Casey & Jarrod delve into the common misconception that handling all aspects of business management in-house can save money for practice owners. They explore the hidden costs and potential pitfalls of this approach, shedding light on how seemingly small decisions today can have significant financial repercussions down the road.
Announcer:
Hello, everyone. Welcome to the Millionaire Dentist Podcast, brought to you by Four Quadrants Advisory. On this podcast, we break down the world of dentistry finances and business practices to help you become the millionaire dentist you deserve to be. Please be advised, we do speak with an honest tongue and may not be safe for work.
Casey Hiers:
Hello and welcome. This is Casey Hiers, back at the Millionaire Dentist Podcast, in the studio with cohost, Jarrod Bridgeman.
Jarrod Bridgeman:
Hey, hey. How are you?
Casey Hiers:
What are you sipping on there?
Jarrod Bridgeman:
It's an energy drink. It's called something in cursive. I can't quite read it, but it's flavored like Hawaiian shaved ice and it's 10 calories.
Casey Hiers:
Energy drink, nice. You're going to be on fire. You're going to pick me up.
Jarrod Bridgeman:
Oh yeah. It's either I'm going to be on fire or I'm going to have a headache later. Those are the options.
Casey Hiers:
Both.
Jarrod Bridgeman:
Yes.
Casey Hiers:
The headache will come later.
Jarrod Bridgeman:
Yeah.
Casey Hiers:
So what do you want to talk about today?
Jarrod Bridgeman:
Well, I was thinking about something the other day. So I was complaining to some people here at the office about my taxes this year. Usually, I have a CPA do it, and he's a buddy of mine, but he's a CPA for the state of Indiana, and he normally does them for me. This year, I'm actually filing married, and my wife was like, "I love to do taxes. I just want to do them." So we did them one of those online services, and it got sent back a couple times. We had to write a letter. I just got my little tax refund last week after filing in April.
Casey Hiers:
So what did you learn?
Jarrod Bridgeman:
Here's what I learned, that you know what? Sometimes doing it yourself and not paying somebody else can really suck in the end. We spent a lot of time and a lot of hours that could have been easily and quickly solved. It sucked.
Casey Hiers:
I like to hire people to do things that I'm not trained in or good at, but yeah. Now, if you were a practice owner doing it yourself, terrible idea. Even having a buddy do it who's a CPA, not the best idea. But yeah, so that lesson cost you a little money for a couple months.
Jarrod Bridgeman:
It did. It cost some money, then also, keep in mind, my time is worth something, whatever the couple hundred bucks it might have been for someone in my position, compared to probably the weeks and weeks and weeks of time.
Casey Hiers:
Listen. Time and money is what it's all about. And I don't say that in a bad way, but the answer to most questions is money. Time is probably the most valuable resource that we have, yet so often, so many people do what you did. Right?
Jarrod Bridgeman:
Yeah.
Casey Hiers:
Get into a project.
Jarrod Bridgeman:
Another example would be if you get own a house. I used to own a house, and one of my biggest things I'd always have trouble with would be something like plumbing. The concept doesn't seem that hard of replacing a pipe under your sink, but if you don't do it exactly right, you're going to be dealing with leaks for time on end. And then you're dealing with water damage and all kinds of things, when a plumber, a simple call to a plumber.
Casey Hiers:
So you want me to tie this into dentistry?
Jarrod Bridgeman:
Is that what we're talking about? If you could, yes. That'd be great.
Casey Hiers:
You thought you were just venting.
Jarrod Bridgeman:
I was. I was bad. I'm ready to go.
Casey Hiers:
A little therapy now. Now when you mention that, it does resonate. And I want to put numbers to this, but again, for our listeners, practice owning dentists and specialists primarily, the temptation is to do most everything yourself, because you are the problem solver. People to come to you for solutions, your patients, everybody, and so that can really be a temptation. And talk about how much money your time is worth.
But here's where we'll just drill down and almost get to the last chapter of the book. So many practice owners, their professional dues for those kind of services less than $10,000, let's call it, $3,000, $6,000, $9,000. Well, you certainly get what you pay for when that happens. Try growing 30% and paying $5,000 for your taxes to get done. You will quickly learn what that gets you, which is a nasty little tax surprise.
Jarrod Bridgeman:
Right.
Casey Hiers:
But I was just breaking down some numbers. Those folks that pay less than $10,000, you get what you pay for, and the stress that can come with it. Sounds like you had a lot of stress with your example, versus with what our firm does, not to be too self-serving. But if you pay a significant amount of money for these services, stress is gone, but there's $5-$15 million left on the table. If you're paying some serious fees to have a world-class firm like ours, over the course of a career, you might end up paying 4, 5, $600,000 for services. Well, that's a lot of money, but what's that mean? Well, to most of our clients, that means 5, 8, 10, 12, $15 million more than they were going to have. That's a big number.
