How Dentists Can Build Smart Financial Systems

On this episode of The Dentist Money Show, Matt and Lauren discuss why financial organization matters more than most dentists realize. They break down the hidden costs of doing everything yourself, the importance of automation and delegation, and the financial systems that can reduce stress, save time, and help dentists make smarter decisions with their money. From bookkeeping and tax savings to tracking spending and building long-term wealth, listen to this episode to learn practical ways to simplify your financial life and create more freedom both inside and outside the practice.

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How Dentist Can Build Smart Financial Systems (Article)

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Podcast Transcript

Matt Mulcock: Welcome back to another episode of the dentist money show where we help dentists make smart financial decisions. I am Matt. I’m excited to be joined here with Lauren. We don’t have a nickname for you, Lauren. We got to come up with something. Maybe like an embarrassing childhood story or something. We’ll talk later. We’ll workshop that.

Lauren: I know. Taylor always calls me Laurel because that’s what I get called in emails all the time. So yeah

Matt Mulcock: Perfect. Laurel works. Yeah, I get called a lot of things in emails. We’re not going to go there. We’re so excited to have you. So for those of you who have not maybe heard Lauren, aka Laurel on the show, she’s one of our amazing advisors. Been here for a long time now. Seven, eight, six years. I just hit eight. I just hit eight at DA.

Lauren: I think six, it’s six. wish eight would be nice. I’m six. Yeah, think I just hit six.

Matt Mulcock: Yeah. Well, you’ve been a part of our business for a long time and held various roles here. You’ve been a huge part of our kind of backend systems and the organization and, you know, everything we’ve kind of the foundation we built here at Dentist Advisors over the last several years. So, no better person with that to have written this article, but we’re going to talk about today. the sexiest topic you can imagine. Like we already do, we already talk about a lot of sexy things when it comes to financial planning. It’s like, you know, it gets everyone so excited, but this is even more exciting. We’re talking about financial systems and an article you wrote. Yeah, it does. We joke, but honestly, it is so important. This is the foundation. Like if you, if you think about anything that you’re doing in life,

Lauren: organization just gets the people going for sure. So nice.

Matt Mulcock: You know, we love making fitness analogies, trying to lose weight, reach fitness goals or whatever it is, you have to be organized around, like you have to know where you stand, you got to get organized to build that system for success. This is whether it be in your business, whether it be with the nutrition or fitness goal, whether it be with money. This is so critical. I know we joke around now people’s eyes glaze over when we talk about getting organized, but this is such an important topic. So let’s just maybe, Anything that comes to mind for you, Lauren, as we go through this initially, as you are writing this article, things from your experience, we’re going to break it all down. But just anything you want to say to kind of intro this first.

Lauren: Well, I just think overall, and maybe I’m an over thinker, you can tell me if you are too, but there is so much to think about in life. Like you’re constantly thinking about so many things. And when you can make something happen without you having to think about it, it changes everything. when it comes to your home, when it comes to your finances, when it comes to your health, you know, when I get my like medication shipped to me, I’m like, that’s it. That’s the ticket when it shows up. Same thing for my dog.

Matt Mulcock: No, yeah, am. Totally. am. Yep. Yep. Yep.

Lauren: When this food shows up right when the bag goes out, I’m happy. Oh, I love anything that really just helps get to the point where you just don’t have to think about it, because I got enough on my mind. so I’m talking about it.

Matt Mulcock: Yeah, yeah. Yeah. Yeah, there’s actually a good, I’m glad to brought that up. There’s something, ⁓ I think a lot of times we get nervous around, not even nervous, but we get resistant to this idea of like organization or systems or whatever, because they almost, I think some personalities, they feel constraining, but I love what you’re saying here that this is actually a way to create more freedom in your life, more peace of mind, but specifically freedom when it comes to like mental and emotional burden. But when you were just saying this, when you’re like,

Lauren: Mm-hmm.

Matt Mulcock: I don’t know if you are overthinker. You’ve got a lot going on. think everyone listening here has a lot going on. And I heard something a long time ago. Can’t remember the original, ⁓ who this originally came from, but, I heard somewhere that being an adult is just saying, ⁓ things will calm down next week until you die. Yeah. Yeah. They just never do. I’m constantly like thinking, yeah, like next week things will calm down and they just don’t. So they never do.

Lauren: Yeah, right, and they never do. They never did.

Matt Mulcock: So let’s go through this. think that, again, this is such a great, important topic to be talking about. I’m going to hit initially three questions we’re hoping to answer through this discussion. So number one, how do I organize my finances as a practice owner? think it’s really important. We’re going to hopefully break that down of how do you actually get organized around specifically as a practice owner? We can talk about associates as well. Number two would be. What financial tasks should I automate first? You’re talking about automation when it comes to your dog food coming to the house. Really that relieves such a, like again, emotional burden for you. They’re same thing with your money. And then number three, how does, how does automating my finances connect to better financial decisions? And we’ll talk about that. Anything you want to add to any of these Lauren?

Lauren: I’m No, I think that’s great. I think those are good.

Matt Mulcock: Perfect. Let’s, let’s jump in. ⁓ I love what you talk about here in this first part of this article, by the way, dentistadvisors.com can go to the education library if you would prefer to read along and, or just read and not listen to us. Yap. We’re not offended. That’s okay. ⁓ but you talk in this first part of this article about will kind of the difference of, or the problem when it comes to willpower. You want to talk about this for a second? I love this point you made.

