I talked to I podcasted hygienists that were crying because they you know they were they had kids at home they were taking care of their mother so I think a lot of labor didn't come back um so their labor went down and by the way when you talk about um when we were talking about earlier about um when you start spreading building your own dso um the highest fatality right rate is between three and four and Greg Stanley and I uh consultant and Scottsdale here we were talking about that 30 years ago because if you're really aggressive you can make so much money on one that you can start a second one it's not quite all that but you're making so much on the first one but by time you get to the third one or the fourth one you can't do enough dentistry in your only profitable dental office to cover all your losses and the mortality right is between office three and four but I think um the other sign that your group practice isn't working is as you start scaling um to be a better business your labor starts going up your labor went from 25 to 28 to 30 to 32 to 35 and if you can't scale by keeping your labor down if you don't get an a in your cost of labor it doesn't matter if you got a lock box over the thermostat and your electric bills on solar those aren't your costs it's labor it's the price of the dentist it's the price of staff then labor then um supply and then lab then supplies but do you think um they're sitting on a lot of cash because their labor has gone down and what do you think of those guys who are taking that extra cash and day trading um stocks I think most of the extra cash is coming from the eid loan because I think the ppp loan has pretty much been used up to pay their staff and then I think there was a temporary injection from the from the pent up need for some dentistry and in the last couple months which I think is going to pair off now a little bit should they take that money and go invest in stocks absolutely not first of all that money uh that's against what the regulations uh are around that money although the audit risk is virtually nothing for most dentists but they need they need to keep that as sleep insurance they need to keep that as money in the in the practice because we don't know what the next six to 12 months is going to look like here's a couple here's a couple thoughts on what dentists can do specifically right now in the situation they're in uh with kobed somewhat behind us somewhat ahead of us some uncertainties and wanting to protect sort of their practice and their cash is I think they need to hold on to the eid alone generally speaking along a little bit longer and not pay that off yet now if your practice is clearly back on track and your schedule is booked out for months on end great go and pay off the eidl stop accruing your 3.75 interest on it otherwise hold it for another three to six months that's number one number two keep funding your retirement plan if you can the market is still down especially after the past few days the market is still down it's a it's you never want to stop funding your retirement plan like your 401k keep funding that worse comes to worse you can stop funding that and then even go take a loan on your 401k but that's just going backward so I say keep funding your retirement plans don't worry about the volatility in the markets when it comes to your 401k you're not going to touch this money for a long time and if the market falls well great you're just buying shares at a lower cost you're going to do what's called dollar cost average more effectively during this period of time just focus on contributions and then of course you get the related tax deductions on funding your retirement plan next thing is be careful with depreciation there's always as we're approaching year end there's always the temptation to go buy new equipment new chairs new x-ray machines new you know build-outs new everything because you get of course what's called a section 179 tax deduction where you can write a hundred percent of that often this year even though you finance it but be careful with that because this year you may be in a pretty darn low tax rate relatively speaking because it's the year of covet and if you're in a lower tax rate this year marginal tax rate you don't want to take a bunch of accelerated tax deductions which is what 179 depreciation or bonus depreciation is you're simply taking deductions from future years and you're packing them in to this year and you're getting this benefit from a tax standpoint that looks great you're paying little taxes or getting a big refund and your cpa looks like a hero and all that stuff but you just took a bunch of tax deductions in a relatively low tax year tax bracket year and if you finance it don't do that instead just let it ride its normal depreciation over the next five years which is what most equipment is deducted at um and you'll match the deduction with your payments on the debt for that you want to match your cash outflow on the debt with the tax benefit or the tax deduction over time so just be really careful with depreciation by default most cpas just automatically take section 179 deductions and bonus depreciation as much as they can without even a second thought when most of the time because you're financing it that's the wrong decision to make you may do some but it's really needs to be viewed in your global tax and financial picture to determine the right amount of depreciation to take the last thing i'll just say is use this as a great period to a plan for next time because there most likely will be a next time and if you didn't have enough working