2024 Dentist Financial Benchmarks: How Do You Measure Up? (Part 3) – Episode #624

On this episode of the Dentist Money Show, Ryan and Matt conclude the three-part series of the past year’s biggest themes in dentistry and analyze the results from a recent survey sent out to Dentist Advisors’ clients. The finale of the benchmark series includes insights about commercial real estate holdings, personal and practice debt averages, and insurance coverage. They explore the emotional weight of homeownership, some of the misconceptions surrounding real estate investments, and share key insights on student loans, life insurance, and disability insurance. Don’t miss this wrap-up of 2024’s dentist financial benchmarks, packed with valuable takeaways for dentists at any stage in their journey.

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Podcast Transcript

Intro: Hello everybody, welcome back to another episode of the dentist money show brought to you by dentist advisors today. We have part three of the dentist advisors wrapped episodes Ryan and I decided to stretch this out to three don’t ask us why we just did Hopefully you you enjoy it today. We talk about real estate debt practice debt. We talk about insurance. We, hit all the benchmarks, and the averages, for our clients in all those categories. And of course we do several side quests and have some fun. Hopefully you enjoy listening to it. Hopefully you get some value out of it. Enjoy the show.

Ryan Isaac: Let’s roll it up and, get it going. You know,

Matt Mulcock: Let’s

Ryan Isaac: Some smoke in this show Let’s roll it up. And

Matt Mulcock: On this bone. We’re going to circle back.

Ryan Isaac: What are some of the more, the other corporate sayings that we had learned in that meeting that we keep forgetting about? I feel like there was a big list of good corporate sayings, meat on the bone, circle back, more juice to squeeze,

Matt Mulcock: Juice to squeeze. Yep.

Ryan Isaac: What else was there? Synergy. There’s a lot of synergy. There was a lot of like hand motions of synergy. Well, we’re

Matt Mulcock: We’ll put a pin in

Ryan Isaac: Now. Circling back to episode take 3, version 3. Part

Matt Mulcock: Part tray.

Ryan Isaac: I’m not sure who’s still following along at this point of the wrapped. We may have overdone it a little bit. It’s

Matt Mulcock: Let’s, no one’s following along anymore. They’re going to see part three, like these idiots.

Ryan Isaac: You guys, it should be, it

Matt Mulcock: They’re struggling this hard for content. They want to do a three part wrapped

Ryan Isaac: I’m making our marketing team somehow title this wrapped. Part three, colon, more meat on the bone.

Matt Mulcock: More meat on the bone.

Ryan Isaac: Let’s squeeze a little more juice

Matt Mulcock: Let’s circle back.

Ryan Isaac: Yeah, this is part three, part three of wrapped. Um, part one of wrapped. If you go back in the archives, Was our survey data questions about, do you like your job? Is dentistry still worth it? Are you making the money you thought you would? Are you living the life you thought you would? Do you spend too much? that was part one. Very cool

Matt Mulcock: We started with, we started with the best. We should have finished with the best stuff.

Ryan Isaac: Yeah. Today, today. Yeah, we, it was, you know, shocking. Part two, we dove into the data. Yeah, we dove into net worth, spending, savings. We took some detours. We took some, uh, conversational detours, some

Matt Mulcock: We don’t ever do that. What are you talking about?

Ryan Isaac: A few side quests. And, today. Sidebars today. We’re circling back. Our people are talking to your people and we’re going to do lunch and, touch base about the last two remaining subjects, which is debt and insurance. And we’re going to dive into the, the details of debt insurance. Is there anything you want to set up, Matt, either like comment on from our previous episodes on wrapped one and two, or set up today with debt and insurance, anything like any precursor to. again, what is a benchmark? When does it matter? When does it not matter? What if you fall wildly outside of these ranges? Anything you want to set up before we jump into the data?

Matt Mulcock: Yeah, we mentioned this last time and we just had a meeting yesterday with our advisors and One of our advisors mentioned that a client was pretty adamant and we’ve heard this multiple times of like pretty adamant about hearing about this data, but like, I want to see how I stack up, which I think is again, keeping it in perspective. I think it’s good to establish a baseline. We’re not against that at all, but like, that’s all it is, is a baseline. I don’t want people to get lost in the data and let it become more important than your own personal life and situation. so just having a healthy perspective on it, I think is the, the main message is the main meat is the main meat on

Ryan Isaac: That’s the meat on the bone that’s still kind of hanging there. You know, when I think of meat on the bone, actually, do you know those Brazilian restaurants that are like all you can eat

Matt Mulcock: Yes, I do. Like rodigio grill. Yeah.

Ryan Isaac: For some reason, those restaurants never fill me up. I can stay green side up the whole time the table’s done. And I’m still just like, shave some more meat. Let’s go

Matt Mulcock: Yeah. I mean, that’s how I feel about sushi too.

Ryan Isaac: Oh yes. Yeah. Sushi sushi does hit me at a certain point, but. Anyway, okay. Well, let’s dive in here. Um, the first thing we’re going to get into is the first column I’m looking at here is personal real estate. Is that a good place to start for you?

Matt Mulcock: I love that place.

Ryan Isaac: You like this place, personal real estate. Um, let’s set this up for a second, Matt. Anything, anything you want to say about personal real estate and, the homes dentists own? Any experiences that you found? the emotions behind personal real estate? not that you have to, but anything come to mind around personal real estate and dentists?

Matt Mulcock: Probably the most emotional decision that we see dentists make. it’s interesting though, this theme that’s come up for me, and it’s just, I fully admit it’s probably just recency bias, but, recently had a couple of conversations where, and this actually backs up the data of the, of part one of this,

Ryan Isaac: Just gonna, uh, reference that.

