As one year ends—a year that doesn’t need any more said about it here—and another begins, it’s a natural time to reflect on what changes we’d like to effect in our lives going forward. For dentists, as you take time off from your practice to enjoy the holidays with your family (and, if you are like many others, you may be looking at a pretty light schedule in January) you may find yourself wondering whether 2021 is the year for you to transition your dental practice.
You might think that selling a dental practice in a time of such uncertainty is counterintuitive. However, one of the many surprising things about 2020 was that we saw a burst of increased activity among interested buyers. And while the prospect of retiring from a career you’ve worked hard at for decades may seem daunting, it doesn’t have to be.
After all, if you consider what you’ve built in your dental practice and are happy with what you’ve done— whether it be the relationships you have with your staff, the quality of care that you’ve provided your patients, the comfortable life you’ve provided for your family, or the role you’ve played in your community—aren’t you entitled to a happy retirement?
This is not to say the decision is an easy one. It’s a big change to be considered carefully. But when you really look closely at all of the factors, retirement may be more in reach than you think.
Just keep in mind that retirement isn’t about your age, it’s about your state of mind. It’s about knowing when the work of your career is done and you are ready to enjoy the rewards of your labor.
Consider Your Financial Situation
If you own your house, your cars, and are overall debt-free, you are well positioned for retirement. If you have a few things you still owe on, think about what it would take to pay those off. A fixed income is a very manageable way to live if your expenses are limited to living expenses.
If you are an older doctor, it’s likely that you don’t have to worry about supporting your children or your parents. These things are often major expenses in mid life, but generally ease up as we age.
Have you been saving and investing? If so, consider what you have accumulated. Discuss it with your financial advisor if you need to. You might find that you already have saved enough to support yourself without having to worry about going to work in the morning or managing an office and staff.
Also, if you were born between 1943 and 1954, you are already at full retirement age for Social Security benefits. If you were born after 1959, you’ll have to wait until you are 67 to receive full benefits. You can start claiming benefits as early as 62, however, your payments will be 25% lower than if you wait.
In addition to all of this, you also will have the proceeds from selling a dental practice. That’s a substantial amount of money that can go a long way when combined with all of these other factors.
Consider What You Want to Do With Your Time
Once the holidays are over, you’ll be back in the office with your hands in someone’s mouth, all day, every day. This work can yet be highly satisfying. Working in a successful practice that you’ve built yourself is very rewarding. But that doesn’t mean that the day-to-day grind doesn’t sometimes wear you down. Are you content to spend another year with the handpiece in hand? Or would you rather it were a fishing pole, a golf club, or a cool drink while relaxing on your porch, enjoying the afternoon?
Another option you may consider is selling your dental practice and continuing to practice without the responsibility of managing the office. This also may relieve the pressure of having to keep a schedule to ensure your production meets the levels you need to sustain profitability. Many doctors opt to continue to practice some dentistry in retirement, yet focus only on the kinds of dentistry they enjoy most, or choose to focus on humanitarian dental services to underserved communities.
Whatever path you choose, the thing to keep in mind in retirement is that your time becomes your own in a way that it hasn’t been for a long time. You have the freedom to choose what you do, and what you don’t do.
So, with that in mind, what do you want to do?
Having a Plan for Retirement is Essential
While it’s easy to daydream about living the good life, the reality is that retirement is like most things in life: the more you’ve planned for it, the better it will go. You don’t want to wake up the morning after your practice transition deal has closed and not know what to do with yourself.
The good news is, this can be the fun kind of planning. Just consider three simple questions: what, where, and who?
What do you want to do with your time? We’ve already touched on that a bit. It’s useful to consider how you’d like to spend your time when you get to make the choice without the constraints and commitments of full-time work.
Where do you want to be? Do you want to stay in the town where you’ve practiced? Or would you like to go somewhere warmer (or cooler)? Have your children moved away? Would you like to be closer to them? Where would you like to travel?
Finally, whom do you want to spend your time with? Your spouse? Your children? Your grandchildren? Your friends that maybe you’ve seen less of over the years?
By making a plan of what you want to do, where you want to do it, and whom you want to do it with, you’ll have something to look forward to on that morning after you’ve transitioned your dental practice—along with an idea of how to make that happen.
Consider Your Health
If you are in good health, that is actually a good reason to consider selling your dental practice sooner than later. This is true for two reasons:
First, too often we’ve seen doctors wait until they’re compelled into retirement by failing health. Retirement is always better when you get to do it on your own terms. When it’s something you’ve chosen, you generally are better positioned to enjoy it.
Similarly, when a doctor is forced to retire because of illness or failing abilities to handle equipment or perform procedures, those last months of practice are unpleasant, and the urgency to transition the practice can compromise your position in the transaction.
Second, having the ability to participate in activities you enjoy will enrich your retirement years. We’ve seen doctors who have simply waited too long and their retirement periods have become more about health care and adjusting to physical limitations, rather than enjoying their hobbies, interests, and travel.
Consider Your Spouse and Family
Retirement doesn’t just affect you, of course. This will be a major change for your whole family. It’s important to discuss the idea with your spouse and be certain that you are both in agreement about it.
You need to discuss both the idea of retirement itself and also your plans. What does your spouse want to do with their time? Where do they want to live? Who do they want to spend time with? Talk through each of these items and put together a plan that works for both of you before your retirement begins so you can approach it as a team.
DDSmatch Mid-Atlantic Can Help with Selling a Dental Practice
We are dental practice transition specialists with extensive experience in helping doctors find the right match in selling a dental practice. Using our proven process, we can guide you through this final step in your career. If you are interested in transitioning in 2021, you can take advantage of our Trusted Transition Process. If you think you may be a few years out from retirement, we can still help you start preparing now through our Practice Optimizer Experience, helping you be ready and retire on your own terms. Contact us today and find out how we can help you make 2021 be a better year for you.