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The Top Financial Concerns from a Poll of Top Dentists – Episode 140


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Are you struggling with the same financial challenges as other dentists? Reese recently posted a survey in a popular online dental forum asking dentists what they were most concerned about when it came to their finances. In this episode of Dentist Money™ Reese and Ryan share the results of the poll and shed light on the two most popular responses. Take a second to think about the source of your financial stress, and then listen to see if you’re in good company. The results might surprise you.

Podcast Transcript

Reese Harper: Welcome to the Dentist Money™ Show, where we help dentists make smart financial decisions. I’m your host, Reese Harper, here with my trusty old co-host, Sir Ryan Isaac.

Ryan Isaac: (laughs) you are choosing to put on a watch right now as you are talking.

Reese Harper: It is a wrist watch!

Ryan Isaac: It felt like that was a metaphor for something, like “we are now on time.”

Reese Harper: It is the millenials’ monocle. It is the wristwatch. None of my watches have had batteries in them for several years, it is a complete fashion statement piece, not functional.

Ryan Isaac: Yeah, it is a complete fashion statement piece… it is non-verbal domination. “I have a watch and you do not.” Reese, today we are going to talk about a question you posted in a popular national dental forum—

Reese Harper: Shoutout to the Dental Success Network.

Ryan Isaac: Oh, we are going to name them by name! DSI, DSN.

Reese Harper: We don’t do cryptic here. If it is legal, we will say it.

Ryan Isaac: Oh yeah! We can say that

Reese Harper: The Dental Success Network has an excellent wealth management forum. Excellent because of the group, not because I am the admin faculty member. But if you haven’t checked it out, go to dentalsuccessnetwork.com. If you did want to join, there is a coupon code that you can go under Dentist Advisors or my name and join that forum. But we are actually launching one this week just because we get so many financial questions that we feel like having our own internal forum is going to be super super helpful. So Justin, how about you tell us just a little bit about that really quickly so that people know what I am talking about.

Justin (Q): Yeah, so you guys are going to moderate it, Reese and Sir Ryan Isaac, and it is going to be on Facebook. The easiest way to find it is if you go to dentistadvisors.com/group, then it will just redirect you to the page on Facebook where you can sign up.

Reese Harper: Yeah. So just go to dentistadvisors.com/group and then just sign up for our new Facebook forum. What we are going to be doing is just answering your questions there, and starting conversations. We found that we are getting a lot better Q&A feedback from Facebook groups then we were getting from people submitting questions on our website. Even though some still come in, we want you to keep submitting them there. Just go to dentistadvisors.com/group and then join the Facebook group and we will be able to have a little bit better dialogue back and forth there. We are going to have some cool polling, a lot of questions… we will post content and Excel spreadsheets and downloads for a lot of people, so it is going to be really cool. But a few days ago, I posted a question that I thought would be really important for our Q&A today that we got a lot of feedback from, and it was a good discussion, and it kind of gave me a reminder— it was super eye-opening to see what dentists are struggling with right now. And that was the question I posed. Last week, I went to the podcast movement in Philadelphia, and there was a—

Ryan Isaac: Do people know that that is? The podcast movement?

Reese Harper: The podcast movement is a big national podcasting conference. Thousands of people attending… I mean, there were like several people from the NBA and the NFL, there were people from small micro-niche gothic podcasts with like three listeners, right? And then there were just a ton of industries there.

Ryan Isaac: People who make seven-figure incomes podcasting.

Reese Harper: Yeah, we don’t make that, alright?

Ryan Isaac: (laughs) any money.

Reese Harper: In the podcast movement, there were a couple of marketing segments, and I would encourage you guys to do the same thing that I did as a product of listening to this. They said, “you know, if you are trying to get to know your customers, if you are trying to get to know your audience, if you are trying to get to know your patients, whoever your customer base is, ask them several questions.” There were three questions that they said to ask. One is, what are we doing good for you right now? What are we doing well for you? Or rephrasing it, you know, what do you like about the service we are providing? Or whatever. Ask them what they like about you and the thing you are doing, whether that is podcasting, whether that is dentistry, whatever. Ask them one thing that they don’t like about working with you, and keep it that simple. And then the third thing they said that is probably the most important, what are you struggling with right now?

Ryan Isaac: Just generally.

Reese Harper: Just asked that question to anyone. What are you struggling with right now as it relates to the area that you are dealing with? So with patients, you know—

Ryan Isaac: Does this work on teenagers? Because that is what I am thinking about right now is asking these questions (laughs), like, my oldest, I think I need to sit down and ask these questions. “Where am I screwing up?”

Reese Harper: Yeah, now that wouldn’t get the same result.

Ryan Isaac: It has to be anonymous.

Reese Harper: Well no, it is focused on the person, and you want them to feel like they have a chance to share what they are going through. What are they feeling? What are they going through right now? So I posed this question to the DSN forum in the wealth management segment. I posed the question, “what are you struggling with right now?”