Matt Mulcock: Yeah. So part one being that we asked people if they’re living in their dream home. And I believe it was something like 40 percent said no by choice. And I just had this conversation the other day with a client who we’ve been working together for five years and five years ago, in fact, we were just kind of laughing about this in our last meeting, uh, like last week and before where about five years ago, they were adamant about upgrading their home and kind of getting into this like quote unquote dream home. And. you know, we had multiple conversations. It just wasn’t working for them based on their cashflow and where their practice was and all that. So they came off of it and tabled it So when we talked about it recently, it’s funny how they’ve changed their opinion and she was saying, she goes, you know, I’ve realized like, I really like traveling and I just do, I worry that if we upgrade our home now. You know, that’s going to, it’s going to hinder our ability to travel and have the lifestyle we want. And I’ve had that conversation multiple times recently, which is, I think, kind of cool that people are starting, there’s no right or wrong answer here. We’re not saying this is right. And the other way is wrong. I just think it’s kind of cool to hear these conversations with clients I’ve worked with for years and kind of seeing their evolution and their mindset change. of understanding those trade offs that you’re making when it comes to like having your quote unquote dream home.

Ryan Isaac: What do you think contributed to that? Is it, age? Is it experience? Is it just coming to know yourself a little bit more? Was it a change in income or cash flow or liquidity somehow? Or, what, what do you think changed that?

Matt Mulcock: Yeah, I mean, I think when we first were talking about it with these particular clients, they were in a position where they couldn’t do their home. They like, they couldn’t, they couldn’t put, they, they literally couldn’t, um, and they knew that and so, they were at the time kind of thinking they wanted to try to force it and Luckily, they realized and I showed them the numbers and we were just like, this is not going to work right now. So they were forced to kind of put it on the back burner, right? But they really were forced to, to, to not pursue that at the time. And I think what, so that’s, and what’s changed since along with their cashflow and the fact that their practice is now doing well and they’ve got some liquidity and they’ve seen this progress over the last five years, they’re starting to feel the impact on their lifestyle in a good way. Meaning like now we have got some extra cash. Now we’ve got some liquidity. They just told me the other day, they’re like, man, if we do this, like we might be, we’re going to be like kind of house poor if we do the house we want or, or they’re worried about that. Like they’ve just gotten to a place where they built up this liquidity. And they’re like, Oh, do we want to like get rid of that? Like we feel pretty good with our situation. So I think before they didn’t even have a choice and they didn’t have the cash and they didn’t have the cash flow. Now that they do, their perspective has kind of changed because their stress levels are so far, they’re so down now,

Ryan Isaac: Is different. Okay, so this is an interesting perspective. Has nothing to do with this episode. So great, we’re off to a good start so

Matt Mulcock: Here we are.

Ryan Isaac: Haven’t even hit the first data point. This makes me wonder, Matt, this is a whole other episode, is the financial decisions we make out of desperation when we can’t, like, when we feel like we can’t or we’re restricted, we don’t have options versus the financial decisions we make when we do have options and we’re not restricted anymore? And how those differ, it does kind of, make me, that decision making process sounds a lot like how people with like less liquidity, let’s say someone has a decent portfolio. I mean, let’s say they got half a million dollars in a portfolio. That’s not D that’s a lot of money. That’s a lot of money. The decision someone might make the out of like, I need to take. All of this and do a higher risk, more sophisticated investment versus when that person 10 years later has like millions of dollars in a portfolio. They are different situations. And I don’t, there’s probably good data and Daniel Crosby style stories on this stuff, but it makes me wonder how we’re influenced in our decision making with money when we’re in like, a place of like wanting. And feeling restricted and not having options versus when we’re in the opposite situation. That’s a really interesting kind of scenario you laid out.

Matt Mulcock: Yeah. And I’ve seen this multiple times. First of all, nobody makes good decisions from a place of anxiety. Nobody makes good decisions from a place of desperation. and I think the biggest money mistakes are made when you feel like you’ve got, or when you’re rushing it, or you’re trying to like, again, rush the process or for something, you know, when you’re forcing it and I’ve seen this, not just with these clients, I’ve seen this countless times from people who all of a sudden they get into a different situation, like they, they come from this place of like, they have no options to now they do mainly like all of a sudden their liquidity is great. Their cashflow is great. Okay. And all of a sudden, again, I’ve seen it, the mindset changes. And they’re like, Oh man, I can take three trips a year and still save 20 percent of my income and live in like a, still a decent house. Um, this has been a general theme for, for me lately with clients. Not all of them. But I’ve had these conversations more so lately. Over the last like year or two and now I think the environment has changed macro economically So if you look at the rates now, it kind of forces you It’s a lot easier to get into your dream home when you’re getting a three percent rate versus now a seven So that’s it. I want to be fair to that that changes some perspectives as well.

Ryan Isaac: So I’m just thinking of three clients just in the last, uh, let’s say two weeks. I’ve had three conversations just in the last couple weeks with clients who are post exit like buyout Who got millions and millions of dollars and before that they really wanted to let’s say diversify their balance sheet Um, into more complex, say sexier investments, just more complex stuff, more private investing, more private equity, more real estate stuff. And they did. And those three conversations that I’ve had lately are now post all this stuff. They’ve had some successes. They’ve had some major losses in some of these things. All three of these people, I’m not saying this is how everyone is, or it’s right or wrong. It’s just the experience. All three of these people are now coming back now that they’ve done it now that they have tons of liquidity have some more experience. They’re all coming back and saying, all right, time to simplify. I actually don’t want the stuff on my balance sheet. I don’t want to deal with this anymore. I want the simple, boring stuff like I had before I got my fill, whatever. And that’s probably a lot of factors, but it is interesting. What we think we want when we can’t have it versus when we know we could and we’re like actually don’t really want that Anymore, I know I could and I don’t really want that anymore. So fascinating We should probably get into some data unless you have anything else to say on them

Matt Mulcock: Should but hopefully this is still a helpful little side quest that we

Ryan Isaac: This is a good side quest Data point number one personal real estate loans. This is all of the non zero personal real estate loan values of our clients and Matt you have a Do you have a, a data point on the average, home price in the country right now?