capital in your bank account your corporate bank account if you didn't have enough emergency reserve in your personal account because we own too much car because we own too much house because we're traveling too much let this be a lesson that we need to always have an emergency reserve fund personally and in the practice I define that as having somewhere between six to 12 12 months might be aggressive but at least six months of living expenses so if you spend ten thousand dollars a month I think you should have sixty thousand dollars sitting in a savings account for your family in the practice I usually say you need somewhere around seventy five to a hundred percent of your monthly collections as you're working capital in your practice to weather the storms that are that are going to come up so just a few thoughts there um as I think about dentists experience going through all of this and what they can do right now and even perhaps some lessons learned but let me just say that the time is coming right now where doctors need to be applying for your ppp forgiveness because the 24 weeks is starting to come due in October for a lot of these doctors in november definitely and um and you should if you apply correctly be able to get a hundred percent forgiveness on that ppp loan um the banks are still a little bit trying to figure out how the application is going to work there's a lot of whisperings that congress is going to issue some legislation that will simplify the loan forgiveness keep in mind that that ppp money as it stands right now is taxable now it's not taxable in the sense that it adds to your taxable income but the irs issued a letter stating that anything you pay using anything that you buy using the ppp money is not deductible so if you used it for rent now that rent is not deductible well that is the exact same thing to the penny of basically saying that that's taxable money so as of right now the ppp is taxable money and you have to plan for that if you haven't met with your cpa or if your client of ours your cfo advisor just make sure that that's been factored into the into the analysis in terms of your tax withholdings and estimated payments and then if congress comes out and says hey we actually want to forgive this because it was never intent to give you this ppp loan and then pull back 40 in taxes uh which I’m cautiously optimistic they're going to do well then great you can reduce your withholdings you'll get a refund etc just be careful to not get caught on april 15th owing a bunch of money because you didn't know that that was taxable and congress doesn't come and change the current tax status of the ppp money just a few more thoughts there on the current situation um this is another theme I’ve been beating up dentists on for a solid 32 years and I want to see if you agree or not but you posted on a post on dental town on the millionaire mind and how millionaires um you know there was you know there's been a couple great books written on this stuff by my phds and uh this guy with a phd says that um millionaires they tended to live in older established homes and nice neighborhoods most didn't live in uh millionaires most didn't live in newly constructed homes they tended to drive average regular cars most didn't have um fancy um cars god it just seems like dentists always live beyond their means I mean if you say the average family has less than two kids dennis will have three four five I mean and I did I had four uh and my oldest boy he's already had four I mean he didn't learn from me my mom had seven I guess I improved but they always seem to have too many kids a stay-at-home spouse fancy vacations I mean I go down the deal and I say okay well most people go to the lake and go fishing but you got an airplane or went on a cruise or went to hawaii most people have a little thirty thousand dollar car you have a sixty seventy thousand dollar car your wife doesn't have a job and she's got a seventy thousand dollar job a car um you know you should have two kids you had four five six half a dozen um I mean do you think living below your means do you see that as a problem in dentistry or do you think they're the same as all americans I think they come out of dental school with what I call pent up consumerism which is they've restrained themselves for so long that now they're making I don't know 175 000 which is massive amounts in their mind now I now I sort of deserve to live the life that I’ve deferred for so long and in my associates on fire program in our first video it's called the general timeline of events in the life of an associate I tell them to keep living like a dental student I know it can be a little painful but keep living like a dental student for a little bit longer because there's a compounding benefit kind of like a compounding interest is interest that then creates interest on itself and it has this geometric growth up over time the more that you can in these early years maintain your frugality and your carefulness around your finances the more options you're going to have down the road medium term and long term the problem that I find is doctors and people in general heck I’m you know I’m totally subject to this at times and I have to catch myself is are just subject to this concept of marginal thinking and marginal thinking is the belief that it's okay to neglect a small important decision because the effect of that neglect feels harmless because it's small so it's okay if I spend a little bit more right now it's okay if I don't exercise today or if it's okay if I don't spend a little time today with my kids or if it's okay