If you missed part 1, it can be read here: http://oneloosetooth.com/pay-dental-school-part-1/

Students graduating as general dentists in 2017 with 300+ thousand dollars of student debt need immediate cash flow to meet their obligations.

There was a time in dentistry when a student could matriculate from a program and set up shop with 1 or 2 used chairs and zero charts then work hard, network, and slowly build a practice. Often, these dentists graduated with the knowledge and skill set they needed to not only survive, but financially thrive.

As the cost of tuition goes up, staring a practice like this soon after graduation becomes much more challenging as student debt must be serviced. A workaround to this would be to set up shop as described above while working as a part-time associate to service your student loans and meet your expenses.

The problem that many new graduates face now, is that part-time employment may not cover their student loan + basic living expenses while they build their own practice. Furthermore, there are very few private practices that truly have the capacity (chairs and working hours) as well as the patient load to provide an environment where an associateship can be successful in the medium to long term considering what an associate needs to take home to keep her head above water. At the end of the day, being an employee won’t cut it unless you qualify for PSLF (but unlike our MD colleagues, there are very few 501(c)(3) organizations that employ dentists).

That leads to ownership…which we will have to talk about next time. For now, I’ll say this, if you have a lot of debt, you have to buy a high collections office to provide the cash flow needed to service both the business loan and student loan. This further perpetuates the cycle of delayed savings in exchange for higher earnings.