A Fifth Grader’s Guide to Becoming a Wealthy Dentist – Episode 76

Should you pay someone else to do a job you can handle yourself? As a practice owner, you might struggle to know when it makes more sense to outsource or keep things on your own plate. In this episode of Dentist Money™, Reese and Ryan explore the fundamentals of trade, specialization, and opportunity costs, and how economic lessons taught to fifth graders can help dentists improve their net worth.

Podcast Transcription:

Reese Harper: Welcome to The Dentist Money Show, where we help dentists make smart financial decisions. I am your host, Reese Harper. I am joined by my trusty old co-host, Sir Ryan Isaac.

Ryan Isaac: Yes, and good morning. Thanks for having me, always good to be here.

Reese Harper: Good morning, sir. Thanks for having you? You didn’t have a choice.

Ryan Isaac: I was unfortunately requested to be here, that’s fine. Let’s start by talking about something that we both hold near and dear to our hearts. I saw a post from a picture of you from Facebook. It was a meal, actually a series of meals. No, it was the same meal. It was just multiple courses.

Reese Harper: Yes, it was a good weekend. We had smoked pork. We had the tastiest little coleslaw made from apple cider vinegar, red cabbage, it was the best. I grilled corn on my barbecue, but I boiled it first, because you want to boil it in the corn juice.

Ryan Isaac: You are in the wrong profession, Reese. I mean you bring a lot of strong suits to this company, but you are in the wrong business.

Reese Harper: Grilled string brings and mushrooms, I did that dish. It was really tasty and super healthy. You would have loved that, just a little garlic salt. Strawberry shortcake really capped it off, but I think I’ll end there. I am really hungry now.

Ryan Isaac: Me too.

Reese Harper: Here is the thing, nailing the preparation of pork shoulder is really important, but today I want to talk about nailing preparation in life. I want to talk about kids that I met this week at an elementary school that were nailing their preparation for life in with regards to money and finance. It was really interesting to me.

Ryan Isaac: You stepped in, helped teach some curriculum for what, fifth graders?

Reese Harper: Yup!

Ryan Isaac: You were telling me about this and it reminded me of a game show.

Reese Harper: Well, it was a third grade class that I taught, and then I taught a fifth grade class. They both are learning this curriculum from something called junior achievement worldwide. I was invited to teach some economic lessons this year. The most recent lesson was on three words that I thought were really applicable to dentists all over the country.

Ryan Isaac: These are three things that you taught these third and fifth graders? These are three topics that you taught them specifically?

Reese Harper: Yes, it is like one hour and a half and there are a series of lessons that the kids receive throughout the year. Each grade level in elementary school has a series of curriculum. You teach for an hour and half on a specific subject. There is a game, vocabulary words, topics, stories, and they are supposed to invite people with personal experience in these areas so they can teach. I was brought in to teach this because my business was related to the subject of the fifth grade class. Anyway, the three words that we went through and basically took up the whole hour and a half on were trade, specialization, and opportunity cost. Those were the three words that we taught the kids. I smiled when I saw those thinking how relevant it is to businesses all over. I think this will be a good conversation for today. I think I want to start by talking about trade. Trade was the first subject that we talked about.

Ryan Isaac: I am just sitting here thinking that if I saw the curriculum and I am going to go sit down and teach third and fifth graders and the first thing I see is trade, that is a major large scale macro economic principle. This is countries around the world, GDP, output, where do you even begin with that? What did you learn teaching the kids? It reminds me of the game show, “Are you smarter than a fifth grader?” It was on for like six seasons, and I was curious how many adults one the whole thing out of six seasons. Only two people ever won the whole thing, the million dollar prize. Only two adults.

Reese Harper: What was that game about again? I just remember Jeff Foxworthy, but I never watched the game.

Ryan Isaac: They would have a panel of fifth grade students and then they would bring in an adult. All of the questions were taken from fifth grade textbooks, they were on your team and there were little helps you could reach out and get but every time you went up, you could earn more money. You could also decide to just take the money that you had earned and walk away. Then you had to look at the camera and say, “I am not smarter than a fifth grader.” If you did that, then you could walk off with your money. Only two people in all six seasons ever one the million dollar prize though. So when you started talking to me about this podcast, “I was like, fifth graders are learning about trade on macro scale economy?” Anyway, explain what you taught them.