Lauren: Yeah, I feel like a perfect example of I just got on a call with a client recently and they do their own bookkeeping and they’re just struggling so bad because they’re like, it’s so tough and I and it always like kind of just hurts my heart a little bit because I know we’re trying to like juggle everything and everyone wants to have their hand in it and make sure they’re looking at it.

Matt Mulcock: Please don’t do that.

Lauren: And it just, it was so tough because I’m like, I don’t know what’s going on. We’ve got some crazy things that we’re labeling and, they’re so adamant that they’re like, well, I just, I just want to keep doing it. And I just feel like it takes so much willpower. Cause at the same time that she’s like, I just want to keep doing it. My first question was like, how was the week? How was it? How’s your week going? And they were like, I’m so busy. I’m so, busy, but it’s so funny. Cause at the same time, they’re so unwilling to like, let some of it go. And it’s just so interesting, like the emotional aspect of it where.

Matt Mulcock: Yeah.

Lauren: It is so tough to let some things go. And I’m interested in knowing more about like what it is about that. Cause you know, especially with bookkeeping, but just in general, where so many things people are like, I just can’t, I don’t know if it’s like that control aspect. It’s hard to release it sometimes.

Matt Mulcock: Yeah. Yeah, I think there is something to that of a sense of a false sense of control or, ⁓ yeah, but that’s probably what it is. Just a sense of control of, think there’s so many things that are uncontrollable in our life, especially as we talk to dentists, practice owning dentists, or even associates. I think any area of your life that you can gather some level of control. think a lot of times they’re going to grasp onto that. think another aspect that I hear a lot is.

Lauren: Okay.

Matt Mulcock: Somehow dentists think they’re saving money. Right. Like on stuff like bookkeeping or not, not delegating certain things like that, which I think on paper, maybe they are because they see, it’s $700 or insert number to have someone else do this for me. I’m just going to do it myself. And I think a lot of times dentists just haven’t taken the time to sit there and think, what do I actually, like, what is my hourly rate in life? What do I actually make and where my best, where are my hours best served, ⁓ to maximize like the return on my energy. ⁓ I think there’s probably two aspects of that when it comes to like this bookkeeping bookkeeping example, but anything else you want to add to that?

Lauren: Well, I just think it’s so interesting where you said like the return on the like energy that you put in, but also like the cost of the mistakes where, know, like I look at it and I’m like, this makes no sense. Right. Like, and we have line items that are like, this is, I don’t even know what this is, but then, you know, maybe it goes through to the accountant and hopefully the accountant catches it. But if they don’t, then you have to redo your taxes. Like there’s so many things. I mean, bookkeeping is just the example that we’re rolling. But on top of it, aren’t small businesses at target for ⁓ fraud and stuff like that too, where doing it yourself may not save the money that you think it will and could actually hurt you way more than you think because you miss so much stuff trying to juggle it all that you’re too busy to even see if people are taking from you, taking from you because you’re just trying to juggle it all and do it all yourself or have your office manager do a few things here and there. It’s such an easy way to to become a target overall for fraud and embezzlement and things like that too, which I think is just so interesting.

Matt Mulcock: Yeah. Yeah, I can definitely increase the con the love, the, the, like the size of the consequence of those, of those decisions. I want to come back to this idea of willpower. And I, I love that you brought this example up earlier of like the automation of, of your dog food or so, you know, you know, you’ve got these things are you through Amazon? Is that what it is? Subscribe and say, okay.

Lauren: Subscribe and save is my religion at this point. I’m getting my makeup, my dog food, you name it. It’s probably coming on Amazon. Yeah. Yes.

Matt Mulcock: Yeah. So I love, I love that. Yeah. Amazon’s like, it’s working. It’s working. It’s working. No, but I, so I, I love this concept you wrote about when it comes to this idea of having a system, because I think the, lot of times, especially when it comes to like establishing goals, it’s really easy to trick ourselves into thinking we can just power our way through it, or we can, we can use willpower to achieve the results that we want. And what we have seen, and Lauren, I want to get your take on this, of like where that can break down for people. ⁓ I think it’s to me, motivation and, ⁓ inspiration are, have a very short shelf life for most people. And it’s like, I’m so inspired. But that, that often will go away. Like if you don’t have, as you write in this article about autumn, you know, automation, having systems a lot of times. things are gonna slip through the cracks, you’re gonna have breakdowns, willpower can’t be the answer for long-term goals. What are your thoughts on that? What have you seen around?

Lauren: Yeah, I just think that for the most part, like people have great intentions to get started. And same thing with fitness goals and things like that. We always want to be like, we’ll start tomorrow. We’ll start tomorrow. But the longer that you go, the more you’re like, Oh, I’ll do it later. And then all of a sudden it’s, you know, you’re 50 and it’s time to retire. And you’re like, wait, I didn’t do the things that I’m supposed to. I see this very, very, um, a lot. I see this a lot, especially in tax season where people will come out of the woodworks and give us a call and be like, I hate my accountant.

Matt Mulcock: Yeah. Poor accountants, poor CPAs, seriously.

