Message Boards
Today's Active Topics Today's Active Cases Browse Forum Categories My Recent Activity My Messages Private Groups My Marked Threads My Subscriptions
Today's Active Images Today's Active Polls Most Active Topics Global Townie Map Advanced Message Board Search Message Board Terms of Use

Financial Keys to an Early Retirement Douglas Carlsen, DDS

More by this author (62)
Financial Keys to an Early Retirement

by Douglas Carlsen, DDS 		The following are valuable financial ideas culled from my own and other early retirees' years of pains and rewards. Some of the following points run counter to "conventional wisdom" espoused by the "experts." Please keep in mind that these tips come from real dentists who were able to retire well before age 60 and on their own terms, while most financial gurus still must work.
Personal
  • Teach your children to be financially responsible. There is a 100 percent correlation between parental accumulation of wealth and children's knowledge of money. Any information that parents impart to their children about saving/spending – good or bad – tends to rub off.
  • Consult your spouse/partner before any major purchase. Decide between yourselves what amount constitutes a major purchase – usually anything more than $500 - $1,000. Couples that talk about money tend to do well financially and stay together. For years, it's been known that money problems are the leading cause of divorce.
  • Credit cards are satanic in nature. The industry promoting them is only concerned with greed and cares little about the emotional wreckage caused. Always pay off the balance, lest you fall into the abyss of penury. If you do slip up, cut the beastly things up, burn them, and send the ashes to your favorite dental insurance company.
  • Debt and creative don't mix. Never use debt as a tool. None of the early retirees I've interviewed ever used debt to invest in a supposedly higher-paying instrument. Those who do usually end up behind. Why? They miss an important entity called risk. Sorry, you'll seldom beat the banks at this game.
  • Don't buy more home than you need. Dentists make a big mistake thinking that a larger personal residence will bring more wealth. Homes do outpace inflation by two percent historically, yet that gain is offset by interest, property taxes, and upkeep/improvements, even after tax breaks. You will gain financially only if you exchange for a less expensive home at retirement, yet few professionals do this.
  • Pay cash for autos – always. If you can still pay cash for that new $70,000 BMW 750i, great. Early retirees would buy a three-year-old model for $40,000.
  • Be compulsive about your dentistry, not your purchases. I've heard several household cleaning crews comment on doctors and spouses that leave stacked unopened boxes of clothes and electronics throughout the home, for years! Buy only what you need.


Practice
  • Look at your practice checkbook once a month. Make sure it is up to date. Make sure there are no strange entries. Note the lowest balance for the month. Is all comfortable? If any of the preceding makes you nervous, ask the person responsible to explain. If you remain nervous, seek professional help pronto, either with your CPA or with a trusted consultant.
  • Always pay yourself first. You've all heard this before, but how do you really do it? Always fund your tax-deferred and non-tax-deferred savings first, before your salary and your employees. If you can't, you need to monitor your practice and personal expenses differently.
  • Do not finance after age 50. Pay in cash. By the time you are in your early 50s, little should be owed on anything. For your practice, use a budget for any large purchases each year. Keep to a reasonable amount – possibly $20,000. Thus, you might switch to digital radiography this year, and then purchase new computers next year.
  • Never make purchases solely for the tax write off. Paying $30,000 for a new digital pano means you are still paying $18,000 after a $12,000 write off. Remember to budget large purchases. And please don't buy just to satisfy the Section 179 IRS write off. You still have to pay for the equipment.
  • Don't move (home or practice) after age 50 unless you pay cash. A main obstacle to retirement is the sequel loan. Saving at this age needs to be significant. New debt of hundreds of thousands of dollars erodes the chance to retire at least five years, often more. Practice relocations, even when leasing, now cost more than $400,000. A gorgeous remodel, paid with cash, can be done for a fraction. A new home mortgage, with additional years of higher payments, can delay retirement even more. Again, a remodel paid with cash is prudent and can be just as rewarding.


Investments
  • Boring and slow always wins. For your core, use index funds from a no-load broker. Any no-load company can guide your asset allocation for a small fee. For do-it-yourselfers, Merriman Berkman Next offers free, professional strategies at www.fundadvice.com. Good dental advisors include Mercer Advisors and Hufford Financial.
  • Be careful with commodities and individual stocks. Why? Risk. Keep your gold and Google habits to less than 10 percent of your total portfolio.
  • Beware banks and insurance companies for investments. The fees will be significantly higher and you will end up with a longer career.
  • Leave day trading to Jim Cramer. Show me a day-trading dentist and I'll show you a Red Bull-chugging, text-messaging zombie trying to figure out Invisalign at age 80.
Author's Bio

Douglas Carlsen, DDS, owner of Golich Carlsen, retired at age 53 from a 25-year private dental practice and clinical lecturing at the UCLA School of Dentistry. He writes and lectures nationally on retirement and financial topics from the point of view of one who was able to retire early on his own terms. Dr. Carlsen consults with dentists, CPAs, and planners on business systems, personal cash flow, and retirement scenarios. Visit his Web site: www.golichcarlsen.com; call 760-798-0886 or e-mail drcarlsen@gmail.com.
Dentaltown Magazine
September 2025
Dentaltown Magazine September 2025 Read Current Issue Read Archived Issues
Sponsors
Townie Perks
Townie® Poll
Who or what do you turn to for most financial advice regarding your practice?
  
Site Menu
Message Boards Magazine Continuing Education Podcasts Blogs Classifieds Dental News Events Townie® Poll Ebooks Townie Choice Awards
Company Info
Contact Us Advertise With Us Howard Farran DDS, MBA Policies and Agreements
Site Help
Sally Gross, Member Services Specialist
Phone: +1-480-445-9710
Email: sally@farranmedia.com
©2025 Dentaltown, a division of Farran Media • All Rights Reserved
9633 S. 48th Street Suite 200 • Phoenix, AZ 85044 • Phone:+1-480-598-0001 • Fax:+1-480-598-3450