Re: economics of dental profession
- From: minnie@xxxxxxxxx (Minnie)
- Date: Mon, 17 Oct 2005 16:57:41 GMT
On 15 Oct 2005 22:33:32 -0700, mamounjo3@xxxxxxxxx wrote:
Interesting.
>Hi,
>
>Anyone have any thoughts on the economics of the dental profession?
>Suppose you spend $120-200k for dental school tuition, plus maybe $80k
>lost wages from studying in dental school for four years instead of
>working. That's maybe $200-250k spent when you're in your early 20's.
Assuming the student pays off the school loans.. some don't pay it
back,some work in gov't facilities after to pay the debt,
some are trained in the military, families pay for school, there
are a few variations.
>If you put that money in a retirement fund at that early age and it
>doubles every 8 years via 8% return on investment, you make maybe $2
>million by the time you are 60, in addition to whatever you'd make
>doing a low-wage job. Now, if you become a dentist, and shell out
>another $200k to start a practice, you might make $65-100k after taxes,
>about $3 million total by the time you are 60, which is maybe only $1-2
>million more than you'd make if you had a low-wage job and worked it
>until you are 60 (but you have lost that $2 million retirement nest egg
>you would have had if you dumped the dental school tuition money and 4
>years wage money in an investment fund while in your 20s). In other
>words, it seems that you work your ass off to be a dentist, but
>basically wind up with the same amount of money, breaking even, as you
>would have if you never became a dentist. Do the economics of this
>career make any sense, or can they only make sense if the government
>pays for dental education and it becomes free for every dental student?
> Otherwise it seems that you make a blood-hemmorraging investment from
>the start for the privilege of working like a dog to make it all back
>and wind up where you would be if you never bothered with the
>undertaking.
My childhood dentist agreed with your assessment:
During a visit when I was a teenager, the dentist suddenly started
telling me what a GREAT patient I was and how he wished all his
patients were like me. He was really emotional, practically on the
verge of tears. Then he said, "I should have done like my brother and
opened a gas station in Arizona. HE was the smart one!"
I listened and felt really bad for him. That was my last visit there
because he was dead from a heart attack 3 months later
>The U.S. government doesn't care, they figure, well, he's
>a dentist, he's making over $75k per year, let's put him in a high tax
>bracket and make him pay a tax penalty because he's rich.
Yes, work hard, heavily taxed, no doubt.
>But the
>taxman doesn't consider how the dental student bled himself dry to
>become a dentist. In fact, most dentists have only saved about $250k
>by the time they reach age 60. It seems that the economics of this
>career don't permit much saving by the dentist,
And the time spent, the opportunity cost, does not permit time
for the study of economics and investments.
Seperately, one doctor told my mother that doctors can't retire
because they are always spending too much on alimony for their
ex wives.
>and he'd wind up with
>much less at retirement age then if he put a big lump sum in during his
>20s and then just worked at McDonald's for the rest of his life. Any
>thoughts on this argument?
I think you have a point here, but the reason is not only the
initial cost of school.
If he bought the McDonalds franchise in his 20's he'd do well, or if
he becomes a dentist and buys the building he works in. Some of
them collectively own the building they work in. Maybe that is not
typical, but I've seen it done.
I would guess there are variations in what they've saved at age 60,
but generally doctors are not known for making great business
investments. You may be correct that not much is saved at the
end of the career, much is lost, and they don't have pensions.
I believe if he goes into it only for the money he's making a big
mistake.
.
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