Reese Harper: When we talked about trade we started out with a giant map of the world. It was a huge map and everyone got copies of the map. Everyone is looking at this big map and we talked about how countries trade with each other when on their own they do not have the resources or the capacity to produce or get everything that they need or want. That is when a country has to engage in trade. If they develop their resources, they develop the things that are unique to them based on the region of the world that they live in, then different countries can produce a surplus. Then they can trade it for the things that they need. If you look at a country like Brazil, they have a fairly heavy orange market. They are a large global producer of oranges. They are able to end up with a surplus in that area and then they can purchase things like aluminum cans from Australia at a price that they couldn’t produce on their own. When we talked about trade every kid had to take these resources that I handed them and build a product together. Some kids got cocoa beans, some kids got electric batteries from South Africa, some kids got LCD screens from China. Then they all had to match up and build products and understand why countries decide to engage in trade.

Ryan Isaac: That is really cool.

Reese Harper: Companies obviously do the same thing. We do the same thing as countries do. That’s what makes an economy run. Companies are smart enough to say, “we are going to exploit our resources. The things we do really well, and then we are going to essentially take the profits from those things that we do really well and buy or trade for other things that we don’t do as well.”

Ryan Isaac: If you take the dental industry, this is making me think on the top of my head. You have different services that are all built around the dental industry. You might have legal or dental services just for bookkeeping or marketing services specific to dentists to financial planning, investing, or a whole bunch of things. It is kind of a micro economy of all these companies who specialize in one thing, which is the next part, right? It happens on a global scale and a smaller scale with economies. Even inside of a practice too. Could a dentist think then by the same logic that their practice is a little micro economy? Part of a little economy?

Reese Harper: I think it is important to think that you the person, the practice, the state, city, government, and country have trade at work. We use it every day in our own lives. The dentist chooses to develop skills to place implants or the orthodontist continues to invest in his treatment coordinators, or the endodontist develops even more hand speed to outpace a competitor and have a better patient experience. All of these micro specializations? Other people are willing to trade for that. Dentists don’t realize how trade ultimately is a really powerful principle. It is really important for any country to adopt. In most countries, the most successful ones from an economic perspective and higher per capita standard of living are the countries that really focus and specialize and have really large trade surpluses instead of trade deficits. We struggle with that right now. The United States is struggling to develop a trade surplus. That is partially because economies that are really broad and diversified and have resources spread thin in a lot of areas, they cannot really develop competitive advantages over other countries. Our advantage right now is that we have really big financial markets. We have a financial sector and software sector, but a lot of our economy doesn’t really produce a surplus and we depend on a lot of other countries for the things that we need. That can be challenging. You are not going to end up with extra money unless you learn to trade effectively.

Ryan Isaac: Let’s’ take a quick break before we jump into these three areas. When we come back we will talk about those three areas and how they apply to dentists and what dentists can do to improve their own businesses, lives, and finances.

Ryan Isaac: Welcome back, I’m excited to get into my fifth grader knowledge here.
Let’s test it with this first one. What does it mean for a dentist to trade? You don’t mean to trade your bookkeeping with dental work. How does a dentist view this concept of trade and how trade can affect them?

Reese Harper: You need to develop and exploit the thing the scarce resources. You need to develop and exploit the thing that makes you unique. A dentist is one of maybe 175,000 people, or one of 200,000 people in the country that works on teeth. Every waking minute of your life, if you were trying to maximize your financial utility, you would try to just improve that and not try to improve everything else that is involved in running a practice. The bookkeeping, consulting, financial planning, tax preparation, legal work, I.T., coaching, all of these things. They are all very specialized and there are specialized people who have made the same trade off decision. I have had to choose to develop my scarce resources around financial planning not bookkeeping, taxes, consulting, transitions, not practice management, not transitions. I am really, really deep in financial planning. That makes me an attractive commodity in the market place. I have a surplus that I can use to pay for all of those other things because I am diving deeper and deeper into my specialization. That kicks us off into the next subject but I would view yourself and your costs and your sacrifice and your time during dental school as a huge investment in specialization that helped you develop the ability to now trade. It sounds intuitive and people are probably listening to this going, “well, I know, duh. I went to school, I chose this, I am doing that.” All I am saying is the entire world functions on this simple, simple principle. There is trade and specialization.