Lauren: Or things like that where they, you know, I know they get hit, especially at the terrible times of the year. But yeah, I think like that’s a big one that people or expect other people to do it for them and just be like, this person will do this for me. And I think that, you know, it just breaks down where all of a sudden it hits you all at once and it can be really tough. ⁓ think, yeah, automating tax savings and automating your financial accounts just really just takes so much effort off your plate and makes even like hard news easier or either way you might owe taxes but at least you can know that you have the money for it. Same thing with vacations. The amount of times that I’ve heard people say I feel so guilty going on a vacation is honestly a lot. Like I’ve heard it probably like three times in the last two weeks but man it’s guilt free spending if you’ve like automated a savings amount to saying I have this much saved for this awesome Disney vacation. And I’m gonna call on it and I feel like it takes away so much guilt and shame that I’m always so not, I wouldn’t say I’m surprised, but I think it’s just hard.

Matt Mulcock: Yeah. That’s a really, that’s a really good point. Like what I like about this article is it’s like, we’re going to get into this more of like these practical things to be applying to your life. Like we were joking about before we even got on of like, man, this is just like, you know, so like, so dry, right? But so there’s such practical takeaways from this article, but I like what you’re highlighting here of like the real life applications that have nothing to do with the practicality or the spreadsheet piece of like truly the emotional burden that can be lifted around planning. And I also like what you’re saying here. We talk all the time as financial advisors about investing, automating investing, and we can, talk about that here, but that’s kind of the go-to for us is like automate investing for the future. But you’re talking about even building a system around saving for taxes every year, systematize that, systematize your vacation budget, like your plans for the year to, to vacation. And again, I’ve never necessarily thought about it from this angle of like the way that can relieve you of guilt as opposed to, ⁓ or when you have that system of like, I’ve saved for this, I plan for this, it’s ready to go. Have you actually seen or have stories around like that actually is reducing someone’s guilt for them?

Lauren: Yeah, absolutely. feel like when people have like a specific project in mind, like I had a client that wanted to do like a backyard landscape project. And so we were like, hey, let’s put it in the goals and automate it. They put a specific amount into their account every single month and we just didn’t worry about it. And when it came time where they had enough based on their goal, they got the landscape and they got exactly what they wanted in their yard. And I feel like it doesn’t just have to be boring. Like you said, it doesn’t have to just be like retirement accounts and investment accounts and things that could be things that are fun. Like if you want to pool, get that pool girl. Go do your thing. And as long as it fits within your financial plan. I feel like as a financial planner and you can tell me if you feel this way too, but a lot of people will think that I’ll tell them not to spend money. I’m like, I’m telling you, no, it’s sometimes it’s the opposite. Sometimes it’s like, let’s prepare for it and make sure that

Matt Mulcock: Yeah, yeah, yeah. Yeah.

Lauren: Project that you want and that you hope for gets done. And so I feel like that it’s definitely helpful for people who plan for it. It’s about planning and it takes away all that frustration and upset.

Matt Mulcock: Yeah. I love that point, Lauren, that because I hear the same thing too, that a lot of times people think they’re going to come to us and think we’re going to tell them to stop spending and only save and only invest when in reality, the name of the financial planning game is spending. That’s what everything comes down to. Your money is meant to be spent and it is going to be spent, whether it be by you or someone else you’re giving your money to. And so I think that that point gets lost on people sometimes that we talk about systems and organization and all this stuff. It’s all the name of eventually spending your money. That’s the goal. That’s what we’re trying to do. But I love, no, we’re not telling you to stop. I like what you’re saying here is build a system around it. Be more intentional. you know, it’s not a black and white either get the pool or you don’t it’s, Hey, let’s figure out a way to make this happen. And based on, based on

Lauren: That’s all. we’re not telling you to stop.

Matt Mulcock: Your goals, your values and your timeline for things and the trade-offs you’re making as well for these types of decisions. So I love this. So the first kind of piece of this is you can’t rely on willpower. The antidote to relying on willpower, which will inevitably break down is automating as much as you possibly can. You mentioned like tax savings, automation, saving for big projects or big things coming up. Obviously investing we are huge proponents of investing which by the way you mentioned you said we talked about this idea of like removing guilt when you have an automatic system for investing I can’t even tell you how many times we’ve seen this when you have an automatic system for investing Where you just we call it reverse budgeting. You just know how much you’re putting away We’re tracking it for our clients. We’re reviewing it on a regular basis. It makes spending so much less guilt written, you just like, you feel so much free. Yeah. You spend the rest. Anything else you’d add Lauren to the automation discussion or just anything dentists should be thinking about when it comes to this, this idea of adding automation to your life.

Lauren: Spend the rest Yeah, in terms of like personal, obviously those ones like I like we said, the investment contributions, the back door else, things like that. For business, I feel like a lot of dentists like again, like to do things a lot on their own. I would love to see more people. Yeah, like offloading, bookkeeping, letting like that automation like go towards someone that’s like doing it daily and that has the time and focus. ⁓ Payroll would be another one. ⁓

Matt Mulcock: Yeah.

Lauren: Yeah, bill pay, the amount of people like that sometimes are still like, like paying their like mortgages just like by clicking the button. I’m like, that is such a good way to forget. So I’m like, make it automatic to just pay off your credit cards and you know, do all of those things. So again, you just don’t have to think about it. You don’t have to go back and double check because it can hurt you too later on in the future. If you forget a payment or something happens and that would just be painful. I feel like payroll bookkeeping.