Matt Mulcock: Yeah, I don’t have it in front of me, but we’ve done this before. I think it’s around and I can get it really quick. I want to say it’s around 440,

Ryan Isaac: I thought it was somewhere in there too. Yeah, Google

Matt Mulcock: But let me tell you,

Ryan Isaac: Up. My kids say search it up. They don’t even say

Matt Mulcock: I’m going to search it

Ryan Isaac: My kids say search it up.

Matt Mulcock: In US. Hang on. I’ll tell you. Oh my word. Okay. As of January, 2025 median home price or the price of a home sold. So median, this is the midpoint

Ryan Isaac: Yeah, mid, yeah.

Matt Mulcock: 446.

Ryan Isaac: Okay.

Matt Mulcock: Oh wait, let’s see. As of Q4, 2024, the median home price in the United States was 419, 200.

Ryan Isaac: Okay.

Matt Mulcock: And then it says the median price of a new home, a new home sold in January of this year was 446, 000. So somewhere in that 420, 000 to 450, 000 range,

Ryan Isaac: Okay. So, our clients, this is just from positive. personal real estate balances. So there are people who don’t own homes and then there’s people who own homes that they’re paid off. So this is just of the, of those

Matt Mulcock: The ones that have a balance.

Ryan Isaac: A balance. The average is 553, which makes more sense considering we’re dealing with people who are much higher than average income earners. But the median in that, this is kind of interesting, the median. So the average is 553, but the median in this data set is actually 472. So pretty, pretty close to the median home price in the

Matt Mulcock: Home price. Yeah

Ryan Isaac: Um,

Matt Mulcock: Just the debt right? So that’s not even that’s we’re not counting. That’s

Ryan Isaac: Not the value

Matt Mulcock: It’s not the home value

Ryan Isaac: That is not the value because when I, when I hear that number, just generally speaking, except for a shout out to all of our clients there in like, less expensive real estate markets, rural places, Midwest, maybe some parts of the South everywhere else is just getting so expensive. Everywhere’s getting so expensive. But yeah, I would, my anecdotal experience would be that the value of these homes that the average dentist is owning is much higher, probably close to double that.

Matt Mulcock: I would I would say yeah, eight eight hundred to a million something

Ryan Isaac: I remember not that long ago having client conversations. Where they were, clients wanted to buy a house. It was like a million to a million five and thinking that was the most insane.

Matt Mulcock: Like you are crazy,

Ryan Isaac: Like that a million. Yeah. And now it’s just, things are so expensive now. Housing is just, it’s the top of the list.

So

Matt Mulcock: Dude now, I mean Don’t like we’re not gonna get started to where you live Where I live in Salt Lake, in a lot of these areas, that’s an entry point. You’re not touching these neighborhoods less than a million.

Ryan Isaac: Yeah. It’s entry point. Let’s go to practice loan. And again, this is practice loan non zeros. Hang on. So these are all the clients with a balance of a practice loan. Now, again, some clients don’t own practices and some clients own practices where they’ve paid off the debt, but do you, and we’d have to run some more data. I do think it’s probably more common for clients to hold practice loans. Do you think that’s true? And maybe let’s pause for a second and talk about the philosophy. What do you think, Matt? What’s your philosophy on holding debt on the practice throughout your whole career? What do you think about that? There’s kind of a stigma,

Matt Mulcock: Yeah. So my take on this has evolved over the years. But it’s, it all comes back to this idea of intention. So like, as long as it’s intentional addition of debt, that’s we’ll call productive debt. So, you know, you’re going to put a scanner. I just had a conversation with a client who was, who was looking to add a scanner to his ortho practice. Cause, and he could, he could outline specifically as to why. Where he is in his stage of his practice, why he’s adding it and what it’s going to do for his business and, and the problems it’s solving for him. So that’s just anecdotally. So what I don’t, where it’s evolved a little bit is just this idea of like growth for growth sake and just being like, I’m just going to keep growing, keep adding debt, keep adding practices, keep adding locations, keep adding chairs with no intention. That’s where I, I struggle with it. And then if we get into like the technical aspects of the debts side, we just talked about this right yesterday in our mastermind around the technical aspects of debt and what it does to your cashflow and why it’s always the number one reason why dentists feel like they’re not making any money. Like we’ll show them their cashflow statement. We’ll, you know, we’ll show them their gross income with everything. And then we’ll show them their, what would be free cashflow. And they’re like, well, wait a second. Why am I not seeing that money? It’s like, well, because you you’re paying 10, 000 for your debt. And by the way, that is always paid with after tax dollars.

Ryan Isaac: Yeah, like 90 percent of it’s after tax

Matt Mulcock: Exactly, that always throws people off. Um, cause the debt reduction piece that the actual balance being reduced is with after tax dollars. So people always get thrown off by that. So I guess I bring that up to say,

Ryan Isaac: I’m glad you

Matt Mulcock: Well, all else being equal, I would want a dentist to focus on how do I make this thing as, a highly cash flowing of a, of a business as quickly as possible.

Ryan Isaac: Mm hmm. Yeah, I’m glad you brought that up because and we’ll just put some numbers to it If it’s a dentist is what was our average income from the

Matt Mulcock: It was like 5, 5, 08 or something?