Ryan Isaac: Do what you’re good at.

Reese Harper: If you find yourself trying to develop yourself or become a producer of some of these other services that I have listed or spending time trying to develop expertise in those areas, you are simply taking a little bit of a detour away from developing more specialization in your own field. It will have financial consequences. Let’s take two dentists that are both age 39. They both graduated from the same dental school, they both left school at the same time, went into private practice at the same time. Why does one person have a net worth that is over a million dollars more than the other person by the time they are forty? They are the same person, why does one have a million dollars more? That kind of data is interesting to us. It’s the same data, education, personalities, people skills, social skills. But in a lot of cases, one person chose to really leverage trade effectively and specialize deeper and another person chose to take everything on their own plate and do everything themselves and not use their surplus or extra money to pay for goods and services from other specialists. They just choose to sort of do all of this stuff a little bit on their own and retain a lot of these tasks. You cannot underscore that principle. It is affecting countries, people, and businesses. Whoever masters that game, really will have a better net worth at a given age in their life.

Ryan Isaac: We talk about this a lot in our business. It is easy to see other problems that technically you do have the ability to fix. In our business, we do financial planning and investments. That is all we do, but we see problems with a client’s marketing strategy, or an issue with a transition, or accounting issues/bookkeeping issues all the time. We see those problems and for ten years we have asked about tackling these things. Do we dive into accounting, or build a practice management/consulting arm in the business? It would really help some clients and it is a prominent problem. We have talked a lot about this lately too. It is so easy to get there. It is so easy to view those things and feel like that is naturally the next place you should put your time and resources. Maybe you can, maybe you are capable, maybe you have the interest, but over time getting away from your one specialty, which is what you talk about next, is detrimental. You see that in a lot of businesses and with dentists that get distracted with other projects. You said something to me yesterday that I thought was intuitive, but you can’t say it enough. You were saying in a sense that even in the early stages, and you practice what you preach. I have seen you spend money on consultants and outsourcing the marketing, developers, and other people to help build our company. You said even when things are early and money is tight, you can’t hold on to every task even if it is uncomfortable. You have to get uncomfortable with the amount of your surplus that you will have to use to get the right people around you. You don’t just do it blindly, but assume that even in the early years of your career or later on, it will always be uncomfortable to have to hire people to do things that you can do but shouldn’t be doing. I have seen that in our own business.

Reese Harper: I totally agree. I think that is just to re-emphasize. It is painful for most people to part with their surplus. I keep calling it that because it is our trade talk. When you have extra money it is called a surplus, which is really just your profit or extra cash that you have after you sell your product/service. It is really tempting for people to hold onto that cash after you have worked so hard to get it. It is really hard to part with it, and you shouldn’t part with all of it. There is an amount you should part with. If I saw a million dollar practice spending ten percent of their revenue on consulting, I would say that is very excessive. That would be one hundred thousand dollars towards consulting? You cannot afford that. That is not a sustainable, long term expense. There may be a short period of time where you are trying to achieve a very large milestone where that would work, but I would say that I would rather see someone consistently spending money every month on coaching and consulting than spending a disproportionately high amount in a short period of time. There are phases of your career where you are going to need consulting for higher amounts of money for shorter periods of time. Especially when starting up or in periods of major transition. I don’t want to scare people from spending too much money. I’m just saying that everyone knows there is a limit to this. We aren’t saying to go spend all of your surplus. I don’t run into people who do that very often. I do run into people who are uncomfortable with parting with their money even when it is tight. When it is tight if you are going to have a surplus, you are going to have to start getting a team built around you and make sure that you hire the right people, and that you invest in the right components of your practice to help it grow and stay healthy. I think everyone has to get a little bit uncomfortable about the amount of money you will have to use to get the right people around you. Let’s talk a little bit about item two. Trade was number one. Two is specialization.

Ryan Isaac: Yes, this seems like a really natural fit. I am curious how the conversation with the fifth graders went? It seems like they probably grasped the idea of trade? Did they make their little projects? What did they do with the cocoa beans and LCD screens?