Matt Mulcock: Yeah. Yeah.

Lauren: Tax savings and working with your accountant for that. I definitely think those are some big ones.

Matt Mulcock: Yeah, I’m hearing to summarize this first part here is automation delegation. I having like, I mean, when you talk about these things, I’m sitting here, things are flashing in my head of accountability as well. Right. It’s like, for step one is setting up the system for sure, but accountability to a stick with the system and be regularly review it. This is where delegation comes into play. So like, for example, I love the CPA example you’re using of automating taxes you need a proactive CPA and accounting team. just do. if you’re period, if you’re not, if there’s a huge difference between having an accountant, a CPA, who’s a, what we call a tax historian, just like, Hey, here’s what you owe this year. Big surprise, $80,000 that you weren’t planning for. We hear that all the time. That’s a tax historian. That’s someone or income historian will say, here’s how much you made. Here’s how much you own tax. The difference between that and having

Lauren: Period.

Matt Mulcock: A CPA that’s going to an accounting team that’s going to implement a proactive system with you and regularly check in with you. There’s such a massive difference. again, coming back to this idea of like that emotional burden being relieved, having that team in place that you can delegate to is so critical as life gets more complex.

Lauren: No, absolutely. I feel like it’s important to know that automation does not mean like you never look at it again. Having like same thing with financial advisors. mean, besides CPAs, I’ll hear people say like, I have a financial advisor, but I haven’t met with them in like two years. I’m like, that’s crazy. That’s so long. And so many things change and happen. And like, as an advisor, I like, I just can’t even imagine not meeting with my clients more often, or I’m like, what’s happened in the last two years, probably everything. So it’s important to keep

Matt Mulcock: Yeah. Yeah. Yeah. Yeah.

Lauren: Looking at them and setting them up and making sure that it’s still in line with what you want. My goals changed so much, know, one year I might want to pool and the next year I’m like, nevermind. It’s not it anymore. It changes so quickly. It can change in an instant. So it’s important to review those with the people you need to.

Matt Mulcock: Yeah. Yeah, yeah, totally. That’s a great point. And by the way, that the reason there’s a reason for that, right? There’s a reason why you haven’t talked to advisor for two years. Usually one of two things either you’ve just gotten busy and you haven’t followed up with them. Maybe possibly, but more likely is that it’s because it’s the business model, just a peek behind the curtain of the advisory space. Everyone out there listening, the advisory space model is gather assets. As they say, I’ve been in this industry for like 15 years. The, the industry standard is and model is gather assets, get asset tender management as much as big as you possibly can and never talk to your client. Like that is the quote unquote dream for a lot of advisors. And so I’m glad you brought that up. That not all advisors are created equal when it comes to things like this, helping you automate, holding you accountable, being a proactive communicator with you, helping you actually review these systems on a regular basis. You know, you might quote unquote have an advisor doesn’t mean you have a, an advisor that’s actually helping you reach your goals. Yeah. We’re built different. Yeah, exactly. Um, so let’s, let’s break this down, Lauren. You, you have a part in here where you actually, a really practical kind of breaking down, like how do you actually get organized and automate your, your finances? Um, you’ve actually, I’m just looking through this. You talk, we’ve talked about a lot here.

Lauren: Built different.

Matt Mulcock: Um, you, you mentioned automating tax savings, automating retirement contributions. Let’s talk about this. What do you, when we talk about getting everything into one clear view, this is really talking about organization and probably the step prior to being able to even automate anything would be getting everything in one clear view. What are the things that you, we help dentists was, or we encourage dentists to think about when it comes to this organization piece and getting kind of that 10,000 foot view.

Lauren: Have some sort of dashboard. I feel like we talk about this a lot, you have so many accounts. I feel like I have so many accounts and I’m not even a practice owner, but practice owners step into the room and take the cake for how many accounts you guys have. so having it all in one place where you can see it really helps so that you know where all of your money is at. Which again, I think really helps with making sure like, whoa, that account is really low. I didn’t see that coming, but you have to remember so many logins.

Matt Mulcock: Yep.

Lauren: And so many different things. So I feel like, first of all, like having a space where all of your accounts are in one spot where you can see everything at once. Because if you have accounts over here and accounts over there, how are you supposed to make good financial decisions if you’re like, well, I think I have this much in this account, this much in that. I want to know exactly what’s in all of those accounts and how that plays into your overarching financial plan.

Matt Mulcock: Yeah, that’s a great point. mean, let’s let’s be honest. Art. So our ultimate goal, ⁓ dentists advisors as advisors, if we had to narrow down to one thing, it’s to get dentists to retirement or, know, to financial freedom, to work being optional. That’s it. Right. That’s the number one thing. There’s a lot of things that go into that, but that’s it. If someone said, what’s the one thing? How do you do that? If you’re just out there listening and not saying you have to work with us to do this, but if you’re doing this on your own. How could you possibly answer that question of how close you are to being ⁓ work being optional or being financially independent if you don’t have one clear view of your financial situation?

Lauren: You got to see it all at once. Yeah.

Matt Mulcock: It would be impossible. So, and again, this is such a fundamental boring as they, know, quote unquote boring part of the, of, of this, of this kind of like eat your vegetables topic of financial planning, but you have to be organized and be tracking this thing, you know, these things on a regular basis. ⁓ and I love what you said earlier of how are you going to make good decisions, intentional decisions if you don’t understand, if you don’t have the you are here part of the map. Right? You got to know where you stand.

