Financial literacy is crucial for dental associate , not only for their personal benefit but also to enhance the financial health of the practice they work for. Here are ten financial strategies that every dental associate should learn before owning their own practice :
Understanding the Basics of Accounting
Learn how dental practices manage their accounts, including the basics of income, expenses, profit, and loss statements. This knowledge can help in making informed decisions regarding the practice’s financial management.
Budgeting and Forecasting
Gain skills in budgeting for various needs, such as equipment, supplies, and staffing. Understanding forecasting methods can also help predict future financial needs and patient flow.
Cost Control
Identify areas where the practice can save money without compromising patient care. This might include finding more cost-effective suppliers, reducing waste, or optimizing staff schedules.
Revenue Cycle Management
Understand the entire process of patient billing and collections, from the initial appointment booking to the final payment. This includes knowledge of insurance claims processing, patient billing procedures, and effective follow-up on receivables.
Financial Reporting
Learn how to read and interpret financial reports to track the health of the practice. Understanding these can help in identifying trends, forecasting future performance, and making informed business decisions.
Investment in Continuing Education
Staying updated with the latest dental technologies and procedures can be seen as an investment. Learn how to evaluate the potential returns on investments in continuing education and new technologies in terms of increased efficiency or expanded services.
Tax Planning
Understand the basics of tax planning for dental practices, including possible deductions and credits specific to the healthcare sector. This knowledge can help in planning purchases and investments in a tax-efficient manner.
Retirement Planning
Gain an understanding of different retirement savings plans available, such as 401(k)s or IRAs, and how you can benefit from them. Knowing how to plan for retirement effectively is crucial for long-term financial security.
Insurance Knowledge
Be knowledgeable about the different types of insurance that impact both personal and business aspects, such as liability, health, and business interruption insurance. Understanding these can help in risk management and decision-making processes.
Negotiation Skills
Learn how to negotiate with suppliers and vendors to secure better prices or favorable terms. Effective negotiation can significantly reduce costs and improve the practice’s bottom line.
For dental associate , acquiring these financial skills can lead to more confident decision-making, potential cost savings, improved operational efficiency, and ultimately contribute to the practice’s success, their future ownership and their own financial well-being.
Hollie Bryant-Foust
CEO & Founder