Reese Harper: I did that at the end. First we taught trade, then specialization. Specialization was where we highlighted each country in the world and talked about things that were popular that those countries chose to specialize in. I talked about Chilean raspberries, German wheat, aluminum from Australia, LCD screens from China, oranges from Brazil, and probably like fifty different things. We talked about how specialization is what makes a city, state, or country really competitive and valuable. It is what helps individuals, like dentists, have extraordinary success in their careers. A dentists is probably one of the most specialized workers in the developed economy. I mean there is a barrier to entry. You have to have a certain degree to be able to practice in the United States. It is the same in other countries. Also, just the ratios of population to dentist is helpful. The world still needs more dentists. The United States still needs more dentists in order to provide care adequately to the population. It is a growing segment, but there is scarcity there. There is scarcity because it is expensive, the barrier to entry is pretty high, and that creates a lot of pressure for dentists. They have to borrow a lot of money to equip themselves. Equipment prices are expensive because there are a scare amount of dentists and a scarce amount of equipment to go around. It is a very specialized field. It is probably one of the most specialized. Consequently, it is probably the highest paying field on average, of almost any occupation. We have talked about this in a lot of presentations. Even though physicians are ranked in national income surveys as the number one, most of their income is reported on a W2 through the bureau of labor statistics and their payroll reports. That is why they show up in the top of the income statistics. They usually get all of their income from their paycheck from the hospital or group that they work with. Dentists are usually trying to keep their salaries low and take larger profits from their business. That does not show up on payroll reports, so dentists usually have a reported salary that is one third of their total compensation or even half. Dentists really do have one of the, if not the highest paying career. They got that because of the amount of specialization that they have had to go through. I think that it is just important to see that. See that you already really specialized in a deep, deep way. Just like Chile decided to do with raspberry production.

Ryan Isaac: I didn’t know that. That’s good.

Reese Harper: Yes, and ultimately, that allows you to have the ability to trade really effectively. It is just not a skill that everyone develops being able to trade effectively means that you are better at identifying who should do the job than the average person. As a business owner, I am getting better and better at finding people who do jobs really, really well. I have only gotten better at that because I have tried it a lot. I have hired a lot of outsourced things and seen what has worked and what has not worked. I have been frustrated by the money that I have wasted on poor outsourcing and seen how big of a value outsourcing was when I did it with a good, call it, trade partner. I ultimately feel like that is a skill you develop through practice, you don’t just have it. We always say that our best clients are people who have already had a few financial advisors.

Ryan Isaac: Yes, they get better at hiring the financial advisors.

Reese Harper: Yes, and they know what they are looking for. They have been through this sea of deciding on incompetencies and identify who knows what they are talking about and who doesn’t. They don’t get sold easily. They are good researchers. I think that being a specialist, which you already chose, now get good at trade. Getting good at trade means looking at everything that is not really narrow and specialized as something the you probably could consider avoiding. At least consider avoiding anything that is not really narrow. I don’t want to say exactly what that is. I am staying purposefully vague. Some of you will have really deep skills in various areas of business management. That is ok. Some of you have MBA’s, some of you love marketing, but you still have to question yourself a little bit and say, “is this the area where I am going to specialize? Is this worth being average at or do I need to trade in order for this to be efficient.” 90% of people we talk to say they are uncomfortable with outsourcing anything that is not their unique ability. We are trying to just push the needle a little bit.

Ryan Isaac: Cool. Well, let’s get into the last one that you mentioned which is opportunity cost. Tell me how the kids viewed this? How did you explain to them how opportunity cost works?