Justin (Q): And that is in the context of finances, right?

Reese Harper: Well it was obvious that it was in the context of finances, because we were in that forum (laughs).

Justin (Q): Because that could get dangerous if you just say, “what are you struggling with?” and it’s like, “gout” (laughs).

Reese Harper: So it is in the wealth management forum. There was no question about what it was relating to. And then I listed ten or twelve different possible responses. Some of them, by the time the poll was over, were not getting any action, so I actually deleted a couple of them.

Ryan Isaac: This would be interesting. How about I read a few of the top ones without saying which ones are the most popular first? So people can listen to this and then think to themselves.

Reese Harper: Yeah, read all the ones that got actual responses.

Ryan Isaac: Okay. No confidence in current financial advisor.

Reese Harper: Wait, hold it. Before you do this, read them slow, and what I want to do is if people— read the exact ones, and if you guys would— this will be really interesting for me. If I were to ask you the question, “what are you struggling with right now?” I would love for you to email me your response, the thing that comes to top of mind. Just email me at reese@dentistadvisors.com with what you felt like your response would have been before you hear the group’s consensus. Just write it down as Ryan is listing them off. Let’s go number one.

Ryan Isaac: 1. Don’t really feel confident in my current advisor but kind of feel stuck. Okay? 2. I want investments that are non-traditional. Stuff that isn’t the stock market. 3. I’m confused about why I woke up passed out in a back alley.

Reese Harper: Great. That was one I had to include. It felt like it was important.

Justin (Q): We actually got a response on that one!

Reese Harper: Shoutout to my man Jim Graham; I think he was the one who posted that that was his morning.

Ryan Isaac: Financials are totally on track, but you wake up in a back alley frequently. That’s fine. 4. I’m worried about my debt. I feel like I need to pay it off right now. 5. How much to I really need to retire? 6. It feels like there should be more money left over with how much I am making. Where is it all going? 7. I’m wondering, what should I do with my extra cash? 8. I wonder if my investments are performing as good as they can. 9. I don’t really feel confident in my plan. It seems like I am driving blind. And 10. I don’t know where to get started, I just know that I’m not doing enough. Those are the options.

Reese Harper: Okay, so I think the interesting thing at this point would just be to read the top— well I am curious which one you would have written down. Kick me that email, and just let me know which one came to your mind. But the top two— let’s start with the number one response by what percentage of responders?

Ryan Isaac: Yeah, this is a third of all the people. It was, I don’t know where to get started, I just know that I’m not doing enough.

Reese Harper: I don’t know where to get started, I just know that I’m not doing enough. And that really surprised me, because I was like, “wow. The bulk of this—” and this was a pretty large group. I mean, in terms of the people who actually responded, I mean, this is a decent sample size that I would say is reflective of a broad mix of dentist types. What was the second one?

Ryan Isaac: No confidence in my plan. I feel like I’m driving blind.

Reese Harper: And that was what percentage?

Ryan Isaac: That was just under 20.

Reese Harper: So over 15% of the respondents market that basically, they didn’t really have a clear plan, or they didn’t know where they were going, right? Or they didn’t have a strategy, or they felt like they were driving blind, right? And that really surprised me that that many people felt that way, because most of these people—

Ryan Isaac: What would you have expected them to answer? When you were typing out these responses, did you think more back alley waking up problems, or was it like— I would have guessed— actually I am biased, because this doesn’t surprise me, by the way. I feel like this is one of the most common anxieties in finances that dentists share. Over ten years of seeing intricacies of dentists personal finance, this doesn’t shock me. But I think anyone else would have guessed investments. My investments aren’t doing good.

Reese Harper: Which was a high one! What percentage did the investments get?

Ryan Isaac: Yeah, it was like third place; it was like 13%. Not even close to I’m not doing enough, I don’t know where to start, I don’t know what to do.

Reese Harper: So let’s just get into this and say why are people feeling this way?

Ryan Isaac: That is the first question I would put to you. Why do you think dentists relate so much to this idea, like, that’s the biggest concern or anxiety of not feeling on track, not knowing? And you said this before, you will meet people who are seven-figure income, multi-practice, very successful people, you know, high net worth, and they are still asking the same question or saying the same thing. Like, “I don’t feel like I’m heading anywhere. Am I going the right way?” Why do you think that’s the case?

Reese Harper: The point I would make about that is if after this long, I still feel like the amount of information that people would have to learn to feel really really confident in their financial future… like it took me quite a while to get to the point to where I lost financial anxiety and I didn’t have a lot of questions and I was confident. And I think a lot of people would feel that same way about whether it is dentistry, whether it is science, whether it is learning how to help your kids through elementary school, whether it is trying to figure out how to run a small business, there is just a body of knowledge to learn—

Ryan Isaac: Before the anxieties of, “I don’t know what I’m doing,” go away.