if I do this and that when it comes to finances marginal thinking is a chronic problem in human nature and that also exists within dentists they're not immune to that thinking and so um they um they will make decisions continually that in the in isolation aren't harmful but in the aggregate are extremely harmful and so now they get into their uh 50s and they've continually refinanced their debt they are always taking on new debts so we still have a lot of debt we didn't fund our retirement plan early because we wanted you know that house we wanted those 260 000 cars we wanted to take that travel we wanted to give that appearance it's so funny because some of my wealthiest clients they don't drive around the expensive car and some of my least wealthy clients drive around really nice cars a car is it's I would say it's inversely reflective but it is commonly a um an illusion of what somebody's financial situation is like but it's hard to feel content knowing that my personal balance sheet is solid but nobody knows about it we just have this need almost to want people to know about that and yet that is you're one of your greatest competitors to building wealth is to fight that desire and to know that your wealth and your financial uh organization and success is really a personal thing um that said you know a lot of um I don't know a dentist do struggle with that concept of marginal thinking I mean my car is at 2004. and whenever I’m meeting with some kid who's been out of um 80 still or midwestern for a year they're driving a 80 000 beamer yeah and I’m like you know uh wow it's like where does that come from um and I also um do you think you can do business financial planning without personal financial planning I mean um are they the same as one more important than the other where do you think dentists are screwing at more on their business financial planning or their personal financial planning I think it's I think it's very equal to be honest I know for a dentist you can't do good personal financial planning if you don't have good business financial planning because the business is the heart of your cash flow it's the engine of all the dollars that eventually flow to your personal balance sheet which then is what dictates how prepared you are for financial independence and I do see a lot of doctors who have actually um a very strong income statement in the business but they're not translating that success into a personal balance sheet it's getting translated into a personal expense statement and so they buy things that lose value over time one of my policies that I’m always telling doctors is I know a doctor's really turned a corner psychologically when it comes to finance personal finance when they don't have car debt anymore because car debt is consumer debt in that you buy something you have debt and it loses value over time that's different than buying say your house or a rental property or an investment that goes up in time and debt that is collateralized like that it can be a very good debt and it's very necessary I think in the world of dentistry if managed correctly but consumer debt is chronic it's just absolutely chronic and it's so accessible these days so I think doctors have to get a planned business in their business in order to be successful personally but just having a successful business plan and being successful doesn't always translate into a successful personal financial plan the two really need to talk to each other and I think a good financial planner for a dentist is going to understand the language of dentistry enough to be able to create a joined plan around the business pocket and the personal pocket what happens with financial planners with dentists is they often come to a dentist and they say doc you need to save five thousand dollars a month to retire at age 60. ready go i'll see you in six months and the doctor goes back they're trying to figure out well how am I going to come up with five thousand dollars a month to set aside and how do I structure my cash flow my taxes my 401k auto structure all that and then they meet with their financial planner and you know they weren't able to do it why because the real hard work is in the business if you can get that right personal financial planning becomes a lot more accessible and successful once you have the engine of your cash flow producing really well to your personal into your personal life okay I want you to explain I want you to put on your uh your uh I mean I mean we're going to talk right now to the kids in dental kindergarten they're still in school they haven't got out or maybe they just graduated in may but they're in the middle of a pandemic and they don't have a job but they don't I do not think they understand why dentists who own their own practices average 244 000 income and dentists who are employed at a practice average 147. where's the hundred thousand dollar difference between I own my own dental office and I work for you um well you as a business owner you not only are making money off your own production you are making money off the passive source of income in your business which is your hygiene if your hygiene can be run successfully nor are is there another owner that you need to share profits with so as a business owner if you can do that successfully be a successful ceo and cash flow it well then you get to keep all of the income all of the profit the passive profit and profit from your own work if you're an employee you're getting paid generally a percentage of your own work and then the other amount of income that you produce goes to owners as well net profit