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What I Learned:

Contrary to popular opinion, the spouse is commonly second on the list with whom orthodontists share their career and practice aspirations with. 

Wanna know who makes the first cut?

The financial advisor.

Most employees in practice go through life with a ‘career plan’ lasting no longer than 5 years before it gets hazy.

Assistants, front desk, office administration, lab techs, etc. They likely can’t tell you where they’ll be in 5 years, let alone in 5 months, and post-2020...in 5 days. 

But one thing that’s almost defined from the day they are accepted to ortho residency: The orthodontist’s career arc. 

I had the opportunity to listen to a financial advisor who specifically had a large clientele of orthodontists over the past 30+ years. I thought this was interesting, given that the different reasons doctors “become more efficient..” follows this almost to a point. 

“…Give me an age, and you can almost be sure which of the 5 stages they’re currently in.”

 Stage 1. “The New Graduate.”

· Age: 27-32:

Average Income and Net worth: $300,000 | -$272,000

· What’s on their career mind: Get a position as an associate, either with an OSO or private practice, with the idea to just build a nest and pay off debt. Oh yeah, it’s a lot of debt. $537k worth. Wait for that first paycheck to roll in, and soak in from the senior doc about the nuts and bolts of how a real practice operates.

· Advisor pillow-talk:  “…I’ve got to pay down this debt, but #@&$!, I also want to spend for a nicer ride and house. I’ve spent all this time in school making peanuts. How can I invest this $1500 per diem so I don’t have to work for this practice manager in 5 years and prepare to do my own thing?”

Stage 2:  “The Young Professional”

· Age: 32-37

Average Income and Net worth: $340,000 | $197,000

· What’s on their career mind: Join the practice as a partner ….or start/buy one of their own.  Debt is under control, and the family of 2 is growing to 3. They’ve got their doctor’s mechanics and philosophy down, and are itching to do things their way. Equity and dreams of control.

· Advisor pillow-talk: “…so I’m making $300,000/yr+, but I have no tax deductions from ownership, and my debts under somewhat under control. I’m ready to start on my own or buy, and implement my own ideas. How much do I need again to buy-in? 80% of collections? What’s the rate on a business loan in 2024? Why is it half a mil to build?

Stage 3: “The Hustler”

· Age: 37-48

Average Income and Net worth: $490,000 | $1,191,000

· What’s on their career mind: Growth.  Let me say it again: Growth. They own this and it’s going to be a rocket. The sweet logo on the wall has their last name on it. With 2-3 kids now, thoughts are of a 2^nd or 3^rd location. “Do I or don’t I?”  Not afraid of any case difficulty, but… the need to balance life a little is creeping up. All about the starts, production, and establishing themselves with flashy photos of their practice and synchronized dancing assistants. Scrolling Instagram on other practices makes them depressed.

· Advisor pillow-talk: “…Let me do all I can for tax deductions. I need to break $3million this year. That’s the bar I’ve set for myself because success is equated to starts. Everyone online is bragging about their EBIDTA multiple, and deep down, I’m as capable as any of than them.”

Stage 4: “The Rose-Smeller”

· Age: 48-55

Average Income and Net worth: $520,000 | $2,800,000

· What’s on their career mind: Around the age of 48 (can be a bit older and younger), more patients, more staffing, more locations, more people ….doesn’t seem to do it. Some life event happens. Or after a long clinic day on a Thursday drive home to an empty house, a lesson is learned: Practice growth isn’t all there is. Life is finite.  Kids are getting older… And I don’t have any great hobbies. 

· Advisor pillow-talk: “…I’m burning out, and need to slow things down. How can we make the current numbers work? I’m entertaining ideas of selling or bringing on an associate. And …I’m done with 4 clinic days. EBDITA multiples have gone down for acquisitions, but I’m on track for $3-5m in retirement if I sell this thing at a great multiple… ”

Stage 5: “The Hobbyist”

· Age: 55-77+

Average Income and Net worth: $550,000 | $4,600,000+

· What’s on their career mind: This group is split in two. For those that want completely out: Florida, fishing, and golf are calling. If they never touch a bracket again, that’ll be too soon.  They’re done. Even if they work 1-2 clinic days a week, the day before is a dread. As they say, its a risk to keep someone who’s checked out from doing check-ins.

For those that stay in: Sitting around at home isn’t their thing, and they’re not doing this for the money anymore. This is now a craft. A lifestyle. Here to teach others. They enjoy the colleagues and industry. Plus, they might have limited hobbies outside of work. This is the hobby. Ortho is life.

· Advisor pillow-talk: “…You know I can quit anytime. My retirement interest is making more than my yearly salary, but…I like it; and this is kind of my thing. I’ll go for another 5 years… or until I can’t …who knows?!”

My take?

After speaking with hundreds of orthodontists, this pattern has merits.  Yes, you can point me to anomalies - where you see the upper 50-year-old focus on growth, or a 31 year old with no desire for equity, …but this is common.

If there’s any wisdom to be gained from this – it’s that the joy is in the journey, and that when you’re speaking to an orthodontist, “production growth” and “quality time” flip around age 48. 

“It’s not the number of smiles one changes, it’s the amount of smiling that changes the numbers.”

_{Graphic from the White Coat Investor, Dr. James M. Dahle:} 

Business Idea Whiteboard:

“Leadership Teams vs. Everything Running Through the Doctor.”