Ryan Isaac: Yeah, so you take you take a you know a dentist making half a million dollars huge income. It’s a lot of money That’s got an 8, 000 a month practice payment between practice loan and some equipment, whatever you know, it’s a hundred thousand dollars a year. I don’t know, maybe 20 of that is interest expense. It’s being written off and deduct deductive income, but 80 grand of it to your point is after tax money. So you’re paying taxes on that. And so, you know, that person’s like, I didn’t make 500. Well, yeah, a hundred of

Matt Mulcock: You did?

Ryan Isaac: Yeah, a hundred of that went to just your practice payment. Another hundred plus one 30 to one 50 went to taxes. And then you spent 200 at home from personal

Matt Mulcock: There’s all your money.

Ryan Isaac: That’s all of it. That’s why we’re trying to squeeze out five grand a month, which is possible. And we went over that in the last episode, tune in to part two to hear how five grand a month can get you to retirement quicker than you think.

Matt Mulcock: Wow. Quicker. You’ll be shocked at number two.

Ryan Isaac: It’s

Matt Mulcock: You won’t believe number

Ryan Isaac: You won’t believe number two. So, um, it’s also kind of funny. yeah, so I, I’m glad you brought that up because while we’re on the practice debt subject, people have to keep in mind that. That is the number one thing besides taxes that’s chewing up your, your money, um, coming out of the practice. Having said that, I do believe we are in a different environment, not that long ago, maybe 10 years plus. Uh, and, and before, getting rid of all of your debt in the business was like the way to go and you could do it. You could keep old chairs, old carpet, paper files, old wallpaper, lease a little building for, you know, four ops for 30 plus years. And you could just do that a whole career. Pay off your loans as fast as possible and still be competitive is what I’m saying. You can’t do that anymore. There’s too much money in competition. There’s too much money in, paying for good teams. Your space has to look good. Consumers want to feel good in your space. So I don’t believe unless you just have a high enough income to not only run your practice and save for your future and live and pay taxes and pay off all your debt faster. I just don’t believe the average dentist can afford to not at least do what it takes to keep the practice competitive. And the way that we measure your financial freedom number is your net worth. And can your net worth cover your spending and net worth includes debt. So as long as. Your net worth is big enough after you pay everything off like then then that’s okay to have you can retire with debt I guess is what I’m saying. But to your point, it just can’t be random You can’t just randomly buy stuff, but you don’t have a plan for you don’t have the CE to implement You don’t know how to market it to your neighborhood or your community to say like hey, there’s a new service I do it’s got to be very intentional Cause you can get in way over your head as a dentist in debt super fast. The banks will give you money hand over fist like in seven days. So

Matt Mulcock: Well, and to that point, Ryan, there’s a huge difference in it in the, I think stating your vision and purpose is super critical for any business owner. Like why are we in business? and understanding like, what’s your vision for this? Kind of the classic start with the end in mind. Cause there’s a massive difference between a dentist and we know plenty of them. Plenty of dentists that are like, listen, I want to run one location. I want to maximize this potential here. I want to, I want to maximize my profitability out of this practice, but I really only want to be chair side a couple of days a week and live a good life. And I don’t really care to like build this massive thing. You compare that to what we also hear from many of our clients are like, no, I’m going to go build like a three, four or five location, kind of mini group practice DSL, and then go sell this thing. The debt, the way you approach debt in both of those scenarios is so different, so

Ryan Isaac: Different. Yeah. And your, your tolerance for having it is going to be very, very different too, which is a whole other thing. That’s a personality thing. Um, I mean. We are big fans of building a net worth and a balance sheet that doesn’t include debt like getting rid of it while saving for the future. That’s, that’s a great worthy goal, but everyone’s personalities really differ with how they deal with debt. So let’s get to some numbers. The average debt balance among those who hold a balance. The, do you want to guess what you think it is?

Matt Mulcock: On the practice

Ryan Isaac: Yeah, unless you’re staring at it. Yeah,

Matt Mulcock: I’m not staring at it, but I’ve, we’ve looked through this. Um, if I remember correctly, I want to say it’s somewhere in the 600s.

Ryan Isaac: Yeah, you do remember. Well, I wouldn’t have, we recorded that in uh, we were looking at it in Nicaragua, like that felt like a year ago. It was

Matt Mulcock: Yeah, it did feel like a long time

Ryan Isaac: It was too beautiful to remember anything. Um 625. Yeah. That’s the average, the median point among that data sets. These are non zero values is 552. So what does that tell you? Does that tell you any stories or just coincidences that the average, the average debt balance is higher than the average. Mortgage balance

Matt Mulcock: I would say not a shock and actually a good thing to me in my opinion. you know, it’s debt on a Asset that’s producing for you. That’s it’s a, it’s an income producing asset. So I’d rather have you level leverage on that than an asset. That’s not. Producing income

Ryan Isaac: Totally Okay, let’s go to commercial real estate balances now. Hang on. Okay, so just for the viewers at home. The people who hold commercial real estate balances in our data set. This is the shortest amount of people, meaning, fewer people hold commercial real estate debt than have personal mortgages or practice debt. I think in, it does in years past, I think when we ran some different numbers, we found it was. Maybe at most like a third of our clients own commercial real estate. Do you remember those numbers? Could have been a quarter to a third.

Matt Mulcock: I think It was somewhere in that

Ryan Isaac: It was. It was a lot less than I thought it was. Um, do you want to set up anything or comment anything about, and it’s a whole other topic, like owning your space? Yes. But, for the majority of people that we have in this data set, don’t own, don’t have commercial real estate debt. Some, not many own it with zero debt on it. That’s actually pretty rare. But anything you want to say about, commercial real estate and like, you know, it’s role in your life as a successful dentist running a good practice.