goes to other owners so that's why the challenge that young these young dentists that you're referring to have is um it can be daunting to know that now I’m not just thinking about teeth and having a plan for teeth I have to have a plan around taxes we all know how complicated that is I have to have a plan around debt I have to plan around all these other things we've been talking around and I have student loans and I got six hundred thousand dollars in student loans and right now I’m on the ibr or pay or repay them on one of these programs and I’m paying 10 percent of a pretty low amount but at some point that's going to go way up and they're just scared and fear is a very powerful thing we're seeing it in our world today with covet fear is a very powerful thing and drives a large amount of human behavior and that is driving a lot of dentists to take the 175 000 instead of the 250 000 or as I see so many of my clients they do a half a million dollars a year they do 700 000 a year I have a few clients do 1.3 million dollars a year in taxable take-home income because they run a great practice a great practice but it takes a lot of work at night or on weekends that they're having to do work in those early years those first three to five years where they're building the system where the rocket ship is just trying to get out of the out of the atmosphere and things are falling off and they're trying to fix everything you know they're being the business person but then once it gets into the atmosphere and it's just a little bit of course adjustments it's a great place to be so I always say if you can if you can carve out that path in your career of private ownership you're going to own your schedule you're going to own your culture you're going to own your people you're going to make more money you're going to love it but it's not cut out for everybody and that's totally fine how many children do you have I got three yeah I tell people that you know if you sit around and wait for the perfect time to have a children a child or open up your own practice uh you're gonna be 103 years old when you're ready I mean I got out of school I made four boys in 60 months I’m the most proud of that and I am graduating may 11 I had my office open September 21 and that's when you're young you're dumb you have all kinds of energy you're not gonna have that energy when you're 35 45 55. I mean when you're young and dumb and don't know any better start your family start your practice and by the time you realize wow that was I bit off more that I can chew you're done you already got the kids you already got the practice and then and then you're just so glad you did it I sometimes I wonder if they're just too smart they're so smart they know all the risk and they get paralyzed by fear what do you um what do you think of the average uh the fear of the coronavirus do you think it's warranted do you think it's way too much fear uh do you think um that's another over fear reaction uh to a threat that's basically um hurting one percent yeah great question and I have to be careful because it's such a sensitive time here in southern California I’m here in san Diego del mar and Carmel valley and other areas where it's kind of a sensitive topic but uh I mean if you ask my personal opinion and I people are going to find me wrong in this I read an article from a renowned European epidemiologist who said we're killing a fly with a sledgehammer and this the places that allowed it sort of play itself out to play itself out and do its thing and it's really unfortunate people are going to die from this it's really unfortunate and we need to take precautions I wear a mask whenever I leave most of my staff is working from home don't get me wrong we take precautions but um there's a lot of there's a tremendous amount of unquantifiable harm and pain and suffering lack of effective education among massive numbers of kids incredible number of people whose businesses are going under financial stress depression home abuse that's coming because of the way that we're responding to this and I personally just feel that we're maybe a little bit overkill and that we're not quite recognizing all of the negative externalities the negative effects that aren't as easily quantifiable as you know the number of death count or the new cases and all that stuff which is so easily quantifiable I want to protect the one don't get me wrong but it can really be the at the expense of the many and from a practical standpoint it does have me a little bit a little bit concerned oh my gosh do I have a friend for you then did you uh listen to my uh interview with dr hessem nozzari who's uh close to you he's in beverly hills who's a uh periodontist I mean he's one of the I think he's one of the smartest dentists out there I mean he's just a legend in perio uh but um he um oh my gosh he just went off for basically an hour and a half just going off on how completely insane all this is so then the question is this and because I was asking about that because here was my leadable question I know so many kids from a.t still right here in mesa and midwestern and they've already been out of school not just one year two year three year but four years and they have there's practices that want to buy it because there's a lot of 60 year old dennis who didn't want to deal with his ppe and that whole three months when you were working around the clock a lot of 60 year old dennis if they'd never had a divorce um trust me if you have a divorce you just ruined your retirement planning for a decade when you cut all your money in half um but um they just