Reese Harper: I explained it like this. I asked them if you were your school’s principal, and you had to hire a lawn mower to mow the school lawn soccer field who would you choose. There are two lawn mowers to pick from. You can hire the lawn mower that mows houses and lawns for schools or you can hire the lawn mower that just mows lawns for schools. Who would hire the person who mows lawns for schools and who would hire the lawn mower that does it for both houses and schools? When I said houses and schools probably like half of the class raised their hand. Then the other half raised their hand for just schools. We had to have a little discussion about it. I asked the combo people why they would pick a lawn mower that did houses and schools? First girl said, “well, it is because they do a lot more lawns. They do a lot more, they are bigger. They probably have more experience. If you just did schools you wouldn’t do that many.” I thought that was interesting because that is the same logic I see happening with a lot of people in business too. I totally disagree with her answer, but I thought it was so interesting because it is human nature in entrepreneurship. “Oh they are big. They do a lot of lawns, bigger is better right? If they are bigger than they must have more experience, probably better suited for me!” Little do you know, the bigger the company gets that is not always the case. The ten dollar an hour person comes in and now does the person’s job that used to get paid real money. Anyway, that was an interesting takeaway. Some kids said that they really thought that the school person who did just schools would be better. When I asked them why that would be they talked about how the equipment they have would be different. I thought that was interesting. One kid said, “don’t they have the big lawn mowers?” Exactly, different tools. That’s what I was trying to get at. They usually do develop different tools for different types of lawns. I asked them how many of them mowed their house lawns with the big lawn mowers they use at schools? Then I started seeing the switch over to schools only. We all raised our hands again after we talked about it and everyone switched over. You wouldn’t learn to cut lawns the same way, you would learn to fertilize differently, you would use different equipment, the time that you can schedule in your job would be different. They type of marketing you would do to find school versus houses would be different. After we went through all of these things, you could see that specialization is something that is difficult for people from the outset to realize the power of. All of those examples I just listed, I don’t think most people would actually contemplate those in every line of business and economic vertical. It is not super intuitive. When you choose to specialize you are giving something up and that is this opportunity cost idea. When you choose to specialize you are giving up an opportunity. You can only do school lawns, you can’t do residential housing lawns.

Ryan Isaac: Unless you want to buy twice as much equipment.

Reese Harper: Yup, you got a 20 ft. trailer to get all your gear on it. The people you hire will have different experiences. The fertilizer guy will have to get it from a different place, and by spending time on one thing you simply don’t spend time on other things. I know that a lot of people have heard of this principle, but I think it is good to question how it happens within dentistry and within our lives. I think opportunity costs that we give up can be broken up into a few different areas. We can break it up into time, which is where we should go first. We can talk about briefly how time is really the main thing you give up in opportunity cost. You are basically saying that you will not allow yourself to develop another skill. I am consciously dedicating time to something else. I don’t know how you would view opportunity cost and time, but I think it would be interesting for me to hear your perspective.

Ryan Isaac: Ya, it actually reminds me of a conversation you and I had a few weeks ago when I was messaging you at night. I was watching a documentary that spurred it. I have always had an interest in math, numbers, technology, and even some computer programming type stuff. I have always been interested in that. I messaged you and asked if it would be worth it based on some of the technology that we would like to have to go learn how to be a developer and programmer? I have an interest in it, I think I could do it! At some point in our business maybe it would be helpful. We had that conversation and I remember thinking about how it seemed like it could be kind of a good idea. It could be useful in our business based on things that we want to develop in the future. I have an interest in it, I think I could do well at it.

Reese Harper: It wasn’t that you didn’t want to be a financial planner anymore, you were just saying that if you could just develop some of those skills it could help the company by combining your skill set of IOS development and finance.

Ryan Isaac: Right, could I develop tech to help our clients see their own data in a better way? Things we talk about anyway, but what was your response to me, remember?

Reese Harper: I was like, “well, you are a partner, but you are also a scarce resource that I view in deployment.” I mean at some level, right? I look at it and go, “dude, your talent is so deep in this one area, your value to the enterprise in this one narrow channel is much greater.” I look at other developers which I know, probably forty of them. They may be interested in finance, but have deep development skill. I was like are you kidding me dude?

Ryan Isaac: No, we would hire that guy?

Reese Harper: In my mind, I’m like, “for real?” You are asking that question? But as I think about it, I believe it was a completely logical question. I have had that same question myself, for about ten years! We have built technology and I have constantly been having to bring in specialists to outsource things to and spend money on.

Ryan Isaac: At some point you think, shouldn’t I just learn this?