Matt Mulcock: Yeah, I would just say simply practice always comes first and I think the biggest mistakes we see dentists make when it comes to commercial real estate is They put their desire To be a real estate mogul ahead of their ability to become or to be a good dentist and to run a killer practice. you know, all those being equal. Yeah, of course, if you can own the real estate versus rent it, it’s awesome. But if you’re set up with an option of saying, renting this space. is, is putting my practice in a way better location for my demographic, for the people that coming to, you know, way better vision or, you know, visibility and, just access. Like if it comes down to that and renting the space versus over here, I can own the building, but it’s way worse. It’s not even close. The practice comes first. Practice always comes first.

Ryan Isaac: Yeah. And, uh, we, we talk about this a lot with, with real estate, especially with the commercial real estate. When you are the, which is usually the case when you’re the sole tenant of the building that you own and practice in the return You think you’re getting while you’re the tenant and you have a note on that thing Let’s say you buy it at 40 and you sell it at 60 when you retire And you were the only tenant and you paid the note on that the whole time the return you think you’re getting on there Is not what people think is gonna be out of commercial real estate and in reality from the number standpoint To get your return as a dentist who owns the space you work in you have to not be the tenant So you got to retire and leave the notes got to be gone And then someone else has to come in there and pay you rent for a good decade plus for you to achieve a double digit Return on that asset because the time that you’re the tenant paying the note on there You’re your return if it’s positive is gonna be low single digits I mean, there’s probably, well, for sure, there’s cases where people just get lucky during certain market periods.

Matt Mulcock: Sure. Or different locations. Yeah.

Ryan Isaac: That’s not a strategy. So the return doesn’t end up being what you think it is while you are the tenant paying the note. if it’s a big building with multi tenant location, kind of situation, that’s a, that’s a different thing, but yeah, Matt, it’s not, it’s practice first. Where can you make the most money and run the best practice first, no matter what the rent or own situation is. So,

Matt Mulcock: Yeah, I think in most cases if you’re trying to protect your mental and emotional health You should never run the numbers on your real estate.

Ryan Isaac: Oh gosh, man.

Matt Mulcock: You should just never do it I think I think it’s one of the biggest misconceptions that people When you actually run numbers on a lot, I’m not saying again, we, we are not anti real estate. I’ve said this many, many times. I come from a real estate background. I believe in it. I know a lot of people who’ve, who’ve built a lot of wealth in real estate. but the average dentist who just is like, I’m going to quote unquote, get into real estate. Uh, if you actually run the numbers, you will realize in most cases you’ll whatever return. Cause what people tend to do with real estate is I bought it for this and I sold it for this. So there’s my return. It’s like, no, that is not how this works. There is so much more that goes into this. And, so yeah, I would just say if you actually run the numbers and, and, and run it in detail and accurately, in most cases, you’re not, you know, your return is not even close to what you think it is.

Ryan Isaac: Yeah. And, and, yeah. The, the real true returns out of real estate is when you’re not the tenant, there’s no note on it anymore, and someone else is paying the rent. Those are double digit returns.

Matt Mulcock: Wait a second. you’re you, so wait, what you’re saying is it takes time.

Ryan Isaac: It takes, what you’re saying, Ryan, is that it takes decades to get a good return out of real estate.

Matt Mulcock: That’s, that’s crazy to me. That’s crazy.

Ryan Isaac: Like everything else. Okay. So the numbers on for those who hold a balance in commercial real estate, any guess on the average?

Matt Mulcock: Ooh. If I remember correctly, I want to say it was in the 600s again, I think.

Ryan Isaac: Very close. The average is 596. Really close. So which is kind of interesting

Matt Mulcock: Going to round up. We’re going to

Ryan Isaac: Round up to make you look better I like that idea the median because I like both of these numbers here. The median is about 467

Matt Mulcock: Okay.

Ryan Isaac: So Yeah, I to me there’s a lesson to be learned here in the commercial real estate every time we do these numbers and it’s everything We’ve just been saying practice first make money the most profitable best flowing best located Best parking visibility practice that you can get into if that’s a rental your whole career. Good for you. Do it.

Matt Mulcock: I think this final point, this is something that I’m pretty adamant about. And we, I think we are adamant about, I think if we’d come to like the fundamental kind of, thinking around. around this of any assets. Right. But let’s take real estate. I think is the, is the biggest, most egregious, like mistake that dentists make with it when it comes to their mindset and I’ll use a, I’ll use a really ridiculous example, Ryan. And, but I hope this lands, there was an article, there was an article last year, I think that came out, but circulated around some of our team around Taylor Swift. And the article is something along the lines of like Taylor Swift and her, like, how, like her real estate portfolio. And it was talking about how she invests a lot of her money in real estate. And, I think someone, or we posted this somewhere, but either way, the whole point of bringing this up is to say, Taylor Swift did not make her like, you could see the article and be like, Oh. You equate Taylor Swift real estate. That’s how she made her money or like that means that real estate makes me wealthy Absolutely, not Taylor Swift did not make her money in real estate Taylor Swift made her money being Taylor Swift and then she took her money and she diversified it in real estate It’s the same thing with dentists. It’s it’s this can dentists get this conflate this idea Year three, year four, year five into practice ownership or being an associate. And they’re like, I’m going to go be a real estate mogul, or I’m going to go invest in real estate because they’re thinking, well, I’ve heard of this guy or this guy or this girl, they’re really rich and they own real estate, but that’s not what made

Ryan Isaac: I came from.