Reese Harper: And I just think they don’t go away for most people because they are not— and I don’t know which points you want to make today, I don’t want to give away your agenda here, but I think that most people aren’t in an environment where they are being taught, they are in an environment where they are being sold something, and when you are sold something outside of the context of having knowledge, you will always question it. It could be the best thing ever, like maybe you set up a 401k. But if you don’t know that that was really the right thing for you because you have knowledge around why it was in place and the options available to you and how many choices you could have made, I still think you will question it.

Ryan Isaac: Okay, so part of the thing that comes to mind for me— and we have seen this after working with dentists for so long— is that I feel like just basic organization in money and finance plays a huge role in this. And I was reading this article on Psychology Today, and it was this article on the mental effects of being disorganized, just kind of generally. But when I was reading through this, it resonated to the feedback and response we get from dentists about the stress they feel in their financial lives. So, some of these side effects from being disorganized, we would talk about how that plays into not feeling like you have a plan and why basic organization is such a key element of a financial plan. But some of the effects of being disorganized are you end up having— and I thought this was interesting— excessive stimuli in your life. So we end up working on things that don’t matter, and a lot of times we talk about dentists committing random acts of money, right? We say that sometimes. Like, you build up cash in the practice checking and then you kind of just randomly, a few times a year, throw it at different places, right? So when we are disorganized, we have too much going on, and we end up spending time that don’t matter. Our focus is– we are distracted. Like, we can’t focus on things, kind of similar. It is hard to relax. You hear that from people all the time where they feel like even if they had a big month or a big year, the business is going in the right place, they have cash, they have money, they are still not relaxed, it signals to our brain that work is never done. So when we are unorganized, we have these thoughts that there are still pending things, there are still stuff on our backs that have to get done, and that causes more anxiety and guilt. And a last point was it inhibits creativity and productivity. And you see that, too, with the way people feel at their— like, you have seen when people started to feel happier at their practice and in their business life when their personal financial life is in better order, you know?

Reese Harper: Yeah, it is definitely a step, right? I mean—

Ryan Isaac: I was just going to say, that is the first thing that came to my mind is a general lack of organization, which is why building a financial plan, the first foundation that we work on when we work with a new client, the first thing we do before making any decisions is we spending like a month just getting organized.

Reese Harper: Well and we will get to this, but I think your organized theme here is bigger than just gathering up stuff, guys. It is more akin to—and I have told you this before, and I don’t know if we want to talk about this today, but I would like to use the analogy of dentistry and compare kind of how dentistry… like, the process of comprehensive oral care and comprehensive financial planning are related, and there is a good analogy here that I think will help people figure this out. When you say just getting organized, I think you feel like sometimes that is—before we just into the dental analogy, I just want to tell you one thing that really happened for me in my own life that, in the last few months, has been really really helpful. This is a separate topic; we can’t really help you with this entirely, but I think it will help you to shine some light inside your practice. In my own business, there are a lot of departments. There are a lot of divisions, right? We have our operations team; we have technology and our product; we have marketing; we have content; we have HR issues; I have vision and strategy things that I have to decide on for the direction of the business; I have ten or twelve different categories of things that I have to tackle. Until I got them organized in my head and sort of figured out what all these categories of things were, and I put them into a system that I could see every day and sort of understand and conceptualize, I would work really crazy and just keep going forever and I would never stop. That is the last one that you mentioned, there, that people never feel like work is done. Because I would never—it is never done if you have this never-ending list, and you have never said what is realistic to complete within a week. You know, “what is realistic to complete within a week? What can I actually do in a day?” Because if you don’t really get to that point, you just start losing your mind. And financial planning is akin to this business problem; it is a massive laundry list of items. I mean, you can’t do it in a day. It can’t be done in a sitting, and it is not a binder. It is not a meeting where you can get planning done. It is like a huge undertaking, from loans, to insurance, to estate planning, to legal and tax, to bookkeeping. It is investments; it is your disability insurance; it is your liability coverage. It is your cash flow, your spending, your savings, your liquidity, your retirement projection. It is your practice valuation; it is your retirement projection. You don’t know– like, right now, you don’t know what it is. No one has defined it for you. I have defined it in my own mind because I have spent a lot of time solving this problem, just like I have spent a lot of time trying to define my own business’ categories. Like, the categories of organization are really important.

Ryan Isaac: But the term “financial planning” in our industry doesn’t actually have—there is not a definition. There is not a standard of practice.

Reese Harper: Yeah you couldn’t say, “oh, there’s fifteen buckets. If these fifteen buckets are taken care of, then you’re fine.” There is nothing like that.

Ryan Isaac: Even within the CFP, which, you know, they have a definition, but you could go sample a thousand CFP’s around the country and they are all doing it completely differently.

Reese Harper: Yeah, the CFP does a good job of making sure people are generally smart, like memorizing facts and regurgitation information, that’s hard! Rote memory is not easy, but it is not that valuable in terms of—it doesn’t create a financial planning methodology.

Ryan Isaac: There is still not a standard of practice.