Lauren: No, absolutely. And with that too, like with talking about a dashboard, I’d say like what comes up like for a close second for me is having all your passwords in some sort of password manager. I know we love having it in our phone, like bless Apple and all the people that, you know, make it so that our faces just get us into everything. But if there’s one thing that I figure out really quickly, it’s like so many people have their passwords like saved in like a note, an Apple note or like a ⁓ Google Excel sheet.

Matt Mulcock: Yeah.

Lauren: And I’m like, man, if one person gets into that, that’s kind of crazy. But I’m like having a system that can set you up with those crazy passwords with all the, you know, fancy symbols and things too. First of all, it’s like way easier because it’s all in one. When you go to set up your dashboard, it’s so much easier. I always, you know, say when we get the dashboard set up, that’s the hardest part, which I think is so funny. Getting the dashboard set up is so hard because people are like, I don’t know my password from this 401k like 25 years ago.

Matt Mulcock: Yep. Yeah.

Lauren: And I’m like having like a password manager is life changing, honestly.

Matt Mulcock: Yeah, I think it is. And with today’s technology, it’s pretty straightforward to be able to have that. But the other thing that I thought of is how many times have we been like onboarding a client, getting them organized? That’s one of the early, earliest steps is helping them build this dashboard, cashflow statement, get everything in one place so they can see it all. How many times have we had someone beg, ⁓ yeah, and I’ve got $30,000 over in this account I forgot about or $50,000 or I’ve seen as big as like a couple of hundred thousand dollars. And it’s like, how did you forget this? Yeah. Just $20,000 sitting around. It’s like, let’s be nice. Yeah.

Lauren: It’s like finding $20,000 in your pocket. I’m like, what is this? Yeah. Totally. I’ll enter all the Bitcoin people that forgot their password, enters the chat. It’s like.

Matt Mulcock: Yeah, seriously. Yeah. But, but to that point we can actually, I mean, on a specific basis, we can’t do this generally, but we talk about what is this costing you? Like that example. So we’re talking about like peace of mind and all these emotional benefits for sure of getting organized and having a system, but there are actual balance sheet and like wealth building ramifications here, right? Like consequential things when it comes to actual return on your money, when we talk about how many out there are listening to this being like, yeah, I probably have some money somewhere that’s just sitting there that I haven’t looked at for a long time. Could be sitting in cash. Like we can actually quantify that for you just in the last three years of money sitting around. And one of the biggest mistakes dentists make is having way too much cash sitting around. And one of the reasons for that is you maybe just forgot about it. And we’re talking.

Lauren: Mm-hmm or the retirement accounts that are completely in cash. So many.

Matt Mulcock: Yep. Yeah. How many times, I mean, we’ve talked to a dentist, it’s like, I’ve got this old Roth. It’s not doing much. And we go to look at it as we get everything organized and it’s been sitting in cash, right? Cause of just not being organized. Like there is literal, you know, thousands, hundreds of thousands, possibly seven figures, depending on your situation type implication here to this simple foundational piece of just getting organized.

Lauren: So sadly common, it really is.

Matt Mulcock: Yeah, absolutely. let’s give some, so if someone’s out there listening, saying, cool. Got to get organized. Got to get everything in one clear view. What are the, the main, what are like two or three things that we’re saying, dentists, if anything, these are the things you’ve got to get organized and have a good view on. What are those things, Lauren?

Lauren: Yeah, I would say like knowing your net worth is really important. Seeing where you’re going is huge. I think if you’re trying to get goals, you gotta see, like you said, you gotta know that you start here and this is the goal moving forward. So tracking that and getting organized, getting all your documents in one place. I feel like, again, as a dentist, you have so many different documents and so many different things that…

Matt Mulcock: Yeah.

Lauren: The amount of things that I see once I get documents where I’m like, there’s like a weird thing going on with this ⁓ and getting all your documents just in one place. It just feels so nice. Like it almost feels like you can sleep a little bit better knowing that it’s all in one place. And if I want that document, I’ve got my policy numbers right here. I was on a call with a client today that was asked a question about their policies and I was like right there. So I was like, well I’ve got all your information right here. The policy number is da da da da.

Matt Mulcock: Yeah. Yeah.

Lauren: And so it’s just nice to have everything in one place, getting all your documents, to be able to look at your insurance policies. And note sometimes like with insurance policies, you look and you’re like, this is about to expire next year. We’ve got to talk about it. people kind of, again, maybe like not the bad side of automating, but like that you’d need to review those things. Cause yeah, maybe you said it you’re like, I’m set. I’ve got my insurance policies going. They terminate next year. documents are important.

Matt Mulcock: Yeah, totally. Yeah. Yeah. I think, I think the one thing about net worth that I think is critical to bring up here is I think a lot of what holds dentists back, especially early on from putting this stuff together, getting organized, a it’s just, it’s a big lift sometimes. And it’s like one of those things it’s like, ⁓ would I rather do this or would I rather watch Shrinking season three, like, you know, and sit down and like turn my brain off after a busy day. So I totally get that. But I think another thing that holds dentists back and Lauren, you’ve probably seen this as well is fear of like, what number am I going to see here? Makes me a little bit nervous. ⁓ or just like, I don’t want to, I don’t want to see it. It’s a negative number. I, because they’re coming out of school with a ton of debt. It feels scary to big. I don’t want to know the number. However, the counterintuitive piece of this is we’ve seen this time and time and time again, even when the number is negative or scary or whatever.