Matt Mulcock: It’s not where it came from.

Ryan Isaac: Very rare very rare You hear the careers like him, you know they made more money in real estate than they did in their ortho practice and for one it’s like Super lucky. And also was that a crappy orthopractic sign? Cause that shouldn’t be,

Matt Mulcock: Shouldn’t be what

Ryan Isaac: Be the case. It’s funny you bring up that, that Taylor Swift thing too. I love listening to biographies of famous people, which is really interesting to hear. I’m listening to one right now, and I’m always surprised, it feels like real estate is the place where, uh, very wealthy people just like park money all the time. I have no, I have no data to back this up. This is just like, what it feels like, okay? So, calm down. but, how

Matt Mulcock: I say, I see what you did there at the calm down.

Ryan Isaac: Do you,

Matt Mulcock: Did you mean to do that?

Ryan Isaac: No, that was not well, well done. You know, that’s

Matt Mulcock: Done by you.

Ryan Isaac: How often do you see in the news? Like Kevin and I’m making this up again, Kevin Costner sells 80 mansion for 35 million. You know, like how often do you see in the news where celebrities and rich people are buying like crazy piece of property all over the world. And then they’re just like fire selling them later. They’re taking like 20 million baths and they don’t care. Like whatever. It makes me wonder. How many of these like celebrities and, you know, there’s definitely an appeal to having like your gorgeous spot in like Spain or Costa Rica or somewhere. Right. But it makes me wonder if a lot of these celebrities, had different advice and what would happen if, if they just parked like. 50 million in like the S and P 500 for

Matt Mulcock: Oh my gosh. Or even better, just a well diversified portfolio

Ryan Isaac: That’s what I’m saying. Like what would have happened? Yeah. If they didn’t just go like on a house buying spree around the world, cause they thought that was the only place to put wealth, which is a very common misconception. I don’t blame anyone for it. And it is more fun to own houses somewhere and play cool places than shares of a mutual fund. That’s way more fun. way better. but like, you know, you hear the stories, they never go, they never visit them. And then they’re always like selling them again. You hear it on the news and they’re just like tens of millions of dollars less than they paid for them.

Matt Mulcock: Yeah, I was just, I was just skiing in Deer Valley last weekend and I’m, you know, you’re On the chairlift looking around at all these vacant second and third

Ryan Isaac: Oh yeah. Oh yeah. That’s like the whole coastline in my, the whole coastline of California

Matt Mulcock: Vacant homes.

Ryan Isaac: Million homes just sitting there and there’s someone’s like fourth home or whatever. It’s just, it makes me wonder how much more wealth. And then how many stories are of famous and rich people who have like, gone bankrupt, but they own six crazy houses around the world. So I think it’s just a default place to put money, especially when you get more of it. But it’s just, you know, like everything else you just have to, tread carefully,

Matt Mulcock: What

Ryan Isaac: Understand what’s going on.

Matt Mulcock: And to to put a bow on this and a

Ryan Isaac: Ooh. Oh, put a bow on it.

Matt Mulcock: To put a bow on it. That’s another one. what you just said is critical of where you park money, right? again, the bottom line is Get really clear around the difference in how people made money versus where they put it after they made it. Like that’s a huge difference, right? Like, cause then again, I can’t emphasize this enough of how many times dentists I believe, that real estate, it’s always real estate or private investments, but real estate is the biggest one of like, that’s their answer to financial freedom sooner. And I’m like, I cannot emphasize enough that it’s not building wealth in real estate, building wealth in the stock market, building wealth and private investments. Your own practice. It’s going to take you decades.

Ryan Isaac: They’re all, they’re all years and years and decades. speaking of Taylor really fast, I think her arrows to her gross, like a billion dollars. So it might’ve been like, yeah, look at her really fast

Matt Mulcock: Yeah, let’s do it. 2.

Ryan Isaac: To your point. Taylor’s making her money from her music and her amazing marketing. I think it was like, it was at least a billion.

Matt Mulcock: 2 billion.

Ryan Isaac: 2. 2. Okay. I think I remember doing the math and which is probably wrong at this point, but I think every stop she netted after all of her costs, it was like 20 to 30 million per night.

Matt Mulcock: Yeah, that’s wild. She sold 10 million tickets

Ryan Isaac: It’s

Matt Mulcock: Across five continents in 21 months and grossed 2. 2 billion.

Ryan Isaac: I don’t know if this is gonna

Matt Mulcock: Wow. We are down a rabbit

Ryan Isaac: Weird Al the Tailor. Alright, let’s go to student loans. Among those who hold a balance,

Matt Mulcock: We can’t do a part four of this, Ryan.

Ryan Isaac: No, we’re gonna wrap this up. We’re gonna wrap up wrapped. What do you think the average student loan balance among those who hold a balance is?

302.

Matt Mulcock: I haven’t seen this one. Cause the one we were looking at was with the zeros. Uh, I’m going to say it’s around 300.

Ryan Isaac: What the freak?

Matt Mulcock: Look at that.

Ryan Isaac: Okay.

Matt Mulcock: I’ve done this for a while,

Ryan Isaac: 302. You kind of know your stuff in the median is 285. Very close. Median. That’s, that’s, that’s interesting. Now the student loans might be a more fair one to do with all of the zeros, which would probably chop it in about half

Matt Mulcock: I think when we did it, I think, I think when we did it, it was around like one 24 with the

Ryan Isaac: Gonna say, yeah, two thirds of it go away. That makes sense. yeah. Anything you wanna say about Stu ? What, anything you wanna say about the, uh, repayment programs of student loans going on right now? Matt, do you have any, do you have any updates, any news you’d like to share with the population?

