Investing as a dentist: Are you leveraging your value to your best advantage?

Today, James focuses on two key ways of helping dentists: Mentoring them to leverage their time spent in practice to make more money - potentially in less time, and helping them to create strategies for growing their wealth in the longer term.

He explains that the dental profession is demanding – particularly for those running their own practice. This means that dentists are left with very little capacity or ‘bandwidth’ for anything else. “The 5% that’s left over is either spent in downtime – with friends and family, or just trying to recover,” he says.

Earn more, don’t work more

James believes dentists generally do want to understand how to manage their time more effectively while maintaining, or even increasing, their income but just don’t know how.

“The trick is to understand the concept of leverage. The next step is to understand how we can apply this to our lives. This means we can earn more and also have more time to do the things that make us happy,” he says, adding: “If you ask people ‘how can you earn more money’, most will say, ‘maybe I could work another day a week’. That works, but there’s only seven days in a week and you can’t ask for eight days. So the trick is to get more out of each day to increase wealth without necessarily working more…the leverage in a system is how much your input is multiplied by in order to obtain the output…Lots of dentists want to do less dentistry but feel like they’re trapped because they don’t necessarily have an understanding of how to make the same or more money but in less time.”

James highlights the importance of dentists properly gauging how happy they are with their career and work/life balance. “Unlike most other jobs that you leave if you don’t enjoy, dentistry takes you five years of studying to reach that understanding, which is pretty unique. Many dentists then think that now they’ve come this far, they have to keep going. Of course, it’s not that black and white. I’m not saying just drop dentistry but there has to be a sweet spot.” He asks his clients to consider how happy they are on a scale of one to 10. If they score 10, then nothing needs to change; instead, he can help them with an investment strategy that will grow their earnings for the future when they retire.

However, if it’s nine out of 10 or less, James believes they’re still making compromises when it comes to their life satisfaction and that’s when they should consider how they can continue to earn the same money but working fewer days per week.

Leverage your value

He stresses that dentists are in the perfect position to increase their earnings from the services they already offer because dentistry is value driven, rather than price driven. “People will pay more when they get a better service, particularly when it comes to their teeth. For instance, if you have a procedure done on your teeth that removes enamel, it is irreversible; it needs to be done correctly the first time. That means when someone is very good at their job, their value is exponential…The more value you give to someone, the more you are within your rights to ask for a greater amount of value in return.

“That sounds like a really simple theory, but the number of people who actually practice that and are ready to implement that mentality is very small because dentists are human too; they have the belief that the best way to help someone is to charge them the least amount money, which makes no sense whatsoever. If you went to a hairdresser and they shaved your head for £5, would you feel they’d done you a favour? No…you’d actually be more grateful to the person who charged five times that price, who did a good job.”

Instead, James advises his dentist clients to let their decisions to be guided by what they truly believe to be the most suitable treatment for the longevity and health of that tooth. He believes this leads to more profitable dentistry for two reasons: The first is that patients will be happier, more likely to return and to recommend the practice to friends and family; the other is that the best treatment is likely to be one at a slightly higher investment. “That’s something dentists are scared of – pitching to somebody that think might be offended that the investment is more,” he says.

James concludes that figuring out how to get more out of each hour of practice, to the point of earning the same in four days compared to five or even six days, will enhance someone’s life tenfold: “Because now they have their optimum relationship with dentistry. Not in 30 years when they retire, but today.”

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