Lauren: Gotta look at it.

Matt Mulcock: 100 % of the time, dentists every single time are relieved when they see that they feel good, they feel better like, okay, now I know, now I know the work I got to put in.

Lauren: Mm-hmm. Yeah, absolutely. It’s nice to know like that you have actionable items of like here’s what I do next I you know, the number may be maybe negative, but you just move on from it. Not a big deal. Just move forward

Matt Mulcock: Yeah. Yeah. Yeah. And I read something actually this morning that you just said that I’m talking about action, like actionable items, ⁓ until you have an action plan to, I’m trying to paraphrase what I read this morning, but it was basically saying, ⁓ for a problem to actually be a problem that can be solved, it needs to be actionable. So for it to be actionable,

Lauren: Mm-hmm.

Matt Mulcock: It actually, for this to be anything in your life to be actionable. This is step one is, we’re just talking like net war specifically or whatever it is. You have to make it actionable. have to get it organized. And to your point, as you just mentioned, then start strategizing of how I’m actually going to tackle this, but it’s crazy how many dentists don’t want to do this step. It’s probably it’s spooky or, or there again, it’s just.

Lauren: Is it spooky?

Matt Mulcock: They’re, they’re maybe not there. It’s just kind of like, this seems kind of boring. ⁓ more simple than you’d think. And I guess that’s another point here is don’t overthink it. This could be something you write down every quarter. I would, you know, probably do a spreadsheet. Like we have softwares that we use and a whole process and system we use. But if you’re out there listening, doing it on your own, great. Find something you can stick with. Keep it simple. Keep the categories really broad. Net worth is just everything you own minus everything you owe track it at least multiple times a year to start, to start seeing kind of your, your progress. Um, the other part of this really quick, Lauren, I’d love to have, have you comment on is just the momentum that we like the, momentum and like, uh, that can be built from doing something like this, like the positive momentum that they can, they can be created in a dentist life by tracking this on a regular basis. Do you have any thoughts on that?

Lauren: Yeah, I feel like when I do like consult calls, I feel like a lot of times people will talk about how stagnant they feel and that they feel like, you know, I’m not going anywhere. And maybe they are going somewhere. They just don’t know it and they just can’t see it. Like they really are stuck on like, the debt is this much, but they don’t really know how much the debt is going down or like the investments are going up. It really does like light a fire under everyone when you see like, I’m actually doing friggin awesome. So yeah, I’m going to go on that vacation and not feel guilty or I’m going to go do this thing.

Matt Mulcock: Yeah. Yeah.

Lauren: I feel like the end of year calls are my favorite. I don’t know about you, but like going over how like accounts went and how things are doing and how they’re, you know, they’re closer to retirement and by how much, ⁓ I feel like they’re always the best calls. They’re always like, we ended the year. Awesome. Let’s keep going. Next year is going to be awesome too.

Matt Mulcock: Yeah. Yeah. I think you’re totally right. think for one of our greatest gifts and biggest curses as humans is our ability to adapt. And when we, and we’ve seen this so many times where we work with a client five, six, seven years, and they forget where they came from. They forget that when they came, they had a negative net worth and now they’re sitting on multiple seven figures. And I’m not saying that because of us. I’m saying because of the work they put in the system they built, but What’s so cool about being able to track this data over time is exactly what you’re saying is being able to look at that and like kind of like shaking you a little bit, like, holy cow, look where I came from. Cause it’s so easy ⁓ to again, adapt to your situation and feel like, I’ve always like, whether they would say this or not, like I’ve always felt like a millionaire dentist. Like, no, you didn’t. You didn’t, you didn’t feel like that 10 years ago when you were scared about your negative net worth. So it’s a good reminder as you’re tracking this over time. The other thing you mentioned is debt. Such a good example. We’re tracking this at the end of the year and showing just with regular debt payments, seeing how much debt is being paid off and how much momentum and like, kind of like how invigorating that can be for dentists. It’s really powerful.

Lauren: Yeah, absolutely. I really do think just like knowing where you are. I just feel like work can. I obviously love where I work and I love showing up. We talk about getting the Sunday scaries, but you know, I think as like a dentist, like you show up every single day and do this, you know, kind of the same thing. And I always hear dentists love their job and love what they do. But at the same time, you want to one day see the end and see like where the fruits of your labor is paid off. And I feel like just talking about that yearly is so nice to know that you are getting somewhere and this is not the rest of your life.

Matt Mulcock: Yeah.

Lauren: It’s going to end and retire when you want to retire, not because you’re forced to work perpetually forever and ever. The goal is to retire and we’re going to get you there.

Matt Mulcock: Yeah. For sure. Yeah, get to work being optional. The other thing you mentioned on this would be spending, tracking your spending. You want to talk about that for a moment?

Lauren: Yeah, like just like you talked about to spending is spending is the it number. It’s like the number that you need for everything. You need it for retirement. Talking about life insurance and it’s such an important number and it’s an important number that doesn’t get tracked very often. So, you know, when I ask someone, much do think you spend? It is a rare occasion. I think I was in a room of like 20 or 30 people and I said, how many of you track your spending? And I have maybe one person that said, I track it. The rest of them were like, I don’t know. You you make

Matt Mulcock: Yeah.