Matt Mulcock: Changes every day. It feels like, and no one knows, no one knows what’s going on. I would just say, we’ve said this before. this is the one we, we like to bring out to people when they’re kind of freaking out, coming out of school with like 250 or 300 or even 400. You know, when I started this, even seven years ago, Ryan, you, well, before me in the dental space, you know, you’d see those numbers when you saw, when you started working, you, you’ve told the story of when you and Reese would see like even a buck 50

Ryan Isaac: Oh,

Matt Mulcock: This is

Ryan Isaac: I thought it was insane. I thought that, and that was the late two thousands. I thought that was insane. Someone have like $200,000 of student loans.

Matt Mulcock: Yeah. And now we work with people that come to us with 350, 400 grand and we don’t

Ryan Isaac: With a seven figure million dollars

Matt Mulcock: We’ve seen it multiple times. Yeah,

Ryan Isaac: That’s so wild. Okay. let’s go to, the insurances. We’re going to do life and disability and yeah, right around 40 minutes, give or take a few edits, probably a lot of edits considering half the intro was us yapping about corporate terms. There is a little more juice to squeeze though. So let’s, let’s give it a little squeeze. the average life insurance for those who have life insurance, non zeros, and there are a lot more of these. What do you think the average

Matt Mulcock: 2. 2 million. Ooh, higher than I thought. Okay.

Ryan Isaac: If we were to go back and combine this episode, if we, if we had any shred of efficiency, we would have done this in one episode. And, uh,

Matt Mulcock: The older we get, the more we yap like a couple of old ladies. I’m like, we’re a couple of old ladies on the, on the porch drinking some lemonade and just

Ryan Isaac: What a dream. Yeah. What a dream to be that. I’ll be there one day. That’ll be

Matt Mulcock: You’ll be an old lady

Ryan Isaac: Maybe one day? Maybe. Who knows? It doesn’t matter. If we combine this with the data of the average net worth, which was 2 point something, the non zero net worth, do you remember? 2. 4, 2. 5,

Matt Mulcock: Was, I think it was, yeah, like two, 3. Yeah.

Ryan Isaac: So, the amount of life insurance you should carry, this is very high level, this is a whole other episode. if something were to happen to you, and you want to cover, and you want your family or whoever, you’re leaving money behind, who depends on you financially, You want them to be able to cover the current living expenses they’re used to. You need your net worth and your life insurance when all is said done to cover that amount. they can pull out their spending every month and that, that’ll last for a while. At least last until the kids are out of the house or last long enough, the time period that works for you. I do find it interesting that a combination of the average life insurance, the average net worth, it would cover, you know, about the average spending.

Matt Mulcock: Yeah.

Ryan Isaac: With a sustainable withdrawal rate of around 4%, just very, very loose numbers. But I do, I that’s encouraging, I guess is all I’m saying. The average net worth stacked with the average life insurance amount that people hold would cover, with a sustainable withdrawal rate, the average spending from our clients. So

Matt Mulcock: Yep.

Ryan Isaac: That tells me that dentists do hold An appropriate amount of life insurance. I was going to do the medium. What do you want to say about life insurance? I mean, this is a whole other episode by itself for sure. How to pick it, how to, you know, get the right stuff, how to pick the right amount. By the way, the median is about 2.1. So not

Matt Mulcock: It also comes, nah, not, not

Ryan Isaac: Far off the average, which, which again says that the most people are holding the appropriate amount of life insurance. We could get way into the weeds on life insurance. It’s its whole other own discussion. Anything you want to say though, about life insurance, uh, in this context at all.

Matt Mulcock: I mean, not much. I think people, most people out there know our stance on life insurance and in regards to a having enough in your, you know, your most vulnerable years being where you’ve got people relying on you financially, young kids, especially it’s, it’s kind of like a, you just have to have it. and then just to kind of a reminder of like, what, what is the purpose of life insurance versus what’s the purpose of investing, you know, life insurance is to protect your, you know, protect you in the present. Investing is to protect you in the future. when you mix the two, which we see people come to us or ask us about this, when you mix the two, you really diminish this efficiency and effectiveness in both protecting yourself now and in

Ryan Isaac: You mean buying

Matt Mulcock: That always comes to mind for me when we talk about life insurance.

Ryan Isaac: Totally.

Matt Mulcock: Yeah, mixing any, any mixed what I’ll call a mixed product when you’re trying to mix in insurance with investing, which is what a lot of these salesmen will try to do and tell you why it’s better. That always just is a good reminder, I think, for the on the life insurance stuff.

Ryan Isaac: Yeah. And, by the way, our philosophy is we, we do want to help people reduce the amount of insurance they carry as time goes on, as their net worth goes up, except for liability insurance. That’s kind of, that goes hand in hand, kind of lockstep with your net worth. Um, to protect that, but as you become self insured through your net worth, it is appropriate to start paring back, certain types of insurance, not health, not life, not liability,

Matt Mulcock: Yeah, it’s the goal to be, to rely on insurance as little as possible. Yeah,

Ryan Isaac: Be your own bank, Matt. Oh, do you, what, what, how, what do you feel inside? What does your body do when you hear that? you hear that, you know, message. It trembles. Let’s go to disability. This’ll be the last insurance that we do. These are non zero disability holders. And, the max, the max per, and this is personal disability, by the way, the max personal disability with combined insurance policies. Maybe some companies will do one single policy. I don’t think so is somewhere in the mid twenties. Um, it used to be like. 17, 19, 000, but it’s like 25 or 26 now that a, that a disability insurance company will let you have total combined between all of them. And then there’s something called coordination of benefits when you have multiple companies. If you’re ever on a claim, any guesses on the average, what’s the average person holding in disability?

