You built your practice one tooth at a time. Your wealth deserves the same system.
You'd never treat a patient without a full exam. Here's the full exam for your money, in one line.
Wealth Management = Investment Consulting + Advanced Planning + Relationship Management
WM = IC + AP + RM
Wealth Management. Investment Consulting. Advanced Planning. Relationship Management.
Advanced Planning = Wealth Enhancement + Wealth Transfer + Wealth Protection + Charitable Gifting
Relationship Management = Client Relationship Management + Professional Network Relationship Management
Here's the formula I use.
How the formula breaks down
Investment Consulting (IC)
What it means for you: Every piece of your investments managed as one whole: how your portfolio is actually performing, how much risk you're carrying, whether alternatives belong in the mix, how your assets are allocated, and what costs and taxes are quietly taking. All of it tied to the life you want after the chair.
Where you leak: Money sits in whatever made sense ten years ago, and nobody has asked how it fits a sale, a buyout or a slower schedule.
Advanced Planning (AP)
Advanced Planning is four pieces working together. Most dentists have one or two. Few have all four talking to each other.
What it means for you: The planning around your money, not just the money itself: what you keep after taxes, what you pass on, what you protect, and what you give. All four done together, and done before a DSO offer lands on your desk.
Where you leak: Each piece gets handled on its own, in a hurry, once the offer is already on the table. Your CPA sees the tax piece, your attorney sees the estate piece, and nobody sees how one sale changes all four at once.
AP = Wealth Enhancement + Wealth Transfer + Wealth Protection + Charitable Gifting
Wealth Enhancement = Tax Mitigation + Cash Flow Planning + Value Acceleration
Tax mitigation, what it means for you: Planning ahead so more of what you earn, and what you eventually sell for, stays with you. Your CPA sets the specifics.
Cash flow planning, what it means for you: Knowing where the money from your schedule goes each month, and how it changes when you cut days, add an associate or step away from the chair.
Value acceleration, what it means for you: Strengthening the things a buyer looks at: steady hygiene production, an associate who can carry the schedule, systems that run when you're not in the operatory. It's about what drives value, not a number. A broker or qualified appraiser handles valuation.
Where you leak: Taxes get planned in April instead of years before a sale, and your practice depends on your hands so much that a DSO offer is really an offer for you.
One number worth sitting with: 89.2% want tax planning, and only 24.8% say they receive it from their advisors. 1
Wealth Transfer
What it means for you: Moving what you've built to the right hands, on your terms. That may be your family, and it may not: an associate who's ready to buy in, a partner, or an outside buyer. Your estate plan and beneficiaries are ready for the day your practice becomes cash, or the day you can't make the decision yourself.
Where you leak: A will written before you bought your building, kids who don't know the plan, and a sale that lands in an estate built for a different life.
Wealth Protection
What it means for you: Protecting what you've built and the hands that built it, in three ways: lowering the risks you can control, using the right legal structures for your practice and your building, and moving the risks you can't control to insurance, like disability coverage that fits your income and malpractice and liability coverage.
Where you leak: One injury to your hand, one lawsuit, or one partner buyout without the right agreements can undo years of production.
Charitable Gifting
What it means for you: Getting the most impact from what you give, so your generosity and your exit work together. If giving isn't part of your plans, that's a fine answer too.
Where you leak: Good intentions with no plan, and giving decisions made after the sale closes instead of before.
Relationship Management (RM)
RM = Client Relationship Management + Professional Network Relationship Management
What it means for you: The people side of your wealth: an advisor who knows you as well as you know your longtime patients, and a team that works together the way your front desk, hygienists and assistants do on your best day.
Client Relationship Management
What it means for you: How well your advisor really knows you: your family, your goals, and when and how you want to step away from the chair.
Professional Network Relationship Management
What it means for you: How well your CPA, attorney, broker and advisor work together as one team around your goals, so you're not the one carrying messages between them.
Where you leak: Every professional does their piece well, and nobody owns the gaps between them. That's where most of the leaks above hide.
Here's the formula in my own words.
Watch Tim walk through the formula
Find out where you leak.
Every piece of the formula is a place you can leak. Most owners never see it until a buyer, a DSO or a closing statement shows them.
Take the 3 minute check. Rate yourself on each part of the formula and see your score, plus the one or two places you're most likely to leak.
Want a closer look? Book a complimentary 25-minute Dental Exit Stress Test. You leave with a one-page written gap analysis across the formula that names your gaps.
Book your 25-minute Dental Exit Stress Test
1 CEG Insights, Navigating the Wealth Management Divide, 2023, p.6 (N = 416 investors and 706 advisors). CEG research covers investors and business owners across industries, not dentists only.
This page is educational only and is not tax, legal or investment advice.