Lauren: You make a lot of money, but maybe you spend a lot of money and maybe you just don’t know where it’s going. so I think tracking your spending can relieve so much pressure and like help you know where you’re going. Same thing of like knowing where you’re going for retirement. So I felt like a dashboard helps with that a lot. Hopefully the dashboard that you have. I mean, if you use an Excel is probably not as helpful, but having a dashboard that tells you what your spending is. I feel like it’s so, so helpful. So, know, like what’s going where and, to what thing?

Matt Mulcock: Yeah. Yeah. I think this is another one that gets scary for dentists when we talk. Cause you said earlier that, ⁓ dentists often think they’re going to talk to a financial advisor and we’re going to say, stop spending money. or specifically they’re going to think we want to get into like a deep detailed budget, but the answer we don’t, we don’t like, yeah, we just like, that’s where we try to get dentists to think. Like when we talk about tracking spending, we’re not saying

Lauren: Just need to the number.

Matt Mulcock: You have to know every, yeah, exactly. You don’t need to be tracking a Starbucks budget or filling up your envelopes, but you do need to know generally what, what you spend every month or really on annual basis. And then you can break it down quarterly or monthly. That’s a really critical piece of information. And again, just like net worth and the components of your net worth until you know, you’re spending and you’ve tracked it on a regular basis.

Lauren: How much coffee, yeah.

Matt Mulcock: There is no possible way that you can answer the question, how much do I need to make work optional? It is literally impossible without that figure.

Lauren: I feel like a lot of people think it’s the opposite of like it’s the income that you need and I think knowing the number for retirement is so confusing. I get that asked all the time where it’s like, well, you know, how much am I supposed to know? Like how much I need to retire if I make this much then but like it’s the opposite. It’s like how much your lifestyle is.

Matt Mulcock: It’s lifestyle. Yeah. Yeah. What lifestyle do you want to live? And then we can start building from there. That is the, that is the first number. And truly, like I said, we said earlier, it’s, everything that is that everything hinges your timeline for retirement and, and, you know, building a plan around all this, the number one thing we’re going to talk about first is lifestyle. Well, what do you, what do you want to do to like, what do you want to, how do you want to live?

Lauren: Absolutely. Yeah. Yeah, absolutely. What’s hard too is like to get that retirement number you use spending. But if you spend too much, then you also it’s like a double edged sword where you’re able to you’re not able to save as much as well. So like it really is such an important number to make sure you keep in line. It’s so easy as you make more money and have more things going on to let that number creep up. And it’s important to at least look at it and make sure that it’s staying in line with your goals and making sure that we can still get there kind of that reverse budgeting idea again.

Matt Mulcock: Yeah. Yeah, definitely. ⁓ I wanted to talk about, ⁓ as we kind of get nearing wrapping this up, but I wanted to talk about specifically from a practice owners perspective, ⁓ around organization as a practice owner. one of the things that we see that we, you mentioned bookkeeping earlier. Another thing that we see that, that I think is worthy of hitting on really quick is when we’re talking about systems and organization and all this is the importance of separating your personal and your business accounts and separating your personal and business transactions. You want to talk about that for a second?

Lauren: It is so tough again, like kind of hitting off on spending. If you’ve got, you know, accounts that are commingled side by side where I’m like, like, I don’t see your mortgage coming out of here. ⁓ well, it comes out of my corporation account or something. It’s like, all of a sudden I’m like, okay, I don’t, we’ve got to figure out how we can separate this. Cause it really can be so tough again, just from a spending perspective, but also from a financial planning, or like a business perspective of like, if you’ve got stuff coming out of your personal accounts and stuff coming out of your business accounts. It’s hard to say, well, this is how much I do for liquidity in the account for your personal and for your business. And then same thing too with the embezzlement stuff. like, if you’ve got stuff commingled, all of a sudden you’re like, I think I just spent it target or something, but maybe you don’t, I don’t know. You don’t know what, never know what’s going on. And keeping those separate is one way to be like, does not make sense. That is not a typical thing that comes out and you can flag it super easily and super quickly.

Matt Mulcock: Yeah, yeah, definitely. I hope that if you take anything away from this as a practice owning dentist, it’s that the mindset shift that you are the CEO of a business, you are an investor in private equity. You need to treat that as a business. there is a direct line to overall success as a, as a practice owner in our, you know, from what we’ve seen when it comes to dentists actually treating it like a business as opposed to this like fuzzy work around the personal expenses. That is not what your business is for. ⁓ and so I just think that’s a really critical piece. I could sound so obvious, but I, can’t even tell you how many times we see dentists treating their practice and their P and L as again, this kind of like way to save on some taxes cause they’re taking bigger deductions, I guess. Like they’re mixing their personal expenses. It’s just, that’s not going to lead to long-term success. You’ve got to treat it like a business.

Lauren: But a lot of times some of the personal things that I guess you can call personal, but some stuff that people are taking out actually hurt you like one that I see all the time where it’s like not that it’s not allowed to maybe you can speak more to this, but life insurance coming out of the P &L where people are like, haha, I’m saving so much money. But yeah, but in the back end, it actually kind of hurts you when you do it that way, because now you’re like for something that was going to be not taxed. Now all of a sudden it is.