Reese Harper: Yeah, as far as it literally goes, like, the standard of care inside of the Certified Financial Planner curriculum, which is a step above the rest of the industry, but it only says, like, you gather information. You analyze information. You present it to the client. You monitor the information. It is like, well what information are you guys talking about? Is it life insurance exclusively? Because that is how some people are doing it. Is it a 401k? Does it have to do with debt? Where does it go into the business? Does it ever touch the business? Where is that fine line? Like, how do you look at cashflow? There is not like a body of knowledge that you are trying to follow. So you can kind of see that without a body of knowledge, without structure, and if you take a ton of subjects that are really hard to master, no wonder dentists answered this question in this polling like, “I’m confused. I don’t know.” Because no matter who you are working with, you are not likely getting these organized bins of information that you are processing and following up a plan.

Ryan Isaac: And it is not an event, either. It is not an event of organization. Like, “I got organized.”

Reese Harper: You are saying it shouldn’t be. But it is treated that way. People think it is, like, “if I could just get a plan, then I would be okay.” Before we jump into this dental analogy, I just think it is important to take that away and just realize that if you are stressed out in your business, or if you are stressed out in your personal finances, like Ryan said, it is largely because you haven’t really got your arms wrapped around what the problem is you are trying to solve, and you haven’t organized it into tiny bins and kind of neatly put it in the shelf and decided when you are going to address things, at what time and how often. And that is what helped be in my business was to just say, “you know what? I can’t be like doing social media nine hours a week. I can only do it three hours a week, and I’m gonna do it thirty minutes every other day. That’s all I can give it.” And then I am not going to feel bad that I can’t do more than that.

Ryan Isaac: And when you say social media, you are talking about just like watching weight lifting videos and funny means?

Reese Harper: Mhmm. Yep. And I think about HR, you know? I can only spend a certain amount of time training employees, and I am going to have to budget that time and say, “this is what I can give to it. But I have categorized everything and assigned time to it. I know how often I’m going to rotate back through.” Dentistry, if we go into this analogy, is a lot the same way. It is an older subject; it has been around for a long time; it has some established norms that a lot of practices follow. Consequently, you are not as worried if you are really doing good work with your patients, because you have a system in place that you are following, and comprehensive oral care has some definitions around it, right?

Ryan Isaac: Well yeah, I was going to say, just from a high level, dentistry in this analogy, it is a repeatable process, right? I always think as a patient, if I were to move to some other city and I pick a new dentist, I know what to expect when I go to the dentist. It is not going to be, like, “tell me how you do dentistry,” you know? It is kind of a similar process everywhere I go. And I don’t want to take away from the nuanced work that dentists bring into their practice, because there is a lot of nuance there. But I know as a patient what I am going to expect as a general process, right? It is repeatable; you said there is a uniform set of standards and expectations that are going to happen. I am going to get cleaning, and an exam, and this is the type of work that I will get done. There are qualifications, like, there are barriers to entry for my dentist to be able to perform dentistry on me, and that is not true for financial planning, right? I think for the most part, it is a pretty conflict-free structure of getting paid for the dentists; we have talked about that before. They don’t get paid from the people who make the crowns, they get paid a fee for their service, and it is a service-focused business, it is not product-focused. The product is just part of the implementation of the service, you know? And so I think from a high level, those are the things that make dentistry—it’s a repeatable process. You can build a good business around it. And that is how it is a little different from financial planning.

Reese Harper: Well yeah, evidence is almost 90%+ of people would say, “I know I need a dentist.”

Ryan Isaac: Yeah, or, “do you know what is going to happen at your next appointment?” Yes. “Do you when you are supposed to go?”

Reese Harper: I don’t know if they would know that… I don’t know what the guy is going to do except for clean my teeth.

Ryan Isaac: Okay, but at least you know that.

Reese Harper: You mean treatment wise, yeah.

Ryan Isaac: Like, how often should you go see your dentist? Like, “I should go see him twice a year. Don’t ask me if I have been twice in the past twelve months…” (laughs).

Reese Harper: Yeah, you are right. But when it comes to financial planning, I am saying statistically, 100% of people would say, “I know I need a dentist,” and probably 30% of people hire a financial advisor. There is just a big gap there, and that is the evidence that this polling question is kind of pointing to. It’s like, “I don’t really know if I am heading in the right direction.” If financial planning is not even defined well enough to where you would actually hire someone, and 30% of people are only choosing to hire someone, and 70% are saying, “I don’t need one,” then clearly there is a problem with the industry, you know? Because 100% of people say they need a CPA to do their taxes, right? Or they will do it themselves, and at least they know they need TurboTax. So it is kind of like exercise, though, and wellness, too. Like, it is not a well-defined science. It kind of is, but it is not as much; it is a more immature science. Like, it is developing, and people don’t do it as consistently, because it is not like, “this is the right way.” It is like, “well there is a lot of nutrition information. It is conflicting, and—”

Ryan Isaac: And it depends on the person, and the personality.

