Salary from a job
A job is time-based income, where one spends a fixed amount of time at the employer’s location, in exchange for an hourly or a monthly salary. This may include working as an assistant to a senior doctor, working in a corporate clinic, working in a multinational corporation, or working as a professor in a dental college.
Because we can only sell a finite amount of time in exchange of money, this is the most inefficient way to make money and get rich. Most wealthy people did not get there by exchanging their time for money. While we encourage young dentists to work for an employer to gain new skills, make sure that this is for a limited amount of time. Do not work on a job for more than five years.
Salary plus location arbitrage
Several dentists aim to multiply their income from jobs by migrating to more affluent countries and working there. We have populated a list of the six most lucrative countries to migrate for an Indian dentist in a previous post. While this is a good strategy, we recommend you use it to pay off your education loan and save money to open a business later. Do not work on a job for all your life.
“The three most harmful addictions are heroin, carbohydrates, and a monthly salary.”Nassim Nicholas Taleb
Unlike a job where one is bound for a fixed number of hours every month, a performance-based pay is when the compensation is task-based and one-off. This may include consultation where one performs a surgery at someone else’s clinic, or delivering guest lectures. The income with such an arrangement is more unpredictable (higher risk), and hence there is a higher reward for such an endeavor. To maximize one’s income, one would need to invest in social skills and rely heavily on their professional networks and referrals.
A typical business for dentists is setting up a dental clinic and expanding it. This would provide you positive cash flows after a period of time, and grow as you gain repeat business and referrals from your patients. Over time, you one may want to broaden their footprint by opening up clinics in nearby areas, or scale up their current clinic by adding more dental chairs and employing more dentists. This is a classic, time tested business model with outsized returns as you scale up.
Other dentistry-related businesses include setting up a coaching center for training medical or NEET MDS aspirants, becoming a dealer of dental materials or equipment, or opening a dental prosthetic lab or diagnostic center.
Building a business from scratch needs a lot of resilience, an ability to be comfortable in uncertainty, and a willingness to fail multiple times.
For experienced professionals, new avenues for business have opened up. These include setting up a franchise of dental clinics, and conducting workshops to teach novel techniques to young professionals.
With the pervasive nature of mobile data and internet, several dentists have also starting making money through video tutorials on platforms such as YouTube and Unacademy, educational blogs, or affiliate marketing (i.e., product reviews on popular platforms such as Facebook).
The good part about non-traditional businesses is that they are also non-linear. There is an outsize impact of your efforts on your income, and there are low barriers to entry.
Passive income streams
Passive income streams are those where you make money from limited effort. These include interest income from savings accounts, fixed deposits, or provident funds. Income from the equity market or mutual funds would also fall in this category.
Passive income streams also include income from property through price appreciation or rental income.
What does this mean for you?
One should try to diversify the source of income and work to create as many income streams as possible. This comes in handy when one source becomes less lucrative.
As a dentist, avoid the temptation to sell your time for money. If you are ambitious, you should avoid jobs in dental colleges like a plague, according to Dr. Satish Alavandar, whom we interviewed recently.
If you are a student, or are stuck in a job because of lack of funds, use your time to either build a network and explore options for consultations, or use it to create online products and platforms such as a YouTube channel, a Facebook group, or even a blog. If you are tech-savvy, you may also pick up skills such as website designing and digital marketing to advance your fortunes.
What are you doing to maximize your income streams? Let us know in the comments section below.
About the author
Dr. Shilpy Bhandari is a Hyderabad-based Periodontist and the founder of Dentistry Insider. She has worked extensively across dental clinics of all sizes — from large corporate chains to small, independent setups.
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