Jarrod Bridgeman:
Would you be willing? Would you pay someone $500,000 to get 10 million back?
Casey Hiers:
Well, thank you for putting a bow on it, but it takes delayed gratification, somebody that can look forward past next week or next month or next quarter or next year to get that big picture. And so, it's two things. It's out of bounds for the personalities of a lot of practice owners, because they're the achievers and they fix things. But all that money, they're getting hit up for money all the time. Dentists have a big target on it. And so, that's frustrating, but what they leave on a table is too much.
Jarrod Bridgeman:
Well, and they're paying comparatively, not as much, let's say, or even close to it. And they're dealing with, I would say, reactive accountants and other people. They don't have someone on their team looking out for them. You have to approach that person with this information, and be like, "Oh, I heard this on the news this morning. What does that mean for me and my practice?" And then they nickel and dime you for their advice on that.
Casey Hiers:
A hundred percent. I was just having flashbacks. You watch dumb stuff on the screen, like somebody trying to frame a barn, and then wind comes, and the whole thing falls down. If we had a meme or a giff or whatever they're called for this podcast, it would be somebody working hard to build something, and the wind just comes and knocks it down.
Jarrod Bridgeman:
Right.
Casey Hiers:
That's what we're talking about.
Jarrod Bridgeman:
Because you're building with a house of cards.
Casey Hiers:
Yeah. Again, the most successful people delegate.
Jarrod Bridgeman:
Right.
Casey Hiers:
The race car driver isn't the mechanic. He's not in the pit. He's the race car driver because he is or she is really good at that. And the rest of the team do a really good job. If the race car driver got out, because they were cheap, and changed their own tires and put in their own gas and looked at the data to determine any adjustments, they would lose every race. Practice owners that try to do everything, boy, they're frustrated.
Jarrod Bridgeman:
Circling back to the least, just looking at taxes and tax management.
Casey Hiers:
If you're a practice owner, it's okay to find somebody who can master the things that you are not good at. And you should be vetting out people that can master those things. And if you find somebody who can prove themselves, it's okay to stroke the check. Most likely you've stroked the check for practice management or for some sort of consulting or some sort of CE that didn't really lead to much, or God forbid, a six-digit piece of equipment. So you've done those things, and it didn't lead to much return, but for the audience, it's okay. It's okay to try to find those people.
Jarrod Bridgeman:
What would be a reason why, let's say, I own a practice, I hired somebody, and I'm still hit with the giant tax surprise. Would it be maybe just because it was my Uncle Jeff, who's a CPA who works in 20 different industries?
Casey Hiers:
So, if you're the dentist, you do have to give your team some information. If you're not giving them information, then that's on you. But other than that, typically, it's because they're lazy or it's just because they have 10 dentists as clients, but they're other 150 are not. And so, they don't really specialize. But yeah, if they look at just last year, that's the kiss of death to get a tax surprise. You need a lifetime forecast that's being monitored, and then know what you did last year and know what you are expected to do.
Jarrod Bridgeman:
What would be some reasons why dentists would not share all their numbers outside of maybe laziness?
Casey Hiers:
Well, they're overwhelmed with all the other hats that they're wearing. Yeah, good question. So they're treating patients, they're navigating their adult babysitting job of their team or staff. They're talking to industry and all of the people coming in to "sell" them all the things that they need to run their practice. And so, it's just time and stress and frustration. They want somebody who has the passion and expertise that they have in dentistry in all these other areas, but they rarely find it.
Jarrod Bridgeman:
But I've mentioned taxes quite a bit, just because I was able to easily invest into it.
Casey Hiers:
Investing.
Jarrod Bridgeman:
Or yes, investing.
Casey Hiers:
Investing in.
Jarrod Bridgeman:
So yeah.
Casey Hiers:
Now a lot of listeners, they might go, "Well, of course, I have a CPA do it." But investing, oh man, they love it. They fancy themselves to be a Wall Street czar. Right? And they love their crypto. And they love talking about that at the club, the club being with music or with golf clubs. I don't know what you're into, listeners, but you like talking about investing things because that's what other people are doing, because most people are trying to be posers. Right? And so, a lot of folks love to invest themselves. They want to be hands-on. I've said this before. Rappers want to be NBA players, NBA players want to be rappers. For some reason, practice owners want to be stock czars. It's fascinating to me.