Reese Harper: And that is how finance is. A lot of information; it is conflicting; it is opinion-driven. And so the more it standardizes, the better off the industry becomes. I just want people listening to this to know that financial planning, it really is much more—we feel like we have defined it in a way that is tangible and that has very defined bins and buckets and organization that you can put to it, and if you are following a very structured process like that, you might not feel 100% confident all the time, it is not going to be perfect, but you will definitely feel less like you are flying blind all of the sudden.

Ryan Isaac: Yeah. So, let’s continue with this analogy. I would say step one in this analogy, or point number one would be, how do exams and x-rays in a dental practice compare—what is the equivalent in financial planning?

Reese Harper: Well, I mean, in financial planning, exams are meeting with an advisor, right? In dentistry you are going to have an exam; you are going to meet and do an oral exam on a patient.

Ryan Isaac: Learn the situation before anything happens.

Reese Harper: You are doing discovery, right? You can do that with a financial advisor, and that is one area that is just obvious that would happen, and it does happen. Discovery happens in financial planning, quite often.

Ryan Isaac: The variation is, the depth of discovery.

Reese Harper: Yeah, the variation would be the depth of discovery, and I think that is one important point. Exams, though, to me… I mean, there is no x-ray system in financial planning that gets the same set of x-rays. Like, dentists are looking at x-rays from even a very narrow set of manufacturers, and they are very concrete, and they are the same thing, right? Most financial planners don’t do exams, or if they do, they are making up their own exams. So they are literally just asking questions and taking a sample of information that they want to take, and it is not uniform.

Ryan Isaac: As I am thinking about this, I think it is an even bigger problem, because a lot of time in our industry, it is so product and sales driven that the exams are geared around—the solution is already in their brain. Like, I don’t think a dentist sees someone come into their practice and be like, “I really want you to have four implants today,” you know? He’s like, “I want you to have better oral health, whatever your solution is. Like, we’ll find it. We’ll get there together.” But in our industry, that is not how it works. In our industry, it is like, “you’re gonna have a life-insurance policy. You’re gonna have a 401k. You’re gonna buy this thing.” Right? And so, even if there is an exam, sometimes it is just—

Reese Harper: I would clarify, when you say our industry, you mean in the financial industry. I would say my industry is not that way. I might be one of a thousand people who are in my own industry, which is not the one you are describing. You are describing a piece of crap industry that I don’t have anything to do with that is absolutely irrelevant and does not help consumers. That is not my industry. Now that might be collectively our, I know you are using it nicely, but I am distancing myself from that comment.

Ryan Isaac: Which you should. I don’t think everyone would— I mean, we get locked in, you know? We get lumped in. In the financial industry, that is how often times even the exams are done; it is with a product in mind.

Reese Harper: Because they know, like, where they are going to steer you, so the exam— it would be like if you literally took exams of your patients’ teeth and you inserted like dark spots in the teeth, like, on the x-rays, so that you could just tell people like, “look! You need a filling right here,” and it was fake. That is kind of like what happens in financial planning. The x-rays are like fake x-rays that steer you towards pain that you don’t have. Literally, that is what is happening.

Ryan Isaac: It is so true! It is kind of insane, but that is exactly what is happening.

Reese Harper: So I think, the real question is, what should an x-ray be? If it were objective, what would an x-ray look like? And in my opinion, an x-ray would have questions about personal financial choices that you have made in the past so that the advisor could understand your behavior and what choices you have made in the past so that your behavior can start to be modified.

Ryan Isaac: Like what? What kind of past choices, past behaviors?

Reese Harper: What investments have you made? What would you consider your biggest investment mistake? What mistakes have you made with your finances? What good things have you done with your finances? A lot of financial choices that you go through.

Ryan Isaac: How did you grow up? What was money like when you were growing up as a kid? How were finances talked about?

Reese Harper: Now that is not super concrete. We don’t have time to go into it today, but there is a list of questions that would analyze your behavior. Your financial behavior is measurable, and—

Ryan Isaac: You can see patterns.

Reese Harper: I mean, there are a lot of tests that help understand people’s behavior and their personality profile, and that would be an important factor. There are accumulators; there are family stewards; there are people who are gamblers; there are innovators; there are a lot of different types of profiles, and you should be able to understand that about someone to start with.

Ryan Isaac: Push pause, let’s give a shoutout to that episode.

Justin (Q): Yeah, so that was a little while back, but a really good episode, episode 19, where we cover all these different personality types.

Ryan Isaac: Yeah, there are nine personality types.

Reese Harper: I mean, these aren’t perfect, but if your advisor has no difference between you and any of his other clients in terms of personality, that is a problem, because the advice they give you has to be based on some kind of past patterns and behavior and financial history knowledge, experience level, that. Okay? So that is a starting point. The real objective thing here though, a real objective measuring stick is, the advisor, before they can talk to you, they have to have a complete and very organized personal financial statement that lists your practice valuation, your practice debts, all of your accounts, business and personal, all of you retirement accounts, all of your investment accounts, all of your assets, all of your real estate, any business interests you have, all of your entities… In our firm, we have a personal financial statement that is a hybrid between all of your business and personal stuff all in one list, and you have to be able to see that, and every debt associated with every asset. If you see that sheet, and you know someone’s age, and you know their personality profile, you are in a position to finally start giving advice.

