2.6.15 Issue #674 info@mckenziemgmt.com 1-877-777-6151 Forward This Newsletter
 

Reduce Your Debt with These 3 Tips
By Sally McKenzie, CEO

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You’re ready to get your practice debt under control. You no longer want your financial obligations to control your every move. You’re ready to break free, and finally be the proud owner of a successful, profitable dental practice. The only problem? You have no idea how.

I see it all the time. Dentists have hefty debt obligations they’re responsible for each month, and once they finish writing all those checks, they’re not left with much to actually invest in their practice. Overhead is out of control, and saving for retirement seems like nothing more than a dream. They’re stuck, frustrated and fed up, yet have no idea how to change their situation and finally get back on track.

The good news is, you don’t have to figure it all out on your own. The team at McKenzie Management can help you break free of your debt, grow your practice revenues and finally reach your full potential. Ready to get started? Here are three tips I’ve put together designed to help you reduce your debt and grow your bottom line.

1. Conduct a Cash Flow Assessment
If you’re going to gain control of your finances, you need to come face to face with reality – and that means getting a firm grasp of your financial situation. I recommend conducting a cash flow assessment in your practice.

How? Log the numbers for net production and collections over the last 12 months, the percentage of accounts receivable over the last 90 days, and total monthly payments on leases, loans and business credit cards. But don’t stop there. Also look at average monthly payments to the lab, dental supplies, salaries, taxes and benefits, and don’t forget about monthly facilities costs and all the various miscellaneous expenses that don’t seem like much until you actually add them up. This assessment will give you a clear picture of where all your money is going, and will help you to address your debt before it gets completely out of control.

I offer a complimentary cash flow assessment on my website HERE.

2. Hire Someone to Evaluate Your Finances
After you complete the cash flow assessment, a financial expert from McKenzie Management can evaluate your individual situation and determine the best way to reduce your debt obligations. This expert may recommend consolidating all your loans and then refinancing them at a lower rate, or it may be determined that it’s much more cost effective to purchase the space you’re using rather than leasing it. If you do decide to refinance, look for loans that allow for additional principal payments, as this will effectively lower your interest rate over the long term.

There isn’t a one-size-fits-all solution for reducing debt in your practice. You have to take a look at where you can make adjustments, and an outside financial expert can help you make these changes and start reducing those financial obligations that are holding you and your practice back.

3. Be Proactive
Once you’ve found ways to reduce your debt obligation, shift your focus to improving your practice management systems. These inefficient systems are only contributing to your debt and overhead problems, causing stress and frustration for both you and your team.

Really look at your 20 practice management systems and make any necessary changes and updates. Trust me, it’s time and money well spent. Enhancing your practice management systems will not only help ensure you don’t find yourself drowning in debt again, it will also make your staff more efficient, your practice more productive and your bottom line more robust.

Most dentists struggle with debt, and I’m talking about hundreds of thousands of dollars in financial obligations they must find a way to pay. The thought of it can be overwhelming, but you have to address your debt and figure out how to reduce it before it pulls your practice under. These tips will help you get your financial obligations under control so you can focus on investing in your systems and creating a thriving practice, not just on writing check after check each month.

Remember, this isn’t a process you need to take on by yourself. McKenzie Management is here to help you take your practice back, and reduce those financial obligations that seem to dictate your every move. Start taking steps to reduce your debt and improve your systems, and you’ll finally realize true practice success and profitability.

For additional information on this topic and more, visit my blog: The Lighter Side

Interested in speaking to me about your practice concerns? Email sallymck@mckenziemgmt.com
Interested in having McKenzie Management Seminars speak to your dental society or study club? Click here.
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