Matt Mulcock: Yeah, or disability. Yeah.

Lauren: I’m like, which one would you rather have? And I feel like most of the time people are like, I didn’t even know that was a thing. I’m like, yeah, for the thousand dollars that you saved in the year or whatever, however much it is. like, I don’t know if that’s worth it for a lifetime of disability. know, like if you end up taking it, that does kind of stinks, you know?

Matt Mulcock: Yeah, that’s a good point. Yeah. That’s a really good point disability. So let’s just break that down really quick. This is a, this is something that gets confused with dentists a lot, understandably so. But if you’re paying your premiums for your dental, sorry, for your disability insurance or life insurance, if you’re paying premiums, I see it more with disability than life. But if you’re paying your premiums for disability out of your business and taking a deduction, if you ever need that policy, that payment to you now becomes taxable. The IRS is not going to allow you to take a deduction on the premiums and then take a tax free benefit on the payout. So you got to, I love that you brought this up Lauren, because that is such a good example of people, dentists not necessarily always thinking about the long-term consequences or not being, and maybe not even thinking about it by the way, and being like, Oh, I, again, from not being organized and then down the road, they go to use it. And it’s like, wait, I’m getting

Lauren: We’ll bring it. You’re a thief.

Matt Mulcock: acts on this $10,000 a month, huge difference. That’s a really good example.

Lauren: No, totally. So there’s things that you take out where it’s like, the benefits not that great.

Matt Mulcock: Yeah. Yeah, exactly. You think you’re saving some money? Maybe you are, but you’re creating a lot more long-term headaches for you down the road. So it’s a really good point. ⁓ okay. So let’s wrap up here. I love this kind of final point here of the, the, when the goal, we’re not highlighting this goal is perfection. That’s never ever been and never will be the goal from what we’re trying to focus on for our clients or dentists out there listening. ⁓ the goal is not perfection. What would you say the goal is, Lauren, or kind of the focus for dentists out there thinking about this?

Lauren: It’s just to try and like, I really think the goal here is the delegation piece of like, what are you okay with keeping and what are you okay with like passing off to someone to make your life easier and better? Really think it’s about time and just doing the small things that you can to improve your life just a little bit more and give yourself a little bit more time for the things that matter to you. Because I hope it’s not bookkeeping. I hope it’s not, it’s not, you know, the taxes and the tax returns and if it is then more power to you. for the most part, from the people that I ask why money is important to them, it’s family, it’s time, it’s, you know, security and focusing on those things. I think that’s the real goal here is to give more more space and time back to yourself and releasing what you can.

Matt Mulcock: Yeah, I love that. When you say that, what I’m hearing is that getting organized, building a system is like the first step to finding alignment with your money in your life. Like I really believe that. And that’s a huge part of what, and again, nothing about that as perfection. Alignment is actually something that is never perfected. You’re constantly working on it, but we’ve seen this, we see this so much with dentists of Getting them organized, starting to build these systems, starting to build momentum. I love what you just said. Every time we ask why is money important to you? It is, you know, always something around relationships or experiences with the people you love or whatever. Hobbies. It is always, it’s never, yeah, bookkeeping or these kinds of things. So I like what you’re saying here is that organizations kind of that first step to getting alignment with your money. And relieving yourself of the burden and the stress that a lot of this stuff can hang over. You just be hanging over your head. Like I can’t, I hate when I had that feeling of like, man, I got to do that. Yeah, I got to do that. And it’s just like this weight that is constantly on you every single day. And as you’re highlighting in this article and through this conversation, the way to get around that is delegation is automation. ⁓ you know, focusing on building these systems.

Lauren: Absolutely. Live your best life. If it’s bookkeeping, listen, I don’t judge you. If that was your answer, I leave a space for you for there. I’d love to meet you in fact.

Matt Mulcock: Yeah, I don’t judge. I don’t judge. really don’t. please, please just stop. don’t. Just don’t. Just stop it. Like you need to have someone else doing your bookkeeping, if anything else. That’s maybe that’s the takeaway of this discussion. Don’t do your own bookkeeping. Lauren, this is great. Any final words you want to finish with on this discussion or this article?

Lauren: Yeah. Please, don’t do this to me, please. No, just looking forward to hearing how people are spending their best times. Their time now that they’re not doing, now that they’re automating, I want to hear what you’re doing with your time.

Matt Mulcock: Yeah. The automating delegating building systems. like this. ⁓ honestly, great article. If you’re out there listening and you want to read Lauren’s great article, you can go to the website, dentistadvisors.com click on the education library. And also if you’re out there listening, thinking, ⁓ I’ve been listening for a long time. Now’s the time I do need help on this. There’s one step. There’s literally one step. Click on the book free consultation button on the website and you can talk to one of our friendly advisors. We would be happy to help you delegate, help you automate, help you build a system. We are here for you. We work with hundreds of dentists all over the country. And lastly, we’d to see the dentist’s money summit, June 11th through the 13th. You can go to dentistsmoneysummit.com. Come learn how to practice on your terms. Lauren, thank you so much for your words of wisdom. Everyone. Thanks for listening till next time. Take care. Bye

Keywords: financial systems, organization, automation, dentists, financial planning, delegation, peace of mind, net worth, spending tracking, automation tools.

Finance 101, Getting Organized