Ryan Isaac: What they spend per year?

Reese Harper: Well you could start giving advice with a personal financial statement, right? You could start at that point. If you don’t have one though, you can’t move forward. You can’t tell anyone anything; you have no right; you don’t have any real information about someone. It is just negligent. Giving someone advice without seeing the context of that discovery of who they are and their history, plus a copy of their personal financial statement in detail, you are just guessing at stuff!

Ryan Isaac: Yeah. Well I think you hit something really important though too. When you look at someone’s balance sheet, it is really helpful to know why those things exist on the balance sheet. Like, why is a 401k there? What made you set that up, you know? What made you pick the investments inside of there? Was it automatic? Did you have a hand in that? Do you have interest in that? Why do you own this building? What made you actually do that, you know?

Reese Harper: Why did you add a second location? Are there associates there? What made you decide to do that? What Ryan is getting at, the reason he is asking why is, he wants to understand how to craft a plan that supports the strengths of the individual and helps give pushback in areas that may have just been random acts of money.

Ryan Isaac: Yeah, why is that amount of cash sitting in those ten accounts right there? What is the purpose for those? Where is it supposed to be? Why do you have those debts? Why is it a five-year term instead of a ten-year term? And all kinds of things.

Reese Harper: Now that is just the first exam, okay? But exams, as you know, comprehensive exams happen throughout your life. Let’s say a comprehensive exam happened once a year. In order for a comprehensive exam in our business to be effective, we think that that personal financial statement— you should take a picture of it basically. In our business, we track it electronically, and so it is updated every day, and we have daily records of all the entries, and so we can basically take a snapshot of it at any given point in time. But we would recommend looking at it at least once a quarter, so four times a year, and see how that is adjusting. Because what you will see is the things you thought about someone when you first met them in that first interaction, and then the things you think a year later, they are very different, and you will see that, “oh! What you told me and what I’m seeing from the numbers aren’t quite the same thing.” You know, “you’re doing a lot better than I thought you were based on your tone,” or “you are actually struggling way worse than I thought you were based on the way you talk about yourself.”

Ryan Isaac: Yeah, I feel like everyone learns—I mean through that process, I feel like everybody learns a little about themselves that they didn’t know before. In dentistry, it is a very methodical and repeatable process, right? There are specific steps that are repeated; there are specific employees that are dedicated to the specific steps. I mean, everyone has individual jobs, you know? There are specific tools and measurements for those things. So I think it is something that our industry—not your industry, (laughs) my industry— I don’t know what to call it anymore! The financial industry could learn a lot from dentistry in making things more measurable and repeatable, and really learning before diagnosing, okay? The second point would be an ongoing treatment plan. This kind of like, could it be ever-changing, call it organic, ongoing plan to create better oral health. It is not a one-time event. So I think one of the first things is the frequency of communication that you have. You said it earlier; everyone knows they need a dentist, and I think every patient knows how often they should see their dentist, you know? But I don’t think there is any consensus on how often, even if you should have a financial planner, how often that interaction should be. So I think frequent communication, maybe that is the first thing to talk about here, with an ongoing treatment plan. That has to be one of the biggest pieces to it to make it work.

Reese Harper: In dentistry, there are probably fifteen different— there are areas of the mouth, and there are types of dentistry that you would at least assess to whether they apply to this patient.

Ryan Isaac: Maybe fifteen aspects of oral health in general.

Reese Harper: Yeah. And we could define them today, and people would all recognize them. Now in financial planning, there are an exact number of subjects that need to be covered in order to properly diagnose someone. The reason that they don’t happen is because most financial service providers don’t have the experience or the competency level to handle the breadth of topics that are required. Kind of like how some dentists who are right out of school or who are in school don’t have the experience level to handle the breadth of topics. But dentists coming out of dental school don’t say, like, “I’m the best dentist ever. I have the most experience ever—”

Ryan Isaac: “I have mentors, I am still learning,” and… yeah.