said you know they don't want to mess with it they see these practices but they're paralyzed they're like man I want I’m so ready but I just think I should wait till the pandemic's over and I’m like well what is the definition the pandemic over there there's a vaccine I mean so what would you tell someone who sees some old man he's like I don't want to do all this ppe crap but you know they're in the middle of Atlanta they're the middle of phoenix and there's a pandemic and we're in the middle of the pandemic what would you what are you seeing on practice transition is that a good idea or if it was you would you say you know what just keep doing what you're doing and just wait another year what would what would you say I’d say right now is not the time to sell most it well you got the dso buyer and then or the large group practice buyer and then you've got the uh private uh a young dentist or you know private buyer and there's not many private buyers right now they're just sort of all sitting on the sidelines waiting for this to flush out because who wants to buy a practice this year when collections are down and there's a lot of uncertainty about what it's going to look like over the next month and so valuations I think are going to be a little bit lower dsos are actually coming in and I think taking advantage of that right now a little bit but I generally tell people not to sell yeah turn on your afterburners make it work be a winner I just I find that some people that are so fearful it's like they're the ones they're the ones in their own way causing a recovery in their own practice because they want to be hyper compliant with everything and you need to be compliant I want you bringing loss but hyper compliant with everything then I got some who will toe the line and they'll tell the line and they say you know what my patients need dentistry and I’m going to figure this out we're going to wear all this stuff and do all that stuff but that I’m going to figure out a way to success I call them the winners because they will they will devise a plan to make it work and they motivate their team and they walk in their office every day and they know it's game faces on and they're excited and they make it work and they work really hard and they're doing there some of my clients are doing great this year through their recovery and I mean I have one client in la jolla who's just this is his best year ever it's amazing because he has taken that approach that I’m gonna I’m gonna figure out a way to win this and not let the government or the ada or anybody tell me I have to completely shut down and close business I’m going to tow that line I’m going to stay compliant but I’m going to till that line and make it make it happen and that's what I recommend be a winner go figure it out well you know my uh how I can prove that I’m a winner and I’m successful I was the first person to follow associates on fire on instagram yeah my gosh am I uh so my before I end remind everyone this is not a commercial simply because I don't have to do commercials I mean I’m a 58 year old retired guy um I brought you on because I know how damn smart you are but I do know this every time you lecture you say is there any questions and everything now very good okay go to the bathroom 15 minutes and then everybody comes up with their special unique question that everyone else has um so I know my homies like the back of my hand and they're saying oh wes you don't understand I got I got my situation so unique so how do they contact you for their unique question that you've heard eight million times uh they contact on our on our website we have a we have a contact us page my personal email is wes practice wes and they can they can call our number uh we're really responsive we have a theme here which is helping doctors thrive financially and thrive is an acronym for a team uh teamwork uh h is highly innovative r is responsive I is industry experts v is value surplus and e is extreme ownership r is one of those critical ones responsiveness we're highly responsive we have a 24-hour return policy when people reach out to us so yeah just uh call us if they call us they're going to get um one of our executive assistants who will sort of field some basic questions about their practice and then bring it over to me and i'll usually call them or one of our cfo advisors we'll talk with them and we often do a free consultation looking at their tax returns and their p l's to decide if there's a good fit we don't take everybody we really are looking for practices that are north of a million in collections because if you're smaller than that it can be hard to you know have a cfo or sometimes you're just trying to make ends meet at that point but we're really looking for practices that are north of a million dollars and really motivated to grow and really need help constructing a master plan around their finances but that's how they could reach us okay I’m a little slow thrive t was for teamwork what was h4 howard you said uh yeah exactly howard looked at howard for everything of wisdom h is highly innovative highly innovative um r is responsive right I is teamwork highly innovative that was uh two words and responsiveness and then what was the other eye uh I is um industry experts meaning we want to know everything there is to know about the financial side of dentistry we work exclusively with dentists and then v valve camera value surplus means that although people might pay 30 40 50 for our services as a cfo function than they may a basic bookkeeper down the street uh value surplus means we are there's a surplus