We are discussing the perfect and most sensible way to raise money to set up your dental practice. In the previous slide, we discussed the importance of raising adequate finance to set up your dental practice. However, the question remains, is there any particular rule to follow?
Yes, there is a formula!
Formula – How to Plan on Raising Finance for Your Dental Practice
Before you get into arranging the money, keep these points or formula in mind:
Start Low to Moderate: In our experience and staying in tune with the ever-changing financial scenario, it is always better to start small to moderate with plans for expansion in the future depending on the growth your practice is showing.
Starting low keeps you flexible: Do not commit to a big spending from the onset. Raise and incrementally spend the investments. It is just common sense. As the saying goes concerning money – Do not put all your cash into one venture, all at the same time.
Starting Low Gives you time to make correct choices: Starting a dental practice involves many expenses. When you have just raised a substantial money from the market then in the excitement of setting up your practice there are always chances for you to go berserk in your spendings. Be careful and starting low will keep you in check. It gives you the time to analyze the expenditures.
Starting low gives you a Saftey Net: You must have heard stories where people have gone all out in their spendings, and to their dismay, the venture did not succeed. A young dentist gets swayed by the romantic stories where the protagonist puts all the money in the line and narrowly wins the jackpot. Such stories do happen but 1 in 100,000. So, it is better not to take chances to be the 1 in that 100,000 when you have raised much money from the market. (and you are liable for returning that amount)
With these points in mind, lets us start decoding the issue of arranging the initial investment for your dental practice.
There are three ways for you to arrange the money for your dental practice:
1 # Ask your parents or very close relatives
The safest way to organize money considering that your parents have adequate finance left with them to support you without much strain. In this mode, you get the required finance within the family without the worry of paying it back (along with interest) within a specified period. It relaxes you considerably, and you work towards a successful dental practice in a better frame of mind.
Problems: Though this is the safest way to get the finance for your dental clinic, it has some loopholes.
- It makes the young dentist complacent as he/she has no psychological, financial burden. It sometimes results in the young dentist not being motivated to work hard enough.
- There have been cases, where parents have given away all of their retirement funds or sold a land to generate money to help their child start a dental practice. Though they do it out of their love, we request you to think 1000 times before doing so. Such financial decisions have the power to put your family in an economic logjam. What if the practice does not click or takes much time to gather pace? Then your family will have no financial cushion left.
So, if you are planning to take a money loan from your family, then it is imperative that you sit down with your family members and have a very open discussion about all the financial possibilities.
Also, never force your family to lend you money somehow even if they have to sell something valuable. This approach in most if the instances might not work out well for you.
Go to the next slide to start decoding the secrets and commonsense of investing money to set up a dental practice
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