Reese Harper: Yeah, they are a little bit more humble about it. Well in the financial planning industry, that is the way some people are. Like the people who we are hiring, I mean, they are coming in with four or five years of experience going, “I want to be mentored. Help mentor me in comprehensive financial planning. My firm is selling products to people. I want more planning experience.” Like they know that this body of work is bigger than a product. And what I would just define is— we don’t need to go through it all today— but it is categorically a quick list of things. We would be measuring your savings rate. Measuring your personal spending. Measuring your effective tax rate. Measuring your debt-to-income ratio. Measuring the amount of liquidity that you should have. Measuring your retirement plan type and the contribution amount that you should be putting in given your income level. Measuring your practice equity and the debt load that you have on it. The last one I would probably throw in, call it retirement plan projects; we call that Tt analysis in our firm. But looking at the rate at which someone’s net worth is progressing, the speed at which it is progressing, and figuring out if that is healthy or not, right? Looking at their real estate, and analyzing the equity in their property, and determining if they should pay property off all the way, if they should continue to have a piece of property paid off completely given their net worth… there is a lot of real estate analysis to be on cap rates and income and offsetting spending with rents. There is insurance; there is investment risks; there is practice profitability, and income—

Ryan Isaac: Yeah I was going to say, as you are listening to this, you can go to dentistadvisors.com if you want to see what Reese is talking about. But if you want to see the areas that we actually measure, that we define and measure, go to dentistadvisors.com, go to services, and Elements® halfway down the page. You can hover over each of these subjects that we are discussing and see them in detail. How we are measuring them, and why we do it. There are videos and podcasts attached to each one, so…

Reese Harper: Thanks for pointing that out.

Ryan Isaac: Yeah, there are twelve of them that are the main high-level categories, and they all have probably half a dozen sub-categories too.

Reese Harper: Yeah, and the reason though that dentists are answering this polling question and being someone confused about their trajectory and their direction is, whether it is on their own or whether it is with an advisor, they are randomly covering some of these topics once in a while, right? But it order to feel good, you have to be covering all of these topics—

Ryan Isaac: Even when there is not a fire in that subject.

Reese Harper: Yeah, even when there is not a fire to put out, you have to be reviewing it. Kind of like—

Ryan Isaac: Why I show up for cleanings even when I don’t have intense mouth pain.

Reese Harper: Yeah! It is hygiene.

Ryan Isaac: I should just be getting those anyway. It is maintenance.

Reese Harper: It is maintenance and hygiene, and you have to be looking at these things to be able to put that emotional fire out in your mind going, “you know what, I think I’m okay, but I’m not sure.” Well, make sure you are okay! Like, if you wonder if your debt reduction strategy is the right strategy, then analyze it. Measure your interest rates compared to where current interest rates are at, look at the length of your loans, decide if you should add more money to pay them down or not, and then review that once a year. Just do that once a year, because then you will feel good about your plan. And then when someone says, “well I did this with my debt,” you won’t wonder if you should, because you will have already evaluated that. And I think that is the advantage of comprehensive oral health and seeing a dentist regularly. It is also the advantage of hiring a fee-only fiduciary who can be that expert in that area for you around financial planning, because it takes a lot of time! The reason people decide to a DIY a lot of this stuff, in my experience, is that they don’t know there is an alternative where it is a defined body of knowledge that they can outsource. I mean, you would never think of doing your own dentistry, but you would think of doing your own financial planning! Why? Because to a lot of dentists, financial planning is like setting up a target date fund at Vanguard and calling it good and getting some life insurance from the ADA. But real planning is not that. That is doing dentistry in a very very limited fashion.

Ryan Isaac: Well let’s hit that. That is point number three today that makes dentistry a little bit different than traditional financial planning is that dentistry is an actual plan for your oral health, it is not about the products. The stuff you get put in your mouth… the patient doesn’t go in there thinking about the product they are going to get in their mouth, they are thinking about the overall health they are going to receive. The relief of their pain, you know? Whatever it is. Maybe a prettier smile. And I think the conversation has to be shifted more away from product and into plan. So, you should have a plan, not a product. And I think a lot of the anxiety people feel about their financial life is they live in the product world, meaning they bought something, but the expectation was that that product was their plan. “I got a life insurance policy,” or “I set up the 401k.” And they are like, “that should be the plan,” but then they still feel this anxiety, like “I really haven’t thought about my debt or my cash flow.” Or “what are we spending? Are my taxes okay? Is my net worth growing?” So let’s talk about that for a minute: a plan, not a product.

Reese Harper: Well just to clarify, it is a misconception if you think a financial product is a financial plan. That is not valid. You need a financial advisor to do all of the things that are more like a comprehensive treatment plan of preventative dentistry, right? You don’t need a financial advisor just to give you an implant, or just to give you a crown, right? I think you need a financial advisor eventually to recommend that crown and to recommend that implant, but dentistry has a process that exists fundamentally as this kind of nice analysis, hygiene, comprehensive oral care, and then—

Ryan Isaac: General health first, yeah.

Reese Harper: Yeah, and you charge a fee when there is an implementation need, and that fee is transparent, and the cost of it is transparent to the patient, and that is just a better route than having an industry that is only paid through product, right?

Ryan Isaac: And this is actually interesting. I mean, you pay a dentist to just give you and exam, right? You pay someone to spend their professional time evaluating your situation.

Reese Harper: Yeah the bulk of most dentists’ time, and for a majority of dentists, the bulk of their revenue, comes from comprehensive exams, right?

Ryan Isaac: Yeah. You are paying a professional to spend their time looking at your situation with eyes and knowledge and experience that you might not have yourself.