in value that you get that exceeds the cost you pay us many times over otherwise you shouldn't hire us we shouldn't be there so we're month to month in everything we do because you always got to feel that value it exceeds the cost that's called value surplus and then the last one extreme ownership extreme ownership um and then um I know uh I know you got a um head out you got a meeting with a dennis at one um just two real quick questions um they always um ask about should they refinance your student loans what's the quick and dirty answer for that so associates on fire fuel cell one video number three is called the overall timeline of events in the life of an associate and they come out of dental school and during that period of time you need to live like a dental student and save you need to be saving money you need to be saving because liquidity will help you when you go to buy a practice it'll help you too when you go to buy a house but you need to be safe okay so those are these all audio podcasts or are they video on youtube too both we have video which are youtube that are embedded in the site video clips there's about 12 hours of video clips about 10 minutes per video on all of these subjects and then there is a podcast called the associates on fire podcast which is live we have about five podcasts love to get you on there at some point and then we have downloadable resources which are sort of tools to help them and then we do once a month at what I call a live fire side where associates can log into a zoom meeting and ask questions for free about their specific situation those are all of the modules with it but to answer your question should they refinance their student loans right now depends where they're at in their stage of buying a practice and a home and setting up a retirement plan I uh in the early years you need to keep your student loans as low as possible even if that means that the balance is going up from accrued interest that's okay because you need to keep your you need to keep your personal overhead low so when you go to buy a practice the bank looks at that and says yes we will lend to you because your global debt is low enough that we believe you can pay us back if you refinance your student loans and you don't own a practice yet now your payments go from twelve hundred dollars a month to thirty three hundred dollars a month well now you become less lendable to a bank who generally speaking doesn't factor in the fact that your student loans balance is going to go up over time because you're on an income driven repayment plan so keep your student loans low now if you've already bought a practice you've already bought your house you're already re funding your retirement plan well great now let's go look at refinancing your federal student loans into a private student loan at a you know 3 10-year rate and let's start tackling that will you get it forgiven over time I always tell doctors maybe you'll get it forgiven after 20 years or uh you know however much time is left or if you're on the pslf program you'll maybe get that forgiven after 10 years but I think a lot is going to change around that we're about to see a massive tidal wave over the next 10 to 15 years of student loans that are going to be forgiven and it's at about one point I think seven trillion dollars of our government debt and the government is not just going to forgive that our economy would spiral overnight if they just suddenly gave up 1.7 trillion dollars of assets on the government balance sheet by forgiving everybody's student loan never it's never going to happen if you want to try to keep your income low for 20 years great but what I say is be a winner go try to go to try to get a 1.5 million dollar single doctor practice with a 40 profit margin great you're making six seven hundred thousand dollars let's tackle your debt let's fund your retirement plan think like a winner not think about just playing defense so to answer that question should they refinance really depends on where they're at in this in the life cycle or the stage of their career well i'll tell you why um what I just did to show you I took that youtube video and I dropped it um into dental town because in downtown when you when you go to youtube uh you can hit a share and it's a link but you can do embed so you can go to dental town and drop the video in the downtown message board and everyone that does that tells me that that's what explodes their views the most uh there's so many people uh on their youtube channel um that just exploded uh so I love um I was one of the first ones where um you know they were saying why does my kid watch youtube and he won't read books it's like well look at that black and white book with no pictures I mean when I’m working with my uh grandkids um when you can tell they don't get something I can go on youtube and find like a two-minute video that explains the difference saying addition and subtraction and you can and you can tell that video probably took five hours or you know it might have taken you know this person might have been a teacher for 10 years and she just made this little bitty lesson and uh so I think video is more informative um thank you so much wes for coming on the show and talking to my homies uh big been a big fan of your work uh forever and uh thanks for all you do and um i'll see you on the other side of this pandemic yeah thanks howard for having me on really appreciate it anytime really admire everything you've done so thank you again all right buddy have a great day okay you too bye-bye
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