Reese Harper: I am paying so much money for it, I could just do it! It probably took me five years of feeling those drags and pulls before you really commit to valuing specialization. If you really start valuing it then you realize how expensive it is for you to do anything else. It becomes very expensive to do anything else beyond your specialization. I mean, if you are an orthodontist or a specialist that has a large practice with multiple locations, your time could literally be worth thousands of dollars an hour. If you are an average producer, your time is worth hundreds of dollars an hour. If you are slightly above average you are right around the thousand dollar an hour mark. There is no professional service that is worth more than that. I mean, ya, silicon valley front end IPO attorneys are worth like the same as a dentist. They are the most expensive attorneys in the whole country. They are very specialized, but their time is probably worth almost a thousand dollars in hour in some cases. There are very few of those relative to dentists. Beyond that the next biggest jump in professional services is significantly lower. Unless you are getting sold a package of goods and you don’t realize how much you are paying. In order for people to bill at a thousand dollars an hour is extremely rare. Two hundred fifty to three hundred an hour can get you the most competent people in any industry. That might be a fixed fee, a flat fee, or however they bill, their time equates to roughly that. Your time is just worth way more than that as a dentist. It is just worth a lot more. It is really hard for me to see people do that. We struggle with that, and a lot of people do. It is important to acknowledge that you are not immune to it.

Ryan Isaac: I remember times of producing video content at our office where you have the ability to write music and little mini film scores, right? I remember times where you thought, “let’s not buy the background music, I will just go write something.” I have the ability, equipment, talents, I like to do it. That is kind of my next question in this subject of opportunity cost. We come across this all the time with dentists, clients, people we meet, in our own business. Should I be a tech developer, should you write film scores? What about the dentist that has a really sincere interest in his own investments? Should he go get an investment credential? Should someone who is frustrated with the insurance reimbursement with their particular state or region divert parts of the practice to building some organization to fight back against it? At what point does an interest and a hobby become a detriment to the sacrifice and the money that you have already spent getting to the point where you are at?

Reese Harper: That is a great question. Everyone has interests and everyone wants to spend time in things that interest them. If your day is not interesting to you, you get bored. Some people really are just bored with clinical dentistry. They want to have an outlet. They like to have an outlet. I think there is a risk in doing that. Everyone has interests that bring balance into your life that is healthy. If it is a hobby and an interest and it is not detracting from your day to day operation, then I don’t know. I have got stuff that I enjoy doing and everyone does. You need an outlet! What I worry about is when it is kind of like a justification. When you are justifying the outlet because you’re trying to say that it is a good use of time and money, but really it is just a hobby. It is just something that you like to do and is entertaining or interesting to you. If it is a business decision like a purely business decision and you are trying to decide what makes the most money, there are very few things that you would do indefinitely that are not highly, highly specialized. For example, let me give you an organizational chart mentally to kind of think through here. If you are starting a business, let’s say you are a dentist or a service provider of any kind. The only main role you are thinking about is producing dentistry. You could put on another hat and say there is marketing, office management, staff, team, payroll, direct mail, the website, community outreach, networking with other referral partners, there is staff development and training. There are all of these things going on. You can have your hand in all of them, but most people will say, “I am just going to be the practicing dentist.” Eventually, I will get some of these other things off of my plate. As companies get larger and larger, every job, technically, is replaceable. Even your job as a dentist. Your job as a dentist is not irreplaceable. You are not the only one in the world that can do dentistry. The more specialized you become as an individual, the more money you will make. My example here is that everyone is at a different phase in terms of ability and skill whether in their career and their ability to handle more levels of specialty. The peak of specialization in dentistry isn’t necessarily being a producing dentist. I mean, the peak of specialization would be being the dentist that can train dentists that you have hired, and being the dentist that can manage an organization of two dentists, or three dentists, that is not even the peak. It goes beyond that. You can say that is one phase, but the next phase is just the dentist who can take a small group of practices, you know, 7-10 and hire the right dentists in each location and then hire a training dentist who can train those people and it is their job to make sure that the marketing happens effectively or that each dentist is being trained properly or that the patient surveys are being completed properly and that you know that the patients are happy. That is not even the end of specialization. There is more specialization. You could be a private equity firm that only does dental acquisition, that only hires dental managers, that manage managers, there is limitless ends to specialization. That is how companies get to be massive. That is how countries grow. That is how economies function. It doesn’t necessarily mean that it has to be what you want to do. It isn’t what I want to do, it is not what I am choosing. There are limits to what I know my abilities are, and how hard I want to push myself and how much energy I am going to give work, and how big I want my business to be before I feel like it is no longer interesting to me.