Reese Harper: And x-rays.

Ryan Isaac: Yeah, not even to mention the tools that they have that you don’t access to to give you a better picture. And then, you pay for the implementation of their advice too. So, we just find this a lot. People just life in this world of, “I’ve got a product, and therefore, that’s a plan,” and there is just a lot of anxiety that comes from that, man.

Reese Harper: So, just in closing— at least from my perspective. I am sure you have something that you want to add— I want to say you need to have an exam done regularly by someone who is looking at x-rays. Looking at your full picture; looking at your full behavioral profile and history. And if you are not doing that, you are just kicking the can down the road for the time you are going to eventually need it. What happens in financial planning is the same thing that happens in dentistry: if you neglect comprehensive oral health, at some point down the road, you are going to have a massive amount of work that needs to be done that can’t fix the damage that has been caused for the last decade.

Ryan Isaac: Well yeah, and the time to get professional help is not when there is a massive problem.

Reese Harper: No. And in financial planning, that is all that happens. People neglect it. They feel like they can just wait, and then when they are 55, they look back and they are like, “geez, I wish I would have—” I mean, how many 55 to 60-year-olds do you talk to who are like, “I just wish I would have started with you guys in my 30s,” you know?

Ryan Isaac: It is a really common thing and a common feedback, yeah. “I wish I would have started earlier.”

Reese Harper: I think every dental patient who neglects oral care for 20 years feels the same way!

Ryan Isaac: Yeah, for sure. And those are the worst patients too, right? I mean, you hear that from the dentists. Those are the hardest patients to work with, because it is like, “man, if you had just come in like a year ago, we could have solved this with a cheaper, easier, less painful solution.”

Reese Harper: Yeah. And here is the second point. So you get the comprehensive exam and the x-rays, and that is going to be a starting foundational point. But the treatment plan in financial planning is very specific to an occupation. And if you are working with someone who has a treatment plan that is generic for all business owners or for all people, you will find that it is missing critical points that for you, as a dentist, are going to continue to make you answer to my polling survey at the top, “I don’t feel like I know what’s going on. I’m flying blind. I don’t know where I’m headed.” Because your treatment plan, if there is one in place, it is probably not answering some pretty critical pain points you have. Like, an actual debt plan for you. An actually investment plan that incorporates your practice equity. An accurate view of your true income and tax situation.

Ryan Isaac: The trajectory of your net worth, and “when can I retire? When is work optional?”

Reese Harper: Yeah, and a lot of financial advisors, even if you assume that they have the knowledge to be able to give you that feedback because they are numbers people, they may not have a treatment plan—

Ryan Isaac: (laughs) “you’re the numbers guy.”

Reese Harper: “Yeah, do it, numbers guy!” I mean, they may not have a treatment plan that has even been informed by your occupation at all! It could be a treatment plan that was literally formed by working with teachers at the local school district and then accomodated to a few dentists, and then you are kind of confused, and you answer—

Ryan Isaac: Or some W-2 physicians, and it is like, “well, there are a lot of dentists too!”

Reese Harper: Yeah, “I work with doctors and dentists!” Well guess what? Those aren’t even close to the same person! So your treatment plan isn’t even close, you know? And in dentistry, the treatment plan can be a little bit more generic. Teeth are teeth, right? But money is not just money. And I would say that from a marketing perspective, it is critical, because as a dentist, you can market to implants, and you can focus grow better, or you can market to a certain demographic of the population. That is marketing. But treatment planning will also vary somewhat depending on the practice that you have, but just not quite as much is it will vary with financial situations. I mean, it is really different. So I think it is important to just remember that a treatment plan and these comprehensive exams and x-rays, that is what will finally help someone feel like they are headed somewhere. Just like if I go to the dentist every six months, or even more frequently, in some cases every four months. If I am actually following the protocol that I am being delivered and I have a comprehensive plan, and I am following through with it, I am feeling great about my teeth! And if I don’t go to the dentist for two years, I know something is up, and I am wondering if I am okay.

Ryan Isaac: And you know you will suffer the consequences for it. Okay, before we go, a reminder of this new cool Facebook group we have going! So we talked about forums today a lot and questions that get posted in these discussions. We now have our own Dentist Advisors Facebook forum. To join this, just go to dentistadvisors.com/group. This is a place where we can have conversations and polls and questions. We will be moderating the forum, so we will be able to answer your questions probably a lot more frequently and directly than we could have otherwise, so this will be a really cool place to have these discussions. So that is dentistadvisors.com/group, go sign up, we would love to see you in there and have some conversation. And as always, when you are ready to have a free consultation with one of our advisors, you can visit dentistadvisors.com and just click on the “Book Free Consultation” link and set up a time at your convenience. Or if you would like to call or text us, you can call or text us at 833-DDSPLAN. We would love to hear from you, so thanks again!

Reese Harper: Carry on!

Getting Organized, Tracking Progress
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