Matt Mulcock: I think it’s It’s in the 20s.

Ryan Isaac: Ooh, the average match. This is finally one that you are not.

Matt Mulcock: Not even close. 10, 12.

Ryan Isaac: 10. Yeah, it’s 10. And then the median is like 9, 500 bucks.

Matt Mulcock: I closed it so poorly.

Ryan Isaac: Man, come on. So this would tell us, this would tell us that the average dentist spending somewhere around 16, 17 thousand dollars a month is covering, would cover about 10, 000 of that through disability insurance if anything ever happened, personal disability. And then the average net worth carried by this average person. would probably cover the rest of it pretty handily. So this data also encourages me and tells me that our clients are properly insured through life and disability insurance. we are not brokers. We don’t sell insurance. No one pays us. We don’t make any money on insurance, but we consult heavily on it. and there’s other kinds too. That we, uh, work with our clients on throughout the year to make sure they have enough, not too much, not too little. They have the right kind.

Matt Mulcock: They’re dropping it when they need to

Ryan Isaac: Dropping it when they need to. Yeah, so this is encouraging to see that among our client data set that people are carrying disability insurance. I will say though, it’s common to meet dentists who don’t carry disability. Or, you know, they’re spending 25, 000 a month and they carry like 5, 000 of disability. Disability is your biggest risk. And I think we’re going to do an episode coming up soon. Will wrote an article. Is that

Matt Mulcock: Yep. There’s, did he write one or he’s writing one?

Ryan Isaac: Well, if he’s not, he is now.

Matt Mulcock: Definitely

Ryan Isaac: We just announced it. So, Will, Will Gochnour of Dentist Advisors, everybody, is writing an article on disability insurance.

Matt Mulcock: The, out on the waves now.

Ryan Isaac: So, yeah,

Matt Mulcock: Also really quick, you know what, you know what Will should do? I thought of this yesterday. Will needs to start his own separate podcast called Good Will.

Ryan Isaac: Whoa. Good Will.

Matt Mulcock: Goodwill, Goodwill

Ryan Isaac: Do you know, he would crush downloads and listens, like, he would crush a dentist money show within 30 days.

Matt Mulcock: He would, he would destroy

Ryan Isaac: Like, it’s just Will Gochnour, like, everyone

Matt Mulcock: We’re just creating our, we’re just creating, building, creating a monster right now.

Ryan Isaac: No, this is Barstool.

Matt Mulcock: Oh, that’s

Ryan Isaac: This is the Barstool of financial advice for dentists. We’re the Barstool. So we’re gonna have

Matt Mulcock: Then we’re going to add Goodwill. Yep.

Ryan Isaac: Anything else you want to say about disability insurance, Matt?

Matt Mulcock: No, just what you said. I mean, it’s the one that’s the, it’s the one that Dentist hate to pay for cause it’s the most expensive, but it’s the most expensive because it’s the most likely you’re going to use it.

Ryan Isaac: Yeah, we’ve got, and we’ve got some stories we’re going to share coming up from like client experiences when, when Will writes the article. Goodwill

Matt Mulcock: Yeah, yeah. Goodwill, right. So, yeah, it’s just something that we see the most, yeah, the one that people are most efficient in is usually disability. And it’s the most critical one to have.

Ryan Isaac: The most def, you said deficient, not efficient, right? Deficient.

Matt Mulcock: Sorry, it’s the one that people are the most deficient in.

Ryan Isaac: Yeah, I totally

Matt Mulcock: Uh, that we need to just make, remind people to review it on a regular basis. Make sure you have enough.

Ryan Isaac: Yeah. Okay. That is. A wrap up of wrapped all three parts, uh, as, as everyone

Matt Mulcock: We nailed it

Ryan Isaac: And,

Matt Mulcock: As everyone requested by popular demand. We decided to extend it to three

Ryan Isaac: We made the webinars go to, and then these turned out to be three. So whatever, Matt, is there anything you want to say about June, 2025 in relation to dentist advisors

Matt Mulcock: Know, I absolutely do.

Ryan Isaac: In the industry?

Matt Mulcock: You know, I’m so glad you set that up, Ryan, because there’s, I absolutely do. We’re actually fresh off

Ryan Isaac: Totally. Just curious, by the way.

Matt Mulcock: Yeah, just genuinely curious. We’re about three weeks out, or three weeks past, the Sundance Film Festival. And, many people have said that the Dentist Money Summit, Is the Sundance film festival of dental

Ryan Isaac: Oh yeah.

Matt Mulcock: And so if you’ve ever been intrigued by the Sundance film festival and all, you know, all of the prestige that comes with that, you’re not too late. If you missed it this year,

Ryan Isaac: Who’s Robert Redford in this scenario? Who’s is that you or Reese? Is that Reese? Reese is the Robert Redford.

Matt Mulcock: Yeah, probably Reese and he will be there. So, with that said, you should definitely check it out. It is, it’s going to be amazing. We already had, we know this for a fact now because we’ve already done one and it was in fact amazing and we’re going to run it back. As they say, part due, uh, Dentist Money Summit in Park City, June 20th and 21st. Theme is planned for the present. We have incredible speakers and, come hang out, check it out. DentistMoneySummit. com.

Ryan Isaac: DentistMoneySummit. com. Thank you, Matt. Thanks everyone for listening to episode three of wrapped. We’ll catch you next time. Take care now. Bye bye.

Keywords: home ownership, debt management, liquidity, personal finance, dental practice, real estate, emotional decisions, commercial real estate, student loans, life insurance, disability insurance, wealth building, real estate investment

Benchmarks, Finance 101, Getting Organized, Tracking Progress