One of the problems we see amongst dental practice owners is that while they may be earning a lot of revenue – the money coming through the business doesn’t end up in their pocket.
This leads dental practice owners to feel like they have to constantly keep working harder and longer in order to see any reward.
We call this Entrepreneurial Poverty – where practice owners allow the business to eat up every last drop of revenue, and they barely pay themselves a living wage.
Needless to say this is frustrating, stressful, and doesn’t help build intergenerational wealth.
The process towards profitability and wealth starts by taking control of the money that goes in and out of your dental practice.
One thing a lot of people don’t know about entrepreneurial poverty, is that many entrepreneurs actually live below the poverty line – and we really don’t want you to fall into that trap.
The reason this happens is that they let the business eat up all the funds and they’re constantly feeding the beast without setting money aside to pay themselves.
The result is that they end up living on leftovers. In order to escape this pattern, pay yourself first.
Robert Kiyosaki, the author of Rich Dad Poor Dad, explains how and why you need to do this in great detail.
We also need to ensure we have a comfortable buffer or rainy day account to give us peace of mind.
Things come out of left field all the time; bills arrive, equipment breaks, circumstances change, and you need to have a contingency to cover yourself if and when these things arise.
It’s all well and good to be sticking to your budget, things going according to plan – but those unexpected costs will come up and you certainly don’t want to let them throw you off.
Just like you have a safety net in our personal finances (or you really should), you want to make sure the practice you’ve worked so hard to build has the funds there for things that undoubtedly come up.
Otherwise, you’ll end up paying out of your own pocket and it’ll set you back on your journey to building wealth.
So, those are two important keys when it comes to escaping the trap of entrepreneurial poverty. Make sure you pay yourself first, plan for a rainy day, and stay savvy in your journey to building lasting wealth!