Jarrod Bridgeman:
And so, this is an obvious question with an obvious answer, but what could happen doing that yourself?
Casey Hiers:
You work until you're 75 as a practicing dentist, basically there two guys in your study club that are in their seventies or eighties, and everybody thinks it's cute. That can be you. Or you take the corporate dentistry check, and then after you pay your taxes and 12 months in and you can't stand it, you look up and go, "Crap. I'm going to have to practice some more." So then you tell everybody you love dentistry. You go back and as an associate, and you're an associate dentist somewhere for a couple weeks, because you need the cash flow. So that's what happens. I get a little fired up about that.
Jarrod Bridgeman:
That sounds rough.
Casey Hiers:
Well, I've seen it. When you meet, what's an old-timey name?
Jarrod Bridgeman:
Jeremiah.
Casey Hiers:
When you meet old Milford.
Jarrod Bridgeman:
Or Bernard. I don't want to name anybody I know.
Casey Hiers:
I've met these guys. And they're like, "And it's so great. He's still practices." I'm like, "He's spilling his drink. It's half full because he's shaking. No, this isn't cool." So we did accounting, do it yourself. Okay, most don't. Then we did investing. How about strategic practice advice? Almost everybody tries to do that. "I'm going to add a second location. I'm going to bring on an associate. I'm going to do this. I'm going to do that." Holy cow. The mistakes made without proper advice, without data and metrics being used. Whew. You're frustrated now with adult babysitting your overhead, your income, your retirement plan. But people keep talking about multiples.
Jarrod Bridgeman:
Can't you just Google how to buy another practice, and then just follow step by step?
Casey Hiers:
Well, there's a lot of people with advice, who probably wrote books because they failed at actually executing that, so now they need revenue from writing a book on this topic. But no, the dentistry is not the hard part. The things we talk about in this podcast is the hard part. And whether it's our firm or another direction, just put down the pride, master these things. Delegate to those who are really good at it these things. Life is better with your team, with your family, with your spouse, whatever that looks like.
But there's so much resistance. There's not a lot of people out there that understand practice ownership, and if you get it wrong, what you need to do. But if you get it right and you're crushing it, there's not a lot of people that they can turn to get it and understand it. And how can I turn my $13 million into $24 million and retire five years sooner. Right? There's not many people that can have that conversation.
Jarrod Bridgeman:
So what you're saying is, call somebody when it comes to your money, things like that.
Casey Hiers:
No, no. Not somebody.
Jarrod Bridgeman:
Us.
Casey Hiers:
Well, to start with. Well, you know this. I talk to hundreds of practice owners. We bring on 15 or 20. It's an exclusive club.
Jarrod Bridgeman:
That's right.
Casey Hiers:
But at least by talking with us, if we decide we're not going to help you or what you need isn't what our firm does, you'll at least get some complimentary advice and pointed in the right direction. But yeah, don't just talk to anybody. But wherever you're at, look to improve.
Jarrod Bridgeman:
That's right. Hey Casey, I wanted to remind you, you're going to be on the road here pretty soon. Did you know that?
Casey Hiers:
What?
Jarrod Bridgeman:
Yeah. You're going to be at the AGD Conference, speaking at the end of July. That's what? July 27th through the 30th, I believe. August 5th, you're going to be in Fishers, Indiana, real far travel for that one. It's right down the street.
Casey Hiers:
Home game.
Jarrod Bridgeman:
That's right. It's at a Topgolf.
Casey Hiers:
That's right.
Jarrod Bridgeman:
So come check us out. Go to fourquadrantsadvisory.com/events. We'll have a list of our events on there. We're also going to be in Schaumburg, Illinois in September, Colorado Springs in November. We've got all kinds of things coming up.
Casey Hiers:
I haven't had anybody beat me at Topgolf yet, and I'm not even that good, so I guess that's a challenge. Hey, come try to beat me.
Jarrod Bridgeman:
I tried, and they're like, "You're using the wrong drive thingy."
Casey Hiers:
Yeah. We're actually going to have a client or two, I think, at that event as well.
Jarrod Bridgeman:
Nice. Yeah. Awesome. It's nice to hang out with our clients. And if you're interested in talking to us some more and getting some real-life stories from people that we've helped, come show up. Thank you.
Casey Hiers:
That's all the time we have today. Thank you to our guests for their insight and for sharing some really great information. And thank you to you, the listener, for tuning in. The Millionaire Dentist Podcast is brought to you by Four Quadrants Advisory. To see if they might be a good fit for you and your practice, go on over to fourquadrantsadvisory.com and see why year after year, they retain over 95% of their clients. Thank you again for joining us, and we'll see you next time.