Ryan Isaac: That kind of goes back to the very first point which is trade. Know your best resources, and for some people their absolute best resource might be one doc, one location, small practice clinical dentistry. That is their absolute best resource.

Reese Harper: Or even being an associate! Not even owning it. Being an associate in a great practice where you are being compensated efficiently and you are adding tons of value. You are maximizing your own utility. You might have tried to specialize deep and realize that practice ownership isn’t for you and that’s a frustrating ceiling to hit. I can say that no question there is a good percentage of the market that own practices that should not own practices. They just shouldn’t. It is not their highest utility. It is over stretching for some people to own a practice.

Ryan Isaac: It is usually trying to get into the black bean market when the raspberries are where it is at.

Reese Harper: There is nothing wrong with any of this, I mean there are a lot of benefits to just moving up the scale in terms of how you are going to specialize. If you are an associate you can’t just be stagnant. You can’t say I am never going to get better. You have to increase your hand speed, you need more CE, you have to understand how to support and communicate, build relationships with patients, and be able to support a team and your manager. If you are a ten location owner that doesn’t even practice dentistry anymore, you still have to develop increased specialization.

Ryan Isaac: Ya, there is no end to the amount of stuff that you can work on.

Reese Harper: I just think that looking at your life in terms of an opportunity cost is the third principle that we have tried to hit on. It really plagues a lot of dentists. I just think that I can see it in the data when I see two people of the same age that are worth very different amounts of money. I will also see people in the same wage, same city, and have different levels of personal wealth. Personal wealth is not the only measure of success in life, but your net worth is the measure of good financial decision making. If you are trying to optimize the amount of wealth that you can accumulate and build up to make work optional and to give yourself flexibility and freedom, than the deeper you can specialize, and the more you can decide what your unique ability is and what you are not willing to try to DIY, the better off you are going to be. That is just a great summary.

Ryan Isaac: Thanks for teaching us what you taught fifth graders.

Reese Harper: The fifth grade lessons. They keep coming back to haunt us for the rest of our lives.

Ryan Isaac: I mean, were all the fifth graders on board? Did it make sense to them?

Reese Harper: Ya, it is interesting. My son was in the class and it is just interesting to have discussions with him afterwards about specialization. We are driving around and I am like, “what kind of bakery is that?” He is like, “you are right, it is not a regular bakery, dad. That is a bagel shop. That is Rich’s bagels, the bagel shop. He only does bagels. He just bakes bagels and that was his highest utility. He specialized and everyone drives from all around to pick up his bagel.” You see a lot of businesses doing that. I love seeing specialized businesses. In dentistry there are plenty, even as a general dentist, there are plenty of ways to carve out your niche in the market. You can be known for something or some type of experience, service, treatment, brand. There are big differences. It think it is important to remember that.

Ryan Isaac: One last question, what is the desert you will be crafting and preparing this weekend?

Reese Harper: Oh man, you know what I want to try to do is figure out how I can do a non-dairy custard. That is what I am trying to work on right now. I love custard. I love flan. I have not been able to find a way to make it turn out. I have got a few recipes I am working on, but I am trying to cut back on the dairy.

Ryan Isaac: I wish you luck. I will look for the picture stream to come through on Saturday evening or something. I want all of these high quality photos of your food.

Reese Harper: Thank you for tolerating my food sharing pictures.

Ryan Isaac: Just invite me one of these times, and it will be better.

Reese Harper: We will see.

Ryan Isaac: Thanks everyone for listening. We would love to ask a favor. If you are listening to this and you have your phone in your hand, just go onto iTunes and leave us a quick review on the actual podcast app. Last time I checked we were number 5 or 6 when you search for dental podcast. If you leave us a review, it will help us climb up a little bit more towards the top and help more dentists find us easier. It takes like two minutes to do and we would really appreciate that. You can also see a full list of episodes on dentistadvisors.com/listen. If you go to our website dentistadivsors.com, you can book a free consultation with one of our advisors. Just click the link on the top of the page, there is a calendar link where you can schedule. We are always happy to talk to you.

Reese Harper: Thanks Ryan, carry on!

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